Tuesday, July 31, 2007
What’s Important?
When selecting a financial system today what applications within the system are the most important? Where is your greatest need? Where is your maximum exposure?
The goal of all financial systems should be to manage the company’s money and provide the required reporting for governments, banking, and internal management. Certain applications should provide the tools and safeguards against making mistakes that could expose you to government and civil legal situations.
Accounts Payable needs to provide taxing authorities with the payment information that you made to your vendors. Accounts Receivable needs to interface to your operational systems (ERP, etc.), as it is basically your “cash register.” Fixed Assets and Customer Management also come into play. Having said all that, clearly the most important applications are Payroll-Human Resources and General Ledger.
Payroll and H/R are extremely important! There are more blogs, chatrooms, and bulletin boards devoted to these applications. Your company may face all kinds of legal and regulatory issues if these systems don’t provide you with the tools that you need!
• Payroll must be timely and accurate. The Payroll Department needs to have the ability to formulate any payment, voluntary deduction, or taxation that may occur.
• H/R needs a close integration with Payroll to manage employee benefits.
General Ledger is the “collecting pot” where everything financial comes together. Without flexible, open-ended data collection, statistical information, and a powerful report generator, this application is worthless as a management tool. Data needs to be stored without Date Restrictions (i.e., “Buckets”)!
Your company needs to know its true financial status in a timely manner to determine where improvements can be made to make the bottom line better.
If you have any doubts about these applications in your current system, go look for a new one. The cost of conversion is nothing compared to the cost of failure of one of these systems! Don’t select a new system unless it addresses these needs!