The purpose of the literature review is to identify and discuss the accounting software industry in Australia. For this purpose, MYOB has been selected as the chosen organization.The literature review also discusses the current market size, identifies the market leaders, current gaps and challenges faced by the customers in Australia.
Accounting software is more often the solution of the cash flow problems. It is a very surprising thing these days that a successful business is not using accounting software. This is the thing that keeps an eye on the company’s money, helps in taxation, and helps in managing the business the whole year.
In the past ten years, the software market in Australia has changed significantly, especially in accounting software. The distributorship has changed the whole picture. Xero has one of the leading market share, but other companies like Intuit and MYOB is not far behind.(Curtis 2015).
History of the company
MYOB, Mind Your Own Business is the leading business management provider in Australia (Curtis 2015). The company offers a range of products and services. It covers all the sectors related to accounting, CRM, job management, payroll, websites, and retail point of sale, professional tax solutions and more. Christopher Lee and a few Teleware developers together found this company in 1980. In 1999, it changed its name to MYOB Inc. after it entered into a contract with Data-Tech software. In 2004, the MYOB limited compound with Solution 6 holdings. In 2008, MYOB limited of Australia acquired Mac development team from the United States. Bain Capital bought MYOB in 2011 for an undisclosed amount. The merger helped Bain Capital a mainstream stake with MYBOB beside management that will be the shareholder in the company. The company offers a variety of products, which can be taken on subscription and it also supports the cloud based technology.
MYOB has more than 1.2 million happy customers across Australia and New Zealand. The company has more than forty thousand accountants, bookkeepers and other professional partners. In Australia every two of three businesses uses the MYOB accounting software (Curtis 2015).
According to the latest segment revenue performance of MYOB, the Small Medium Enterprise revenue of the company has up by fourteen percent ($205 million), online users has also increased by forty six percent. That is more than one and a half million. The company has also seen a growth in the practice solutions, which is twenty-five percent of the total revenue. MYOB Advanced and MYOB Exo, the newly launched licensed desktop software, which comes under the enterprise solutions has grown thirteen percent (Curtis 2015).
MYOB mainly helps in automate all the financial aspects of the business. The software built with GST and Vat ready and the latest version can also run on windows 8 . The accounting software is broadly used in GST countries namely Australia, Indonesia, New Zealand and many more. As a result, it is tested globally for the processing of GST. The enquiries raised by the users of MYBOB have been handled by a large group of technical team, which is always available.
Figure 1: Market share of MYOB
(Source: Curtis 2015)
Three companies dominate Australia’s accounting software market, namely Intuit, Xero and MYOB (Curtis 2015). The companies compete for supremacy in the huge market of software. It is important for every company to keep a track of its accounts in the business. Bookkeepers are no longer needed to keep track of everything, the software allows the business to make invoicing and it helps the management in cash flow management. The software can be run on desktop and mobile (Pavaloaia and Andone 2013).
The accounting software industry is wide open by the cloud services of Xero and Intuit. In Australia, MYOB have been one of the leading companies which is maintaining the market share and raising a lot of revenue.
On the other hand Xero has started from a very small New Zealand based start up to spend about two fifty million on developing the software. The company has a four million paying customers across one eighty countries. It processes about 240 billion in the transactions and over 90 millions in invoices(Curtis 2015). The software is very easy to use and it is one of the most innovative software in the market. The only problem with the software is the inventory. The inventory of Xero can only handle a limited number of transactions.
US giant Intuit has also started to grow in the Australian market, Intuit is an US based software company which develops financial softwares.The company believes that the accounting software industry was being significantly interrupted but the room for growth was there. In the past few months the company has enlarged its team to more than 60 people and also acquired Invitco which is a data extraction company which deals with the automation of the extraction of the data used in accounting software. Intuit QuickBooks online has a feature called Money bar which helps the company to keep a focus on the cash flow. It also has a small ecosystem of the applications and the interface is well built (Jones and Jones 2016).
Competitive advantage over other softwares
In the recent years, MYOB has become one of the biggest SME accounting software in Australia. The newly launched MYOB Accounting essential is one of the best features that the software offers. It gives the company a competitive edge over other companies. This is probably the biggest threat to Xero in the country; as Xero has been in the market for quite some time. MYOB is popular for selling Account Right variety of mixed desktop software. Account Right has the capability to save the data to its online servers or in the desktop itself. The most amazing thing that the software offers is the complex inventory solutions, which most of the accounting software lacks or they have not yet added it to their software (Curtis 2012).
Current challenges encountered by users of accounting software
Accounting problems are very common among the people who use the accounting software.
Lack of security
Most of the software users are concerned about the data security. The valuable data can be accessed from the foreign parties. Though firewall is used for security reasons,butut sometimes the user doubts the capabilities of the firewall, The firewall is always available on a computer, but if the computer fails to identify the problem. Nothing much can be done.
Weak reporting structure
A lot of accounting software solutions are there in the market, which cannot help the user properly. The users are annoyed on the fact that they can easily put the data but when it comes to retrieving it, the process is not so smooth. Some users find it useless as the software does not support both the ways.
Lack of efficiency
The main reason of installing the accounting software is to do the accounting neatly and quickly. Every business owner wants the software to perform smoothly whenever required. Few accounting software are not user friendly and does not allow the user to use the keyboard properly. Using the software by only using the mouse makes it difficult for the user.
Due to system restriction, users cannot modify the software on their own. Moreover, some software are difficult to understand.
Using software needs proper guidance. asoftware software can be used in a number of way. Not enough training and development is given to the users. Most of the companies charge for the training. Companies charge even more when it comes to fixing a problem or any changes in the software.
Though companies claim 24*7 support assistance, but in reality customers have to wait for the next business day to fix the problems regarding the accounting software. Most of the consultants only stay available during the business hours. Few companies offer technical assistance over the phone or computer using remote access. However, it is not possible for the user to make the company understand the real problem. The customers still believes in the face to face interaction is the best way to solve a problem.
Speed of access
Accounting software are accessed over the internet; users face some delays due to the internet connection of the location. Sometimes the speed of the processor and the servers used for the software, responds too late as it delays the whole work..
Suggestions and recommendations
The latest trend in accounting software involves automation, data analysis and support for the value added services. Automation and the integration of the software will help in the reducing the data entry and will also simply the workflow. Data analysis provides the exact information at the time required. It helps the SMEs to understand the business in a simple way. Providing high amount of data for more perceptive customer discussion by the customer support services comes under the value added advice. These days MYOB may be too focused on building the online presence but the main strategy continues to be the legacy as a desktop software company. The legacy continues to influence the products. However, the company is looking to move its customers into the cloud, as cloud is the future of the accounting software.
Curtis, V., 2012. Making the Most of MYOB AccountRight. Woodslane Press.
Curtis, V., 2015. MYOB Software for Dummies-Australia. John Wiley & Sons.
Jones, D. and Jones, M., 2016. Using QuickBooks® Accounting Software to Improve Financial and Production Records for Better Decision Making. In 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas (No. 229772). Southern Agricultural Economics Association.
Lignier, P. and Evans, C., 2012, August. The rise and rise of tax compliance costs for the small business sector in Australia. In Australian Tax Forum (Vol. 27, No. 3, pp. 615-672).
Pavaloaia, V.D. and Andone, I.I., 2013. Opportunities of innovation with intelligent technologies for the financial and accounting software. Global Journal on Technology, 4(2).