Holly Dunn really understands the SAGE versus Intuit company challenge in the United States. She started out in the Accounting Space before cloud accounting software had been developed. Actually she was in the space before accounting software was created. Her first job was using a click eraser and pencil with a Green Ledger.
Holly has an intricate knowledge of the SAGE company, having been a trainer for them many years ago, and an accountant using SAGE 100 across a large varied client base.
In addition to hearing her background and how she created Accountable Bean, the accounting & bookkeeping company she runs, it was also fascinating to hear her views on why SAGE is a better accounting software product than both Quickbooks Online and Quickbooks desktop, and what SAGE needs to change in order to take on Intuit in the US market.
From the Accountable Bean website:
Accountable Bean’s staff provides fractional controllership and ERP implementation services for it’s clients.
From an accounts payable clerk to a certified trainer at SAGE
Eric: You have an interesting background in the accounting and bookkeeping space. Before we hear about your current position, and your thoughts on accounting software, tell us about what your background is that got you into your current position?
Holly: The background is that I started as a controller about 30 years ago. I went to work for a small resort as an accounts payable clerk. The bookkeeper, that was the controller there, left suddenly. I was forced to try to figure out how to do the controller job rather than just my accounts payable job.
I had to look at the things she had done previously to figure out how to do the daily posting of sales, cash receipts, and bank recs and such. At the same time, the owner of the resort had a CPA, who took me under her wing.
This CPA taught me a lot. Many of the procedures and the types of documentation that I use, still today, in my career, are from those first lessons with her. That was my first introduction. I had done other types of payroll clerk, payable, receptionist jobs previous to that. But that was the first real accounting job that I had at the time.
She encouraged me to go to college:
You’re really good at this. This is something you should pursue in your career.
So I started college to get an accounting degree. Then I moved to the East Coast and continued to work for small businesses doing pretty much all of their accounting. When you work for a small business, you end up being the resource for pretty much everything. Doing a little bit of everything. Human Resources, IT, payroll, marriage counselling! You pretty much do everything.
Doing a little bit of everything. Human Resources, IT, payroll, marriage counselling! You pretty much do everything.
So I did that for a lot of years. Then I quit working for a while to have children. When I went back to work, I went to work for a CPA firm from back east that had a SAGE software consulting practice. We sold and implemented and supported an accounting software package called Sage 100. That was a really interesting “why” in my career. Up to then I was just an accountant and had been doing accounting for small businesses. Suddenly I was in 30 different clients businesses.
Learning about their businesses and how to help them take this piece of software and do their Accounting in the most efficient way they could. A very different perspective. A very different way to do my job. It taught me a lot about the underpinnings and structure of software & Accounting and all of that together.
Then I moved to California and worked for Sage Software directly as a certified trainer. I led classroom training. I did that for a while.
Then I started a Consulting practice where I combined both. I combined my accounting skills and did a lot of interim controllership along with sage 100 consulting support, implementation types of tasks.
Then I worked for a small business at running their accounting department for 11 years. I helped them sell their business. I went through due diligence with them. The first round of investment from a non profit and then the non-profit bought them. So we went through both of those due diligences.
I have to say, I’ve learned a lot. I’m a person that likes to learn. I’m most excited & probably perform at my best when I’m learning. I really enjoyed that. I’ve learned a lot through my career. But up to now that experience of going through a due diligence of the purchase was probably the largest “contributing to learning” that I’ve gone through in my career. It was such a compact amount of time that I learned and acquired so many new skills. I’m really thankful I went through that.
Then after they sold the business I decided I had had my third child, and for about 11 years I wasn’t around. I was running this company and pretty engrossed in it. I had a really hard time balancing home, parenthood and running a successful business. And all of the accounting for that. So about that time I decided, you know what, my youngest is going to be 13 this year, and he needs someone to be around to watch him. So he doesn’t get himself into trouble.
So I went back to Consulting and started up my Consulting practice. And when I did it, I was working maybe 10 to 15 hours a week at most. William, my youngest, was loving that, because I was spending a lot more time with him. Now, I’ve got so busy that I’m working full-time again. But from home. So he’s always yelling at me “Mom, you said you weren’t going to work anymore!”. That’s the way it goes.
Mom, you said you weren’t going to work anymore!
Accountable Bean – all accountants are bean counters
E: So you started your own accounting company advising clients on their bookkeeping and accounting strategy? Or doing bookkeeping for them? Where is the focus?
H: Actually, it’s a combination of all of that. It’s funny. It depends what the client needs. Sometimes I’m actually doing the bookkeeping for them. I’m doing their Bank reconciliation. I’m doing their monthly close. I’m not doing the day-to-day most of the time. I’m doing the month-end type of procedures. So I am, kind of a controller for them.
And there are others that have internal staff, but their internal staff really need training on how to do the month-end procedures. How to do a bank reconciliation properly. How to forecast. How to create a pro-forma. How to budget. All those type of things.
I’ve actually had some experience coaching CEO’s on what reports they need. And how to read them. What they need to be looking at. Some of them are running a business and they’re in the whirlwind of the business, and they’re not necessarily understanding what they should be looking at strategically. So I’ve done that.
And obviously I also have the Sage 100 practice. So I’m help-desking. People are emailing, and saying “I can’t print my check. This report is broken. Can you help me”. And I’ll dial into their computer. And diagnose what’s happening. And help them through it.
We also have clients that are on QuickBooks and are switching to Sage 100. Or they are upgrading their current version of SAGE 100. So we’ll go through that procedure. We have clients that say “we need a custom report. We need to change our custom financial report. We need a new way to do purchase order receipts.”
What happens, because I have accounting skills and software skills, is that a lot of clients on Sage 100 will call me and say “I need a new procedure. I need a new way to do this using this tool.” And so what will happen is we’ll put in a new procedure that is accounting, but that is Sage 100.
From Wikipedia:
Sage 100 or Sage100cloud, formerly known as Sage 100 ERP, and before that Sage MAS 90 or Sage MAS 200, is accounting software offered by Sage.
SAGE versus Intuit – What SAGE 100 has that QBO and QBD don’t
E: So you spoke earlier about Sage and training for Sage, and now you’ve spoken about Sage 100. You mentioned that some of your clients are moving over from QuickBooks to Sage. QuickBooks is obviously part of Intuit, one of the largest accounting software companies in the US. Sage is also a very large company. It sounds like you have a preference for Sage? Why is that?
H: QuickBooks in my opinion is a perfect piece of software for a mom-and-pop organization. But it’s not an Enterprise situation. It’s not enterprise software. It’s way too flexible. It’s not audit-worthy in my opinion. You can’t really prove that any transaction that you posted to QuickBooks, was the original transaction. So I’m not a big fan of it.
I think it’s good for small mom-and-pop, 1 or 2 people, and you don’t have an employee who could fraudulently enter transactions or delete them, or create transactions that are not really there. Once you have an accounting employee, unless it’s your kid or your wife, you should not be using QuickBooks.
QuickBooks in my opinion is a perfect piece of software for a mom-and-pop organization. But it’s not an Enterprise situation. It’s not enterprise software. It’s way too flexible.
E: And when you talk about QuickBooks, are you referring to QuickBooks online and QuickBooks desktop both being unsuitable for larger businesses? Or just the QuickBooks online side?
H: No. Both of them. Both versions, Quickbooks desktop and online. And Enterprise. So all of it.
E: That’s interesting. Spend a few minutes, saying why you don’t think the QuickBooks Enterprise side is suitable for larger businesses. What is better about Sage?
H: You can delete transactions. You do not need to host a transaction in QuickBooks. The minute you enter the transaction in Quickbooks, it’s created. In Sage you have to enter a transaction, and you have to actually go through a posting process. And in order to change that transaction after you have posted it, you have to reverse it. There is no way to change your transaction that’s been posted in Sage.
E: Why is there this difference between the two different accounting software packages? Why does Intuit do it the one way and Sage does it the other way?
H: I think it’s because QuickBooks started as a checkbook software. It was for home accountants. I remember when QuickBooks started. It was part of Quicken software. Quicken is still around but people don’t use it much.
From Wikipedia:
The initial Quicken software did not function as a “double-entry” accounting package. The initial release of QuickBooks was the DOS version that was based on the Quicken codebase. The Windows and Mac versions shared a different codebase that was based on In-House Accountant, which Intuit had acquired.
Quicken was started as a home accounting software. It wasn’t supposed to be a business accounting software. And then what happened, a lot of small businesses adopted QuickBooks, because it was easy for them. If you’re not an accountant, and someone puts a checkbook, (what looks like a check on the screen) in front of you, you can figure out. I can do my accounting! But you don’t really know how to do your accounting. You are bumbling along, right?
I’ve had so many times, that clients have handed me QuickBooks, and said “figure this out, I need to file my tax returns.” And they posted everything so wrong. They posted expenses to asset accounts. They posted assets to liabilities. It’s all messed up. It’s because they don’t know what they doing. They think that they’re using this piece of software, that they’re doing their accounting. But they are not really. I think it can be dangerous without the right amount of direction.
Like I said, the biggest difference in my opinion, is that QuickBooks is so easy to manipulate. And that makes it, even if you don’t have fraudulent transactions, if fraud does not exist, you are still really messing up your books. Whoever has to take it to file your tax return, has to unravel this mess..
Before SAGE was Lotus 1-2-3
E: Changing the subject slightly, before this discussion, you were telling me how you’ve been involved in the accounting world from the days of pen and paper. From the early days of accounting software. What was it like in these early days of accounting. How did the account process work? How did accounting evolve from the early days, up to today’s age where a lot of it is now cloud accounting software and a lot of automation.
H: When I started, we didn’t have Sage. The very first job I had, I had a payroll clerk job in accounting. There was no accounting software. We actually had Lotus 1-2-3. It was a spreadsheet that existed before Excel. Microsoft didn’t exist at this time. There was a software, which you can’t even call software as it was DOS, before Windows.
It was a spreadsheet thing, called Lotus 1-2-3. It was supposed to duplicate those green ledgers. That took columns and rows and combined them. So you could add up everything without using a 10-key calculator. Lotus 1-2-3 was trying to organize things into rows and columns and replace the 10-key calculator, so you didn’t have to run tapes. Do you remember 10-key calculators and tapes. You had to have this huge tape of addition and fold it all up and staple it together.
My first job was a payroll clerk. I had to take time cards and add up the hours for these construction workers. I had maybe 120 time cards per week. I spent hours adding up all this time. And figuring out what was their overtime, and what was their double time. Then, I had to manually write their name out, the amount of regular hours, the amount of overtime hours, the double time, the rate. And what their gross pay should be. And then I had to go to the circular-e, which was a little gray booklet. That was how you computed payroll taxes.
Before software you had to calculate the amount of taxes to deduct from an employee’s pay check manually. If they are single, and they’re claiming two, I had to go look at this table thing in this big book, which was pretty thick. And look for a single two. He made $5,000. Therefore Federal withholding should be $230 and FAICA should be this amount. And then State.
Because we lived in California. There is federal, FAICA & state taxes to deduct. And so for each one of those 120 employees I had to do that every single week. So I remember, having very complicated green ledgers.
In the old days you had to have a click eraser and a pencil. If you didn’t and you wrote anything in pen you were in trouble. One mistake, it was a mess. You had to have a pencil and eraser. So you could erase everything if you made a mistake. And I remember doing a lot of that manually for years.
In the old days you had to have a click eraser and a pencil. If you didn’t and you wrote anything in pen you were in trouble. One mistake, it was a mess. You had to have a pencil and eraser.
Then the first accounting software that I used was Sage 100. But the resort that I worked for, we had the accounts payable. I think we only had the accounts payable module. It wasn’t integrated with the general ledger. Which was so stupid. And I didn’t understand it. I don’t understand why we would have accounts payable module and basically all it was was a check writer. So checks could be printed rather than having to write them out manually.
The Ledger of posting those checks to accounts payable and the expense accounts. The controller that was there did all of that manually on green ledgers. I thought she was crazy. Why would you do that if you have this piece of software to do it for us. So the very first thing I did when she left, and I had to take over was I implemented it. I said “we’re integrating the software”. I’m not messing around with that. That seems like a waste of time.
So we turned on the general ledger, and we were able to post everything that we did. And we also started posting all of our sales in the accounting software which she hadn’t done before either. Everything was all manual. I think the thing about accounting software, is that it saves you computation time. It doesn’t necessarily save you task time. You still have to enter all that stuff into the software. And you have to make sure that is correct. If you put garbage into accounting software you’ll get garbage out. It doesn’t mean that it will fix everything and make it great. It’s not. You have to put it in right. You have to make sure you are posting things correctly.
And then on the back end it saves you all that computation time. Producing a financial statement that makes sense. And presents an accurate picture of the business.
Bookkeeping and accounting in the year 2030
E: That sounds like bookkeeping in the last decade or two has really come a long way from Excel and the green ledgers. All the way to Cloud accounting and automated accounting and processes being digital. Just like any other technology things are moving quickly. Can you take your crystal ball of where the accounting and bookkeeping space will be, let’s say, 10 years from now.
And what are bookkeepers and accountants going to be doing a decade from now? Obviously they will be doing a lot less of the processing side. But as you said, there’s always space in the business for financial people to be advising businesses on a variety of different things. Where is your crystal ball for bookkeeping & accounting a decade from now?
H: It’s a good question. I think about it sometimes. The interpretation, or the reading of data by machines, is going to be advanced. I’m sure. To the point where you’ll be able to take an invoice, scan it into a machine, and the machine will be able to create the invoice from it. It will post the entry from that accounts payable or accounts receivable document or bill. Probably it will be able to create, for the most part, if it’s a known vendor.
If it’s a new vendor or new expense, you might have to do some backend mapping. But for the most part, it may help with those repetitive types of expenses. That every business has. That we end up having to input manually. I imagine it will change that part of accounting.
But I think I’m probably more old-fashioned than most people nowadays, in that I feel, unless a miracle happens, you can’t really replace the decision making of a human being with a machine. You can’t replace the fact that if someone looks at a new transaction, that needs to be recorded in the software, and it’s not like any other transaction that’s ever happened, the system isn’t going to know what to do with that. There’s always going to be human interaction, even at the processing level in my opinion. It maybe lessened. The day to day types of tasks that we do.
But bank reconciliations, in-depth reconciliations where data can really be used and I’m excited for, is where you have to hunt down information in large amounts of data. That’s going to be amazing. Excel is already doing that, obviously. If you use know how to use Excel you can find information in Excel pretty easily. It’s going to be even more powerful.
Let’s say you are trying to create a pro-forma or a trend analysis of a business. You wouldn’t need to really put that information to excel. You would tell this machine to go into the database of the financial information of this particular organization, and say “I want five years of average sales data for this product line.” And you wouldn’t even need to extract out into Excel and create any kind of formulas. It would just do it. That would be really cool. That would be the part of technology that I think would be amazing to use because humans just can’t process data at the same speed.
So that part of it, that part of machine technology, taking over accounting, is what I’m excited about. The other parts I just don’t think that machines have the decision making, the reflection, the idiosyncrasies, of the human brain and how to interpret data in unexacting ways. This machine can return the exact number you looking for. But to interpret it. And to tell the story behind it, you need a human. Machines are going to be a big part of accounting. But I don’t necessarily think they are going to replace accountants.
Large Business Bookkeeping Services
E: Putting the technology aside, with this crystal ball, I had an interesting conversation with another bookkeeping company a few weeks ago in the United States. She owns a medium-sized bookkeeping company with about twenty bookkeepers.
She explained to me in her opinion, there are freelance bookkeepers which have a small number of clients. But these freelance bookkeepers don’t really have colleagues. They work as freelance or solo bookkeepers.
Then you get small bookkeeping & accounting companies anywhere from two people up to maybe 15 to 20 people in the company.
And what’s interesting is that there is this new batch of what we called VC backed bookkeeping corporations. Examples being Bench, Botkeeper, Xendoo & ScaleFactor.
And from what we understand, they are trying to offer businesses bookkeeping services in scale using technology. But in the background many of these bookkeeping corporations are taking the bookkeepers that used to be solo bookkeepers or small bookkeeping companies, and giving jobs to them in the backend of their companies. So businesses are dealing with these new massive bookkeeping outsourcing corporations, and they do use technology, but many also use bookkeepers in the backend actually doing the work.
Do you have any opinion on whether this is happening? Do you have any thoughts if this continues, does this mean there will be a dozen super large bookkeeping companies in the United States each with 25,000 or 100,000 businesses as clients? And if so, does this mean the days of intimate personal relationships between the bookkeeping companies and their clients are over. I’m interested to hear your thoughts on that?
H: I have to tell you that I have clients that have hired those services. And the problem is that they are so removed from the individual business. And know so little about the owner, or the business, or the industry. They look at it in a very sterile way. I’m just a transactional data processor. The problem is that they make mistakes. All the time. You get into that clients accounting software, and look at their accounting, and it’s not right. Things are posted incorrectly, or they are not posted because they can’t get the information they need from the owner. And no one bothers to try follow up on that.
I’ve seen a lot of, in my opinion, not good service, from these bookkeeping coalition services. They just don’t seem to have perfected it yet. Maybe at some point they will. I think what they probably will need in order to do that successfully, is you are going to need an account manager, in addition to the bookkeeper who is doing the actual work in the background.
You’re going to need an account manager for each client. Who has some sort of accounting knowledge. They don’t need to be an accountant. But they need to have some kind of idea of what a debit versus credit is. They can take the information. They can be the ones contacting the clients with questions, with follow-ups, and then communicating that to the bookkeepers in the back end. If they developed a company like that, that would be really successful.
But I think the idea of “lets maximize” profits, and have all these data entry people in the background. And we’re just the connection, isn’t working.
Bookkeepers near me
E: It sounds like personal relationships in the bookkeeping space is still essential to actually understanding the businesses.
H: I don’t know who thought that the idea that the CEO and the accountant don’t need to know each other. But whoever thought of that idea is wrong. There has to be some connection between the two of them. You cannot have a successful business, and be a successful CEO or an operator of a business without having an intimate knowledge of your numbers. If you think that someone else can do it all and then just give you a piece of paper, you’re wrong.
You need to know what the story is behind those numbers. Why is my business up. What made it go up. And ask questions. And get into the data.
Maybe I’m just old-fashioned, so when I’m ready to retire someone will say “no one speaks to the accountant anymore. They just sit in a black box and do all their work.” I wouldn’t like that. I want to know the owners or the clients of the businesses that I work for. I want to know about their businesses. I want to be excited about their businesses just like them.
Coronavirus impact on Business
E: Most bookkeepers and accountants other than these big bookkeeping corporations are on the coalface of business. They see what’s happening every day with small and medium-sized businesses. Three months ago it was absolutely disastrous due to Corona and NASDAQ collapsed. But now in the last few weeks NASDAQ has recovered. (Although it has fallen in the last few days significantly again.)
What is actually happening on the ground at the moment, because from a helicopter point of view it looks like even though there’s massive amounts of people being affected by Corona in the United States the market isn’t reflecting it. I understand businesses are taking massive strain, and shutting globally! What is your feeling about what’s happening?
Three months ago it was absolutely disastrous due to Corona and NASDAQ collapsed. But now in the last few weeks NASDAQ has recovered.
H: I don’t see small and medium size businesses shutting left, right and center in America! I’m not a big stock market person but I believe it’s the instability. Governments, in my opinion, especially the United States government, are run so unstable. It’s so unpredictable to predict what is going to happen next.
Whether or not they should or should not be, stock markets are determined a lot of the time on the mood, or the wave, of whatever is happening. I don’t know if I necessarily agree with that. Stock markets should be based on data. Not on political instability. If a business is not doing well profitably, for whatever reason, whether it be a global pandemic, or they are not making the right management decisions, then their stock value should go down. Because the revenue is going down. And the profitability is going down.
It shouldn’t be based on “the CDC said now we can stop wearing masks”. That seems silly to me.
I haven’t seen a lot of small businesses going out of business. I am seeing, as you would expect, most of the small businesses that I have, their revenue has gone down. But their prices have gone down at the same time. They’re cutting things. They’re in survival mode. Most of the businesses that I’m dealing with right now, are in survival mode. Trying to lay low and get through this period. And then rise on the other side.
I’m hearing a lot in the webinars that I attend here in America, that now is the time to shine. Now is the time to get your ducks in a row. Make sure that you’re operating at the most efficient level you can because when the economy does come back, if you’re ready for it, then you’ll be able to take that opportunity. So a lot of businesses are investing actually, in staff, and in training, in order to build up to that time when they’ll be ready to take back the business, when the economy comes back.
the CDC said now we can stop wearing masks
Which is better – Quickbooks or SAGE?
E: You’re a big fan of SAGE. You use it all the time. But in America, from what I understand, Intuit is still a much bigger brand, than Sage. What advice do you have for SAGE, in order to get more market share in the US. Which industry should SAGE be focussing on? Should they be focusing more on the desktop or Cloud? What should Sage be doing to build their brand up to become bigger than Intuit in the US market?
H: They need to get Cloud. SAGE needs to be in the cloud. They need to create a solution, so that they can be cloud compliant. They are not. Even though they recently, two years ago, started calling themselves SAGE 100 Cloud, they’re not in the cloud. You still have to have a hosted server in order to use SAGE. They are losing market share because of it.
They just can’t compete with Intuit on the lower end, and Netsuite on the higher end, because they don’t have the technology for it. And I don’t know why they haven’t done that. It doesn’t make any sense to me. I know their customer base is going to be upset, but they will adjust.
A lot of the customer base have been with SAGE since before Windows existed. On DOS. Seriously. They’ve had people on SAGE 100 for 25 or 30 years. And they are very resistant to being in the cloud. We’re talking about 75 year old ladies, who have been accountants since they were 20, and they are not going to go over anyone earning their data. I know that’s why SAGE resist it, and are slow to change. Because of that big customer base they have. It’s such an old piece of software. They have an old client base. I get it.
But at some point you have to enter it. They are just losing so much market share. From the newer, more up and coming businesses, who say, “I have to have cloud accounting. I’m not hosting it in a server in the cloud and then worry about that. And I’m not going to host it in my own business and have VPN to it. I don’t want to do that.” I’d say that’s my advice for them.
E: Interestingly, I’m actually having a conversation with an ex SAGE executive from South Africa, that’s just recently left the company. It will be really interesting to hear his viewpoint on why they are not moving into the cloud stronger.
E: Holly, this was really interesting. I’ll be keeping a close eye on SAGE and Intuit. Thank you.
Do you think Accounting will be the same in 2027?
This is a series that DOKKA is running where we explore the thoughts of Bookkeepers, Accountants, CFO’s & others involved in the Bookkeeping & Accounting space throughout the world.
See some of our previous discussions:
Mary McBlain from McBlain and Davis Accountants – Understanding the Bookkeeping & Accounting industry in the UK
Hossein Dadkhah from DataDrivenCIOs – Factors Accounting companies should consider when dealing with client data
Lisa Cervantez from PureSpeed Lightwave – Why an internal Finance Team chose SAGE 300 as their Accounting Software
Jeffrey Levine from Persofi – Bookkeeping differences between Israel versus the UK
Zane Orton from M-inent – Future of Bookkeeping
Akiva Brett from KB Tax – A South African Tax Practitioner
Julie DeLong from Backyard Bookkeeper – Part 1 – Choose between Quickbooks Online and Quickbooks Desktop
Julie DeLong from Backyard Bookkeeper – Part 2 – Advice from a Virtual Bookkeeping Company
Holly Dunn from Accountable Bean – SAGE versus Intuit
If you have strong opinions on the Bookkeeping & Accounting industry, we’d love to have a discussion with you.
