If you have just established your business or need to update your existing accounting system that, then you must take out time to plan what you need today and what you will need 2 years from now. Some accounting software applications allow you to easily update to the next software package without requiring purchase of new software.

There are some basic steps you need to follow to get you pointed in the right direction.

Step 1. Identify your needs - perform a complete needs analysis. Talk to every one in your business. Each job position has different information and reporting needs.

Step 2. List the current features you have in your accounting system.

Step 3. List the new features you want- Again, talk to every one and let them make their list and then combine all the lists. Just because something is on the new features list does not mean you have to buy into every thing on the list.

Step 4. Define custom reports you need for your business - collect what you have now that you can not live without. That way you don't have to pay a consultant to do this collection of information.

Step 5. Plan for growth - How large is your business today? How large do you want your business to grow? If you have a small business, an application like Peachtree or Quickbooks would do just fine. If you have 15,000 customers, it is advisable to go in for a mid market application like MAS 90 or MAS 200.

Step 6. Review each system you are considering - do this one at a time and only one per day. This step can get overwhelming very quickly. You need to understand what you are buying before your purchase. It is a good idea to look for a local consultant that installs and supports the application you are interested in.

Step 7. Review the hardware and network requirements you need for the system you select. Find the white papers that state what the hardware and network requirements are and then do an inventory at your office so you don't end up with software that will not run because it is not compatible with your OS.

The most important idea to keep in mind is to speak with someone who has used the software you are planning to use. Using the general ledger portion of a software application is always easy but rarely has anything to do with what really drives the business's revenue.

The person you speak to should be able to answer all your questions, and after going through your new features list, be able to give you a yes/no answer about whether the software is capable of meeting your needs. All too often businesses make quick purchase decisions and later realize they did not get all the features they needed to make their business processes efficient. If you are not careful you will end up spending more in manual time tracking and maintaining information than you would have spent if you had made a smarter purchase decision.