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Over the past decade or so, accounting software for small firms has evolved way beyond simple end-of-month accounts and payroll.

Driven by businesses’ desire for greater efficiency and cost control, it is now more accurately described as accounting and business software because it incorporates various add-ons, such as customer relationship management (CRM) or human resources (HR), all integrated into one package.

This trend has extended the company accountant’s remit beyond keeping an eye on the books to practically becoming the head of IT within an SME, according to software providers.

“It’s probably always been the case that the accountant has had accountability for selecting IT solutions, but it’s happening differently today. He or she is interested in any way the company can gain more efficiency through the deployment of technology, as well as the payback involved. The challenge for IT providers is to translate the payback into a language accountants can understand,” says Liam Mullaney, managing director of Sage.

“Following our acquisition of a CRM package called ACT! five years ago, we discovered that quite often ACT! customers also had our accounting products and most of those said they would be interested in an integrated solution,” says Mullaney.

“The whole idea is that salespeople gain access to the accounting system via their laptop or handheld device while on the road. Productivity increases because they can check stock levels onsite, look at the customers’ account history and place orders in real-time.”

Sage's solutions

Sage has added a lot of new features to the Sage 50 product recently, including a dashboard so you can see your current cash position, ie who owes you the most money, who is overdue with their payments and so on.

It has also a package that integrates its payroll product Micropay with a HR solution. This is in response to the arrival of the National Employment Rights Authority and the increased pressure on SMEs to be compliant.

“How I believe software can really work for small companies is to follow the ‘next, next, finish’ principle – in other words, write the functionality, for example Sage CRM, and literally have the ability to type the word ‘integration’ and a Sage 50 customer is automatically in the CRM system.”

Alan Connor, commercial director at Exchequer, says the average accountant in an SME has become far more IT literate since Windows 95 was introduced. Of its 1,000 customers attracted over the past 10 years, 95pc switched from another software package.

“Previously Y2K and the introduction of the euro were reasons for accountants in SMEs to think about the software they needed. The high percentage of our customers who switched from other packages shows how they have outgrown this phase,” he observes.

“Nowadays, software has to deliver greater automation and far greater accountability to the operators and management, so they have better control of decisions. Technology had to change to allow fully integrated CRM, with websites and handheld devices all integrating live,” he says.

It isn’t only large organisations that want to upgrade in this way, as SMEs are realising the coal-face benefits of synchronising data seamlessly and having information in real-time, notes Connor.

“There’s no reason why you can’t run a business nowadays in an informed way on an hourly basis – people can view a snapshot when management decides, not when the software wants.”

Integrated accounting and CRM, such as the Exchequer package, is important both from a sales perspective and when planning production, targets and cash flow, as well as customer exposure.

“A lot of SMEs have a key trading partner with whom they do, say, 60pc of their business and they need to build in special processes unique to that client – for example, having to deal with them faster and more electronically than normal.

“If you were to do a poll of Irish suppliers to the multiple chains, five years ago price was the key factor and the lowest bidder got the deal. Now they look for proof that suppliers have the systems in place capable of sustaining supply.”