The Fizz! Blog

Plug pulled on Microsoft Office Accounting

Microsoft have decided to withdraw their accounts package, Microsoft Office Accounting.  It was launched a couple of years ago, and, as I wrote at the time, it appeared likely to cause Sage and QuickBooks some real problems, particularly as the basic version was free.

Well, it didn't work out that way.  Firstly, Microsoft never really seemed to push it too hard.  Although I'm sure it was available, I didn't notice it coming through any of the channels I would have expected to see it.  And, although they launched an accountants' "club" to try and promote the software via firm like Fizz, after initially giving us an MS Office licence as an incentive to join, they just went completely silent.

Secondly, the thing that has actually caused problems is the rise of online accounting services, like our own FizzBooks.  They meant that the market for traditional accounting software has been gradually contracting anyway, so not only did Microsoft not get as big a slice of the pie as they hoped, but the pie was shrinking at the same time.

Fortunately, we've no clients using the package.  For companies that are using it, there should be minimal disruption if they want to continue using it for accounting - ongoing support is being provided, and you often don't need support or upgrades for accounts software anyway - I'm still happily monitoring my personal finances on a copy of Microsoft Money 1999.  For companies using Microsoft Office Accounting for their payroll, there is a problem, as the use of that is just being withdrawn in December, in the middle of the PAYE year.  So users will have to process the remaining three months and the year-end of their payroll some other way.

www.fizzhq.com

Online accounting with Fizz

We've launched a new web-based bookkeeping system, which, here in the office, we're calling FizzBooks. Rather than keeping your accounts on a software package on a PC in your office, you log into our system and create and maintain your accounting records online.

Some of the key benefits:

• You’ll never have to worry again about upgrades to your accounting software. Every time you log on, you’ll be using the latest version.
• If you’re away from the office and your usual PC, you can still access your accounts data. You can enter and review data from any PC with an internet connection.
• If you want your accountants to look at your records, they don’t have to have the same accounting software as you, and you don’t have to email a Sage or QuickBooks backup or a spreadsheet to them. They can just log on and see the same data that you see. If your accountant needs to make amendments to your data, you don’t have to stop your bookkeeping while they’ve got the live data file – they can enter the adjustments online and you can just carry on with your bookkeeping as normal.
• You don’t have to worry about losing your data if your PC dies and it’s not backed up; your data is continually backed up online.
• You can email documents straight from the site to your customers, email regular invoices to customers automatically, be notified by email when an invoice becomes overdue, and perform lots of other tasks more easily than with traditional accounting packages.

There's more on our website here.

www.fizzhq.com

Should you be using accounting software?

One of the things I often have to do is to advise businesses on how to keep their records.  There's no "one size fits all" approach.  Here are some of the things that you should think about when making a decision.

For many businesses, using accounting software is overkill.  In most cases, there are really only two key benefits to accounting software when all's said and done:

1. It makes it easy to track amounts owed to you by customers.
2. It makes it easy to create reports from your accounting data.

Often, neither of those things are a concern.  Many small enterprises only have one or two customers, and might only invoice them once a month.  If that’s the case, the owner is unlikely to have much interest in tracking amounts owed to the business – he or she will always know how much is owed.  Similarly, it’s all very well being able to easily create a profit and loss account for a given period with your accounting software, but if you only raise a single invoice each month and have fairly fixed costs, you may well feel that you know perfectly well how much you’re making.

So, for businesses like that a simple Excel cashbook can do the trick – it accurately captures details of income and expenditure in a form adequate for year-end accounts (and, if necessary, VAT returns) with minimal effort.

But many businesses are more complex.  For complicated or growing businesses it can be important to track amounts owed by multiple customers, and to report on accounting data to track profitability, solvency and growth.  That means that accounting software is really useful.

Lots of accountants have a favourite accounting package.  Many are fans of Sage.  Many are fans of QuickBooks.  Most of the Sage fans sneer at QuickBooks.  Most of the QuickBooks fans sneer at Sage.  We’re now seeing a big move towards browser-based online accounting systems.  Most of the fans (and providers) of the online accounting systems sneer at both Sage and QuickBooks.

The thing is, for most businesses, any of those systems (and others, like MYOB and Tasbooks) are fine.  They’re good products.  Double entry bookkeeping hasn’t changed for around 600 years, and Sage, QuickBooks or any other similar package is really reliable at doing double entry bookkeeping.  They can all track customers who owe you money.  They can all provide you with a profit and loss account, or a list of your most lucrative customers.  For most businesses, choosing between Sage and QuickBooks is like choosing between a blue pen and a black pen.  They’re both perfectly adequate tools for the job.

For what it’s worth, I like QuickBooks a bit more, as I find the reporting function more flexible and I find it quicker to enter data and correct errors.  And I think it looks a bit nicer.  But if I pick up a new customer who uses Sage, I won’t encourage them to change if they're happy, because Sage is fine too in 90% of cases.

The interesting thing over the next year or two will be the progress of the online, browser-based services.  These have a key benefit: easy sharing of data between a business and their accountant, or between different members of staff at a business.  Rather than being emailed a data file at the year-end or when there’s a problem, I can just log on to my customer’s account to check their data and make adjustments or corrections where necessary.  Where a single company has multiple employees in different locations, or employees who need access to the accounting records but travel a lot, an online system that can be accessed from a PC anywhere – or even a smartphone -  makes a lot of sense.
I think it’s likely that before long we’ll be partnering with an online accounting provider so that we can offer this service to our customers.  Watch this space!

www.fizzhq.com

Sage and Intuit may be a bit worried right now

Microsoft has launched a new accounting package which looks likely to shake up the UK accounting software market:

http://www.msofficeaccounting.co.uk/product.aspx

It's called Microsoft Office Accounting Professional.  There's two versions of it.

The full blown version, which is £149.95, has similar capabilities to the mainstream Sage and QuickBooks products which retail for somewhat more (maybe £250 to £400 or so) - although no doubt both Sage and Intuit, who publish QuickBooks, will be assuring us that their offerings have significant advantages!

More significantly, the Express version, which is pitched at the level of Sage Instant Accounts or QuickBooks SimpleStart, is free.  That's right, free.  Instant accounts is around £100 and SimpleStart about £50.  In my experience, while that's not much money for bigger businesses, for whom getting the right package is more important than getting the cheapest package, the type of business looking for an entry-level package will be happy to save even £50, and rightly so.  I would think that Microsoft have just wiped out the market for those products, particularly for those businesses buying the software themselves, rather than being pushed in a particular direction by their accountants.

Now, a fair chunk of the sales of the "grown up" versions of Sage and QuickBooks are businesses upgrading from Instant or SimpleStart as their business grows and their needs become more complicated.  So it won't just be the sales of the basic products that are affected, in time it could be the full blown versions too.

But the recommendation of accountants counts for a lot with new businesses, and accountants are reactionaries who will carry on recommening the Sage and QuickBooks that they're comfortable with, right?  Maybe, maybe not.  Microsoft have got a plan.  I've got a copy of the full version of the new MS package - firstly because I need to know if it's good enough to recommend to clients, and secondly because MS are bribing accountants by giving it to us for free - along with a copy of Office 2007 as well.  So, I'll have a play, and will report back in due course.

http://www.fizzhq.com