Is it time to replace your legacy accounting system? 8 signs tribal CFOs should watch for.

Tribal governments, gaming businesses and other tribal enterprises often rely on legacy accounting systems to oversee their financials. But many of those systems are decades old — and increasingly represent a genuine barrier to efficiency and growth.

Should your tribe consider replacing your current accounting system with a modern, cloud-based enterprise resource planning (ERP) platform like Sage Intacct? Keep reading to learn key indicators that may mean your organization is due for an upgrade, plus how a new ERP would help strengthen your organization.

What are the signs your tribal entity may need to upgrade to a modern ERP system?

The cost of sticking with an aging accounting system grows higher every year, especially as those systems themselves begin to sunset. While your organization may be reluctant to move on from familiar business processes and ways of conducting financial reporting, consider that an accounting system based on paper, spreadsheets or aging software forces your team to work more slowly, makes it harder to prepare for audits and creates cybersecurity risks.

Here is a full list of red flags that may indicate your organization should explore an ERP upgrade:

1. Slowed down by manual processes

Tribal entities relying on legacy accounting systems typically devote significant time and effort to performing slow or paper-based manual processes. These can hamper your organization, costing you hundreds of labor hours per month while also making it harder to adapt to meet today’s fast-paced business climate.

For example, let’s say your tribe requires wet signatures on 3-part carbon purchase orders. This would slow processes in any organization, but for a tribal entity where relevant approvers may be geographically spread out, simply collecting the needed signatures on a single PO could take several hours or even days.

2. Lack of standard processes or controls

Even if your legacy accounting system seems to be meeting your needs, it was almost certainly designed for an earlier iteration of your organization. That means your team has likely adapted as your organization has evolved, to the point where you’re working without standard processes or controls. Some elements of your work could be done on an aging software system, others in spreadsheets and still others on paper.

3. Audit risks

Older accounting systems make it harder for tribal organizations to comply with audits. You’ll spend additional labor hours preparing for audits and pulling sample data if that information is in physical files, storage rooms or trailers rather than readily available as digital attachments in your financial system.

The audit will also likely last longer and cost more because the auditor, too, will have to navigate physical documentation. Manual processes are also more error-prone and have the potential to gain additional scrutiny during your audit process.   

4. Grant compliance challenges

Tribal governments and their grant-funded entities, such as healthcare facilities, face additional grant compliance challenges by leaning on legacy systems. Accounting leaders will have a harder time demonstrating compliance to regulators, risk a higher rate of errors and will also struggle to connect modern grant management software to a legacy accounting system.

5. Data integrity problems

Tribal entities collect financial data in a variety of peripheral systems, which, depending on the specific organization, may include payroll, front-of-house, grant management and more. A modern ERP can typically integrate and streamline daily information from each peripheral system, but a legacy accounting system can’t — which means your team has to manually extract this data and enter it into your spreadsheets or accounting software, taking time and risking mistakes.

6. Limited software support

If your legacy accounting system is sunsetting, you may struggle to find support for that software. The maker may no longer support the product or even be out of business, leaving you reliant on in-house workarounds or a limited pool of third-party technical help.

7. Cybersecurity vulnerabilities

Legacy software systems don’t receive the same ongoing cybersecurity patches that newer systems do. This can leave your systems exposed to cyberattacks, malware and other security incidents that carry costly financial repercussions.

8. Trouble recruiting new talent

Finally, talented professionals want to work on modern systems. If you’re still working out of spreadsheets, using paper approval processes, or working on green screens, you’re going to have trouble recruiting talent to your tribal organization, especially as younger, digitally native generations make up an ever-larger share of the workforce.

One example is how WinnaVegas Casino Resort (WinnaVegas case study) improved financial visibility and streamline processes through ERP implementation supported by outsourced accounting expertise.

How does a modern ERP accounting system benefit tribal organizations?

Tribal governments, casinos and other business entities can all see substantial benefits from a modern ERP accounting system. These include greater operational efficiency, simpler compliance, more focus on high-value work, stronger cybersecurity, easier recruiting and clearer, timely financial data for decision-makers.

• Efficiency: A modern ERP system helps your whole organization to run more efficiently. Using capabilities already built into the ERP, your team can leverage AI or automation tools to automate previously manual tasks like pulling data from your peripheral systems to vastly speed up your financial reporting processes. You’ll also be able to streamline your procurement for greater speed, transparency and visibility.
• Compliance: You’ll streamline audits and more easily demonstrate grant compliance to regulators. Not only will all your essential documentation be easily available in digital form rather than buried in paper files, but you’ll reduce your risk of errors or mistakes that, however unintentional, could raise red flags during the audit process.
• Value: By allowing your team to automate routine tasks, you can free your team members up to focus on higher-level work. For example, your accounting team can spend more time forecasting and developing financial models to help you assess your strategic options for proactive decision-making. You’ll also be better positioned to explore options like outsourcing in situations where that proves cost-effective.
• Security: While a cyberattack is essentially an inevitability for organizations of any size, modern systems can help dramatically mitigate your risk of suffering significant damage. A new ERP will receive regular security updates to patch against vulnerabilities and contain safeguards that legacy systems don’t.
• Recruiting: Skilled professionals want to use tools that empower them, not spreadsheets or systems that may have been built before they were born. As your tribe prepares for your current generation of leaders to retire, modern systems can help you attract top talent.
• Visibility: A modern ERP can give your leadership access to real-time financial data and deeper insights into the performance of your tribal government or business. Your leaders will be able to see what’s happening, consider strategic options and make proactive decisions based on current data rather than relying on reporting that is weeks or even months old.

What’s next?

If you recognize any of the red flags described in this article, your tribal entity may benefit from choosing and implementing a new ERP platform. To explore that question more deeply, begin considering specific areas within your government or business that are hampered by legacy systems and where a modern alternative would deliver tangible ROI.

Talk to a third-party advisor as well. A good advisory firm will understand both ERPs and the specific needs of tribal entities and will be able to help you decide if an ERP upgrade makes sense and support your team in the implementation process.

And finally, to learn more about how tribal organizations can benefit from a new ERP platform, watch this webinar:

How Wipfli can help

We advise tribal governments and gaming organizations on financials, performance, digital systems, compliance, and growth. Let’s talk about how tools like a new ERP platform can help your tribal entity operate more efficiently and effectively. Start a conversation.

Read more

• How real-time financial reporting transforms tribal gaming
• Sage Intacct helps tribal entities improve grant management
• AI for tribes: Managing risk and maximizing impact