HA2042 Accounting Information System Report: JB Hi-Fi Cloud Software

This report provides an executive summary and detailed analysis of cloud-based accounting software for JB Hi-Fi, an ASX-listed retail company. It begins with an introduction, describes JB Hi-Fi's business activities and processes, and outlines the required software features. The report then compares and contrasts two accounting vendors, Xero and MYOB, evaluating their functionalities like banking and cash management, invoicing, payroll, inventory, mobile applications, and multi-currency support. Based on this comparison, the report recommends Xero as the best-suited accounting software for JB Hi-Fi, emphasizing its mobile app features, integration capabilities, and compatibility with e-commerce operations. The report concludes by highlighting the benefits of Xero for JB Hi-Fi's accounting and financial processes, including payroll processing and automated bank reconciliation.

Accounting Information System
1

Executive Summary
The purpose of report is to evaluate the use of cloud based accounting software by the
ASX listed company such as SAP, Myob and Xero. This report has evaluated the benefits of
using the cloud based accounting software that JB Hifi will receive when it make of selected
accounting software. On the basis of overall examination of features and functions of both Xero
and Myob it has been suggested to JB Hifi to make use of Xero as it is best accounting software
and suitable for business processes of this company.
2

Contents
Introduction.................................................................................................................................................4
Description of the Company and its Business Activities..............................................................................4
Business Processes......................................................................................................................................4
Required Software Features and Functionalities for the Selected Company...............................................5
Selections of two different accounting vendors and description of vendor & their products.....................6
Xero.........................................................................................................................................................6
Myob.......................................................................................................................................................6
Detailed comparison and contrast of functions or features of two selected cloud based accounting
software packages.......................................................................................................................................7
Best Recommended Accounting Software for the Selected Company........................................................8
Conclusion...................................................................................................................................................9
References.................................................................................................................................................10
3

Introduction
This report is carried out for providing recommendation to an ASX listed entity
emphasizing on the adopting the use of a cloud-based accounting system. As such, it primarily
examines the business activities and processes of the selected entity and then provides a
description of the software features and functionalities that is required by it. This is followed by
analyzing the two selected accounting vendors from SAP, XERO or SAP and their respective
products. The comparison of the selected accounting software is then carried out followed by
providing suggestions regarding the best accounting software suited for the selected company.
This analysis is undertaken from the perspective of a management consultant aiming to provide
suggestions to the CFO of the client company regarding the adoption of best accounting
software. The company selected for analysis purpose is Jb Hi-Fi, an Australian based Retail
Company involved in selling of consumer goods.
Description of the Company and its Business Activities
JB Hi-fi is a recognized retailer of Australia that is specialized in selling of consumer
goods across Australia and New Zealand. It is publicly listed on ASX and has achieved a
distinctive position within the retail sector of the country. The Group focuses on developing
consumer electronics products such as music, games, movies, white goods and appliances. In
addition to this, it is also involved in providing telecommunication products and information
technology products and services.
Business Processes
The key business processes of the company include sales, customer service, finance
department, supply chain activities, production, human resources and accounting and financing
activities. The various type of business process involves accounting and financing activities such
as sales and procurement involves developing invoices and bills, human resources involves
developing of employee payroll, supply chain activities involve tracking of inventory, costs and
expenses, production involves determining the price of products and lastly financing and
accounting department is involved in collecting individual financial data from various
department to develop an integrated financial report. Thus, it can be said that accounting and
4

finance operations are the core of all the business processes of JB Hi-Fi. Therefore, it is highly
important for the company to manage adequately its financial data for carrying out its various
business processes in an effective manner (Jb Hi-Fi Limited, 2018).
Required Software Features and Functionalities for the Selected
Company
Jb Hi-Fi conducts different types of retail operations ranging from eCommerce to mail
order to direct retail and also through other channels for providing its various products and
services to the customers. Therefore, it has to manage adequately the variety of its business
functions such as merchandising of products, advertising, marketing, stock control, customers
service, market research, supplier negotiation and others such business activities. Therefore
diverse accounting functions associated with the business processes of the company and
therefore it requires the integration of cloud-based online accounting software to monitor and
control the diverse accounting functions (Brewer, Sorensen and Stout, 2014). The cloud-based
accounting software applications provides advance features to manage the diverse accounting
and financing activities of the company such as cash flow, payroll processing, tax compliance
and development of ledgers and annual accounts. The major advantage that can be utilized by the
company with the use of such online accounting software application is tracking of real time
accounting data by the business managers without requiring the need for office. This is because
cloud-based applications can be accessed with the use of remote server such as internet and thus
enabling the business managers to gain insight into the real time accounting data anytime which
facilitate them in better decision-making (Hossack, 2015).
The automation of the accounting and financing functions will help in reducing the time
consumed in manual entering the data and recording the financial transactions. It would enable
the company to gain a more transparent view of the business and thus developing realistic goals
and strategies for the future. The ecommerce business of the company requires the use of
automatic processing of the accounting functions. The cloud-based accounting software provides
advanced features such as helps in cash flow forecasting and keeping a track of daily inventory
balance which is very useful for the success of ecommerce business. Also, it would help in
creation of automatic invoices and bills of the customers thus providing instant services to its
online customers. The ease of use and managing huge volume of data in an effective manner
5

makes this type of accounting software to be adequately used by JB Hi-Fi for promoting the
growth and development of its ecommerce business (Kosalge and Ritz, 2015).
Selections of two different accounting vendors and description of vendor
& their products
The two selected accounting vendor that provides cloud based accounting package are
MYOB and XERO. Detailed description of both Myob and Xero has been provided below:
Xero
This firm provides accounting software that has various attractive features and can be
implemented in most of business types. Xero is ASX listed company that provides cloud based
accounting software for the company operating in Australia and New Zealand. Xero has
established its accounting software in year 2006 and since then it has become one of best
accounting software vendor in Australia.
There is only one product offered by Xero but there is there are differences in features
and functions depending upon the product type chosen by customer. Depending upon the feature,
product offered by Xero has been divided into Starter, Standard and Premium (Schaeffer, 2017).
Myob
Mind Your Own Business (MYOB) is multinational company based in Australia and it
offers variety of accounting software that cloud based and can be easily implemented in any
business firm. This company provides both accounting and taxation software to most of business
in Australia and New Zealand. The detailed discussion of all features and functions provided in
Myob accounting software has been discussed in next section. Various products offered by Myob
are as follows:
 Myob AccountRight/RightPlus: It is available both offline and online, and provides
attracting features such as job tracking, multicurrency option, inventory management
(advance version) etc.
 Myob Essential: It offers similar features as AccountRight but it is available online not
offline (About MYOB, 2019).
6

Detailed comparison and contrast of functions or features of two
selected cloud based accounting software packages
The two selected cloud based accounting software are Myob and Xero. Both of these
accounting packages are cloud based but they have some difference as well as similarities with
regards to their features or functions. Comparison of functions/features of these two selected
cloud based accounting software package can performed through use of their main features or
functions and highlighting the main differences. Below points reflects the detailed comparison of
Myob and Xero:
 Banking and cash management: Both Xero and Myob provide connectivity with the
bank account and provide facility to download all banking information within the
accounting system and process the same. Xero and Myob have active partnership with all
the Australian Banks so that it is easy for software users to match the bank statement with
the accounting transactions entered in the software. This feature or function helps the
users to reconcile the bank account with bank statement as they there is time difference
between bank transactions at user end and at bank end. Myob offers better way to
reconcile the bank accounts and also has more features as compared to Xero(Smith,
2019).
 Invoicing and Bills: In both accounting software there is facility to create and record
entries in invoices and bills. The field of invoices and bills can be adjusted as per the
customer preference and there are many offered to create in both Myob and Xero. When
invoicing feature of Myob compared with Xero it can be said Myob is highly advance
and provides many other features for invoice recording as compared to Xero. As Xero
work online there is issue to create the invoice offline if it is required.
 Payroll Feature: Both Xero and Myob has feature of payroll and allow to process wages
and salaries of employees with facility of PayG taxation. It has been observed that Xero
and Myob have facility to maintain employees’ names, per period payout and process
payroll. Xero offers limited payroll options and is also limited to number of employees
whereas there is no restriction with Myob (Titman, 2018).
 Inventory: Both Xero and Myob is equipped with feature of inventory management and
allow users to manages cost of sales, units in inventory, and number of inventory on real
time basis. Real time inventory function prevents customer to make sales without actual
7

inventory being present in store. Myob Accounting right Plus has feature of advance
inventory management but there is no such feature in Xero.
 Mobile Application: Xero and Myob have facility of mobile application and allow users
to tract important accounting transactions and have other features also. Myob has highly
advance mobile as compare to Xero.
 Multi-Currency: Only Xero supports multi-currency features but there is no such facility
available in Myob.
 Pricing: Both Xero and Myob are available at multi level pricing depending upon
accounting software type and features. There is no substantial difference in monthly
pricing of both software but Myob offers high advance features as compared to Xero.
Xero offers valuable features in less cost that made it more popular among small as well
as medium size company. It is also suitable for bigger companies when it is properly
implemented (Lane, 2018).
Best Recommended Accounting Software for the Selected Company
JB Hi-Fi is mainly involved in e-retailing of different types of electronics products and
services to its customers across Australia and New Zealand. As such, the best suited online
accounting software to be used by the company is XERO as it provides mobile app features that
are not provided by MYOB. The use of mobile app features will help the company to provide
online accounting functions on the mobile app. Xero can also be synchronized with third party
apps for conducting point of sale and inventory tracking. The automatic bank reconciliation
provided by XERO would also enable the company to provide its customers the features of
automatically downloading the bill on every month. The payroll feature provided by XERO
would also help in easy processing of salary of the employees (Xero Limited, 2019).
Thus, payroll processing can enable in paying the staff in an easy manner on a fixed date
without requiring manual entry of data for recording the employee details and processing of their
salary. The XERO accounting features are largely compatible with all aspects of ecommerce
right from bookkeeping to generating invoices and quotes and reconciliation of bank balance.
The accounting software also provides full support to the customers after sales and this would
prove to be largely beneficial for promoting the growth of ecommerce business. The full sales
recording feature of the accounting software helps in easy generating of credit and debit card
8

friendly invoices and payment notifications (Smith, 2019). The customers can also easily
download the bank transactions details and also categorize and review the previous deposit and
expenses incurred on purchasing the products from online platform of the company. The instant
access to real-time accounting data would enable the company to continually replenish the
inventory and thus ensuring the continued availability of products to the customers. The supports
service provided by XERO such as mobile integration and connectability with bank accounts
also makes it an ideal choice for supporting the ecommerce business of the company
(Macpherson, 2019).
Conclusion
It can be summarized from the above discussion carried out that use of cloud-based
online accounting software applications are largely being used by businesses for improving their
financial management and thus maximizing their operational efficiency. The ecommerce
company such as Jb Hi-Fi can also enhance its business growth and provide adequate customers
service with the use of such type of accounting software package. The company is recommended
to integrate the use of XERO accounting software due to its better features of inventory
management, bank reconciliation, point of sale and mobile integration which is required for the
success of ecommerce business.
9

References
About MYOB. 2019. [Online]. Available at: https://www.myob.com/au/about [Accessed on: 22
May 2019].
Brewer, P. C., Sorensen, J. E., and Stout, D. E. 2014. The future of accounting education:
addressing the competency crisis. Strategic Finance, 96(2), pp. 29-38.
Hossack, S. 2015. Cloud-based accounting and productivity tools for practitioners and taxpayers.
Taxation in Australia, 50(5).
Jb Hi-Fi Limited. 2018. About Us. [Online]. Available at:
https://www.jbhifi.com.au/General/Corporate/Consumer-Matters/About-Us/ [Accessed on: 23
May 2019].
Kosalge, P.U. and Ritz, E., 2015. Finding the tipping point for a CEO to say yes to an ERP: a
case study. Journal of Enterprise Information Management, 28(5), pp.718-738.
Lane, S. 2018. Which one is the best cloud accounting provider? [Online]. Available at:
https://www.listonnewton.com.au/information-centre/xero-vs-myob-which-will-work-better-for-
your-business [Accessed on: 22 May 2019].
Macpherson, S. 2019. The latest in online accounting software in Australia. [Online]. Available
at: https://www.intheblack.com/articles/2018/12/01/latest-online-accounting-software-australia
[Accessed on: 23 May 2019].
Schaeffer, E. 2017. Industry X.0: Realizing Digital Value in Industrial Sectors. Germany: Kogan
Page Publishers.
Smith, H. 2019. Xero For Dummies. USA: John Wiley & Sons.
Titman, J. 2018. Which Accounting Software Is Best for Your Ecommerce Business? [Online].
Available at: https://www.netohq.com/blog/accounting-software-for-ecommerce [Accessed on:
23 May 2019].
10

Xero Limited. 2019. Accounting software made for your retail business. [Online]. Available at:
https://www.xero.com/au/why-xero/your-business/retail/ [Accessed on: 23 May 2019].
11