As your business grows, your need for an accounting system that is up to the task of managing your growing finances and operations grows too. Yet more often than not, the accounting system you relied on handle frustrations becomes a frustration instead. When do you know it’s time to make a change? Take a look at these signs to see if your accounting system is hindering your growth and efficiency.
Sign no. 1: You’re on an old accounting system release
Running a business is hard work. With so many important responsibilities, it’s easy to neglect routine check ups on the state of your software. In fact, it is not uncommon for a company go years without touching its accounting system. But even the best-intentioned neglect can have cause significant risks.
Outdated and/or unsupported software can quickly become unreliable. Downtime problems start to arise as well as security vulnerabilities. Simply maintaining legacy software becomes a costly and time-consuming effort in and of itself. While the anxiety and costs surrounding upgrading software may hold you back, it is evident that old software is more of a burden than a helpful tool.
Sign no. 2: You’re held back by disconnected systems and processes
Finance works best when it works in seamless collaboration with other departments and functions of your business. Unfortunately, old legacy systems often aren’t well-integrated with other enterprise tools and systems. This lack of integration can bury you under manual processes, spreadsheets, and tedious workflows as you fight against conflicting software formats and rekey the same data in multiple systems.
Sign no. 3: You can’t keep up with business expansion
It’s always a good sign when you add business units, expand into new markets and geographies, or even add entirely new lines of business. That means your business is growing—but so are your financial burdens. New subsidiaries with more currencies, tax jurisdictions, regulatory frameworks, sales channels, and product costs pile up in no time.
The sad reality is most legacy accounting systems weren’t designed to support the fast growth and business expansions that smart businesses pursue. Due to legacy systems’ inability to add entities quickly, you might be tempted to stitch together an approximation of total finance operations across different accounting systems. Yet this approach brings its own set of problems. Soon, you’re hiring more people just to keep up with transaction costs.
Sign no. 4: New business requirements are difficult obstacles
To keep up with customer demands and expectations, many businesses are experimenting with alternative business structures. The subscription business model is increasingly popular amongst many industries. This can lead to new financial burdens, especially when your traditional, outdated accounting system was simply never intended to cater to these changing rules of business. The result: you’re forced to do manual accounting processes, leading to increased audit risks and billing errors.
Sign no. 5: You aren’t able to fully track your business
Success in business depends on the ability to see what’s happening in all areas of your business. You need a holistic view of bookings, available capacity, inventory levels, and financial metrics. Informed, timely decisions become impossible when it takes weeks to assemble and analyze data. On old accounting systems, data is often processed slowly and with no real-time visibility. More and more, businesses require real-time dashboards that show key metrics and enable you to drill down to details. Only then can you stand against fierce modern competition.
So you know that your accounting system is of more harm than help to you these days. What now? Well, it may be time to update. Read here for more information on why Sage Intacct might be the solution your business needs.