The real extent of the integration problem facing accountancy firms is highlighted in a recent survey by the ICAEW’s IT faculty.

Most of the 700 practices surveyed use more than one software package, and the majority of those say those systems are not sufficiently integrated so that re-keying of simple data, such as client details, might be required. Most of the respondents also say software houses are not doing enough to enable data sharing between applications.

Paul Booth, technical and development manager at the ICAEW’s IT faculty, says the integration problem is an important one. ‘There could be quite a bit of time wasted – expensive time – in practices where there is a lack of integration. And there is increased risk of error. These two things make it an important issue.’ He adds that better integration enables firms to choose best-of-breed applications, which may not necessarily be the best software packages, but those that are most appropriate to the needs of the particular user.

‘From the suppliers’ point of view, the issue has always been that some suppliers are keener on it [integration] than others,’ says Simon Hurst, IT consultant and chairman of the IT faculty’s practice software suppliers’ forum. ‘Some have a suite of applications.’ They can therefore claim that any customer buying the suite has automatic integration, Hurst explains.

However, the IT faculty wants to support promotion of choice, enabling firms to choose best-of-breed packages from different suppliers. ‘That’s why the faculty has been working on the XAPL project,’ Hurst says.

XAPL is a new common standard for the exchange and sharing of data between different applications supplied to accountancy firms

by software developers. With support from the IT faculty, software supplier Digita took the lead to develop XAPL, running a successful test last year when a file was transferred out of a Star Computers suite and uploaded into a Digita solution.

Jerry Rihll, managing director of Digita, explains his company’s role in developing the XAPL standard. ‘To have a standard you have to have a schema, a template, you have to define what a name is, an address, a person – it can be quite complicated,’ Rihll says. ‘Digita defined a standard, a schema, and submitted it to the IT faculty and software companies that are partners and competitors. That was ratified by the software market and we have spent the last year implementing it.’

Digita applications using the new XAPL standard will be available from March. Meanwhile, the company is working with a couple of partners that are also integrating the standard into their own products. ‘We are very, very excited about it,’ Rihll says of XAPL. ‘We are very enthusiastic but we recognise that standards only get adopted when you get a tipping point. There are too many monopolistic companies that don’t have their clients’ best interest at heart. Too many software companies have a vested interest in locking their clients in. It’s no surprise that all software companies in the industry confirmed the ratification of the standard, but one or two have been less than forthcoming.’ Encouraging mass adoption will need some form of ‘lobby action’, Rihll believes.

Although the institute has played an important role in supporting the XAPL standard, Rihll believes it could do more. ‘The institute has been acting as a kind of United Nations,’ he says. ‘Maybe it could now take it to the next level. It has a very successful product accreditation scheme in place. Why not make it [adoption of the XAPL standard] a condition of the accreditation?’ Given that accreditation has to be renewed every year, this could very quickly bring about widespread XAPL adoption.

Suppliers aren’t necessarily resistant to change. Greg Ford, managing director of Sage’s accountants division, believes it would be better for firms if applications from different suppliers were better integrated. ‘The ability to reuse and leverage data is highly regarded by accountants,’ he says. ‘On the one hand there are efficiency savings and this is well-known. However, adding value by reuse of data, especially for analytics, is potentially much more powerful. Since there are pockets of excellence and best-of-breed products in use, these will be greatly enhanced if there is clear and clean data sharing.’

As for the XAPL standard, Ford says: ‘Sage fully supports this initiative and has been actively involved with the ICAEW and other vendors in this project.’ Sage does anticipate incorporating the XAPL standard into its applications in future. ‘However, we have no definitive date for implementation,’ Ford notes. ‘The content of our products is driven by customers. Via our strategic development groups and development partner initiatives, we are actively driven to deliver what our customers deem to be their priorities.’

While Ford admits ‘there is still more we can do’ in terms of integration, he concludes: ‘We are and remain, committed to integration.’

Another major supplier to accountancy firms, IRIS, appears to have a fairly standoffish attitude to the XAPL initiative, highlighting its own suite of applications’ integration capability. ‘As the only software provider with an integrated product range, we would recommend better integration every time,’ says Martin Leuw, chief executive of IRIS.

Leuw adds: ‘The XAPL standard will be far more relevant to all those other software suppliers that don’t have an integrated product range, residing on one single central database.’

Asked whether IRIS envisages incorporating the XAPL standard into its applications in future, Leuw remains noncommittal. ‘The introduction of the XAPL standard is a good idea in principle,’ he says. ‘IRIS maintains a close dialogue with the ICAEW and will watch the progress of the XAPL standard with interest.’

Ultimately, it will be user pressure that forces change before major software suppliers decide if it is worthwhile implementing XAPL. Until then, choice of best-of-breed applications by accountancy firms could remain impeded.

Sarah Perrin is a freelance journalist