APL Accounting News August 2015

Integrating accounting software with your practice management software – proceed with caution

We speak from experience proceed with caution when you integrate your accounting software with your practice management system. There are a few software providers now promoting these integrations and it has become a big selling point for practice management systems.

Please read this carefully so you know what you are in for if you are considering such a change! And TELL YOUR ACCOUNTANT because they are definitely going to have to make some entries so you don’t end up overpaying tax!

We have had a number of cases now where such integrations have caused nothing but trouble and from experience with our own development team we understand why.

Firstly, software developers are not accountants, and they do not realise the damage that can be caused by incorrectly changing an accounting file. The most common issue we have encountered in this space is where these integrations post back into previous BAS and tax periods. This may not sound that serious on the surface, but can result in double counting income and the business paying more tax. In some instances we have seen such bad damage to an accounting file that it was near to impossible to repair!

Secondly, by having real time integration from your practice management system to your accounting system, you are effectively giving your reception team and all your vets the power to alter your general ledger. Just take a second to consider the number of times errors are made with payments and invoices each day in the veterinary clinic. These errors then flow through to your accounting file which is a problem if the developers of the software have not considered carefully how to deal with these errors. How does the accounting software deal with refunds, editing of invoices, changing dates on invoices, voiding invoices made out to the wrong client? – all of these things, if not dealt with properly, can corrupt your accounting numbers and have a very significant impact on the amount of tax you end up paying.

Thirdly, any accounting adjustments your accountant made as bulk entries to balance your debtors (something that is often done at end of year for tax purposes) will need to be reversed out. This is because your system suddenly switches from a bulk entry process to a real time process. Who is going to deal with these reversing entries? If they are not done, you double up on your debtors and can end up again paying tens of thousands more in tax (and GST if you are on accruals) than you should!

Finally, a live integration to your accounting software significantly changes your bookkeeping process. The way your bookkeeper does their work needs to change dramatically. You must communicate in advance with your bookkeeper.

So consider carefully before undertaking such an integration, and most importantly – TELL YOUR ACCOUNTANT AND BOOKKEEPER beforehand otherwise you could end up with a disaster. We are not telling you not to do it, but to consider that you must prepare in advance and talk to key individuals (accountants, bookkeepers).

Need some help leading your team?

The Lincoln Institute is starting their next Leadership Program in Surfer’s Paradise on Friday 21st and Saturday 22nd August.

You will learn how to deal with staff so they work better, run better team meetings and develop clarity around your practice direction.

To find out more contact Gary Turnbull gary.turnbull@lincolninstitute.com.au and tel 0488 254545 or Paul Ainsworth paul@lincolninstitute.com.au and tel 0417 807980

 

Bottom of the pack – Welcome to some new pack members.

Zack is a dog who is a couch potato and has an unusual life experience. His owners who were once exciting vets have now become boring accountants. They used to bring him into the exciting vet practice every day, now they bring him into a boring accounting office every day. This gives him a unique dog’s eye view on both professions.

Pictured above taking a ‘Power Nap’ at APL Head Office!

We would like to say goodbye to Debbie our office administrator whom you all have become familiar with by virtue of her excellent telephone mannerism and friendliness. The APL pack is really sad to see Debbie go.

We have two new pack members to welcome, Jemma and Tori, who will share the office administration and take on some of the bookkeeping work. So please be nice to them in their first few months – they need to learn that vets don’t bite!

 

 

 

 

Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances. In particular, please note that ‘Zack’ is a dog and does not have opposable thumbs so has to type with his nose.