Accounting Software Implementation Steps

Last Updated: January 27th, 2023
Researched and Written by: Mike Budiac

Congratulations on selecting your new accounting software system! Now the work really begins. The question is who is going install, setup and train everyone on your new system and what is all involved? The good news is that your software provider is an expert and you can lean on them to the extent you need.

Employee installing business software

Exploring Your Accounting Software Implementation Options

The reality is software providers are more than happy to involve software buyers as much as possible. This means you can help reduce your final software cost by doing more of the work. However keep in mind that some companies think they know more than the experts who do this day in and day out. It is similar to self diagnosing a serious illness and performing surgery on yourself! The best approach is consider new software implementation as a team approach. Your software provider really can’t do it alone so you need to participate.

Also consider that many of today’s businesses, especially small ones, do not have accountants or controllers on staff. Your software provider likely have accountants on staff who can make sure that your new system is configured properly for your use. It’s easy to assume before an implementation that things will go smoothly. A quick Google search of “accounting software configuration errors” (2.57 million results!) will confirm that unfortunately configuration errors do happen quite frequently.

For some things it’s actually better for you to do yourself. However a number of these tasks are either time consuming or have a large potential for error making that task better done your software provider. How and if to import data from an existing system is judged comparing the value of the time people would spend to manually enter information versus the cost to import the data.

Trying to go alone if done incorrectly, at best may mean needing to restart the process and at worst may cause incorrect data and increased cost and taxes. Your software provider has this stuff down pat. Instead of you spending 8 hours to accomplish one of these items your software provider might be able to do the same task in 2 hours instead. How much time overall can that save you? Potentially quite a bit. A study conducted by SAP found that even for small companies 3+ months is typical for implementation and 39% of all ERP implementations took over 9 months to complete. So, certainly, there’s quite a bit of fat to trim.

You also have to realize that you likely don’t have employees who are simply sitting around twiddling their thumbs! Your employees have normal day to day tasks that need to be done. Having to review, select, install software, gather the accounting data, configure the accounting system and learn how to use it properly takes a lot of time. Time that they likely do not have available. If you think about it who’s going to say “I don’t have anything else to do so I can devote all my time getting this done.” In today’s business environment this is extremely rare indeed.

Here is a brief list of the major stages that needs to be completed in order to implement a new accounting software system:

  • Implementation planning
  • Software installation
  • Accounting system configuration
  • System training

Implementation Planning

  • This is the vital first step that can make or break your project. The expertise of knowing how all the pieces need to flow, the order of the steps, what needs to be addressed and when will impact how successful your new system is for your business.
  • Implementation planning is where decisions on the Chart of Accounts, customer numbers, vendors numbers, inventory items, integration, who gets trained, how to go live in a timely and safe manner all occur.
  • Discussion and determination of what information from your old system is needed in the new system. There can be an broad difference in the cost based on what they want. Be careful not to try to do more than you actually need or more than you find cost effective.

Software Installation

  • Make sure your hardware and network system is adequately configured to support the new accounting software. Since several of today’s programs also offer CRM additional hardware needs may be required.
  • Load the software from a CD or a download onto the proper computer either a stand alone or server
  • Install or adjust the operating system and ancillary software such as Microsoft Windows Server, SQL Server, Small Business Server, IIS, etc.
  • Establish a backup of the system data to protect against hardware failure. This needs to be followed up by testing and checking to confirm that the right files are being backed and the process is correct. Note that backing up SQL products are handled differently.
  • Setup of Terminal Services, Citrix or web services is required in many of today’s environments, especially where companies have remote employees or multiple locations.
  • If loaded onto a server and accessed from PC’s then establish proper access rights to the server to allow your employees to use the system. Network security must be incorporated into the accounting software installation.
  • If multiple users:
    • Establish passwords for each user
    • Establish proper access for each user to their specific areas such as limiting Payroll access to specific employees
    • Sarbanes-Oxley type security options (role based security) is available for many systems. The setup needs to be specific and carefully setup.
  • Configure system documents to suit your needs such as:
    • Customer invoices
    • Customer statements
    • Payroll checks
    • Vendor checks
    • Purchase Orders
    • Sales Quotes, etc.
  • Create custom reports to provide information in a format you need. These reports incorporate both operational areas as well as financial areas.
  • Establish any needed “tie in” with other software such as importing data from an E-commerce application or from a time clock. Integration with other systems will vary based on your individual system. All require attention for security, backup and the ability to recover from a failed import.

Accounting System Configuration

  • Establish your company chart of accounts for assets, liabilities, equity, sales and expenses
  • Establish company divisions, departments and cost centers as needed
  • Load the following actual data:
    • All customer information into Accounts Receivable and establish new customer default AR information
    • All vendor information into Accounts Payable and establish new vendor default AP information
    • All Inventory items into Inventory Control and establish new part default IC information
    • All employees information into Payroll and establish new employee information – payroll must be handled very carefully as the data in the system must feed to quarterly payroll reports correctly and year to date numbers are vital to a clean cut over.
  • Load specific figures so as to support the Trial Balance amounts for these accounts:
    • Some people need history transactions–see the implementation plan
    • The integrity of the old data must be determined.
    • Before and after reports must be run to confirm that the data imported flowed through correctly. We recommending bringing in non master record information through data entry screens to have it post through where possible. This checks the data integrity and lets you keep drill downs inherent in most of today’s systems.
    • Accounts Receivable all open unpaid invoices
    • Accounts Payable all open unpaid invoices
    • Inventory Control all current inventory stats including: quantity on hand, quantity on order by customers, quantity on order from vendors, current cost per item in stock, etc
    • Payroll all individual payroll amounts per employee for current and former employees for the current year and quarter including pay, individual Federal, state, local and unemployment taxes paid and withheld
    • Load other specific information to support the actual business condition at the time of conversion
    • Purchase Order all open purchase order detail
    • Sales Orders all open sales orders detail
    • Job Cost all open jobs detail information and costs
    • Bill of Materials all BOM “recipes”

System Training

  • Software providers include training on the software use tailored to specific individuals based on their area of responsibilities for example train payroll department employees are trained on employee adds, changes and terminations; recording employee payroll data, preparing various tax reports, procedures to close a month and year and processing various year end tax reports.
  • Training needs to be timed correctly so it is long enough ahead of go live to learn, but so far ahead where employees forget what they learned.
  • Although most companies employ smart people, they are not experts on the systems they are implementing.
  • Training of new employees that did not sit in on the initial training is vital to avoid “attrition of knowledge”.
  • Update training when new version come out. It is a waste to install a new version and not know the new features.

Other Items

  • Providers allow time for GO live support, both for the regular system and for payroll
  • Conference room pilots – providers often find the need to use conference room pilots to test out more complex solutions and resolve processes and needs before rolling out training to clients.
  • Initial bank reconciliation – most users need assistance for their first bank reconciliation to tick and tie the numbers to their old reconciliation.
  • Work flow processing–providers often can help a business see if their processes are the most efficient possible.

I want to thank Lisa Kianoff of L. Kianoff Associates for providing many of the details above. Lisa and her staff since 1986 have been helping businesses get the most out of their new accounting software.

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