In fact, most of them are probably are a pretty good solution for 97% of what you want to do. But it’s the last 3% that might just do you in. And that is where buyers can take a big hit.

When it comes to entering job cost transactions and running essential reports, most products are just fine. However, if you have to deal with any of the following, straighten-up and pay attention because these are items that separate the average vendors from the stronger ones. And these are areas that sales literature (or so called “Demo” CDs) will never call to your attention:

• Union reporting, especially multistate
• Multistate , multi-tier sales taxes reporting
• Equipment costing
• Fixed Asset tracking
• Purchase order creation, receipt and inventory control
• Custom report writing
• Multicompany consolidations and intercompany transactions
• Workflow for document alerts and approvals
• Project management and accounting integration
• Under the hood technology (database) and potential ramifications
• Posting and ability to access realtime information
• Field capture of labor and transmission to central database.

Vendor sales literature is deliberately vague – an actual case history

A few years back I spoke with a large heavy contractor, doing extensive excavation work with large, expensive machines. He was evaluating a number of programs to see which ones could best handle its need for fully burdened .job cost to include its high cost daily rate of internal machine rental costs in order to compare actual overhead to standard overhead rates.

Fully burden charges per day for his using the machines included wear and tear and salaries to make use of the equipment.

They also wanted to see journal entries with the related amounts. Despite the representations of the salesman that the program could meet this requirement, they found out after using it that it was severely lacking in this area. To get around the limitations they would up spending a lot of time gathering and tracking the information in Excel.

The product did the other 97% of their requirements fine but could not do this critical item and that made the system a major failure for them.

Why does this kind of thing happen?

The prospect was told by the vendor that they did do standard vs. actual costing with variances. Unfortunately the prospect did know not know enough to follow that up with further clarifying questions and made the assumption it would work for them.

Lesson learned:
Salesman demonstrate what their programs do well and try to leave out the hard stuff. If buying prospects don’t ask the right questions and demand to see a demonstration (better yet do it themselves) of the specific inputs and outputs of what they need done, chances are very high they won’t get what they expect.

When it comes to buying construction accounting software, never assume anything. Check it out for yourself.