Eureka Limited: Accounting Software Report for Business Development

This report provides a comprehensive analysis of accounting software solutions for Eureka Limited, a beverage manufacturing and distribution company. The report begins with an executive summary outlining the need for a cloud-based accounting information system to mitigate business risks and improve financial reporting. It details Eureka Limited's business requirements, including business processes such as production, marketing, and sales, and identifies major control risks related to inventory, costing strategies, and production/sales planning. The report then outlines system requirements, emphasizing the need for historical data storage, MIS reporting, and cloud-based access. It explores market options, including MYOB, XERO, and SAP, comparing their features and suitability for Eureka Limited. The report concludes with vendor selection recommendations based on a cost-benefit analysis and the ability of the software to meet the company's specific needs, aiming to improve financial health and operational efficiency. The report also includes a flow chart of the business process, a table of contents, and references.

Strategic Information System
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Executive Summary
The objective of this report is to find a suitable solution for accounting system adaptation of
Eureka Limited with critical analysis of the needs of the company. As a present trend, all
enterprises are tending towards adaptation of cloud-based accounting information system to
ensure mitigation of business risks and presentation of prudent and appropriate financial
reporting for the stakeholders. As per the financial performance of the company, Eureka Limited
is a mediocre enterprise with the legal status of family ownership. Through adaptation of right
accounting software, the company can meet the business objective with proper activities of
business operations and better control on persisting risks. For this purpose, the company should
get suggestion from professional accountant to adapt the right accounting software by analyzing
the need of the company and the features of the accounting software available in the market.
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Table of Contents
Introduction.................................................................................................................................................4
Business Requirements- Eureka Limited......................................................................................................4
Business Process......................................................................................................................................4
Major control risks...................................................................................................................................6
System Requirements..................................................................................................................................7
Software Selection.......................................................................................................................................7
Market Options for Software...................................................................................................................8
MYOB...................................................................................................................................................9
XERO....................................................................................................................................................9
SAP.....................................................................................................................................................10
Suitable category of software................................................................................................................11
Vendor Selection.......................................................................................................................................11
Compare and contrast between two software......................................................................................11
Selection of vendor................................................................................................................................12
Recommendation......................................................................................................................................12
Conclusion.................................................................................................................................................13
References:................................................................................................................................................13
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Introduction
Eureka Limited is a family owned organization with strong past history of fifty five years. The
company is engaged in the business of beverages manufacturing and distribution. Staff strength
of the company is seventy three. The customers of the company are ranging from retailers to
institutions like super markets. Basic strategy of the company is to sell their product by Business-
to-business (B2B) model. Due to some upgraded version of their products, the business of the
company is growing steadily. Due to lack of experience to handle higher level of turnover, the
company is facing problems related to retention of some vital customer accounts. Although the
company had hired an accountant for managing their regular financial transactions, the company
is feeling the need to deploy a new cloud-based accounting information system for their business
to manage their data and find out the proper strategy by analyzing those data. As the business
grows for the company, the need for such accounting software is emerging very fast to keep pace
with the competitors of the market. Accounting software can provide proper projection of
financial transactions with storage of data for future use in strategy fixation for different domains
of company operation like production, sales, different management information system and
accounting to produce financial reporting as per guideline set by regulators’ standard. Ultimate
objective of any business is to prove its sustainability by adaptation of proper instruments.
Cloud-based accounting software is one such tool, which can provide better retention of data, use
of those data for different analyses and fix strategies based on those analyses. The recent
happening of losing few important customers is not found comfortable for the management and
while analyzing, the management found lack of proper management information system to cover
the persisting risks. That why, the company is planning to have a cloud-based accounting
software to maintain their pace of growth in the market and ensure compliance of strategies to
accomplish their objective.
Business Requirements- Eureka Limited
Business Process
Business process of any organization is depicting every level of its operation. Operation of
Eureka limited is consisting of production; packaging; marketing; sales; distribution; collection
from debtors; financial accounting. For successful execution of business processes, the company
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needs human resource in every micro-level operation of the company. Production process is
consisting of production planning, procurement of raw products and conversion to finished
goods. Packaging is part of production to ensure environment and eco-friendly packing of
products with the objective of sustaining persistent long-life of products. As the product is food
related, normal tendency of limited shelf-life is persistent in the product feature. Marketing is
next business process to make the target audience aware of the company products with their
features. Good marketing strategy needs identification of target audience and generates loyal
customer base for the products. Sales are the most essential part of business process, as this
activity ensures revenue of the company. Distribution is mainly depending upon effective supply
chain and logistics management. Collection from debtors is ultimate part of this business process
to ensure cash inflow of the company remaining steady to keep balance of working capital.
Financial accounting ensures booking of financial transactions of the company to find out the
financial condition of the company with its main financial features like income statement, cash
flow and balance sheet. The flow chart of business process is given below to understand the
operation cycle of the company:
With the above flow chart of business process, it is evident that each part of operation has to
ensure professional and competent approach for the success of the company. Every part of this
business process is the outcome of successful strategy, which is generated from the corporate
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objective of the company and the eagerness to accomplish those objectives. Every part also
demands efficient supervision with proper management skill for the company to prosper in future
business. (Jeston, 2014)
Major control risks
To identify major control risks of Eureka Limited business, we have to understand their business
process with thorough analysis. After critical analysis of their business process, three different
risks are identified in the form of risk related inventories; risks related to costing strategy and
risk related production and sales. (Loughran, 2010)
Risks related to inventories are mainly concerned with inventory management. The company has
to ensure inventory management in such effective manner that floor stock should be as per the
requirement. There should not be any excess production to create excess stock of inventories on
floor or warehouse. As the product is perishable in nature with specific shelf-life; production,
sales and warehouse management is to be strengthened in order to mitigate risks related to
inventory. It is not possible to abolish product damage completely due to expiry of shelf-life, but
realistic sales plan can ensure minimization of such risk through effective production planning.
(Russell, 2007)
Second risk is costing strategies. As per latest happening, the company lost some market share
through losing of customers due to inability to supply some products in cost effective prices to
the customer to match their value for money. Effective cost strategy can ensure cost benefit
analysis of the company, which was not present in company’s cost strategy. (Albrecht et al.,
2015)
The third risk is sales and production planning as part of company’s business processes. It is
observed that production planning is depending upon sales projection based on historical data
with application of management acumen to affect expected increase in sales volume.
Contributors of production management are procurement of raw materials and labor. Production
planning is depending upon proper working capital management related to cost of these
ingredients. Hence, deployment of required working capital can ensure effective fund
management of the company related to procurement of raw materials and labor. Over production
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is always resulting to damages of the unsold products. Pushing them to market may increase
unrealizable debtors. Both these have negative impacts on the working capital of the company.
Hence, the financial health will be at risk for improper sales and production planning; improper
costing strategy and inventory management of the company. All these risks are to be controlled
or mitigated through effective strategy. Perfect execution of those strategies related to inventory
management, costing practice and production and sales are necessary to keep the company at
comfort level about its financial health.
System Requirements
Eureka Limited needs system which can provide with following features:
 Storage of historical data;
 MIS presentation as per requirement of the management;
 To facilitate different level of business process activities;
 To ensure proper financial accounting;
 Cloud-based information system.
As the company is in the operation of manufacturing and sales of their products, the need of
maintaining historical data is necessary for them for future analysis to assess trend of business.
Different reports related to MIS are required to fix the strategy for future business of the
company. The normal business processes need purchase accounting, sales accounting, and bank
management with live feed, payroll management and finalization of accounts. As the company
needs flexible approach of accounting to assess its data on 24x7 basis irrespective of any
geographical constraint, the company needs accounting software , which is available on cloud-
based platform for the users with different level of hierarchical authority as per the delegation of
authority given for different personnel. (Aiton & Russell, 2011)
Software Selection
Selection of accounting software is depending upon the company requirement and respective
services offered by different accounting software providers to match the need of the business
entity. As per the latest trend, the company will go for cloud-based dynamic type of accounting
software. These software products are available in Australian market with their salient features to
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meet the need of the client as per their size of business. There are three types of software
products available in the market as per the business volume and technological back-up required
by the company. They fit the requirements of small, middle and big size of business volume with
respective technology support. The features of the software should be ideal for business
processes of this company are as follows:
 Purchase accounting;
 Inventory management;
 Sales accounting;
 Receipt management;
 Debtors and creditors management;
 Payroll management;
 Financial accounting and respective provision for finalization of accounting reports as per
accounting standards;
 Storage of data;
 Generation of different MIS reports for strategy fixation by management.
Proper maintenance of accounting data and financial transaction can guide the company for
effective strategy fixation to accomplish the corporative objectives of the company. To minimize
the control risks, internal control is necessarily to be practiced by the company. For this exercise,
data management is necessary to ensure detection of control risks and to mitigate them with
proper internal check measures. Strong controls over identified risks are to be ensured by the
software by whistleblower, when deviation is expected to occur in any level of business process.
Although, this is a customized solution required for the company, the software provider can
arrange that through their customized service for the client. The company has to make a cost-
benefit analysis of this investment before finalizing the software. System requirement of any
business is derived by business objectives with respective provision for accomplishment of those
objectives. As this business is increasing its volume during present days, insistence should be to
assess the ability of the software with comparison to deliverables as featured by the system opted
for.
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Market Options for Software
As per need of the situation, consideration of three accounting software packages was done.
They software considered are MYOB, SAP and XERO. As per their websites, the prevalent
features of them are discussed below to understand their offering to meet the demand of Eureka
Limited.
MYOB
The need of Eureka Limited for accounting software is to ensure integrated and extensive cloud-
based accounting information system to cover all business processes of the company. The
features offered by MYOB are given below to understand their ability and limit to meet company
requirement:
 purchase management including raw materials management;
 sales invoicing with codification of customers and products;
 payment receipt accounting system with Paydirect provision;
 inventory control of raw materials and finished goods with ageing of products as per date
of manufacturing;
 bank operation with the option of life-feed and reconciliation;
 GST compliance;
 offline work facility with single terminal back-up;
 payroll management;
 retention of historical financial data;
 MIS preparation as per requirement of the aspired body.
MYOB is very popular in small and medium size industries for its easy working pattern and easy
accessibility by the users. The software is capable of presenting financial reporting as per
prescribed form to comply with regulators’ requirement. The rental charge of this software is
AUD 52.5 per month with the additional offer of 25% concession for booking period of 12
months.(Myob, 2019)
XERO
XERO is offering cloud-based accounting information system to its clients with different
features and rates. Their product named Premium 20 can be considered for the purpose of
installation in Eureka business process. This product offers flowing characteristics:
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 Purchase accounting with raw materials and finished goods;
 Sales invoice and receipt generation with codification of customers and products up to N
numbers;
 Expense monitoring with respective tracking;
 Bank management with live feed option and reconciliation;
 Inventory control management for both raw materials and finished goods;
 Payroll management for staffs;
 GST compliance;
 Retention of data;
 Generation of MIS report as per management requirement;
 Financial accounting as per AASB standards.
This software costs AUD 90 per month as rental charge. (Moneyedge, 2018) (Xero, 2019)
SAP
This software provides its service globally with cloud-based technology with high-end
technology of digitization. Main features of this accounting package are management of Big
Data and Internet of Things (IoT). This accounting information system provides support in the
area of digital economy with opportunity of its web-based model to help the company to create,
move and assist better. (SAP, 2019)
The following characteristics of this software features through its application:
 Ensuring business process lifecycle with full software support through the option of
terminal-wise, cloud-based and hybrid models;
 Provision of testing service management for the clients to improve better strategies with
effective outputs;
 Effective risk management;
 System of security management for controlling environment of the system operation;
 Data restoration and retention through effective management for the entity with set-up of
data by IoT. (Carey, 2018)
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The price of this product is not available in their website, as this software can be obtained
through customer-specific tailor-made contract specifying the requirement of additional features
and subsequent deliverance.
Suitable category of software
There are different types of accounting software as per market availability to manage different
types of business size with technology support. Software products for small and medium size
enterprises are more popular in the market with required standardized features and technology
support. Eureka Limited needs software for middle sized enterprise. This type of software will
provide necessary solution for the company to cover all requirements of the company as per
business process with control risk management. Business process of the company is consisting of
production, sales, financial accounting, HR, supply chain and logistics management and statutory
compliance by the company to run the business along with control risk management. While
finding suitable category of software, consideration is to be made for complying with the above
business processes of the company. Cost of the software is another criterion. For rightly judged
decision of procuring the software, the company should undergo cost-benefit analysis related to
cost of short-listed accounting software and respective return expected from that software. There
is no point of going for high-end software, as those software services are mainly concentrating
on management of Big Data through Internet of Things or IoT. Instead, the choice should be
made from the brace of medium size software services readily available in the market in order to
meet the present requirement and upcoming business prospect of the company with enhancement
of business size to specific limit of operation.
Vendor Selection
Compare and contrast between two software
Out of the three software discussed above, SAP should not be considered for Eureka Limited.
Basic criteria of selecting accounting software are to meet the requirements of business processes
of the company along with control risk management. Out of the other two options, MYOB and
XERO, both are offering basic business process compliant features for their SME customers.
MYOB is popular due to its service to the clients compared to cost impact. XERO is bit costly
with some add- on features. MYOB can meet the requirements of the company for accounting
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software, whereas XERO is also able to ensure such deliverance. XERO is totally Cloud-based
software, where as MYOB can be used with terminal specific offline application. Security of
data is another feature to protect company from infiltration by hackers.
Selection of vendor
The main objective of the company to adapt cloud-based accounting packages is to ensure
smooth running of business processes and mitigation of control risks. Risk management can be
done with the feedback of financial data and proper management to analyze them. The company
has to select accounting information system to comply with the business processes of the
company, control risk management and provision of cloud-based accounting. MYOB can ensure
proper functioning of routine field of accounting operation like production, sales, payroll
management and statutory compliance of regulators with provision of necessary data to exercise
effective measures of control risks with other add-on features. Cost-wise MYOB proves its
efficiency. Selection of vendor also matters with security of web-based data. MYOB has strong
functionalities in the field of data security. The roll-out plan of historical data transfer is also
taken care properly by MYOB to ensure uninterrupted continuance of business processes. Hence,
MYOB should be opted by Eureka Limited as their accounting software for ensured smooth
running and effective risk management.
Recommendation
With the above discussion, recommendation is made for Eureka Limited for opting right
financial accounting software as MYOB Accounting Right plus. This package would provide all
necessary activities related to business processes of the company with additional features of data
back-up for effective control risk management, data security and successful roll-out plan for data
transfer from old to new software. MYOB is cost effective comparing its deliverables. Hence
MYOB is recommended for the company to serve their purpose of effective financial accounting
and control risk management.
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