Small business: Anthony O’Brien

MYOB’s accounting package may cost more but it can save time and effort

MYOB Group must be doing something right, despite its accounting solutions seemingly more pricey than some of its competitors’ products. The online accounting giant reported an after-tax profit of $96.8 million (up 13%) for the last calendar year.

While the full-year result is certain to have been sweet music to the ears of its shareholders, MYOB’s focus on providing seamless technology aimed at slashing bookkeeping time and red tape is evidently keeping it in the mix with small business owners too.

How fees work

If you’re seeking the cheapest online accounting platform for your start-up business, then MYOB might not be for you. For example, there is an $18 monthly subscription for its entry-level solution, MYOB Essentials Connected Ledger. This package is aimed at laggard SMEs using shoeboxes or Excel spreadsheets to manage their accounts. Essentials Connected Ledger gives users BAS and GST reports, automatic tax updates, automatic bank feeds and secure data. In comparison, for an $8 monthly subscription Reckon One gives you most of this functionality, plus the holy grail of unlimited invoicing. To buy into unlimited invoicing with an MYOB solution, you’re looking at an Essentials accounting subscription of $35 a month, which is significantly more expensive than Reckon. Time is money

As a small business owner myself, I see shaving costs as an important consideration. However, when trading picks up, an accounting package that can reduce data entry is worth considering. Not long ago, MYOB recognised the data entry vortex confronting many SMEs and launched Smart Bills, a free function available through its cloud accounting solutions. Smart Bills allows SMEs to drag and drop, or photograph an invoice with a smartphone, directly into an MYOB accounting solution. Users can even email bills to their MYOB accounts.

Once the invoices or expenses are in the system, Smart Bills uses optical character recognition (OCR) technology to capture key data fields and automatically enters them into a MYOB account. In addition, if a supplier’s ABN is not already in the books, Smart Bills will lift it from the supplier’s invoice and automatically add it to the details. This data capture enables future invoices sent by the supplier to be automatically matched. Smart Bills also provides multiple compliance benefits such as ABN validation and the electronic storage of source documents, which removes the need for SMEs to keep paper files for tax purposes.

Small business owner Margaret Whitfield, of bookkeeping firm My SOS, uses Smart Bills as part of her MYOB Essentials Accounting subscription, and says it has reduced her data processing and the margin for error. “Getting bills emailed straight in means that our data entry just happens. This [is] great at the end of the year – everything is just there, nothing is lost or misfiled,” she says. “Having all documents stored makes life easier for accountants and bookkeepers, saving them hours previously spent manually entering every single client bill and invoice.” Additionally, Smart Bills enables the sharing of documents between a business owner, an accountant and a bookkeeper.

In comparison, Xero doesn’t offer OCR functionality directly to its customers. However, Xero collaborates with app partners such as Receipt Bank, Squirrel Street (formerly Shoeboxed) and Expensify. The app partners have their own costs, which are an additional charge to a monthly Xero subscription. For example, it will cost an additional $33 a month to process 50 expenses through Receipt Bank. With Squirrel Street, they’ll hit you with $26.95 for 50 documents over and above the Xero subscription. Keep in mind that this OCR functionality is included in a monthly MYOB subscription.

“Even the most organised among us could surely think of better things to do than sorting through old invoices,” says Tim Reed, CEO of MYOB. “Painstakingly re-entering details and trying to track down stray bills to balance books and remain compliant was eating into clients’ time and sanity, especially at tax time. Faster processing of invoices helps manage cash flow and improves the accuracy of information in a company file. With Smart Bills, clients have insight into money owed by entering expenses as soon as they receive them, not just when they’re paid.”

Next month we’ll check out what Xero has to offer.