11 Apr 2014
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Over the last couple of months I have been travelling around the country giving a number of talks on IT in the notforprofit sector. Speaker ratings are always close to my heart and it was with some trepidation that I went up to Leeds to talk at the ICAEW’s charity and voluntary sector group annual conference. I was giving the after lunch slot and there were two challenges. Firstly, the lunch was excellent and I was worried that delegates might not be at their most lively afterwards. Secondly, I was pitted against Les Jones – a widely respected figure in the sector, who was giving a talk on governance at the same time.
I met Les before the talk and the spirit of competition was apparent. Les, like me, has an allotment. Much to my delight, Les reads this column from time to time and noticed that I have written that I have two sheds on my plot. I am proud of this but was aghast when Les proudly announced he has three. Somewhat deflated I gave my talk against three sheds Les and await the delegate feedback with great interest.
So what has come out of my speakinfg sessions? High on the list is the continued frustration with accounting software. Larger charities often resent paying a sixfigure sum for their product of choice and frequently go well over their planned budgets and timescales. Smaller charities continue to struggle to find an appropriate product. Sage, the market leader, still lacks functionality in several areas such as coding structures and is relatively expensive to buy and maintain .
I asked the audience in Leeds what they thought of SageLine50, the most widely used product in the charity sector. Out of an audience of around 50 only one thought it was a great piece of software. Most rated it as OK and a few thought it was poor. Not a dreadful result – but not great either.
So it is with interest that Microsoft announced in midNovember that it was launching an entry level accounting software package – Microsoft Office Accounting. There is a free version called Express and an enhanced version called Professional which costs from £149.95.
So should charities take this product seriously? Initial reviews suggest it is worth a look. A major feature is the level of integration with Microsoft Office. This will allow users to work with Excel for reporting. The application also comes with a utility to convert information from Sage into the system.
As a vendor Microsoft has made several attempts to gain a foothold in the entry level accounting software market. Microsoft Money and Profit have both been available for years and back in the nineties it tried to buy Intuit, the author of QuickBooks. In the midmarket it has gained a foothold with Great Plains, Navision and Solomon. However, it has struggled to take a dominant position. Some argue this is down to confusion about which product suits which organisation best. Others suggest Microsoft has struggled to integrate its business applications operation with the rest of the organisation and really leverage its market presence. The jury is out on whether it can drive real market share with its new offering.
One challenge for all the entry level vendors is their ability to price and deliver adequate support to their user base. Even though Microsoft’s latest entry level offering is free, users may well struggle to get the software up and running without some face-to-face training, which can cost several hundred pounds a day. There is a UK discussion forum on the Microsoft site highlighting this problem. See http://www.microsoft.com/office/community/en-us/default.mspx.
Most accountants will agree that regardless of the tool, users need a reasonable level of accounting skills to use any product. Many small charities do not have these and rely on helplines. These cost money to staff and charities ultimately have to pay for this. For an entry level system to really take off this issue needs to be addressed. It will be interesting to see whether Microsoft develops a new approach to this that might work, for example, via interactive training/support. If it can tackle this it may make it in the entry level accounting software space.
John Tate is a leading IT analyst in the charity sector and chair of Citra
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