High-Tech Bookkeeping

New technology is changing the face of the small business's ledger

Kenneth M. Sheldon

Time is money. And the more time you spend maintaining your business's finances, the less time you have to actually make money. Fortunately, several new technologies could change the way businesses keep their books on computer and result in increased productivity for even small offices.

The typical finance or accounting program contains a great deal of information that would be valuable to share with other applications. Most of the accounting and personal-finance programs let you export a file that a spreadsheet or word processing program can use. A few programs, however, also support Windows' DDE technology, which would let you, for example, automatically export sales figures into an Excel spreadsheet tha t compared sales over the course of several months or years.

One such package is Peachtree Accounting for Windows. Circuits & Systems Inc. (East Rockaway, NY) developed Chaver-ware, a membership-management program for synagogues. It uses Peachtree's package for its accounting module. According to Rob Hirsch, senior vice president for Circuits & Systems, DDE links make it easy to send invoices to synagogue members for things like dues and religious school tuition. The user clicks on a button, and Chaver-ware sends that information by DDE link to Peachtree, which then creates an invoice.

Going a step beyond DDE, Microsoft's OLE technology allows users to create links to other applications and to automatically open those applications and edit objects without leaving the original application. Peachtree uses OLE in its forms designer. Clicking on a clip-art object in the forms designer opens a window to the associated application (such as Windows Paintbrush), with access to a full set of editing to ols.

Another product that makes use of OLE is MTX Accounting from MTX International (Englewood, CO) for Microsoft Office. Built around Microsoft Access, MTX Accounting provides tools that let users track and analyze their accounting information. Bill Glasier, president of Sentry Medical Products of Englewood, Colorado, uses MTX Accounting to search his accounting database for customers who have not made purchases within a specified time. When he selects the option, MTX automatically launches Microsoft Word and merges those customers' names and addresses with a document that thanks them for their business and offers them a discount on their next purchase.

Small Business on Small Disks

Peachtree Accounting for Windows is now available in a CD-ROM edition that includes, along with basic program files, a large selection of clip art, label-creation software, and a CompuServe link. The disk also provides on-line documentation for the program, as well as Allegro's Multimedia Busi ness Library of 12 financial books.

Another company that now provides its software on CD-ROM is Intuit (Menlo Park, CA), whose Deluxe edition of Quicken 4 for Windows includes on-line documentation, multimedia tutorials, and interactive advice from financial experts. As this story was being written, Microsoft announced that it was in the process of buying Intuit and selling its Quicken competitor, Money, to Novell.

Taking Businesses On-Line

Another technology that may affect the way small companies do business is the advent of on-line electronic services such as banking, bill payment, and credit-card reconciliation. Many personal-finance programs already let users pay bills and update stock prices electronically, using commercial services available through on-line systems such as CompuServe or Prodigy. These are straightforward, one-way transactions that take place through the ACH (Automated Clearing House) network maintained by the Federal Reserve.

Bringing compl ete electronic banking to PC users has taken longer, because setting it up is more complicated, due to the restrictions on access to an individual's banking data. Providing electronic access to the data requires a cooperative relationship between the service provider and the bank.

Individual banks can sell on-line services to their customers, but most don't have the expertise or software to do so. And any service provider or software company wanting to provide electronic banking services to users has to strike a separate deal with each individual bank.

Nevertheless, a few software companies have made forays into the field. Microsoft Money has a Bank On-Line option that lets you bank electronically, but you must have an account with one of the four banking institutions connected with the service: U.S. Bank, First National Bank of Chicago, Michigan National Bank, or Chase Manhattan Bank. Microsoft is negotiating to include other major banking institutions, which, it says, will significantly enhanc e your ability to link to banks.

Microsoft's electronic banking services are delivered by National Payment Clearinghouse Inc. (Downer's Grove, IL), which provides services in cooperation with local banks. Interestingly, NPCI is owned by Intuit, which incorporated NPCI's services into its own financial services hub for Quicken users. If the above-mentioned services are integrated into Windows 95, and if the purchase of Intuit goes through, Microsoft will be in a position to provide a tremendous range of on-line services for both individuals and companies.

Peachtree Accounting for Windows is also poised to leap into the arena of on-line services. Last year, Peachtree was acquired by Automatic Data Processing (Roseland, NJ), a major provider of computerized services (e.g., automated payroll) to businesses. ADP markets a service to banks called Business Express/PC, which lets business users check their account's status whenever they want, view transaction history, transfer funds, and perform other b anking functions.

Taking Down the Barriers

For individual users, one barrier to on-line banking and bill payment services has been cost. At $10 to $15 per month, many people don't pay enough bills or do enough banking to make the services worthwhile. However, for businesses, which may conduct hundreds of such transactions a month, the cost isn't a barrier.

So why aren't businesses clamoring for on-line services? And why aren't vendors of accounting programs providing them?

To begin with, setting up electronic banking for businesses is even more complicated than doing it for individuals. Because businesses generally handle more money than individuals, there's more risk involved in making accounts accessible via telecommunications, not to mention special regulatory issues. Also, banks maintain business accounts separately from personal (or "consumer") accounts. On top of that, many business users are afraid of on-line services. A primary concern is usually the lack of a paper trail.

On-line banking also presents security issues for businesses. In an office where more than one person has access to the accounts, security measures such as password protection are a necessity. Without them, an employee could easily transfer money to a private account. Most on-line services use a PIN (personal identification number), like those used to access accounts via a bank's ATM machine. For security purposes, larger businesses will require multilevel passwords that limit access to sensitive areas.

Businesspeople in general and accountants in particular tend to be a technologically conservative lot. There's too much at stake to invest in technologies that aren't tested and true. Nevertheless, a booming market indicates that small businesses want to computerize their books and may be more willing to try new technologies like CD-ROM delivery and on-line services that could make their lives easier.

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Kenneth M. Sheldon is a freelance author who has written extens ively for BYTE and other computer publications. You can contact him on the Internet or BIX at ksheldon@bix.com .