Early accounting systems were developed in-house for the sole use of the organisations that created them. They were usually built on mainframe computers, and access to them for data input or reporting purposes was somewhat limited. Integration with other business critical applications was virtually non-existent. Also, maintaining a proprietary computerised accounting system caused problems with costs, training and ongoing development.
The PC Revolution
The explosion in the use of PCs in the workplace was coupled with the widespread adoption of standard software products such as spreadsheets and word processing applications. This led software houses such as Infor SunSystems (Systems Union), Sage, SAP and Oracle to develop standardised, configurable accounting software with prebuilt internal processes.
The Problem With Enterprise Systems
Initially, organisations preferred ERP (Enterprise Resource Planning) type implementations. These are single integrated systems, featuring a comprehensive set of modules designed to handle all aspects of an organisation’s processing requirements. The computerised accounting system would be just one component of ERP, possibly integrated with other applications that handle related functions such as expenses management, payroll and human resources. Leaders in this field are SAP and Oracle; and although these systems fulfil most requirements, they are generally expensive, have an extremely lengthy implementation timeline and are difficult to revise and upgrade.
The Integrated Computerised Accounting System
Recently, more efficient methods of connecting disparate systems have been developed. So organisations are choosing to assemble solutions using a range of best of breed software from multiple vendors. Therefore, programmes handling different aspect of accounting and financial control are “linked together” (interfaced) to create an integrated array of software solutions.
Having the majority of applications running on a common server platform is a key enabler of an integrated solution. However, since such commonality is not assured, the most forward thinking vendors have developed open network configurable middleware. This facilitates the integration of systems, independent of their database and server environment.
This takes a lot of pressure off, when deciding to buy a new computerised accounting system. So no matter what other software if required to run your business, now and in the future, you should still have an accounting system that will serve your needs for many years to come.