Change Is Scary Part 2: Changing Accounting Software and Seeing Your Numbers for the First Time

We recently wrote a blog about how scary change can be, especially when you’re thinking of switching accountants.

Today, we want to talk about another big change you might be putting off: switching to better accounting software.

Your choice of accounting software is about more than just its features. It can be the difference between being fully in control of your business and flying by the seat of your pants.

When you don’t have access to your key numbers, you’re unable to see clearly how much money you’re making or losing. This can be damaging to your business and anxiety-inducing as a business owner.

In 10 Years of Business, Tom Had Never Seen a Profit and Loss Report

When our client Tom first approached us, he had been using the same accountant for years. Tom owns and manages several property development businesses, and his accountant looked after several of them.

He is a very clever man and sensible with his spending, but he is also really busy. He doesn’t want stress and he certainly doesn’t want to upset anyone.

As we find in many cases, Tom’s accountant hadn’t particularly done anything wrong to cause him to look elsewhere. Tom just felt that somehow he wasn’t really being looked after.

After our initial conversations, it took him over a year to decide to make the switch, for many of the reasons we mention in our blog about the fear of change.

• He was hesitant because he was so busy.
• He didn’t want the change to cause awkwardness with his accountant.
• He was worried the switch would take too much time.
• He was afraid the transition would prevent him from running payroll or making payments.
• He felt his business was too complicated for new software.
• He didn’t know what would be required of him, in terms of either time or cost.

But all the while he was waiting, he continued to do business without access to his key numbers. His accountant was using Sage to run his accounts, and Tom didn’t have access to it personally.

We kept in touch regularly to check how he was getting on. In the end, COVID-19 became the final catalyst for change.

Lockdown gave Tom time to think and, as fewer transactions came in, he decided it was time to get better support. He contacted us around the time of his year-end, which was perfect timing.

We Moved Tom from Sage to Xero

It shocked us that Tom had only ever seen a profit and loss report when his year-end accounts were produced. By that point, it was too late to make proactive decisions about his business.

As the country was in lockdown, we used Zoom to train him in Xero, starting with the basics until he was comfortable enough to move on to more advanced features.

During the data clean-up and catch-up process, we identified that one of his companies was losing money. Together, we reviewed the numbers and worked out what Tom could change to turn the business around.

We’re always so pleased for our clients when they get to see their numbers clearly for the first time, and Tom was like a child with a new toy.

“Ann, this is amazing! I can see the numbers. I can see where we’re spending money. I’d been asking the old accountant for a profit and loss report for years, but he never sent one. This is the first time I’ve seen this.”

Although there were areas of the business that needed attention, he was happy. Once you know your numbers, you can identify the issues and make a plan to resolve them.

You can also put proactive measures in place to help prevent the same problems from happening again.

I recently visited Tom and met with him to see how he was getting on. Now that he is used to Xero, we looked at some of the other areas where things weren’t running as smoothly as they could.

We have now introduced him to ApprovalMax, making his supplier approval process even easier and saving us both valuable time. That simply wouldn’t have been possible with his previous Sage setup.

Having access to meaningful, live data is crucial for businesses today. With Xero, we aim to reconcile bank accounts daily so you know exactly where you stand. There is no need to wait until after the year-end.

Why Did It Take So Long to Switch?

Like Tom, you may already be feeling strain within your business and be unsure how to resolve it.

But change is scary. As human beings, we are hardwired to resist it because we are creatures of habit. We like to feel protected inside our comfort zone.

Like Tom, if your accountant isn’t doing anything obviously wrong, you may feel there is no need to uproot yourself.

Charles Duhigg explains this well in the introduction to his book The Power of Habit: Why We Do What We Do and How to Change.

“When you woke up this morning, what did you do first? Did you hop in the shower, check your email, or grab a doughnut from the kitchen counter? Did you brush your teeth before or after you towelled off? Tie the left or right shoe first? What did you say to your children on the way out the door? Which route did you drive to work? Most of the choices we make each day feel like the products of well-considered decision-making, but they’re not. They’re habits.”

We tend to continue doing the things we are most comfortable with because we believe change will be painful and cause us unnecessary stress.

The problem is that you may already be causing yourself unnecessary stress by staying with your existing accounting software, or by not using accounting software at all.

We encourage you not to wait for a crisis before bringing your business finances into the light. When you don’t understand how your finances are performing, problems can remain hidden until they become much harder to resolve.

We Ask the Right Questions and Move at Your Pace

To support Tom, we did what we do best at Total Accounting.

We asked the right questions, learnt how Tom worked and how his businesses operated, and then moved at a speed he was comfortable with.

Tom needed plenty of support and training, and we continued to be by his side throughout the transition.

You don’t need to fear switching your accounting software. We make the change methodically and at a pace that works for you.

No time or data should be lost in the process. Instead, you gain clearer information, better control and the confidence to make informed decisions about your business.

What was the first thing you did when you woke up this morning? If you found yourself worrying about your business, let’s make a change.