October 2015 Newsletter
Buyer — BE Aware!
“We think it’s always a good idea for buyers…to see what existing functionality might be hiding in the current solution.”- Find Accounting Solutions
What we’re talking about in October:
- Your NEW software might be your OLD software.
- Affordable Care Act (ACA) – numbers to know for 2016
- Holla! TimberScan in Old Town Scottsdale in November.
- Tips and Tricks for Construction Accounting, Sage 100 CON, Sage 300 CRE, and Sage Estimating
Hiding in Plain Sight: Unused Software
In our role of business consulting for software solutions we are often surprised by clients’ reasons for purchasing new or replacing software solutions. Many times the obstacles posed or the wishlists presented are already fixable/available in the software they own. This made us wonder how much software is actually wasted or even totally replaced. We did a little digging…
A report from the UK named “Tackling the Cost of Unused Software” stated, “Overall, about 28 percent of all enterprise software across 1.8 million desktops went unused... – Read more.
However, there’s also an alarming rise of “shelfware,” indicating that too much money is spent on tools that end up under-utilized, or get abandoned. Given that the total market for packaged software has been estimated at $325 billion, under-utilized software is getting to be an expensive problem.
Not surprisingly, many companies are dissatisfied with the way they manage software licenses and usage, according to the survey. “Corporations adjust quickly to economic realities, and in this economic downturn they’ve become expert in leveraging software to offset leaner staff,” says Steve Schmidt, vice president of corporate development at Flexera Software. “But they’ve developed a blind spot—investing heavily in efficiency-creating technologies like software without really understanding how to ensure this critical asset is being optimally used. Consequently, an unacceptable proportion of that expenditure is wasted.“
Don’t Know What You Don’t Know
We spoke with Find Accounting Software to see if they had any insight on how many software solution seekers may be replacing systems identical (in theory) to what they already own. FAS Managing Editor, Adam Bluemner, had this to say:
At Find Accounting Software, we speak with thousands of buyers each year looking for recommendations on new software. In hundreds of these cases, we’ll find that one of the best options is one that buyers didn’t expect: their current software.
Whether it’s a result of operating with outdated configuration settings, looking past a recently added feature, or simply not recognizing that a particular capability existed all along, many companies have untapped potential in the software they’ve already paid for.
Before considering the costly prospect of replacing a system or integrating an add-on, we think it’s always a good idea for buyers to connect with their support provider to see what existing functionality might be hiding in the current solution.
Surprise – It’s IN There!
We had a recent engagement with a head estimator who used spreadsheets for all of his commercial estimating. At the meeting, it was revealed the company already owned two Sage Estimating licenses (along with Sage Accounting) and the estimator didn’t even know it! This simple communication gap showed that management and the IT manager didn’t truly focus on the system’s full capabilities. A few meetings later, they reviewed their Sage Estimating software and everyone was convinced this was the system to use – at no cost to them, of course.
While this seems like an unlikely example, it happens more than you think. Attrition, management changes, lack of communication…there are many other companies who are leaving their investment unused. Here are some of the most common issues for not getting the most out of your investment along with some simple remedies (in italics):
Our consultants constantly work with clients who upgrade their Sage 100 CON or 300 CRE software to the latest versions for Sage support continuation or operating systems/server compatibility – BUT AREN’T LEARNING THE ENHANCEMENTS.
This is easy to fix, with several options – from research to online learning to onsite training.
Sage posts version release videos on the Sage CRE YouTube channel and downloadable assets on Sage University. Or you can enroll in specific feature- or role-driven LAI online courses. Maybe you prefer to schedule a few consultant hours at your location to learn how the newest features can save time and money. Or, bring your team to LAI onsite training center for some in-depth, hands-on learning. Request a special curriculum for online training or new hires. The options are copious and affordable – it’s up to YOU!
This condition is probably endemic and software-agnostic. You get through researching, demos, project scope, purchasing, and implementation. You just want the darn thing to WORK.
You check the ‘hit the deadline’ checkbox, sit back and sigh – and then launch the simplest version possible. All of the cool features that you purchased the solution for sit untouched. You have the best intention of learning the full potentiality of your investment, but then you get BUSY.
We get it. You don’t want to spend 4 hours in training next week when you’re stuck on a question that’s holding up payroll NOW. The quickest help will be in the software, in the Sage Knowledgebase, or most surprisingly – FROM OTHER USERS. Have you checked out Sage City lately? This is the place to ask specific questions where Sage and other users will reply to. (Sage is shutting down the LinkedIn group forum, and redirecting to Sage City for a single site for info.) Bookmark Sage City here.)
Again, this happens with more frequency than you would expect. Licenses go unused due to attrition, lack of training, purchasing inefficiencies, or lack of communication between business divisions or departments.
Create a basic technology audit to know how many licenses you have, and which modules. Or ask us! We have what you’ve purchased in our system and are happy to look it up for you.
Just a Small Investment Could Save a Fortune
Another client of ours was so frustrated by the perceived limitations of her Sage 300 CRE system, she was ready to abandon the software. In her role as the accounting manager, she complained of the lack of visibility into project progress. Reasonably, she wanted to know when her projects were getting close to over budget and in enough time to react favorably to correct the course. She was beginning to look at other systems that she believed could help her do her job better.
All it took was ONE brief business meeting to discover that if she added two licenses of Project Management and a single use of MyAssistant her “problems” were solved! Everything on her list was ticked off by adding seamlessly-integrated functionality to her original Timberline accounting system. A $5,000 investment saved a SIX FIGURE replacement cost for a new system (approximately over $55k).
Another client didn’t know how to best handle Change Orders within Sage 300 CRE. There’s two ways: in Job Cost(JC) or in Project Management(PJ). The client was using JC until we showed them that PJ could give them the advanced features they needed. They had actually gone out with a list of requirements which they believed their system was missing. They got a quote from a competitor for $146,000 and we recommended a $4,200 solution that did everything they needed – with the system in place!
Tony Merry Recommends
As it was Tony, (Director of Sales at LAI), who provided the examples of common client issues, we thought it would be beneficial to share what Tony believes are the top three performing add-ons or modules to optimize Sage 300 CRE:
Are you still launching TS Main and pulling a license each time you open Sage 300? Desktop, which has been around for years, gives you FREE INFO like JC reports, open invoices reports, profit summaries – any reports that literally exist in the system can be added to your Desktop. And this is FREE (included with Sage 300 CRE).
Project Management (PJ)
“Anyone who is doing Change Orders should be using Project Management in lieu of Job Cost.” – Tony Merry
In JC, you have to open each Change Request separately to manually approve them. That means if you have 15 separate Change Requests, you have to open them each individually, and then find any subcontracts associated with them – and approve them individually and manually. In Project Management, say you have that same list of potential Change Requests. You can ‘group select’ ANY or ALL of the change requests and approve them with ONE CLICK. Additionally, this includes and approves any subcontracts that exist downstream! It’s all linked, and ultimately results in better reports that show all associated costs.
Legend has it that Tony won’t submit a new system proposal without MyAssistant. While the “bones” of core construction accounting in Timberline don’t change and really don’t need updating – the user experience does!! MyAssistant modernizes Sage 300 with workflows, routing, and alerts that present through Outlook. This is the visibility that our unhappy Accounting Manager demanded – a solution to proactively monitor key performance indicators and provide instant alerts about issues needing attention and the information needed to take action. This inexpensive add-on (around $2,500) makes your Sage 300 CRE perform at the next level. She, you and Tony will all be happy!
(by Debra Carpenter-Beck, reprinted with permission from the Sage Construction and Real Estate blog.)
It’s all about the numbers.
When it comes to the Affordable Care Act (ACA) that common saying certainly seems to hold true. From percentages, to employee counts, to dollar amounts, complying with the ACA means
paying attention to some critical defining digits. To complicate matters, those numbers have and are continuing to change as the law is being phased in.
Now with another year just around the corner, updated compliance figures will take effect. Here are a few numbers (some existing, some new) that you need to be aware of for 2016:
- 50— Starting in 2016, all companies with more than 50 full-time or full-time equivalent employees will be required to provide health insurance.
- 95%— If you meet the 50+ employee requirement, your company must offer health care coverage to 95% of your employees who work at least 30 hours per week.
- 9.56%— Any required company health insurance plan must not exceed over 9.56 percent of the employee contribution for self-only coverage in order to be deemed affordable.
- 60%— At least 60% of covered health care expenses for a typical population must be paid for by the required company health insurance plan to meet the minimum value rule.
- $2,000— This is the base penalty you’d pay per full-time employee if you do not offer a required health care plan and an employee purchases insurance from a health care exchange. In 2016 the penalty equation is $2,000 x number of full-time employees minus 30. The penalty will increase each year by the growth in insurance premiums. Another penalty applies if your required health care plan does not meet affordability and minimum value requirements.
- 25— Companies with 25 or fewer employees that offer health care and pay less than $50,000 in average annual wages may be eligible for a health insurance tax credit.
- 100% of employers, regardless of size, that provide health care coverage must file an annual return reporting certain information for individuals they cover. The first returns are due to be filed in 2016 for the year 2015. The only exception to this rule are plans in place prior to March 23, 2010 that are grandfathered.
There are a lot more details behind these numbers, so make sure you check with your company’s employment law specialists. Sage also provides some helpful tools. Visit SageCanHelp for assistance with navigating the rules of the Affordable Care Act.
One of Sage 300 CRE’s best-selling third-party partners, TimberScan from Core Associates, will be at our LAI Headquarters for a special, live event! Start with lunch at 11:30, and enjoy dining al fresco (weather permitting) on our patio. Then down to our Training Center for live, interactive learning from the people who created TimberScan. The session will run until 4pm or later, if there’s demand.
After receiving your registration, we will email the GoToMeeting link.
What You Will Learn:
TimberScan dramatically improves the A/P process & management of documents from all departments:
- Centralizes, stores and indexes all documents from all departments for easy search and retrieval
- OCR Capability automatically prefills text in data entry screen, reducing data entry by 80%
- Provides full visibility of documents in TimberScan and in Timberline
- Automatically routes invoices to approvers making the approval process 50% faster
- Provides invoice status and dollar value of invoices in approval process
- Flexible reporting and customizable dashboard
Dine ‘al fresco’ on our 2nd story outdoor patio (weather permitting), and then gather downstairs in our Training Center.
Space is limited to 20 attendees (only one person per company, please)!!
Don’t forget to forward your newsletter to a friend, and follow us on Social Media for immediate construction and technology news!
Twitter | Facebook | LinkedIn LAI Page | LAI Sage 300 CRE Users Group
Upcoming LAI Online Training and Networking Events:
Employee W-2 Preparation and Audit
Join an LAI consultant for a live, online FREE session.
1099 Preparation for Year End
Join an LAI consultant for a live, online FREE session.
GL vs. Job Costs Reconciliation
Join an LAI consultant for a live, online FREE session.
1099 Prep for Year End
Don’t Forget to Audit Payroll!
Submitted by Walt Mathieson, Certified Sage 100 Consultant
Payroll Audit is a handy utility that compares amounts actually withheld and accrued for FICA and Medicare Taxes with what should have been withheld. It also identifies payroll records that have not been completely processed or processed with conflicting payroll quarters compared to payroll check dates. If you use the Repair option, the system will reconstruct the control totals on the employee records – this will correct any mis-posted or partially posted payroll records before it actually audits the payroll records. The Repair option takes longer than just running the Payroll Audit (this makes sense because it performs both the reconstruction of control totals and the auditing of payroll), but the extra time is usually worth it. Always run the Payroll Audit with Repair and resolve any issues indicated, before computing the amount of payroll taxes to deposit or preparing payroll tax returns.
Since we’re talking about preparing payroll tax data, remember to always run your payroll tax reports by check date, not by period ending date. The tax authorities want all of their payroll data reported by check date.
If you find that payroll audit errors exist, contact Sage Tech Support or you favorite Sage Certified Consultant for assistance.
Current Version Information
The latest “recommended” version of Sage 100 Contractor is version 19.6.41, the release of which was announced on May 28, 2015. Since then, there have been two “Optional” updates that contain payroll tax table updates for North Dakota, Connecticut, Ohio and Idaho, plus a couple of minor report fixes. You may want to consider the optional updates as well.
More about Sage 100 Contractor here. Call Ledgerwood Associates at 877-918-8301 today and we’ll match your needs to the best solution.
Email Walt at email@example.com.
Affordable Care Act (ACA) Compliance
Submitted by Kyle Zeigler, Sage Senior Certified Consultant
Year-end is quickly approaching! Are you ready for 2016 and the new Affordable Care Act (ACA) tax forms your company may be required to file? Tax forms 1094/1095-B and 1094/1095-C are not yet available in the Aatrix forms library and will be added later this year according to Sage. However, you can begin preparing now to set up your Sage 300 CRE software to track the information needed for filing.
First, users should confirm that Accounting Update 9 has been installed on the server and all workstations. This update installs the following Payroll settings, tasks, data fields and reports required to manage the ACA requirements:
- New settings in PR Settings (“ACA Settings”)
- A new PR Task: ACA Compliance
- A new Tab in Employee Setup: ACA Coverage
- A new checkbox on the Pay setup: Include in ACA hours
- The three new reports in your system Report folder (typically found in \\[Servername]\Timberline Office\9.5\Accounting). These reports will need to be added to your desired report menu using the application’s Reports Manager:
- ACA Employee Coverage
- ACA Dependent Coverage
- ACA Hours Allocated
- New Aatrix reports that in one of the Aatrix updates (as soon as the IRS forms are finalized)
To prepare your system to begin tracking ACA-required information, users must complete the following:
- Enter health care coverage information for each employee
- Confirm that ACA hours are being recorded for each employee
- Know what your full-time employee equivalent counts are
This preparation seems simple, but many users are seeking help understanding the new Sage 300 CRE features and how to use them. If you need help preparing for the new ACA reporting requirements, multiple resources available to help, including articles, videos and other resources. To access these resources, go to Sage Desktop > Web Resources and select Service & Support. Log in with your customer logon information and search the knowledgebase for article 52204, “What do I need to know about the Affordable Care Act (ACA)?”
Also, be sure to check our Upcoming Events Calendar for online Year-End preparation classes coming soon!
The IRS, Identity Theft and Tax Scams
Submitted by Bryan Eto, CPA
The Federal Trade Commission estimates as many as 9 million Americans have their identities stolen every year. Although the security of personal data is a top priority of all types of entities, the IRS is especially vigilant, because tax-related identity theft is the most common form of reported identity theft. The number of identity theft victims is expected to grow as perpetrators become increasingly sophisticated. Many are now clever enough to hack through passwords and other security measures to gain access to personal accounts and data. Case in point: The IRS recently announced that the May 2015 security breach of its online “Get Transcript” service affected nearly three times more taxpayers than the agency originally estimated.
Expanded IRS Data Breach
In August the IRS announced that fraudsters had hacked into 334,000 taxpayers’ accounts — up from the agency’s original estimate of 114,000 accounts. They used stolen Social Security numbers, addresses and other personal data acquired from social media and other sources to breach the system’s multistep verification process. In response to the breach, the IRS will offer free credit monitoring services and other protections — such as identity protection personal identification numbers (PINs) — to taxpayers whose information was compromised. The IRS will also mail letters to another 170,000 households, notifying them that their personal information could be at risk even though the fraudsters failed to access the IRS system with their information. (This is in addition to the 334,000 taxpayers whose accounts were breached.)
Future Cutbacks on W-2 Extensions
In another effort to combat taxpayer identity theft scams, the IRS has curtailed the W-2 filing extension available to employers. Under existing tax law, the automatic extension for filing W-2 forms is 30 days from the original due date. Employers may request an additional extension of up to 30 days by submitting a second Form 8809. For the 2016 tax season, the current automatic extension will still be available. Starting in the 2017 tax season, however, the IRS will allow only one 30-day, non-automatic extension for filing W-2 forms. Identity thieves often file fraudulent tax returns early in the tax season, before W-2s have been sent. Early filing leaves the agency unable to verify wage and other information. By limiting the availability of extensions, the IRS hopes to catch fraudulent refund scams earlier in the tax season and reduce the opportunity for thieves to steal data.
IRS Reminder about Tax Scams
In August, the IRS reiterated its warning for taxpayers to be on “high alert” for aggressive tax scams. Often these frauds start with access to personal information (names, addresses and Social Security numbers) obtained through social media or possibly illegal means. Then the fraudster contacts the individuals using this information via a phone call, email or letter, requesting payment or additional personal information to use in other frauds. These tax scams — which originally targeted older people and immigrants — have become bolder and more authentic-looking. For example, fraudsters may cite fake IRS badge numbers, alter what shows up on the victim’s caller ID and copy IRS letterhead. To sound legitimate, a fraudster may provide directions to the nearest bank so the victim can make a payment and an actual IRS address where the victim can mail the receipt from the bank for the payment (though the payment actually goes to the fraudster, not the IRS). The IRS warns, “Scammers try to scare people into reacting immediately without taking a moment to think through what is actually happening.”
How to Protect Yourself
The Treasury Inspector General for Tax Administration estimates that nearly 4,000 victims have collectively reported more than $20 million in financial losses as a result of tax-related scams. Don’t allow yourself to become the next identity theft or fraud victim. If you receive a suspicious call, email or letter from someone posing as an IRS agent, contact your tax adviser immediately. He or she can help determine whether the alleged IRS inquiry is legitimate or, if not, help you report the suspicious activity to protect others from identity theft and other tax scams.
Work Breakdown Structure (WBS)
Submitted by Jim Hoeppner, Sage Senior Enterprise Managing Consultant
Back in May I wrote about how the operating systems in North America sort vertically via the ASCII sorting. I mentioned that if you understand this sorting, you will be able to navigate through folder and files and find what you are looking for much more quickly. Sorting is also the gear behind the scenes when working with WBS. Once you determine your naming conventions for the codes/values, then you can collapse and sort easily to find your information.
It helps the user to know that the phase/item structure or tab is the backbone of the database, versus the alternate sort orders or WBS sequences. There are many application for WBS, from systems, to estimator names to toxicity level. You can customize the codes to your needs.
The terminology is as follows: codes are the Headers, i.e., Estimators, and the values that come under them can be limitless almost, i.e., Ed, Mary, Frank; being the estimators under the WBS code of Estimator. This is an example where different estimators may work on their scopes of the larger estimate and then combine their estimates near the end of the bidding process to still retain the breakout. Another common example is that a customer wants to see their costs/bids broken out by their own classification/numbering system.
There are many example of WBS in the Sage Estimating system. Not only the WBS codes, of which there is one in the Standard version and 40 of in the Extended version, but also when working with the Job Cost Phase or aka Cost Codes, or Bill of Materials, or Location feature. All of these classifications allow you to break down your estimate into different views.
Don’t let yourself get lost in the detail. The WBS concept is fairly straight forward. It is just another way to break out the same information that is on the database backbone phase/item tab.
Would you like a copy of our newsletter in PDF format? Email Joanie@ledgerwoodassociatesusa.com and we will email it to you!