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Costing roundup: MYOB, Mamut, TAS, Sage, QuickBooks. By David Carter

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11th May 2005
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For many users it's the management accounting features of an accounts package that are really important rather than the basic ledgers. In this roundup David Carter compares the job costing facilities on offer from MYOB, Mamut, TAS Books, Sage Line 50 and QuickBooks.

In principle, job costing is very simple work for a computer. Whenever you post a purchase invoice, for example, for each amount entered there is a box where you enter a nominal code describing what type of expense it is. To add job costing, all the package designer has to do is to add another box where you can enter a job code or cost centre code to identify where the expense was incurred.

And that's basically all you need. In computer terms cost centre codes and job codes perform the same function, except that job costing includes extra features such as work in progress.

Although job costing is basically very simple in computer terms, it various enormously from company to company dependent on the type of business you're in. Before buying a job costing package you need first to have worked out the answer to this question: where do our costs come from?

Costs can come from the following transaction types:

Purchase invoices Items bought in for specific jobs will be recorded via purchase invoices.

Timesheets You may have people assigned to work on different jobs and the time they spend on each needs to be recorded.

Stock issues are for items that you charge out to jobs at a certain rate. The word 'stock' is very wide-ranging here. They might be real stock items which you use in assemblies. Or they might be 'non-stock' items such as 100 photocopies @ 10p apiece, or 50 miles travel costs @ 45p per mile, etc. Either way, these 'non-ledger' items are not part of the double entry, and you need to have some way of recording them against the job.

Payments and receipts There may be some job costs which you record when you make payments or receipts, e. g. commission deductions.

Nominal Journals You may need to make adjustments such as accruals, inter-company transfers etc. You will do this via a nominal journal. It is remarkable how many packages provide the facility to analyse costs in invoices but fail to provide it in journals.

Purchase orders If you want to control job costs by monitoring them against budgets, you need to think about including purchase orders. This will enable you to see 'committed' costs on a job (i.e items ordered for this job but not yet invoiced) as well as invoiced costs. If you want to compare Actual vs Budget during the life of the job, the figures are only truly comparable if committed costs are included in the actuals.

Sales invoices Are your jobs fixed price or are they cost plus (i.e. you simply recharge your time and materials to the client)? If you recharge costs to the client, you may want the facility to generate sales invoices automatically. The computer displays a list of all the non-recharged costs for a job on the screen. The user goes through the list and ticks which ones should be included, whether a markup should be added, whether to change the description, etc. etc. [ A note of warning here: this sounds great in theory but often a lot of care has to be taken in preparing a cost statement for the customer. So any sales invoicing module has got to be really flexible if it is going to work. In practice, I think many accountants prefer to export all the transactions into Excel, and massage them there. Then provide the Excel spreadsheet as a backing schedule to a simple, one-line summary invoice. ]

Bills of Material If you are in the business of making things, as opposed to supplying services, you may need a parts list facility or 'BOM' (bill of materials). Where a job is assembled out of numerous components, the BOM lists all the components. Running the BOM will automatically tell you whether you have sufficient stock of each item. In addition, the BOM will automatically calculate the total cost of the assembly from the individual costs of the components. With a good quality package the latest prices of components should flow automatically through from purchase invoices and update the stock file. This way the BOM costing is constantly kept accurate and up to date with the latest prices.

Job Costing for Service companies
Once you get into manufacturing, the ledgers aren't really very important. It's the Stock, BOM and Purchase Ordering modules which are the key. These are a bit outside the remit of this review, which is concerned primarily with entry-level accounting packages.

So we'll be looking at the job costing needs of service companies rather than stock-based. These tend to fall into two main types:

- Professional services companies such as lawyers, accountants, consultants, PR agencies etc. Most of the costs involved here are staff time which is charged out at an hourly or daily rate. There will also be additional costs such as travel expenses and photocopying. In the IT industry, the software for this type of company is often called a PSA ('Professional Services Automation') package. These companies usually recharge their time to the client.

- Contract Costing companies. These are organisations to which a company will subcontract out a part of its operations. They offer a complete service and incur not only time costs, but also quite a high level of bought out costs. These companies tend to work on a fixed price basis rather than time and materials.

The Tests
To test each package, I tried to enter one transaction of each of the different types, and to analyse it to the one job. Then I tried to find a Job Detail report which listed all the costs I had typed in for this job, from whatever source.

1. MYOB Accounting Plus (£199)
MYOB has been around since 1992. Originally a Macintosh product, it always dominated the market for accounting packages for the Mac. But it's never been backed with sufficient marketing clout to make a big impact on the PC area. On the other hand, it's always been a thoroughbred and its sheer quality has given it a small but faithful bunch of fans. Nigel Harris was surprised at just how good the latest version is in his review of February 2004. A test copy can be downloaded from the MYOB web site www.myob.co.uk.

When it comes to time recording, MYOB is far and away the best package amongst the group. It is very sophisticated. For example, you can create a special billing unit to which MYOB will automatically round up the actual time. So, you may take a call that lasts for 11 minutes, but your minimum charge for any call is 15 minutes. MYOB will record the actual time you've spent, but then automatically round it up to the standard billing unit of 15 minutes in your invoice. This is an essential feature for professionals who sell their services on a time basis. Very neat; MYOB is the only one in the group with this feature.

On Job Costing, MYOB starts equally well. There's a detailed record about each job with start and end date, job status etc. And there's space to enter a job code field at transaction level on all the main transaction types - purchase invoices, stock issues, nominal journals.

But when you go into the Job Detail reports, disaster strikes. MYOB brings over the wrong Description field. Instead of the description you've typed into each transaction line, MYOB brings over the description for the journal as a whole. Effectively you've lost the details of what the cost item actually was.

For me this flaw is so fundamental that it immediately rules out MYOB ' what a pity.

[MYOB have taken this on board and have put this modification on their wish list. If corrected, it will put MYOB where it belongs ' one of the top market contenders for entry-level job costing]

2. TAS Books (Tas Books 2, £349)
TAS Books was released in 1991 as a £99 package available by mail order and at one stage was claiming over 20% of the entry-level marketplace. I installed TAS into a lot of customers during the early 90's and they were all very happy with it. Unlike many entry-level packages TAS doesn't try to hide the accounting element, but it is organized in such a way that everything makes sense. For me, anyway, TAS has always been an eminently satisfying package.

But going head to head with the Sage leviathan was too much of a struggle and in a few years ago TAS sold out to Sage. At the time TAS fans worried that Sage were just eliminating a competitor and would leave TAS to wither on the vine.

TAS Books 2 includes Job Analysis. This allows you to add a 'Tag Code' to an invoice which effectively cross-references it to a job. This was a big improvement, but was still fairly rudimentary in that you can only allocate a tag code to the transaction as a whole. So if you have an invoice containing costs that apply to more than one job, the invoice cannot be split among the two jobs.

Two years ago TAS user Graham Pears made a plea for improved Job Costing facilities in TAS, which generated a lot of discussion. A number of Graham's criticisms have been addressed ' it is now possible to analyse to jobs in nominal journals and in stock issues ' but the basic problem still remains, that you can't analyse costs at transaction line level in TAS. And there's no timesheet analysis either.

So TAS cannot really be recommended for Job Costing. And yet its superior basic design means that management accounting is an area where TAS really should be strong. It will be scandalous if Sage allow such an excellent product to fade away, but right now it seems that no serious money is being put into development of TAS and the doom-mongers' predictions of its future under Sage are coming true.

3. Mamut (Enterprise edition, £399)
Originating from Norway, Mamut only arrived in this country last year. Almost immediately it won an Accountancy Age award for best entry-level package. There's no doubt, this is superb software and the arrival of Mamut is the most important event to take place in the entry-level marketplace for a decade.

Mamut is a complete business management package, with particular emphasis on the CRM side, which is terrific. Go into a customer record and you can see all the invoices you've sent this customer, all the sales you've made, the balance owing on his account, all the conversations you've had, all the Outlook messages you've sent to him or he's sent to you, any related Word or Excel documents. Everything you've ever done with this customer is there.

There's an astonishing amount of functionality for the price, but it does take some time to find your way around the sheer volume of features. The Projects module is found in the Contacts menu. It holds plenty of information held about the project ' start date, end date, the stage it's at, etc. You can define the project as internal (no invoicing to a customer, simply a cost collection exercise), or as external, which pops up an extra 'invoice' button allowing you to invoice a customer.

Timesheets entry seems comprehensive. I wasn't sure how to post non-ledger items such as photocopying charges, but I'm sure there's a way.

The doubts with Mamut lie in the Reporting. I was just looking for a simple listing of all the transactions analysed to one job. Mamut has a whole suite of 'Project' reports, none of which seemed to be of much use. In the Accounting reports there's one entitled Transaction List with Dept and Project, which was fairly good, although it omitted any details of the supplier.

What is surprising is the lack of a decent report writer. Mamut's reporting is curiously similar to Sage. Its Report Editor is equally bad, but with Sage you have the Report Designer Wizard which allows you to select all the data you need and export it into Excel. Users who buy a product as sophisticated as Mamut are the sort of people who want to be able to this sort of thing, but Mamut won't let them.

I cannot say that I have yet got the measure of Mamut. We need some feedback from readers who are using it. Is there anyone out there who uses Mamut for Costing and who can tell us how they've got on? [if you wish to investigate Mamut further, you can download a trial copy of the software from their website, www.mamut.co.uk]

4. Sage Line 50 version 11 (Accountant Plus, £695)
Until recently Job Costing in Sage was handled by a stand-alone package that you had to buy separately as an add-on to Line 50. Integration with Line 50 was rudimentary, and Sage Job Costing has usually excited frustration and derision among Accountingweb readers.

Perhaps Sage have been listening. With the latest version of Line 50, version 11, they have embarked on a different and much better strategy. From now on Project Costing will be an integral part of Line 50 rather than a stand-alone product.

In March I did a detailed review of the new Project Costing features. Although all the features aren't there yet, the basic design is pretty good. Whereas previously Sage only allowed you to analyse costs to GL code and a Department code, version 11 now allows you to analyse costs to a Project Code and a Cost code as well. Much better.

You can enter Project codes on purchase invoices, payments and stock issues. However, you can't put them on nominal ledger journals for period end adjustments, transfers etc. Nor can you put them on purchase orders. If you want to see committed costs on your reports, I don't think Sage is for you.

There's a 'Project Charge' transaction type for costs that are not part of the double entry. You can use this for timesheets.

On the crucial test ' displaying a list of costs from various sources ' Sage picked up all the costs, which is excellent. On the reporting side, the new fields for project costing are not yet integrated into the Sage Report Writer, which is a pity. However, there's a couple of decent Job Detail reports which contain all the important fields and transactions, and you can easily export the contents of these into Excel.

A very good start, then, and for the first time Sage now has a credible offering for Job Costing. The main drawback is price ' Accountant Plus at £695 is far more expensive than any of the other packages.

5. QuickBooks (Professional, £299)
Among the more progressive readers of AccountingWeb it has long been an article of faith that QuickBooks is a much better package all round than Sage, particularly when it comes to reporting and cost analysis.

I must confess, however, that when I first looked at Job Costing in QuickBooks I couldn't make head nor tail of it. This led to an article How Good is QuickBooks at Job Costing which encouraged many QuickBooks users to point out where I was going wrong.

The basic thing you have to get straight about QuickBooks is that it is designed on the assumption that all costs are going to be recharged to the customer. The Job Detail reports only list those costs that have been recharged through sales invoicing. So if your jobs are all fixed price, you will find that the Job Detail reports in QuickBooks are empty. Instead, you will find that your costs are all held in the Unbilled Costs by Job report.

Following the advice given by readers, I wrote a second article QuickBooks and Job Costing tips ' part 1. . This contained a tutorial 'How to create a new Project Detail report out of the Unbilled Costs by job report' which users new to QuickBooks might find useful.

The article was entitled Part 1 because I couldn't find a way of getting costs from ALL sources onto the Unbilled Costs report. Part 2 was going to explain how to pull together costs from all sources. I haven't managed to work out how to do this yet, so part 2 remains unwritten.

QuickBooks is great at analysing data to Jobs when you are entering transactions. However, getting a simple report out of QuickBooks that lists all these transactions in one place may take a little thought. But QuickBooks is cheap (£299), it's very good quality, and there's lots of readers on Accountingweb who will help you along if you get into difficulties.

Replies (11)

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By AnonymousUser
27th May 2005 08:16

TAS tag codes
Thank you for a comprehensive survey of features needed for a job costing function and shortcomings of these packages. I have particular experience with TAS and Quickbooks. I was among those who lamented the the lack of functionality in TAS 2 years ago. I am suprised to learn that nominal and stock postings can now be coded to tag codes. I use TAS books 3 (version 4 plus latest upgrade) and have not found these features. I would be (almost !) excited if you can show me where it is.
I have found that TAS because it has a 3 character dept code and an account code upto 6 digits can be very flexible.

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By David Carter
28th May 2005 09:49

reviewer gets his come-uppance!
Hi David,
You've let me off gently, but of course I haven't actually got a copy of the latest TAS Books and all I did was ring up TAS Technical Support and ask them for the latest situation. Message for reviewer: only ever report what you've actually seen with your own eyes.

Can I ask your opinion on another feature of the latest TAS version? After some agitating from me, at the last minute they put in a facility for exporting nominal transactions to Excel (previously it was only balances).

Is it any good? Do you use it?
David

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By AnonymousUser
28th May 2005 12:40

TAS - nominal export
Reply to David Carter
I can confirm that since version 4 it is possible to export nominal transactions. This is an excellent implementation. In addition to the base nominal data, Customer/ Supplier/ Nominal Analysis/ Nominal Type and Tag Codes are included along with (in separate fields) the full description of these codes. A total of come 27 fields are available and data can be selected by account range, account type date range etc.

Apart from our agreed difficulties with the tag code this software is close to being the best I have come accross for its adaptability.

Another of its great unsung advantages is the ability to make global changes to account numbers, customer/supplier codes tag codes etc.

I have recently re-organised a chart of accounts so radically that any other package I know of would have necessitated a new ledger and a start from scratch ( and the loss of comparative history).

To be fair to TAS they have recently released an upgrade to version 4 which has addressed a number of issues I have had with them over the past 2 years and included several new features. I hope this can give us assurance that the software will be developed further.

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By David Carter
29th May 2005 10:12

Job Costing the way forward
Thanks David. The Nominal Export was to my specification so I'm glad it's OK. TAS is also very good at exporting sales transactions for sales analysis (that's mine too!).

On this global changes aspect - do you mean that you can renumber any account and still keep the history? You can do this if the package also holds an internal code number for the account (which is invisible to the user). You can then change the account code as you suggest.

TAS is too good to lose and we have to keep jogging Sage so that it keeps getting some development funding. To me the way forward has to be for its job costing functionality to be enhanced so that it then becomes a top quality specialist accounting package.

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By mramsay
31st May 2005 20:11

Job Costing, TAS and the way forward
David Smith is quite correct about TAS's great unsung advantages, like the ability to make global changes to Account Numbers, Customer & Supplier codes, Tag codes, Product codes etc. Yes, you can renumber/recode any of these and still keep all the history (without any invisible internal code number for the records)!

We have worked closely with TAS for more than 10 years, both on networking and on application software.

With regard to the former, over the last 6 months or so, we have pioneered wider use of the (backwards-compatible) database engine called Pervasive.SQL at modest cost. This results in other unsung advantages: a massive increase in the scaleability and speed of TAS, both for small 2-5 user networks (with or without dedicated fileserver) and for 10, 20, 30, 50+ user systems - plus new benefits like remote internet access to TAS, use of Linux servers, potential to backup the database(s) while in use etc.

On the software front, I think it is clear that significant investment is being made by Sage in the TAS brand - the last release of Payroll (v4) was the first ever customer and feature-led payroll upgrade and I believe many will be surprised at the enhancements in the upcoming releases of TAS Books and Payroll this year (v5) and next. Our own TAS 'bolt-on' options aim to cover areas of functionality that are more specialist, like full Bill of Materials, multi-site Stock Control, Transaction imports, full Job Costing (inc Timesheets, Fixed Price Agreements, compliance with FRS 5 Application Note G re SSAP 9/IAS 18 and WiP calcs) etc.

All this is facilitated by the mostly excellent structural architecture of the TAS database, the high quality of which is not widely known. Yes, TAS is certainly too good to lose!

Mark Ramsay
Infoplex

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By PhillipIRosslee
19th May 2005 12:37

What about Simply Accounting Professional and Premium
Simply Accounting Professional and Premium 2005 offer excellent job costing features with Bill Of Material and Item Assembly Features included as standard is also Project Management very useful for a small to medium sized construction company. Simply Accounting Professional Professional also comes with Crystal Reposts as standard.Report writing is absolutely fundamental to most accounting software and at £199 for a single user System or £450 for a 5 user system you have exceptional value. The Premium version also allows customization of terminology e.g. customers could become guests for a company involved in the hotel industry or customers could be called clients for service based organisations.Frequently users require additional fields of data depending on their type of business and Simply includes these optional fields to easily customize for a particular type of business.

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By andrewg
19th May 2005 12:53

Time & Fees software for Fixed Price Agreements
I am looking for a Time & Fees (T&F) system that caters adequately for Fixed Price Agreements (FPA), in other words where a fixed monthly amount is paid over 1 year for a fixed set of services.

As well as the standard T&F features, the system I need must also:
- deal with negative WIP on the FPAs
- cater for individual Extra Work Order bills
- serve as a management tool for the FPAs, eg alerting when they are about to expire.
- integrate with Sage Line 50
- allow reporting on various levels:
-Job
-manager
-partner
-department

We use IRIS at present and find it far too inflexible, particularly the reporting.

Can anyone recommend such a system?

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By PhillipIRosslee
17th Jun 2005 09:40

Costing Roundup - Productivity
I think as accountants we all seem to be missing the main point concerning all the different features offered by the different software companies costing applications and that is PRODUCTIVITY and TRANSPARENCY in processing accounting information. Sage Line 50 is by far the poorest application in terms of productivity and transparency in processing accounting information and data out of all the applications under review. It offers limited drill down capability when looking at information already processed and requires by far the greatest number of keystrokes in processing information.Also to make changes to data input incorrectly it is the most inflexable.

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By workhow
10th Jun 2005 16:52

When Wenger winges?
Sage Line 50 does have one very annoying fault in its Project system - you cant edit transactions to add or alter a Project number later.

So if you do realise at a later date that the dinner you gave to Ashley Cole actually properly belongs to the "Annoy Wenger" project - its too late - unless you cancel and re-enter - and all thoe red entries are bound to invite unwanted attention.


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By Ray051
16th Aug 2007 14:32

QuickBooks Class analysis
David correctly points out that the job costing in QuickBooks is tied to customers which is where it traditionally belongs. However there is a very powerful independent analysis feature called class accounting which provides first class project accounting. When the feature is turned on, a posting field will appear in all transaction entries including payroll and journals. You can then use the QuickBook benefits of filtered and tailored reports and drill down to present the information the way the Client needs it. Clients also like the time saving option of names instead of numbers which QB permits. Also you can reorganise the structure when necessary by nesting projects and can easily merge or reclassifiy data. This is important when "cleaning" Client's bookkeeping work. I use it to great success with Clients in construction and charities, both of which have a crucial need for project reporting. It can also be used for departmental analysis or, for example, the analysis of fee earners contribution in a consultancy business.

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By onesys
23rd Nov 2009 19:33

Bloat-ware or Add-ons?

The older Technology / Software posts make you realise how far we have come with software functionality improvements over the last few years but is there such a thing as obesity in the software world?

No matter which software product you read about, it has either grown fat or died altogether.  In the case of Sage 50, it has picked up more and more Management Accounting / Job Costing functionality year on year and it has always had its own separate Job Costing module for product-centric businesses but unbeknown to many, Sage Coretime is the networked PSA software / Job Costing module for service sector businesses.  Some of its functionality is now also incorporated in the more mid-market Sage 200 Project Accounting WTE module.  For small and medium-sized Service Sector businesses such as consultancies, designers or surveyors who already use Sage 50, the Sage Coretime add-on is an affordable upgrade path if they are looking for a real-time, networked business overview and timesheet software tool that replaces their time-consuming manual or spreadsheet-based job / project costing system.  

 

A 'one size fits all' doesn't suit every pocket or type of business, that's why add-ons are maybe not such a bad thing.

 

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