Holmes Institute HA2042: Accounting Software Selection Report

This report provides a comprehensive analysis of accounting information systems (AIS) for a retail business, specifically focusing on Adairs Limited. It begins with an executive summary highlighting the importance of accounting software in business operations and proposes a cloud-based solution for Adairs. The report includes a detailed company profile, key business processes, and system requirements. It then compares two popular cloud-based software options, MYOB and XERO, evaluating their features and suitability for the company's needs. The comparison covers aspects such as invoice management, expense tracking, bank reconciliation, and inventory control. Based on this analysis, the report recommends MYOB as the most suitable AIS for Adairs, emphasizing its inventory control capabilities and cloud-based platform. The report concludes with a summary of findings and recommendations, emphasizing the importance of selecting an AIS that meets the company's specific requirements and ensures regulatory compliance. References are also included.

Accounting Information System
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Executive Summary
This professional report is to highlight the role of accounting software to run any
business effectively. A suggestion will be forwarded to the CFO of my workplace to
guide one of our clients about the adoption of latest cloud-based software for their
business. The client is Adairs Limited, who is enlisted in ASX with code ADH. The
company is engaged in retailing of different products with special emphasis on soft
furnishing items with wide spread retail chain outlets. For their expanded business of
retail outlets all over Australia and New Zealand, they need cloud-based accounting
software to be installed with the required features for their business. This report will
feature short profile of the company with their business, comparison between two
popular cloud-based software of Australia with their features to meet the requirements
of their business followed by the suggestion of most suitable software to be adapted by
them.
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Table of Contents
Introduction.................................................................................................................................................4
Background..................................................................................................................................................4
Adairs Limited..........................................................................................................................................4
Key Business Process-Adairs Limited.......................................................................................................4
System Requirements for Adairs Limited....................................................................................................5
Management Information System...........................................................................................................6
Accounting System..................................................................................................................................6
Software selection.......................................................................................................................................6
MYOB.......................................................................................................................................................7
XERO........................................................................................................................................................7
Comparison between MYOB and XERO...................................................................................................8
Recommendation for sustainable cloud-based AIS.................................................................................8
Conclusion...................................................................................................................................................8
References:................................................................................................................................................10
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Introduction
Basic necessity of any business is to manage its financial information system. Earlier
this job was done manually. With the evolution of technology, different options had
come to the business entities to maintain their accounting system by suitable
accounting software of their choice and as per their need of the business. There are two
types of accounting software- fixed and flexible. For fixed software, the accounting of
any entity is restricted to specific terminal of the company. For flexible software, the
option is wider for the business entities with better accessibility globally through web.
This software is known as cloud-based software. Due to different advantages of this
type of software, the companies adapt this software for their business operation and
accounting. In this present report, we will narrate comparative analysis of two such
cloud-based accounting software systems with their features to decide about the
adaptation strategy of the company for new cloud-based accounting software.
Background
Adairs Limited
Adairs started its operation on Chapel Street, Prahan, of Victoria in early period of
1900. Later it had established its departmental stores in small size at Camberwell with
the products of soft furnishing and other allied products in ladies-wear. The company
had started its latest version of Adairs boutique by the young people of Adair family. The
organization entered in a partnership with MacLean in 1984. This strategic alliance
showed its success with further opening of its retail outlets in Victoria. MacLean had
taken main command of this business in 1986. During the period of 1990 to 2000s, the
company expanded its network further in all major states of Australia. MacLean had
sold their majority stake in 2007 to BB Retail Capital, who is well known entity in
Australian retail-based entrepreneur with the advantage of guidance of its director, Brett
Blundy. The fund management advisor, Catalyst had taken up 69.5% interest of Adairs
by introducing fund of around AUD 400 million. The company was then enlisted in the
ASX with issuer code ADH (ASX, 2019) on 17th June, 2015. (Adairs, Adairs- Investor
Site- History, 2019)At present the company has 160 retail outlets all over Australia and
3 at New Zealand. (IBISWorld, 2018)The latest financial report of Adairs Ltd as on 30th
December, 2018 had projected revenue of AUD 164,377, 000 as on date; while last
year this period revenue was AUD 149, 047,000. The profit for the current period was
reported as AUD 14,893,000 against the profit of last year this period AUD 13,940,000.
Earnings per share of current period are 9 cents compared to 8.04 cents for same
period last year. (Adairs, Annual Reprot-2018, 2018)Projection of sales of the company
for first six months of 2019 is between 340- 355 million AUD. (Bloomberg, 2019)
Key Business Process-Adairs Limited
This company has widespread retail network all over the major states of Australia and
some part of New Zealand. (pnmsoft, 2019)The company has 160 outlets in Australia
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and three in New Zealand to sell their varieties of products, based on soft furnishing and
other products as per their catalogues including fashion-wear including kids wear, too.
The business process of Adairs demands well-knit network of retail outlets, with
different inventories with specific nomenclature. Hence inventory management is the
basic requirement of Adairs. The logistics of this business demands well-coordinated
supply chain management to track the logistics requirement to be connected with shelf-
inventories management. The sales of this company need an integrated accounting
system to track invoices of different retail outlets. All these information should be stored
in cloud so that the people engaged in this business can access relevant data at any
time. Sales are followed by respective payments and issuance of receipt for the
customers. These receipts are to be accounted for understanding the closure of sales in
effective manner. Moreover, the inventories stuck in shelf are to be identified to dispose
off with necessary strategies. For all these requirements of business process, the
company needs a flexible format of accounting information system, which can cover the
needs of the business with standardized format of reporting. (Bhasin, 2016)
Basic goals for investing in accounting software are to confirm maintenance of financial
information in accurate and proper manner. This feature would enable the management
to make effective management decision related to business operation. The ultimate
objective is to run the business through sustainable accounting information
management to ensure comfort level for the stakeholders including customer,
employees, top management and supply chain associates. (Appian, 2019)
System Requirements for Adairs Limited
Appended below the hierarchical table for need of accounting information system with
its roles for different perspective of effective management of any company:
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The company needs different services from system to comply with its requirements, as
given above through diagram.
Management Information System
It is mainly consisting of procurement planning, inventory management and sales
planning. All these features are interconnected with their services. The company has to
plan their procurement from vendors as per the market trend. Effective inventory
management would ensure proper use of working capital. Sales planning are to be
made as per historical data by analyzing sales trend of the products sold by the outlets.
(guru99, 2019)
Accounting System
Accounting system consists of two main jobs- statutory accounting and tax compliance.
Statutory accounting is meant for sales, receipts, inventories, payments to vendors,
payroll management and other allied requirements of accounting deliverables. Statutory
accounting would provide financial report of final status to form annual financial report of
any company. Tax compliance is related to GST collection, submission to authorities
and respective return for input credit claims.
Software selection
Like other business, the accounting information system market of Australia is
competitive with so many players present there providing latest features of cloud-based
accounting information system to make their footstep strong in this market. Adairs Ltd
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have to choose one from them to meet the requirements of the company with multi-layer
locking provision with hierarchical delegation of authority empowered. (Sgabend,
2017)Basic features to be considered for selection of accounting software are:
 Invoice and receipt management;
 Expense management ;
 Bank management;
 Supply-chain management;
 Procurement management;
 Pay-roll management;
 Inventory tracking and management;
 Tax management;
 Offline working provision with backup in local PC.
For selection of accounting software suitable for the company, Adairs should consider
two shortlisted providers of accounting software namely MYOB and XERO. With the
available features and easy procurement method, one of these two can be chosen after
proper analysis of the offering by them by matching them with the requirement of the
company.
MYOB
As per the requirement of Adairs business process, MYOB can provide following
solutions through their accounting information system named MYOB Accountingright
Plus. This specific software solution will provide following services on cloud-based
platform for any business:
 Invoice and receipt ( Paydirect option) management;
 Financial information management;
 Sales management;
 Expenditure management with effective control;
 Bank activities management;
 Procurement management;
 Offline working provision with back-up in PC;
 Inventory control and management;
 Staff payroll systems.
The rental charge for this software is AUD 52.5 per month with offer of 25% discount for
12 month booking. (Myob, 2019)
XERO
The other option is XERO for web-based accounting software, which can be availed by
Adairs. This accounting information with brand name Premium 20 system provides
following features:
 Sales invoice with unlimited numbers;
 Expenditure management and subsequent tracking;
 Management of bank transactions with no-limit;
 Connection of bank with live feeds;
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 Financial reports as per tailor-made structure;
 Payroll and GST management with respective compliance and reports.
(Moneyedge, 2018)
Rental charge for this accounting software is AUD 90 per month. (Xero, 2019)
Comparison between MYOB and XERO
We have considered two premium cloud-based accounting information systems
available in Australia to prescribe for Adairs Limited- MYOB software named
AccountingRight Plus and XERO Premium 20. The considered options are best to suit
the demand of the Adairs business. The comparison between these two depicts thin
edge of advantages for MYOB due to its variety of features including provision for offline
working. Although rental charges are not big issue, still, if the cost benefit analysis is
done, MYOB will prove its worth. (PEAVLER, 2018)
Recommendation for sustainable cloud-based AIS
Adairs is engaged in retail chain business with different types of products in soft
furnishing and fashion segment of ladies and children. It is evident that the business
needs strong inventory control for proper track in business. The generation of sales
invoice and respective receipt generation are basic deliverables. As MYOB is providing
the requirements of the business on cloud-based platform, the company should go for
this accounting information system. (accountingedu, 2019) The banking part is also
necessary including reconciliation. This service is also available in MYOB software.
MYOB facility provides free trial to assess applicability of the product, hence company
can decide after going through trial for this software. It is advisable that rollout of data
should be easy and smooth for any type of data switch-over for business. Hence, the
restoration of historical data is to be entered through system by application of available
facility of conversion provided. Main objective of selecting any cloud-based information
system is to ensure its easy accessibility, correctness and prudence in application for
the stakeholders. Adairs has to comply with the statutory requirements of ASX and
other regulators including AASB standards. To ensure compliance of those factors
related to regulators, the company has to ensure prudent, accurate and timely
presentation of accounting statements for the stakeholders and the management of the
company. The MYOB AccountingRight Plus software will provide the service to meet
basic needs of this business. Hence my recommendation would go for this cloud-based
accounting information system for Adairs to end the search for effective accounting
software with cloud-based platform. (Gartemstein, 2018)
Conclusion
Adairs Limited has a big network of retail-chain outlets dealing with different products of
fashion products for ladies and children, soft furnishing including curtains, towels and
other allied products. The company maintains big quantity of inventory. Main challenge
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of this business is to control those inventories with subsequent assurance to identify the
fast-moving and slow moving items. For effective business management, the company
is looking for cloud-based accounting information system and seeks guidance with
respective suggestion for suitable option in Australian business perspective. To
suggest the company with proper analysis of their need of business process, the
requirement of services for the business and the readily available options are to be
considered. Accounting information systems mainly provides services related to
different commercial aspects of any business organization. These aspects include
invoicing, receipt, bank, inventory, GST and other related service like payroll
management, regulators’ compliance etc. There are different options in Australia for this
service. To suggest the right option of cloud-based accounting software, I have to
identify the basic requirements of the company to cover up by this facility. Then
respective software packages with their facilities are diagnosed to meet those
requirements. After then, I have shortlisted two solutions- MYOB AccountingRight Plus
and XERO Premium 20. Going through their features and respective rentals, I have
suggested MYOB AccountingRight Plus for Adairs Limited to run their business
smoothly. This report will be forwarded to the CFO of our company to pass on to the
client with analysis and respective suggestion for effective service.
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References:
accountingedu. (2019). What are Accounting Information Systems? Retrieved May 23, 2019, from
https://www.accountingedu.org/accounting-information-systems.html
Adairs. (2019). Adairs- Investor Site- History. Retrieved May 19, 2019, from
http://investors.adairs.com.au/investors/?page=history
Adairs. (2018). Annual Reprot-2018. Adairs.
Appian. (2019). Business Process Definition. Retrieved May 23, 2019, from
https://www.appian.com/bpm/definition-of-a-business-process/
ASX. (2019). ADH- Adairs Limited. Retrieved May 19, 2019, from https://www.asx.com.au/asx/share-
price-research/company/ADH
Bhasin, H. (2016). Sales planning process. Retrieved May 10, 2017, from
http://www.marketing91.com/sales-planning-process/
Bloomberg. (2019). Company Overview of Adairs Limited. Bloomberg.
Gartemstein, D. (2018). Accounting as an information system. Retrieved May 23, 2019, from
https://smallbusiness.chron.com/accounting-information-system-43420.html
guru99. (2019). What is MIS? Intoduction & Definition. Retrieved May 23, 2019, from
https://www.guru99.com/mis-definition.html
IBISWorld. (2018). Adairs Limited - Profile Company Report Australia. IBIS World.
Moneyedge. (2018). Price Increase for Xero Users – will this affect you? Retrieved May 19, 2019, from
http://www.themoneyedge.com.au/price-increase-for-xero-users-will-this-affect-you/
Myob. (2019). Set your business up for success. Retrieved May 19, 2019, from
https://www.myob.com/au
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PEAVLER, R. (2018). The Business Owner's Guide to Accounting Information Systems. Retrieved May 23,
2019, from https://www.thebalancesmb.com/accounting-information-systems-392953
pnmsoft. (2019). Business Process. Retrieved May 23, 2019, from
http://www.pnmsoft.com/resources/bpm-tutorial/business-process/
Sgabend. (2017). Accounting Software Selection and Implementation. Retrieved May 10, 2017, from
https://www.sgabend.com/services/for-profit-business/consulting/accounting-software-
selection/
Xero. (2019). Pricing Plan to suit most busienss. Retrieved May 19, 2019, from
https://www.xero.com/au/pricing/
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