Farmer vs Hunter

Would you be willing to do business with a software implementer who offered a great ERP product which met all your functional requirements, but would be difficult and frustrating to work with along the way? Consider what you should expect from your ERP implementation partner

You have decided on an ERP solution. Now what?

Once a business outgrows their current accounting system, they begin seeking an ERP software that checks every box on their functionality wish list. Although this is a crucial decision, don’t forget about the partner behind the software. The partner will be the driving force in implementing the system into your business. ERP implementation is a complex and costly investment that can impact your business for its foreseeable future. Therefore, ensure you are making a calculated decision on who your implementer is. Are they a Farmer or a Hunter?

At Kilimanjaro, we believe that software is a platform for business efficiency. This software may be in place for up to 10 years, so a long-term and reliable partner is essential. One of our golden rules states that we are proud to self-identify as “farmers not hunters”. Having sown the seed of efficiency improvement, we are here for the long haul, always keeping pace with new technology that benefits your business.

Why worry about the Implementation Partner?

An ERP implementation is like surgery – you would want an expert. You want to choose an ERP implementation partner who is experienced and can help you recognise your current business state as well as provide solutions for your future state. A trusted partner will guide you through the whole process with a proven methodology and a team of highly skilled experts. There are partners and then there are partners that count. On the other hand, a Hunter is an implementation partner who has little technical expertise or experience in the industry, and has intentions that don’t necessarily serve your business. You may be lured in by a quick implementation and a seemingly low investment, but shortly after you will begin to realise how unrealistic and unsustainable their offer was all along.

An ERP implementation can take anywhere from 3 months to 2 years, depending on the complexities of the business. But what comes next? After the implementation, you will need a partner who is willing to guide you through setting up new staff, upgrades and tech support. Someone who will be there not only when your business grows but also when a new challenge or opportunity arises. This journey can take over a decade.

In a nutshell, implementing a new ERP system is an opportunity to both identify and redesign your business processes. You want to ensure you have an implementation partner who can understand your current business requirements, envision where you want to be, and support your business from day one, all the way through the journey. 

Factors to look at when choosing an ERP Implementation Partner

Before choosing which implementation partner you are going to commit to, make sure you understand your choice is going to be multi-faceted. You can start by basing your decision on certain factors such as: 

  • Reputation – are they well regarded in the markets they serve?
  • Skills – Do they have a strong team?
  • Size- Can they provide continuity of employees leave or are unavailable?
  • Longevity – Have they been around long enough for their failures to surface?
  • Methodologies – Does the partner have proven and documented methodologies, that ensure they will do it right, first time?
  • Investment- Is the implementation of partner cutting costs to get into the market?
  • Experience – Have they done it before?
  • Risk – Can I pull out if I don’t like the proposed solution?
  • Software – Does the implementing partner have a strong relationship with the software vendor?
  • Geographic – Does the ERP implementer operate in the regions in which you operate? 

With all of this to consider, make sure you have a team behind you to contribute, as the choices you make now will impact your business far into the future.

There are a range of implementation partner “types” out there, some include:

  • Innovators
  • Financially driven firm
  • Growth orientated
  • Litigious (if I don’t have to, I don’t want to)

It’s critical to consider what you want out of this long-term relationship. Ensure you are avoiding the hidden costs and surprise increases by choosing a partner that doesn’t view you like another number.

The signs of a Farmer vs a Hunter

At Kilimanjaro, we refer to a “Hunter” as a partner who merely provides implementation services and does not nurture their clients in growth and support. This is exactly what you want to avoid when choosing your ERP implementation partner.

Here are some of the warning signs to watch out for when dealing with a Hunter:

  • Confusing contracts 
  • Sales professionals who are not able to answer your questions directly, or who do not take the trouble to get back to you with definitive answers. 
  • Offer a fixed price implementation without clearly defining the scope
  • Poor relationship with the software vendor
  • Little understanding or care of your business requirements
  • No “User Acceptance Testing” phase in the implementation.
  • No ‘after implementation’ support 
  • Lower prices in comparison to the market 

Choose the wrong implementation partner, and you will start to see things fall apart quicker than you think. 

So, what characteristics should you be looking for? We refer to a “farmer” as a partner who supports the growth of businesses over the length of the entire relationship. A trusted ERP Partner should have:

  • A consistent implementation methodology 
  • Long term intentions with your business
  • Clear communication about the risks (software, implementation, and self-inflicted risks)
  • A prominent relationship with the software vendor 
  • Long-standing relationships with their clients
  • A significant team of experts 
  • A local support desk
  • Training options (software is continuously developing, so your skills should too)
  • A positive company culture

Make sure that you have the right tools and knowledge behind you to pick the right surgeon, ensuring the procedure and post-op check-ups go smoothly! 

Don’t forget, your software decision can last a decade or longer, so choose your partner wisely! Still considering whether your business needs an ERP? We can help.

If you are still in the process of choosing an ERP but aren’t sure where to start, download our helpful E-book that takes you through some useful tips on how to get started on your ERP journey. 

If you have any enquiries please call us on 1300 857 464 or email us at [email protected]

 

Fixed Assets in MYOB Advanced

Fixed Assets Management in MYOB Advanced (powered by Acumatica) makes it easier to manage company assets and provides complete visibility and depreciation calculations. You can include your assets into your reporting directly from your accounts payable purchases, imported from an existing file or individually. The MYOB Advanced Fixed Assets module can support you in many ways. The newest version of MYOB Advanced saw the completion of the long-awaited additions to Fixed Assets module. Therefore, this release adds functionality by completing work on the diminishing value and prime cost/straight-line depreciation methods for the Aust and NZ jurisdictions. And so, we will take you through some of the new features and how to access these in your system.

Two new calculation methods are now available for the Australian jurisdiction:

          1. Australian Prime Cost

          2. Australian Diminishing Method

It is also now possible to define the percentage calculation of depreciation on the following levels per:

  • Depreciation method

  • Fixed Asset Class

  • Fixed Asset (individually)

Furthermore, with the new depreciation methods, the following attributes are improvements on the old behaviour:

  • Depreciation amounts are calculated on a per-day basis, which means that the calculation for a 31-day month is slightly more than for a month with 30 or fewer days.

Let us illustrate this with an example: An Asset with Acquisition Cost of $12000 was purchased and Placed in Service on 31.03.2020 with a useful life of 1 year.
For each period of an asset’s useful life, depreciation is calculated based on the following formula.

D = Depr. Base * (Percent per Year / 100) * (N / 365)

where

  • N: The exact number of days the asset is held in the fiscal period. The number of days held is calculated as follows for the listed periods:
    • The first depreciation period that is specified for the book (Depr. From Period): Last day of the period – Placed-in-Service Date + 1
    • The disposal period: Disposal Date – First date of the period + 1
    • All other periods: Length of the period in days

In our example, the formula calculates the following depreciation for the first three months of assets life:

  • March 2020 Depr Base 12000*(100%/100)*(1 day/365)=32.88
  • April 2020 Depr Base 12000*(100%/100)*(30/365)=986.30
  • May 2020 Depr Base 12000*(100%/100)*(31/365)=1019.88

The same calculated depreciation amounts can be seen on the Depreciation History tab of the asset:

The pre-2020 versions Straight-Line Depreciation Calculation Method calculates the monthly depreciation to be $1000 for all full months regardless of if the month was 28, 29, 30 or 31 days as seen below:

  • We now need to consider leap years. A leap year calculation is slightly higher than a non-leap year

  • The calculation for depreciation per asset is done by changing the Depreciation percentage value

Therefore, the Fixed Asset class can then be used on a Fixed Asset, with the percentage value defaulting based on what the Fixed Asset class has set. This value can change on an asset-by-asset basis, or a book-by-book basis for each asset.

MYOB is constantly looking to improve the user experience and the software itself within MYOB Advanced. Thus, the latest release, 2020.1, introduces Employee Self Service features, and more extensive features to the Payroll module. For more information about the new Employer Self Service Portal, read here (link to our new article).

This release also includes updates to Bank Feeds and Fixed Asset features and resolves issues identified in previous releases. Therefore, for more information, visit our page here to learn about MYOB Advanced Version Release History.

Interested in other ways to optimise MYOB Advanced? If so, we have prepared numerous MYOB Advanced Tips and Tricks to ensure you are making the most out of your system. Learn more about:

Alternatively, for a comprehensive overview of all of our best MYOB Advanced ‘hacks’ in one place, you can download our PDF – The Ultimate Compilations of Tips and Tricks!

Questions about using the MYOB Advanced 2020.1?

If so, feel free to email us on [email protected] or give us a call on 1300 857 464, we’re happy to help!

8 simple steps to take before End of Financial Year

Editor’s Note: This article was originally published in May 2014 and has been reviewed and updated in order to provide the most relevant and accurate information. You will notice the renewed version now has 11 steps to take before EOFY.

Unlike many important things throughout 2020, the End of Financial Year is an unchangeable phenomenon that will continue as expected. At Kilimanjaro, we understand how important it is for your business to be prepared and how critical it is to take the right steps in approaching this important time.  Below are 10 simple things you can be doing to ease this process and enter the new year as a stronger business.

1. Read Kilimanjaro’s COVID-19 Updates page

We have dedicated ourselves to keeping our clients up-to-date with the latest news and support to help you manage your business processes during this time. On this page, you will find important guides on government schemes that will affect your business this EOFY, such as the JobKeeper Payments and STP, as well as the official MYOB Business Preparedness Reports and other useful information that can help your business navigate smoothly through this busy time. Find this insightful page here.

2. Forecast your Profits

If you are forecasting a profit for this Financial Year, be sure to plan well in advance to make purchases that could potentially reduce your tax liability. Speak to your accountant as there might be a chance to take advantage of write-offs, rebates and deductions.

3. Plan for your stocktake

Many businesses try to will avoid the annual stocktake because of the hassle involved. However, the stocktake is incredibly important to verify that your accounting systems are operating correctly. Think of it with the same importance as reconciling your bank accounts. If your system shows an inventory of $1mil, and the actual stock count is $800000, you have some investigating to do. What looks like a profit in your accounts may suddenly turn into a loss (or vice-versa), as you adjust your Cost of Goods account. Think about using a hand-held scanning system such as BLUE ECHIDNA to ease the pain of stocktaking. To understand more about the metrics that really matter, read how NETSTOCK can take key metrics to indicate a company’s inventory health.

4. Make a backup of your system before rolling the month/year and take a second backup immediately after rolling.

This gives you a “recovery point”. Additionally, it gives you the ability to print out historical reports at any point in time. For example, when your accountant asks you in December for a stock valuation report as of 30th June, you are able to do this from your backup. Bear in mind that retrospective stock valuation reports are usually inaccurate unless you are running a FIFO system. The backup copy should also be provided to your accountant to complete your tax returns. This is a good way to evaluate the backup data to ensure it is readable.

5. Consider other areas requiring End of Year attention

While the actual process of rolling Exo Business will set up a new financial year, the Analytics module requires a calendar to be set up independently.  A separate year-end is also required if utilising the Assets (1) module.  It is also a good time to consider establishing and loading new budgets for the coming year.

(1) Assets now roll the end of the year automatically as part of the 2018 product release.

6. Print Reports.

It is a good idea to create a folder on your file server called something like “2019/20 Financial Reports”. Most systems have a built-in PDF writer, so instead of printing your reports to paper, be kind to the environment and print to PDF. Save your suite of reports in the folder. This will save you hours over the next year or two when you are asked by your financial institutions for copies of Profit and Loss statements and Balance Sheets. Simply attach to an e-mail and send them off when required.

7. Pay your super obligations by 30th June

Even if the due date is July, you won’t be able to claim this unless it has actually been paid.

8. Review your Chart of Accounts

If you are going to make any changes to your Chart of Accounts, the end of financial year is a good time to do it. Speak to your ERP implementation partner to discuss the implications on comparative reports, such as “This Year / Last Year”.

9. Ensure that you are across Single Touch Payroll

From July 1, 2019, all businesses were expected to report payments such as salaries, wages, pay as you go (PAYG) and superannuation information to the ATO through their STP software. As this policy has been in place for a full year, it is important to be across the processes behind STP and ensure that you are processing this information correctly. Any questions? Visit our page here – Frequently Asked Questions. Additionally, ensure that you are across the JobKeeper and STP procedures implemented this year, by reading our useful guide, as mentioned above, at the bottom of our COVID-19 Updates Page.

10. Review your business processes

This is the ideal time to review your business processes and to look at replacing your ERP system if you have been thinking about it for a few years. It is always easier to start with a set of accounts that have been reconciled. Don’t go through another year with your old system if you can improve efficiency with a new one. You will be surprised at the rate of development in new software and how much it can help your business grow. When choosing the right ERP system for your business, remember to start by defining your requirements.  With technology rapidly advancing, you have the choice of on-premise, a hosted version or Software as a Service (SaaS). To find out which one is more suitable for your business, read our article here.

11. Prepare a checklist

The end of the financial year is a busy period for most team members in your company. It is easy to forget about a step or procedure that will later cause issues.

Being prepared for the End of Financial Year will allow your business to run efficiently through to the new financial year. If you have any question or need support, feel free to call us on 1300 857 464 or simply fill out the contact form below and we will get in contact with you. Alternatively, save yourself time and download our EOFY checklists. Whether you are an MYOB Exo or MYOB Advanced user, we have got you covered. Register or sign up through the Training Portal to access your checklist now!