Accounting Software and Accounting Knowledge

Many people's initial reaction to implementing accounting software in a real way to their business is that they fear it will be simply one more difficult and specialized skill to learn.  "Why," they ask, "do I have to learn accounting principles to use financial software?  Isn't that what my accountant is for?"

While this reaction is common, it is not true.  Accounting principles are helpful when using accounting software, to be sure.  They are not, however, essential.  One can successfully implement and use accounting software without learning anything new about accounting principles.

For example, when inputting sales and expenses, an accountant might see all the complexities of credits, debits, assets, liabilities, accounts receivable, accounts payable, and so on.

Yes, it is very helpful and useful to understand these principles when using financial software.  There is no doubt about that.  However, to conflate that fact with "accounting knowledge is essential" is not accurate, since good accounting programs will do the nitty-gritty work for you.  You'll also see that most accounting software comparisons don't focus on accounting principles but the functionality of the software.

To use the above example of inputting sales, what the average user needs to know about the software is:

a)    How to input an invoice;
b)    How to close an invoice when the invoice is paid;
c)    How to print out or e-mail a receipt of payment.

This is not a complex thing to learn at all.  Someone with a depth and breadth of accounting knowledge may be able to look at those pieces of information and see exactly where on the ledger the pieces of data will fit.  However, for most people, this is unnecessary knowledge to possess.

The unnecessary nature of accounting knowledge in successfully and efficiently using accounting programs is indicative in the format of most accounting software reviews.  The average financial software review will not focus on the inner workings of accounting programs, just as the average car review does not focus on the inner workings of a car.  The specialized knowledge is best left to the specialists in the field.

Rather, the reviews focus on the usability and efficiency of these programs for the average user.  While some programs are more complex than others, overly complex and difficult-to-understand programs do not survive in the marketplace.

Who wins when simplicity and ease-of-use are deciding factors in the marketplace of accounting programs?

The average user.  Because of the factors that decide which accounting programs sell, knowledge of accounting principles is not necessary.  If it were necessary, then only a few select people with specialized knowledge would be able to buy the software.

None of this, however, is to say that accounting knowledge is useless when dealing with accounting programs.  If you have the opportunity to fine-tune your accounting skills, then by all means, do so.  Every little bit of knowledge helps when using accounting programs, but don't let the fact that it is useful knowledge to have be conflated in your mind with "I must learn accounting knowledge to use accounting programs."

You don't need to know how to build a car in order to drive one.

You don't need to know why medicine works in order to take it.  That's what the experts are for.