Accounting software, especially in the SMME market, is outdated and living in the pre-Internet era.
This is the view of EconoServ SA CEO Keith Levenstein, who says accounting packages that do not harness the power of the Internet need to be dumped.
"The accounting fraternity is living in the dark ages. Why do bookkeepers, accountants and small business owners have to manually transcribe transactions from bank statements when the information is already electronically available in their Internet banking account.
"I find it such a waste of time that a bookkeeper or accountant has to re-type accounting transactions into their accounting system. Customers already use Internet banking to pay accounts, transfer funds and make enquiries. The old-fashioned approach was for a person to download their bank statement from the Internet or work off the original bank statement and then re-enter the information into their accounting system."
"Bank statements can now be downloaded electronically in seconds directly into the financials each morning if necessary, enabling users to automatically produce up-to-date figures and financial statements," notes Levenstein.
"The days of manual accounting are over. The accounting fraternity needs to wake up to this fact. They cannot continue living in the 1980s. The Internet can cut labour costs by 90%, produce immediate reports and is 100% accurate because there are no transcription errors," argues Levenstein.
At the same time, when transactions are imported automatically into the system, they can be automatically allocated to the relevant expense account, and VAT included if necessary. Auto-allocate allows the users to setup keywords, which helps in automatically allocating transactions to the relevant income, expense, asset or liability account. Fraudulent transactions can be identified immediately.
"If an accounting package has the ability to electronically import bank statements from the Internet, it will help users identify suspect transactions," Levenstein explains.
Where there is an unauthorised transaction, the software will not be able to allocate the amount and will instantly flag it for the user`s attention. In this way it is far easier to identify an illegal transaction and give it to the bank to investigate.
"Fraudsters do not only steal passwords and PIN numbers. More often than not they use other methods to transfer money out of your account. They may try to send a debit order through your account. All too common they deduct extra charges from your credit card account. Therefore, keeping your PIN safe is no protection against this."
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