The importance of upgrading your accounting software – why, when & how

Upgrading your existing accounting software need not be an expensive and painful exercise. By not upgrading, you may be heading for problems. The risk of downtime, data loss and increased operational costs are higher for companies that continue to use old hardware and operating systems that have been superseded and are no longer supported.

It is widely accepted that choosing not to upgrade can impact on a company’s profitability. Whether a company is large or small, using a single user entry level software package or multi-user ERP system, upgrading is an essential part of running a computerised business system.

Here are some of the reasons why companies should upgrade

• Company Growth - Companies may not be able to justify the investment in a system that is sophisticated to cope with anticipated future growth. Choosing a package than can be upgraded in line with the development of the business will be a key factor for many firms.
• Product enhancements - Running the latest versions will reflect current business needs and best practice. It will facilitate the process of implementing legislative changes e.g. VAT/PAYE and provide enhanced tools for integration with 3rd party applications.
• Technological advances - In most cases, users gain significant added value by running the latest version of their package. This ensures that your organisation is receiving the benefit of the latest functionality offered for your chosen software package.
• Improved support services - Eventually even the best suppliers have to suspend support for older versions of software. Running the latest versions allow system errors to be resolved more quickly and give you ready access to the latest support material.

An upgrade should also be installed at a time that is convenient to the business. Try, for example, not to choose end-of-year or budget planning periods.

The upgrade should be treated in the same way as a project. It is a good idea to hold meetings with everyone involved to agree the objectives and assign roles, responsibilities and timescales.

Issues such as user impact and acceptance, technical integration, testing and training should all be considered. For example, look at the functions provided by your current package and make sure than none of these will be lost and ensure you are given the opportunity to review all the benefits your upgrade system can provide you with.

Things to consider when upgrading:

• Performance - Performance is a key consideration. As technology develops systems have become much more performance efficient allowing you to process information quicker, i.e. run reports in quicker times.
• Costs - Check whether future upgrade costs are included in an annual maintenance fee and what, if any, additional costs will be incurred.
• Infrastructure changes - Find out whether the accounts software upgrade demands specific hardware or software to take full advantage of the new features
• Custom processes, reports, documents - If there are elements of your accounts software that have been customised for you then these will need to be reviewed. While some software houses provide customisation that can be upgraded, some customised software may need to be re-coded to run with the latest software version. Custom reports or documents will also need to be reviewed and tested.
• Integrated applications - If your accounts system is linked to an external application such as a website, manufacturing system or electronic banking system these will need to be reviewed to ensure that integration can be maintained. Many of the more sophisticated accounts software systems provide an Application Programmers Interface that minimises any risk of integrated applications failing.
• Complimentary tools - Many companies are dependant on using office tools such as MS Excel or Crystal Reports to extract data from the accounts system and provide additional analysis. It is worth verifying with your accounts software supplier that these tools will not be affected by the software upgrade.
• Data conversion - When an upgrade is taking place from a very old system or where there has been a fundamental change to the software e.g. from a mainframe to a web based or client/server system, data conversion may be necessary. It is important to pilot and test the converted data before running the system live.
• Training and consultancy - End user training and consultancy will be required to ensure you make the most of the way the system is set up for your business.