Many business owners use cloud accounting solutions and benefit from daily bank-feeds, a feature where bank transactions are automatically imported and matched to the correct accounts in their accounting software. Bank feeds remove both the tedious task of data entry and the challenge of correctly allocating numerous transactions in the bank reconciliation process. However MYOB warns bank feeds services from some software providers may be unreliable and inaccurate.
MYOB General Manager, User Experience and Design, Ben Ross, says the company is committed to providing reliable, accurate data and maintaining rigorous standards of security when managing financial data.
“At MYOB, we understand that reliable access to accurate data is absolutely fundamental for our customers. Automatically importing transaction details into MYOB accounting solutions significantly reduces manual data entry, improves accuracy and saves both time and money,” he says.
Mr Ross explains that it is important for business owners to understand exactly how their accounting software accesses their sensitive banking information, and whether that access is authorised by their banks online terms and conditions.
“There are several ways that accounting service providers can access aggregated bank transaction data and unfortunately some software providers play fast and loose with data quality and customer security,” he says.
MYOB uses a bank-authorised data collection system provided by BankLink for its LiveAccounts and AccountRight Liveproducts. In this process, BankLink supplies secure bank transaction data via direct feeds from financial institutions without needing to disclose logon details. The data is supplied in a secure, ‘read only’ format. The entire process complies with the stringent Payment Card Industry Data Security Standard for the safe handling of transaction data and meets the requirements of more than 100 financial institutions.
“MYOB chose to work with BankLink for its proven reliability, security and coverage of feeds from financial institutions across Australia. BankLink has a team of data accuracy specialists reviewing bank data feeds using processes they have refined over their 25 years of providing this service. For this reason, BankLink feeds are 99.9999% accurate and in some cases, more reliable than the bank’s own raw feeds,” says Mr Ross.
BankLink applies a series of proprietary, data validation routines to all bank transactions that identify and correct any anomalies in the data. This sophisticated error detection system results in a significant increase in data accuracy. Furthermore, BankLink’s direct contractual relationship with the banks means that they have protocols in place to fix any errors promptly without any interruption to service.
Some cloud accounting providers use a method commonly called “screen-scraping”. This process requires a business owner to disclose their internet banking username and password to a third party ‘screen-scraper’. This third party then automatically logs in to the business’s internet banking account at regular intervals, copies their transactions and supplies them to their accounting services provider.
The screen-scraping process may contravene internet banking terms and conditions.
“Most online banking terms and conditions forbid the disclosure of login and password details to any party, and exclude the bank from liability for any fraud which may then occur on the account – whether or not the fraud is related to the actions of the screen-scraper. We caution users of other software against passing on their online banking credentials through to third parties in return for bank feeds that are insecure and contain inaccuracies,” says Mr Ross.
Along with the potential security risks, screen-scraping can also be unreliable as the third party isn’t working directly with the banks. Not surprisingly, this lack of reliability can lead to frustration for accountants, bookkeepers and business owners.
“The concern for business owners is in the accuracy of their business financials. Even if only two in every hundred transactions are wrong, how do you know which two? That adds in a whole lot of extra work that undermines the original time saving benefit of the bank feed system.”
According to BAS agent, Louise McLoughlin of e-BAS Accounts, the bank feeds with some cloud accounting packages that use ‘screen-scraping’ can be both unreliable and inaccurate. This makes it time consuming to reconcile a client’s bank accounts, adding in costs.
“I was reconciling a client’s bank accounts when I discovered only two of the nine accounts matched the balances in the client’s online banking screen. The other seven were wrong by thousands of dollars. Not only was the data inaccurate but a job that should have taken me less than an hour took six hours to do,” she says.
“Bank feeds just stop for days on end until you put your bank credentials in again. Then when you do, it dumps days of information in there. It’s not good enough. The additional time it takes me to reconcile these doesn’t make me look good but it’s not my fault and it’s not the client’s fault either,” says Ms McLoughlin.
Fortunately for accountants, bookkeepers and business owners who want to enjoy the time and cost benefits of bank feeds, MYOB’s provider BankLink offers both an accurate and more reliable alternative to screen-scraping.
“For anyone using cloud accounting, accurate bank feeds can be a real time-saver, inaccurate bank feeds can be a nightmare. To ensure you are getting accurate, reliable data in a way that doesn’t contravene your bank’s terms and conditions, it’s important to understand how your cloud accounting provider obtains its bank feeds. Users should check that they haven’t inadvertently supplied a third party with their banking login in details and ask their provider what industry standards their third party supplier complies with,” says Mr Ross.
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Established in 1991, MYOB is now Australasia’s largest business management software provider. Its 50+ products and services have been employed by more than one million businesses in Australia and New Zealand. MYOB serves businesses of all ages, types and sizes, delivering solutions that simplify accounting, payroll, client management, websites and much more.–With a network of more than 20,000 accountants and other professional partners, it provides the support and tools that help make business life easier. Today, MYOB is extending its solutions online and delivering innovation through cloud computing, enabling clients to make smarter connections with their business partners and customers:http://myob.com.au/smarterconnections.