In a previous article, I looked at the internal software used in an accounting practice. The next consideration is to look at the core accounting software and apps we use with our clients - the so-called ‘tech stack’!

The basics

Although I love technology and ‘playing’ with all the apps, to create my tech stack I had to focus on the tools that are key for me in my business. These are the tools that I will use with my clients and are the ‘core’ software I will use.

I do not want a huge tech stack because:

• updating - usually, the software is regularly updated with new features so the more products I use, the more features that I need to keep up to date with and test out
• time - it takes time to pick your tools, set them up and get to grips with them and so keeping to the core ones, at least initially, really helps
• cost - the more tools you use, the higher the costs will be. As a new practice, it is critical for me not to have a huge tech stack and to watch the costs.

By having a core stack, you also keep all clients following the same process. It may be that not all clients need/want all the tools, but you can bundle your core tech into your proposal to them and ensure they all use the same software, and all follow the same processes. This leads to efficiencies internally and also good client service as it is a ‘well-oiled wheel’!

Accounting software

The first consideration was to select the core accounting software. In my case, I only wanted one. This was what I used when I initially tried cloud accounting software and I am sure this plays a part when you decide on the one you like the most.

I chose a company that I have known for many years, I know it well and I like the company. Also, and importantly for me, there are a vast and growing number of apps that integrate with the software and so allow for the development of more advanced cloud solutions for clients.

I have also worked in firms where a range of accounting software was used. They had a large number of clients and so wanted to offer a wider range of options. This is another option.

The apps

App ecosystems are huge and growing all the time! In addition, not all the apps that integrate with core software are even on the eco system so there is a vast choice and it can be tricky just to pick your core ones.

For my core apps, I looked at the data going into software and the data coming out the other end. I wanted to have something in place to help reduce the time and processing needed to get the information into software and something to let me produce great analysis and reporting on the data coming out. Hence my core stack had to be made up of an invoice processing app, a cashflow app and a reporting app.

Invoice processing app

A core app in the tech stack has to be one to eliminate the need for manual invoice processing and that gives the user the option to photograph, scan or email in invoices and receipts for processing.

This saves so much time and also improves the chances of receipts not being lost before the expense is reclaimed! Many of these apps have other useful features such as fetching invoices directly from suppliers, bank statement extraction and supplier rules for speedier processing which can be useful.

For me cost, functionality and reliability are big considerations. Cost is not usually a key driver, but I have found in the past that the costs can ramp up depending on the package chosen or how the app is priced. For example, some apps offer packages where you pay a fixed amount per firm regardless of the number of clients or number of items being processed; others volume price and you get a certain number of documents per month.

I have used many different apps in this area, and all have pros and cons. I do like the fact that you have the ability to manage and record staff expenses as part of the app and this is not an additional cost. I also like the option of bank statement extraction although I have found the need for this has fallen over recent months as more clients opt for bank feeds.

I have chosen certain apps in my firm, with the following all being considerations:

• it will not disappear or be bought by another party
• it works well and does everything I need it to do - it does not have the inbuilt expenses management but there are other options available
• it is free - whilst this is not the reason for choosing it, it is an important consideration.
• it is a good introduction to apps for clients. Some clients are resistant to apps and they see them as an additional cost which is not totally necessary. I choose an app that they are more inclined to use, free can often work and then, when they see the benefits they get as a result, they are more inclined to use other apps later in time.

Cashflow

Businesses need to monitor and control their cash flow regardless of their size and their sector. Knowing their day-to-day cash flow needs and early identification of potential issues is so much easier with an integrated cashflow app.

I see this as a key part of my tech stack as I have seen first-hand how beneficial these apps are for the business owner. A cashflow app that syncs with software means that all the data flows into the app and allows different scenarios to be assessed and actions agreed. Yes, you could do this in Excel but the likelihood of doing this regularly is much less likely under this scenario.

For me, I was looking for something easy to use, has all the key functionality I need and that is simple to understand. In addition, the training and support was also a factor as well as their plans for the future. The cost did play a part, but it was not a key driver.

There are quite a few apps in this sector and there is no right or wrong choice. I opted for Float as it ticked all the boxes and I have known them for years. I find it easy to use and clients understand it and quickly see the benefits of using it.

Reporting

Reporting the data out of software is something I do for all my clients and therefore an app that produces high quality, detailed and accurate management reports is something that I need in my app stack.

As with cash flow, there is a lot of choice and the key considerations for me were:

• integration with software
• cloud based product
• easy to use
• key features such as consolidations, KPI reporting, forecasting and benchmarking
• reports available, interpretation and how they can be delivered to clients
• support and training.

Although not one of the main considerations, the cost is a key driver too. Many apps are charged on a per licence basis so costs can ramp up - even though you usually do get reduced costs per licence as the volume goes up. However, where you have a flat fee per month regardless of how many licences you use, this is an attractive option - especially for a new firm.

I am still weighing up the reporting options at the moment. There has been a lot of activity in this area recently and a lot of new features released by these apps over the last few months. There are some really great products to choose from!

Top tips

There are a lot of apps out there but I want to keep my tech stack lean and relevant for all my clients. This combined with the software used for the day-to-day running of the practice (which I covered in the last article) means that I have everything in place that I need.

My top tips when starting out and selecting your core app stack are:

• keep it lean to start with and ensure you cover your key needs for you and your clients
• know the apps you choose inside and out. Do the training, know the features and use everyone that you can to maximise their benefits
• stick with them and do not jump from one app to another. Pick your core stack and then stick with it unless there are issues which mean you have to look again 
• watch bundles! It can be tempting to buy bundles of licences at a discount but there is a risk that you end up paying for unused licences for several months. In the early stages, make sure you use the apps for a while before you opt for bundles to make sure you are happy with them and your clients like them too.

ACCA has further resources for those planning to start a practice on our website.

Caroline Harridence ACCA – Co-Founder, C-Squared Finance Limited