EPOS retail automatic accounts system link

One of the things which retailers look for in a new EPOS system is integration with their existing accounting system e.g. Sage. What does this really entail?

Retail EPOS systems are very good a doing their job. They do stock control and front end tilling, and they handle cashing up and banking. This is what they are designed to do. However, a retail company needs to produce accounts. At a very minimum you need to have a daily posting in the accounts software for takings – and preferably much more such as sales and purchase.

If you run credit accounts, then you soon need a sales ledger. EPOS system do not normally contain all the features of a sales ledger, such as printing invoices, allocations and statement printing. This means that the sales ledger in your accounting system must be used. If the credit account sales are done on the EPOS system, somebody is going to have to re-key them into the account system.

Any accounting software worth its salt will have a method of bringing data from another computer system in automatically. This might be known as middleware, or perhaps and import utility. Advanced accounting software might also have an API with which third party programmers can integrated.

To automatically update an accounts system (e.g. Sage Line 100), the job of the EPOS system is to produce the data ready for the accounts software (such as Sage) to read and post into the accounts.

This is a lot more complicated than it sounds. In a very simple sense, you might just want a single journal posted each day for the takings. Something in the EPOS system produces this journal, and presents it to the automatic accounting software import tool on a daily basis. However, even this very simple idea gets rapidly complicated. How does the EPOS system know that the account software has posted the transaction? Did the transaction get deleted out of the account system? What if, at the end of the year you add up all the takings posted in the accounts software and it does not agree to the same report in the EPOS system? What do you do?

Once the journals and sales ledger transaction that are being posted by the EPOS system into the accounts system get more complicated, the above issues magnify. Perhaps you do a journal for daily sales, and a journal for daily takings. Perhaps this is posted through a control account – how do you explain any difference on that control account?

Reconciliation is the major problem with linking EPOS systems with accounts systems. Whilst it is extremely attractive to have your daily EPOS sales magically and automatically appearing in the accounts, it doesn’t really reduce the accountants workload – he still has to balance the books, and prove that the data in the accounts system is a fair match to the EPOS system.

A lot of accountants don’t realise this – they think the EPOS system is doing all the work for them, and it is only at the year end that they find large unexplained balances in the accounts system (e.g. Sage) and the EPOS system does not clearly explain them.

If you want integration between your account system and your EPOS system, make sure you talk to reference sites about this feature when you are in the sales process. Ask probing questions about how easy it is to reconcile between the two systems. If you want to put credit account transactions through the till, make sure that the reference site is comfortable with how they run their sales ledger. As soon as you print invoices in one system and statements in another system, things can go wrong very quickly.

If you don’t know how much money your customers owe you, cash flow soon starts to suffer. Although integrating your accounts software for your EPOS software doesn’t sound like an exciting EPOS system feature, it can soon lead to trouble and is difficult for EPOS software houses to get right.