If you contract with a third party CPA, you should absolutely seek out their opinion when purchasing accounting software.
But if you rely solely on their opinion, you could be making a mistake.
Having spoken with hundreds of software buyers over the last decade or so, I can attest that there’s no shortage of companies who have learned this seemingly counter-intuitive lesson the hard way.
Accountants, of course, bring a valuable perspective to the question of how technology can help address financial management challenges. Any savvy business owner or decision-maker with access to this kind of resource is wise to tap it.
But there are aspects to evaluating software that may fall outside of your accountant’s expertise. There may even be conflicts of interest that can interfere with an unbiased recommendation.
Consider some of the strengths and weakness third-party accountants bring to software recommendations, in order to understand how to best weight their selection input.
Why you should seek out your CPA’s opinion on your software purchase
- Expert knowledge of accounting standards. A CPA’s knowledge of standards and regulations is a unique resource. For example, your accountant is far more likely to tip you off to a program which lacks the features to easily establish GAAP or regulatory compliance, than, say, your company’s IT manager would be.
- Your accountant likely has deep insight into your company’s accounting processes. Selecting the right software means picking a program with the flexibility to accommodate your chart of accounts, accounting periods, payment terms, approvals processes, workflows, income statement and balance sheet set-up, and a variety of other personalized accounting choices. Your accountant should be able to comment not only on the programs that can support your accounting approach, but also help you recognize the products that will help you streamline and improve it.
- Accountants can advise you on software they are familiar with using. If you expect to extensively use a particular CPA for their accounting services, selecting a program whose functionality and file formats your accountant is familiar with could significantly limit the hours you’ll be billed.
Why you shouldn’t solely rely on your accountant’s software recommendation
- Accountants may lack the IT knowledge necessary to select the right software. There are a number of technical aspects to software selection that might be outside of your accountant’s expertise. For example, if you need to integrate your accounting software with other key business applications, an accountant might not be your best bet for vetting the various software options’ APIs. If a product can’t meet your integration, deployment (hosted vs. on-premise), database compatibility, and information security requirements, each factor could be a deal-breaker. If your accountant isn’t experienced in the evaluation of these areas, sourcing the opinion of a trusted IT expert is a necessity when validating your accountant’s product recommendation.
- Accountants may under-emphasize the importance of non-accounting specific functionality. Today’s accounting software goes far beyond ledger support. The inclusion of sales management, project management, inventory control, and other non-accounting department features is common. Nobody is an expert in everything. Internal departmental leaders might have a very different perspective on which programs best meet their needs than your accountant.
- Accountants may be biased towards more limited software options. Preparing payroll, depreciating fixed assets, and preparing financial statements are among the most common services offered by public accountants. However, many contemporary accounting systems offer automation tools for these same tasks. It can be difficult for any service professional, no matter the depth of the relationship, to recommend a solution to clients that involves cutting their own billable revenue.
- The programs an accountant is familiar with might not be the ones that are best for you. There are hundreds of commercial accounting software products available. Software developers have created highly targeted solutions designed to meet the needs of companies in a variety of different industries. Even an experienced accountant may only have in-depth familiarity with a dozen or so programs. While sharing a common accounting platform with your accountant can have advantages, it can also be limiting. The more industry-specific or sophisticated your needs, the more likely it is that the best product for you is one that your accountant doesn’t use or may not have even used before.