As a consultant, you quickly realize that while QuickBooks is a robust accounting solution, it is packaged software and there are many different reasons why it may not be quite enough to meet the client’s needs. Intuit realized that they could have more, happy customers if they could leverage the resources of developers to fill in the gaps. In this article I’ll discuss the types of client needs that integrated applications can fill, how to evaluate a developer and their products, and how to get started expanding your practice by leveraging these solutions.
To learn more about the depth and breadth of integrated applications you can begin by visiting http://marketplace.intuit.com/. There are over 500 applications listed on the site that are available from developers who participate in the Intuit Developer Network (a group of trusted, independent developers and industry experts) and, as such, are using Intuit approved tools to create, read, edit, and/or delete transactional and list data in the QuickBooks Company file. There are several ways to search for applications, but for now let’s look at a high level of the types of applications which might be important to a small business.
The need might be something very specific for an industry such as a Country Club or an Automobile Dealer; or it might be something specific for a particular business need, such as a robust time and billing solution. There are also tools included on the website for functionality such as transferring transactions from one QuickBooks file to another, removing transactions from a file, or importing transactions from a web store or Microsoft Excel.
As you search for an integrated application (a business process “chunk,” as Doug Sleeter puts it), it is helpful to understand more about software developers. This includes understanding HOW they access QuickBooks data, WHO you will be working with on these projects, and WHAT they do to the QuickBooks data.
Intuit organizes the developers into three designations. The majority of the applications are designed to work with the desktop QuickBooks products, but there are applications for QuickBooks Online as well. QuickBooks for the Mac is not supported at this time.
All of the developers have undergone a testing and approval process prior to being listed on the Intuit developer sites.
QuickBooks SDK Apps
Many applications use the QuickBooks SDK (software development kit) to connect QuickBooks data to desktop applications. If the application is web-enabled, there will be a tool which resides on the desktop to allow synchronization between the app and QuickBooks. To be listed by Intuit the app must be tested by an independent testing company. The purpose of the QuickBooks Technical Review Program is to verify that 3rd party applications appropriately integrate, exchange data, and are compatible with the QuickBooks platform. Note that this process is performed at a technical level. It is not an accounting or best-practices in business management review. While this certification program is very useful in evaluating solutions, it is only one part of the overall evaluation you should conduct.
Here are the different “levels” of certification that a QuickBooks integrated application can receive from the technical review:
Silver: To achieve Silver certification, the product must pass the QuickBooks Technical Review. This is the minimal level of integration an application must have with QuickBooks in order to be certified by Intuit.
Gold: To reach Gold certification, an application must pass the same level of scrutiny as the Silver Developers, plus achieve a passing score on an extensive customer satisfaction survey, submit customer case studies, and more.
Intuit Workplace Apps
These are SaaS and Mobile applications that utilize the Intuit Sync Manager (a component of the QuickBooks installation) to synchronize data with QuickBooks (desktop or online edition). Applications synchronize data using the Intuit Partner Platform or Intuit Anywhere to securely connect with the QuickBooks data. This streamlines the process of using multiple integrated applications with the same QuickBooks data file because it provides one integration point (called Intuit Data Services) that allows multiple applications to work with a cloud copy of the QuickBooks (Desktop or Online) data. As with the SDK, these applications are evaluated before they can be listed on the Intuit web site.
IIF is the old method of integrating applications with QuickBooks. IIF stands for Intuit Interchange Format, and is a special type of text file. I mention it here so you know it exists, but in most cases, you would not want to choose an application that uses this method to integrate with QuickBooks. Intuit has publicly stated that this is not a supported method, and applications that use this method will not pass the Intuit testing process. From a practical perspective, it is not recommended since there is:
- No useful error messaging
- No error log
- A possibility that using IIF imports can create data corruption issues
- A tendency to be unreliable and produce inconsistent results in the data file.
There are certain situations where it is the only option, for example, with QuickBooks for Mac. But in general, I would recommend avoiding this type of integration.
Who They Are
In addition to confirming that Intuit has placed their stamp of approval on the developer, you will need to do your due diligence too. Here are some things to consider:
- How long has the product been available? How many versions has the product had? How often are maintenance updates released? How often are new product/versions released?
- What is the size of the company who develops the application? How many employees? What is the break down between developers, sales, etc.? How many customers?
- How easy are they to contact? How easy are they to work with?
- Do you know of other clients or accountants who have worked with this application? What has been their experience? What can they share both positive and negative about the company and the product? Also consider partnering with the other consultants to assist with implementation and training. This is a great way to help ensure a successful implementation while providing a hands-on learning experience for you.
- If you do not have first-hand experience of someone who has worked with the company and the product, consider posting a request for information on a message board and/or contact references from the developer.
What Is Integrated?
Once you have determined “How” the data will be integrated from a technical perspective, the next step is to understand “What” is going to be integrated. To determine if the integrated application will meet the client’s needs consider the following:
- Will information be “pulled” from QuickBooks into the integrated application for additional manipulation, such as with reporting applications? Or will the information be “pushed” into QuickBooks, such as importing tools? Or will there be a combination of “push” and “pull” which may be called syncing or a bi-directional sync? Do you have control over what will be integrated and when?
- What types of list and transaction data will change as the result of using the integrated application? Most importantly, will pushed information arrive in QuickBooks in the same format as if a user had entered it manually? For example, if you are integrating invoices, will they be recorded as journal entries? If so, that means the General Ledger will be accurate, but QuickBooks will not be able to produce sales reports by item or sales tax liability reports. Or, as another example, consider eCommerce activity, maybe the transactions are recorded as a batch, which again, will result in an accurate General Ledger and reduce the number size of the file based on summary transactions and customer information, but QuickBooks will not be able to produce detail reports. Depending on the needs of the business, one approach or another may be preferable. Make sure to take the time to understand exactly how the data will appear in QuickBooks and to consider the pros and cons of this decision.
- It is critical that you do adequate testing of the application with several transactions representing a cross section of the types of data. Use a backup of the live data file at first, so you don’t risk polluting the file with errors if you discover them during testing. Test processes from beginning to end to ensure that the results are as expected. There is nothing more frustrating than going live with a new integrated application and then discovering bugs several weeks or months down the road. Some clients just want to take your word for it that everything will work fine. If that is the case, you will need to do the testing, but I strongly encourage you to involve your clients during testing so they learn about their new business processes and are available to give feedback on each step of the new integration. There are often details clients forgot to tell you before you started, or “exceptions” they forgot (or assumed you knew), so testing the integration together is a good way to flush out that information. I usually stress to the client that this “billable” time is cheap insurance to keep from making a much more costly mistake. If they are willing to do the testing themselves, all the better, but, in my opinion, under no circumstances, should testing be skipped.
- Finally, before going live, after the transactions have been processed, review the activity in QuickBooks with a critical eye. Run some reports, reconcile balance sheet accounts, and verify that data is populating correctly to facilitate full reporting in QuickBooks. Remember that the software is developed by a Programmer, typically not an Accountant, and usually not a QuickBooks ProAdvisor. While we would like to believe that the accounting is just right, that is not an assumption you can afford to make. Think about the exceptions to the general rules for this client. Think about how the data might be entered incorrectly. Think about how you will need to enter corrections. And, think about the accounting ramifications of each transaction. Look especially at sales tax, inventory, Balance Sheet accounts, etc. What type of reports will you get from the integrated application or the source documents for the transactions? What are your checks and balances to make sure everything is being recorded completely and correctly in QuickBooks?
The Next Steps
While there is a lot to think about when considering an integrated application, the benefits of providing a more well-rounded solution makes for a better client experience. This directly translates into making you a more valuable consultant which contributes to your practice growth and profitability. As you become more comfortable with building solutions, you are expanding the scope of the projects. This approach is definitely in line with Doug’s phrase of “Chunkification” or the concept of splitting up the separate parts of the overall business process system into discrete parts. The iPhone and iPad have popularized this concept of having a specific “app for that” where the app does what it does well, but does not try to be all things.
As I mentioned in my last post, I truly believe the best way to learn about and evaluate integrated applications is to pick a few applications that you can use in your business. I would love to hear about the experiences you have had with different developers, which applications you have been using, and any other tips and tricks you would like to share about getting up and running with an integrated application.