What’s Your Sign?

How might you introduce a new accounting employee to an unfamiliar financial system?  First of all, you might want to warn them about any quirks in how the system shows signs.

There are two ways to display signs:  Normal and Debit /Credit.

Currently I am working with a system that mixes both in the same report.  I know!  I know!  You are asking how does that work? Answer – not well. A download of transactions into Excel looks like the five columns on the left below.

Transaction report

Revenue and expense are shown in one column with a positive number indicating the amount is “normal” for that transaction type, and balance sheet accounts are shown in separate debit and credit columns.  Huh?  To make this report even remotely usable I have to do the conversion to the right.

This transaction report probably is the result of a the vendor’s fundamental lack of understanding of its users’ needs.

So, if you develop financial system solutions, I’d like to know that each of your accounts is not one customer but a constellation of customers, each with wildly different needs.

Non-accountant users require particular data entry screens and reports that make their experience with the system intuitive and simple. They most certainly don’t want to see anything that asks them to enter or understand debits and credits. Know these needs and deliver appropriate solutions.

Most of the time accountants are going to want to see transactions displayed and reported as debits and credits. Accountants would additionally like to select a version of a non-accountant “user friendly” screen to display as debits and credits.  What, you say, interfaces that perform identical functions delivered in two different formats?  Yes.

So, am I actually advocating for a mixed system?  Sort of. Input and output conventions are probably most effective when they are user dependent.  For this reason it would be helpful if screens and reports actually indicated how signs are being displayed.

However you address this, here’s my admonition: never mix both types in the same screen or report.

If something has outlived its usefulness, or you discover it never really worked in the first place (e.g. the report shown above), let it go, no matter how much time, energy and money you invested in developing it.

Now that’s a rule with a pretty wide application to life in general, I’d say.

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