According to Attach_ Software, businesses are being urged to update their accounting software to reduce the risk of business failure resulting from inadequate financial systems.
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Managing Director, Michael Rich said more than 300,000 Australian and New Zealand businesses are using accounting software they have outgrown resulting in enterprises being deficient of vital information they need to perform their core business activities.
“Our experience has indicated that in many instances financial reports are between four and six months old with inadequate stock and debtors control, poor system security, over-reliance on spreadsheets and too many manual procedures. Accountants’ auditing and banks relying on reports is also a potential danger”, Rich said.
“Most of these businesses employ more than five staff and often have managers who have never experienced a major downturn, which can make them complacent about their financial systems.”
He said the transition process for a business to update its accounting software is actually very simple and operations need not be affected during the installation period.
“Without such information, businesses are flying blind and are ill-equipped to make strategic decisions that could impact on the viability of their enterprise.”
“Being complacent about accounting software in the current economic climate could result in many businesses experiencing a downturn in their own activities,” he said.
As part of their duty of care, Rich advises all banks and accountants and IT Service Providers to ensure their clients are aware of the risks of inadequate financial systems and to suggest a review of their accounting software if they have any doubts.