Implementing a new accounting system is a big project. In addition to the improvements being made to the business through better technology and workflows, there is also the opportunity (and in some cases, necessity) to clean up the current data to ensure a successful implementation with no adverse impact on day-to-day operations during the transition.
To start, you need to understand the scope of the system you are implementing and prepare the data for the modules that will be included. This sounds simple, but it is a crucial step. Any accounting system requires the essential data elements, from basic Employee Data to Chart of Accounts and AP/AR data. If you are implementing a larger system with distribution or manufacturing functionality, you may be looking at a full ERP software that handles inventory, materials, routings, bill of materials, and even full CRM. All of these items must be discussed and agreed upon by your internal evaluation team and shared with your software vendor (as per best practices outlined in this white paper).
For the sake of simplicity, let’s look at the core accounting data you should migrate during your accounting software implementation.
While you may not be replacing your HR system, this step is necessary and simple. Employee names, contact info, and other essential data points will be stored in your ERP system.
Chart of Accounts
Necessary for your accounting to function properly, a clean chart of accounts is essential. This is an opportunity to clean up your legacy main and sub accounts in an effort to streamline your CoA. Discuss best practices with your vendor/partner for your chosen accounting system.
This is the data needed to pay your vendors moving forward. Include all open payable invoices (with balance). You're going to need these as you move to a new system without missing payments.
This data set includes all your customers, and standard data migration during a new implementation will include the master record and a contact. Modern systems have a number of attributes and activity records available as well that need to be discussed.
Open Customer Invoices
As with the AP invoices, you need to have all your open customer invoices in place to ensure business continuity through the implementation and go-live period of the new system.
In addition to these areas of data migration, you should also consider what reports you require from accounting that help your business operate. An ERP implementation is an ideal time to make improvements on existing reports or have your vendor build the reports you need. Custom reporting is more accessible than ever, and there is no reason you should not have the full visibility you need to operate at your best with the most up-to-the-minute data available.
Today’s Software Is More Robust than You May Realize
Migrating to your new accounting system is also a great time to evaluate current business processes in other areas and move toward best practices if you have not done so recently.
If you haven't evaluated accounting software in the last five years, you may be surprised to learn that there are additional features to consider. Fixed assets, inventory, distribution, and CRM are all common modules today that may have been niche software options in the past. If these areas are currently in third-party software licenses and your accounting package offers an integration or their own integrated module with similar (or better) features, take the time to consider consolidating everything into your new software. The time you’ll save by having visibility in a single system and potentially reducing double data entry is often worth the implementation.
All of this is a high level look at the data that is migrated when implementing a new accounting system. Remember, use this time to evaluate your business processes and the quality of the data as well as the solution you've selected to implement. These are big changes with huge impact to your business, and we're delighted if this article has helped in any way. Please leverage other helpful content from our library of resources here, and of course reach out for any questions or comments.