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December 7, 2017
We often use this blog to share examples of how CPA firms can leverage technology in the cloud to improve their practices. The convenience, scalability, and lower costs of cloud computing have helped even the smallest practices remain competitive. Within cloud computing resides a whole host of services, including cloud software, designed to make accounting firms more efficient.
One such software-as-a-service model is enterprise resource planning (ERP) tools.
This post explores everything you need to k ow about ERP, including what it is, which platforms are the best, and how it’s changing accounting. Can ERP offer value-adds for clients seeking to drill up or drill down on financial statements?
IT Outsourcing 101 – What is ERP?
ERP is a database-driven software program that integrates all of the basic functions of a business, including:
ERP acts as the umbrella over all basic business functions. By integrating all of the processes across every department, many manual data entry processes are streamlined. Instead of having every department create a new log for a customer, everything is pulled from one single database. An ERP creates a single source of truth for business data within an organization. This makes for much more accurate customer and sales information as well as order management, accounting, and forecasting
Having accurate data across all departments is just one benefit from what are very sophisticated tools for modern business.
ERP platforms synchronize data simultaneously across all business functions. Sales can flow into bookkeeping and then bill. Customer order processing flows into inventory and vendor management. Everything is tied together in one dashboard or hub connecting all separate business functions.
Data can be automated for reporting purposes, and business intelligence can be sliced, diced, and analyzed as part of the process.
Some of the vendors that offer ERP software include:
The benefits of EPR software include:
Companies use ERP software to gain a 360-view of all their basic processes, and can then develop strategic growth plans based upon prior historical trends. These are all good reasons for accountants to become the expert in these platforms in order to add value for business clients.
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Accounting and ERP
An article in the International Management Review illustrated exactly why ERP software is so important to accounting firms, “Besides finance, accountants are expected to be business partners, technology experts, and strategy allies…” The article pointed out that accounting firms provide consulting services in ERP for enterprise-level companies. While the software provides the data, CPAs have the intellectual capacity to interpret and find meaningful insight from it.
For accountants that have not taken the time to become certified in ERP systems, it is highly recommended. The ERP Software Blog points out:
What may help bolster your résumé and financial credentials is experience and training in ERP software, such as Microsoft Dynamics GP. If you can demonstrate that you know how to use ERP software and can even train others to use it, employers will view you as a prospect much more valuable than someone who only knows numbers.
ERP software is all about repositioning traditional accounting practices into strategic business advisory services. The software is much more sophisticated than typical accounting software. They impact the entire enterprise and CPAs can be poised to make effective use of this technology in order to strengthen their relationship with the client by providing expertise in interpreting ERP data.
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