With the busy season upon us, having the ability to export information from your general ledger into the tax preparation software of you choice, such as Lacerte, UltraTax, Drake, CCH and others would radically reduce the amount of time it takes to prepare corporation or partnership tax returns. Imagine never having to manually enter data or proofread pages upon pages of forms. Wouldn’t that be a welcomed relief?
Unfortunately, accounting practices may not be appropriately educated when purchasing their general ledger systems and tax preparation software, because, for the most part, they are very likely inextricably linked. When choosing accounting software, your choice for tax preparation software has been made for you – and vice versa.
For example, data exported from Thomson’s general ledger only works with Thompson’s UltraTax CS. Does another tax software solution from CCH or Lacerte better meet your client needs? If so, profitability will drop as your staff starts re-keying information by hand. Neither vendor’s system has a bridge to another software, nor will either vendor likely ever create one.
The solution would be to choose software that allows for interchangeable exchange of data between platforms and software. Termed “portability,” this exchange of data is seamlessly imported and exported between multiple vendors. Portability is the concept of how easily a software program and data can be moved between, and used on, different computer operating systems, similar to the way you can play a CD on anyone’s CD player. When a firm understands how portability directly impacts profitability, they would make portability a top requirement when purchasing either general ledger or tax software.
However, portability does not necessarily imply that an application will easily transfer to a new platform or that a major effort is not required. Instead, portability is the ability to use the program on another system with reasonable cost and effort, including little or no retraining on the program.
Portability is highly desirable for software products; it saves time and money up front and over an extended period of time. What company wouldn’t want to run its accounting, payroll and tax software on a five-year old Windows-based PC, the latest Macintosh system or both? Usually a program written for Windows is fundamentally different and virtually impossible to transfer to Unix, Linux or any other operating system unless portability is designed in. Portability allows the end user the flexibility to make changes in hardware and software while remaining flexible.
This flexibility certainly impacts workflow and processing during tax season. You should be allowed to produce current year financial statements without yet finalizing the prior year. Balance sheet entries should seamlessly roll forward as required, along with any changes made to the operating statement and the retained earnings. The software should also be able to allocate the profit and loss statement for the year, based on the profit and loss sharing percentages that are set up in advance with the system automatically handling the processing.
If portability and flexibility are limited, users may not be able to use the same software on different versions of the same operating platform. What’s a business to do if some computers run Windows 98, XP or
If accountants had the ability to separate their general ledger write-up system from their tax preparation system, they could select the best products for their practice, while minimizing any disruption to their profitable tax preparation workflow. Here are some of the more distinct advantages.
Mix and Match Best-of-Breed Solutions
Most software designers want to have users captive to all their company’s products, whether or not these programs are the right fit. This highly parochial, monopolistic view of the world would be similar to having a printer or copy machine that only worked with a particular brand or model of computer.
Accountants should be free to mix and match best-of-breed software that meets their specific needs. Changing tax preparation software shouldn’t mean having to change everything in the office or the general ledger because this all-or-nothing move costs time and reduces productivity, especially during tax season.
Server Flexibility
Beyond simple data transfer, having portable software allows an office to run an ASP (Application Service Provider) server. Because data is kept on the server, it can be connected to an internal network or the Internet; employees can access the client’s data where there is Internet connectivity. This includes PDF file document storage.
Software designed for portability plugs into an ASP server and behaves the same way it would on a local workstation or peer-to-peer network. Data exchanges between software behave the same way. In an ASP environment, you can configure portable brand X tax software and install portable brand Y’s general ledger. Through appropriate configurations, exchange data as before. It can be that easy.
Operating System Flexibility
Portable software allows for flexibility in operating systems, including Windows, Linux, Unix or Mac. Most general ledger, payroll and other accounting software, whether designed for small or large companies, is written exclusively for Windows. Similarly, all tax prep software for the accounting industry is currently written exclusively for Windows. As a result, tax preparation programs often do not allow data to be transferred to general ledger software programs on platforms other than Windows. Regrettably, the only way to get data out of the system is in the format the software allows.
Because of Windows’ popularity and broad use, it’s relatively easy to find qualified IT help and hire employees who have experience working with a Windows system. Although a wide variety of programs are written for Windows, users still need technical assistance regularly because Windows applications don’t scale as well as Linux or Unix-based ones for multiple reasons. Sadly, they don’t accommodate growth in users or multiple users of particular files.
Linux may be a more desirable platform long term. Most notably, there is more limited vulnerability to viruses and hackers, it’s faster and offers more stable performance, and there is greater scalability. Because Linux is an open source system, users can actually see and manipulate the underlying code for it. This makes Linux easily adaptable to a company’s specific needs. Linux interface is not as user friendly, making it definitely a “geekier” system requiring specialized technical assistance. There are not as many end-user applications for smaller businesses, making it more suited for larger firms.
Macintosh’s operating systems are now based on Unix, making it a limited, but increasingly popular choice; vulnerabilities are limited and it is stable. The Mac’s OS is also designed to do many functions for the user, giving more flexibility.
Mac and Unix users trade off that ease of use for functionality. Unix is difficult to customize for an individual user, is graphically impaired and requires arcane commands. Unix is definitely for geeks only. Other than software written for Macintosh, no one is writing in Unix.
Portable Software
SouthWare, SAP and UBCC all have accounting industry software with general ledger systems designed for platform independence. SouthWare touts its scalability from one to many users. It has been around since 1984 and has significant integration with any ODBC database. SAP, founded in 1972 in
True, multi-user, multi-task accounting software – if designed properly – is easily ported to other systems. UBCC, founded in 1981, runs exactly the same on well over 600 platforms, including all Windows, Linux and Unix operating systems and even IBM mainframes. These are not different versions of the software written for each system, but rather one set of source and object code, and one set of data files. Ultimately, the same program that runs on an ancient Windows 95 machine will function on an IBM mainframe or the latest Macintosh, with no need for the user to relearn the software.
The benefits of using the most portable software available are many. Companies can seamlessly grow from one to several thousands of users, or switch platforms or operating environments without jeopardizing mission critical software systems. Companies can preserve their investment in hardware, data files, software and training time. In a matter of minutes, users copy file folders from one operating environment or system to the other, add the new run time, place the software application shortcut on their desktop and are literally ready to continue.
Another benefit of building an application for platform-independence is that printing should be a snap. Anyone who has struggled with getting and keeping printers working seamlessly can appreciate not having an operating system update create havoc with installed printers. All the controls for the printer would be written into the software; there’s no need to choose the printer or printer trays manually, and the functionality would be built into the application.
The general ledger and tax preparation software solution for managing your client data should be portable. Highly portable software equates to unrestricted growth, seamless file sharing, including uploading and downloading between software and platforms, and the ability to adapt to your clients needs. Ultimately, software portability directly impacts how efficient, productive and profitable your tax preparation can be.
