Don't need to close accounts

This is a tale about another of our clients. They had a 'legacy' accounting software, meaning a software written many, many years ago (>20 years) using the technology at that era.

What happens is that this client is not able to continue with entering the new year's transactions without having to 'close' and 'finalise' the previous year's entries.

Now how many companies have the resources to be able to 'close' and finalise the last year's accounts within days after the year-end. It is usual for companies to take some time (even with a computerised accounting software) to finalise the accounts because they have to consider, amongs others:
1. inventory valuations
2. bills not received yet (accounting matching principle)
3. tax
4. uncollectible debts

To cut the story short, in May 2006, this client was still keying in their 2005 accounts into the old accounting software. Their auditors completed the audit for 2004 accounts in August 2005, and so the staff could only start entering their 2005 accounts from September 2005. They took almost 9 months to enter 12 months accounts.

Fast forward to new MYOB system which we installed in May 2006. They started keying in the 2006 transactions right away, and as of this instant, they are on top of things. They are now able to key in the 2007 transactions while waiting for the audit of 2006 accounts to be finalised.

That is one big benefit they got out of the system. There is no need to close the accounts before starting a new financial year.

Another big benefit is that all reports can be exported to Microsoft Excel, and they don't waste time rekeying data. More importantly, data is not lost in the process of transcribing the data from the system to Excel.

MYOB systems requires you to purge your accounts every 2 years though.