EFTA01122477.pdf

ISSUE 142 APRIL 2013 uperyacht SThy TRUTH • OPINION KNOVUEDGE • IDEAS \ND EXPERT INDUSTRY ANALYSIS REPOR BEST OF BRITISH Insight into what some of the UK's superyachting leading lights think puts the 'great in Great Britain. Page 27 STAR FISH Approved by class for rebuild after a fire. this 50th explorer ',min. now for sale. makes an interesting businem prospect. Page 42 PENDENNIS Currenih rebuilding 315. the largest sloop in the world, the yard is also launching a massive new development. Page 50 MANAGEMENT SURVEY Comments on whether the gmwing yacht management industry is assisting or hindering operations at sea. Page 74 EFTA01122477 Keep It Simple The mantra for captains and managers when it comes to superyacht accounting is little and often, but even then, difficulties arise. Don Hoyt Gorman investigates some of the latest superyacht-specific software solutions available on the market today. alking the docks at Fort Lauderdale in previously developed property management W 2012, Dacha Grupman might very easily have been intimidated by the prevalence of and accounting solutions, medical billing software (EMR), invoicing systems, industry fat-cats and surly sailors amidst the maintenance management software, customer tens of thousands of show visitors who picked relationship management (CRM), and several their way through the hurricane-soaked event. other database management systems. Together, But Grupman was determined. She's spent the over two years, they built a deceptively simple better part of four years developing a tool that program, based on the robust architecture could help the industry, and she quickly booked of the commercially available FileMakerPm meetings with some of the show's key figures. software. Starting in the summer of 2009, they developed their first trial version by 2010 and Grupman's software — previously known quickly began proposing its use for other home as Expense Steward and now known as office accountants through their network of Latitude505 — aims to solve the significant contacts. By 2011, they'd met a client who also accounting headaches that captains face had a yacht and wanted to use the software to essentially every day: tracking receipts and account for the vessel's expenses. Grupman invoices, and submitting expenses for approval, said that she has shown Latitude to most of the providing historical reports to show how the major management companies and has free costs of various departments (engine room, trials out with about 10 captains. galley, housekeeping) have fluctuated over the season or over years. With the ability to export all its data to Excel, the system works relatively well in conjunction Grupman has an MBA from Fordhain and, prior with a home office or management company's to stepping into the superyacht sector; had been existing systems. "We're focusing on private managing a handful of residential estates for vessels for the time being, though we've had JP Bailey. "I was doing the accounting for these meetings with a number of managements homes, and was getting reports from the people companies," Grupman said. "On commercial managing those homes, who had no accounting vessels, management tends to dictate the education and who barely knew Excel," accounting software, and so we're hoping we Grupman explained. "So every month, it was a can persuade one of the companies to give us big headache." She looked for software to make a try." it easier, but they were all too complicated and time-consuming for these managers to learn. I'd seen Grupman's pitch and started to wonder about the problem of accounting for To make her own life easier, she partnered superyachts. Her product clearly seemed to be with software developer Uli Graser, who had filling a perceived need. After all, 1 pres d nE SLFERYAD IT FEPCRT I ISSLE 142 95 EFTA01122478 MANAGEMENT FOCUS I ACCOUNTING that, like me, most yacht crew had avoid spreadsheets our whole lives. Patrick Moussa at Master Yachts gotten into the life of sailing to avoid According to our industry insight, explained that they are currently things like spreadsheets. Accounting most managers and captains work developing new software for their — with no offence intended to with general accounting software clients that forms part of their wider accountants — is pretty much the like Access, Quicken, TAS, Sage and management software platform. The opposite of sailing. So how, with all others, which are then customised new system, MYConnect, will be a web- of today's reporting requirements to their offices' and yachts' needs. based portal that will allow owners, and need for fiscal transparency, are Other managers, captains and owners managers and crew to access their captains and managers coping? will have taken the technical step yacht data. The software, according to of commissioning custom software Moussa, is an "integration of Microsoft I am a journalist, not an accountant Dynamics AX 2012 and SharePoint (some of you may not know that), 2010, with some third party add-ons but that's not the point: any software "Crews are getting and custom code. It'll allow owners I have used for tabulating sums and more professional and and crew to access ISM and statutory building some kind of report (Excel, management companies documents, real-time accounting data, Quicken and a custom program I used and it will eventually tie into their years ago when I worked for a hospital are following more package management system as well. foundation) was bafflingly over-spec'd. reporting rules. It might It's a very serious investment that is They're almost always made to be be that accounting will taking a lot of effort to put in place too powerful, and inevitably offer be one of the next areas and will enhance dramatically what we tools, templates and functions that I to get more attention." have today? would never need. Using them was like having to perform gastric surgery Another company that's developed each time I wanted to take a pulse. to enable them to simplify their accounting solutions as part of So, although I don't manage a yacht's own processes... and many of these their wider management solution finances, I feel equivalent to those solutions are no doubt excellent. The is the German firm SpecTec. who need to manage budgets and big management houses have invested Tobias Allebrodt explained that the account for spending - we've tried to in their own custom systems. accounting tool they offer for their yacht clients through their IDEA I ts d•—•••• • i••• ••• platform is designed for petty cash aboard, and uses different accounts for different currencies for individual !=l• SEE. cost centres on the yacht. Allebrodes sense of what the clients are looking • • • for, however, is telling. • • ti • • • "We've been approached by a few • • . • • companies interested in developing • fl • very detailed accounting software `1M-1 -1-1110•••••PI i!spo • • 1L for yachts, but, from our point of view, the issue is, at the moment, overestimated," Allebrodt said. ABOVE. SPLCTEC IDEAS ACCOUNTING PLATFORM ENABLES CREW TO KEEP TRACK OF PETTY CASH. BELOW. TECHMAN HUB. MS I .se.• •••• ....es es. ample • ••• a se •••••S SAMOS a.• So SSD a •••• — S Jai al* • • ••••••• 'mew SWISH. OWSO SSW M elSe a IS •••••• SSP •••• SS 0 • ••••••• onsimo seep ISO Yea ma as Ss •a sis WISES. SA SI SS Sq. OEM ••••• SIS nee Se ti SI SINS is • ra.• n sow is. s••••••••• 0e es . SS as ei•-•••• sm. Ss SEEPS eiS Seme eft WS SIS SS •••• Ste. Sa a a se es ••••••• MS •••••• SWISS Se •••••• • anal. SS's SOS • Mg MIS SOY SIBS ell 01, .0000 MEM •••••• Imflin ewe.. ea im east.. a- -- e• %/IMPS SSW. •••• SS .MO •.• asses - • 96 nE SISERYACIff PZPORT I ME 142 EFTA01122479  at at. dam Clive Dixon, senior partner with ...er••• aaa NINSIMINIP • the chartered accountants and business advisors Moore Stephens ItetIPM in the Isle of Man, sees the issue of a SI Ile accounting as a universal challenge al that isn't any different for yachts from other business. 'The fundamentals ▪wig of accounting arc the same, no ▪Vol as matter which field or industry is involved," Dixon said. "Multi- currency is important given the mobility of yachts from one country or jurisdiction to another and the tendency to use suppliers from a variety ofjurisdictions. A robust chart of accounts is also a must-have to ensure expenditure is captured under appropriate headings with an ••••• lal CSIT Sal IS. saW appropriate level of detail. Flexibility is key and this very much depends on what information the owner or other Conicarloon Report Ile 1013 /Lest Month/Last Year /Chsen Asap* stakeholder wants to see and it should (Cash 0•111) seek to complement information LaShootr•Dort provided by other sources? 3•• 0013 Ost 2•11 1.a 0•13 Asa. ••• Ora, I 013 431 ID/ 4C0 The challenge for ISSOSW 14" Nene••••• Sae 'sago sou 12,030 1.100 21 LIADO LAT? 2.211 captains is finding the MN WOWS AMMON Fa I Laie 10.430 12.0:0 UAW Ithn )7. time required to get all • tia• aia7 the accounts in order and then keeping easy We NU x21• ti 190.••• • ear track of spending. 11000 11.03 "a Moore Stephens tailors its accounting 1000 software exactly to its client's needs. a' • "One of our aims is to help captains with their expense reporting so they can provide improved reporting osca or- ter ces timescales and accuracy," Dixon said. 'We often see our role as a friendly auditor, helping when it comes to MSS MSS a verifying information provided by ala alma yacht managers and captains by ••• a a a *walla Imow as, adding value and giving peace of ...war lane r Olaalaialla Maas mind to the owners.' ar dada alai* Sao alma SS. -- • In his on-going work to source new solutions for Moore Stephens' clients. aa* Dixon met with Grupman and is rr currently evaluating her latitude365 osagaillati software. 'Metall, Latitude365 looks versatile, which is important because yacht clients often have their own Ina••••r specific preferences as to presentation of information," Dixon said. "We are due to meet up with Dasha soon to TOR LANTUDE365'S ANNUAL BUDGET SCREEN SHOWING CREW EXPENSE CATEGORIES BY learn more about the package and MONTH OVER THE PREVIOUS YEAR. CELLS IN ORANGE INDICATE AMOUNT BY WHICH BUDGET WAS EXCEEDED. want to explore budget versus actual MIDDLE: LATITUDE365'S COMPARISON REPORT FOR ADMINISTRATION COSTS SHOWS reporting and how the data can be CURRENT MONTH, PREVIOUS MONTH, AND SAME MONTH LAST YEAR FOR QUICK REFERENCE. output to enable financial modelling ABOVE: LATITUDE365'S MAIN DASHBOARD SHOWNG THE STATUS OF ALL CURRENT and reporting formatting, among ACCOUNTS, ACCESS TO UNPAID INVOICES AND A SNAPSHOT OF CURRENT SPENDING. TPE SUCIERVOrt FIEPCAT I tSSUE 142 97 EFTA01122480 other things. On first sight, though, based data server and the ship's on- You have to find the categories and for superyacht-specific accounting board server, and all the workstations calculate the results... I used to do it and reporting, this looks like a neat they serve. Will Kaye, former manager manually for my previous boss and it solution." and captain of NI/Y BigAron, tested took hours. No matter how careful I the software and thinks the sync was, it was almost impossible not to With Latitude365, Crupman and feature is a game-changer for captains. make a mistake once in a while." her partner have taken a superyacht- "At the moment, heads of department specific approach (although the send me their Quicken files and I "What struck me when going through software is equally well suited to import them on to the main server. it was the fact that every little bit managing private residences, as was Latitude's process makes this a lot of functionality of the system was its genesis). Clients don't need to easier. They'd import the receipts something I need and use and like," lay out enormous sums for custom themselves, and it would be there for Captain Kaye said, "and there was software development, and they don't me, the owner or other managers to nothing else. It was just all there. It need to hire a developer to customise view•. It saves us all this extra process." seems to be very well thought out in existing software. It's been developed terms of what we in this industry need and tested based on the needs and Latitude365's clients can use the to use." feedback of those on the front lines of company's US-based servers (all SSL- the industry. According to Grupman, encrypted) or, as one residential client the package cost starts at E50 per requested, have the software installed It's a tough market. Each month up to E350, depending on the on their private server wherever in owner, manager and size of the yacht and requirements. the world they prefer. In any case, the captain wants to do their on-board software syncs and keeps the data current across all platforms. A accounts their own way. "Excel reports calculate item 'reports' tab brings the user to a page by item down incredibly of options, like a tool bag of simple Y.CO were early adopters when it yet sophisticated accounting toys that came to engaging with latitude. "The long spreadsheets... No lets users produce understandable last piece of the puzzle for us in our matter how careful I was, reports. Users can produce monthly ongoing development of Y.CO Live it was almost impossible summaries or generate a detailed view is the accounting package," Charlie not to make a mistake of all the incomings and outgoings. Birkett of Y.CO told me. "We met with once in a while." There's an option to see a report Dasha and brought Latitude in for an of expenses by supplier, so captains initial test. It certainly ticks a lot of the can quickly assess where funds are boxes. We're watching it very closely. However, the most important feature headed (food, telecommunications, We'll definitely be trialling it for one of La 1e365 is its, shall we say, crew- fuel, transport, etc.) There is also a or two of our yachts." Depending on proof simplicity. It's so easy to figure historical summary function, a clever how well the trial goes, the software out and start using that I would expect means for captains and managers to could be integrated into the house's every spreadsheet-averse crewmember show their owners how funds have Y.CO LIVE management suite. in the fleet could file monthly reports been disbursed over a season, a year to the owner or manager after less or the lifetime of the yacht. It's a tough market. Each owner, than an hour's introduction. manager and captain wants to do their "Most commercial software avoids accounts their own way, so Grupman Latitude365 uses a dashboard-like historical summaries, but owners has a major campaign on her hands to interface that foregoes flashy colours seem to really like them," Grupman persuade the industry that Latitude is or slick typefaces. At a glance, users said, when I questioned the need easy, effective and better than what's see the state of the yacht's accounts for this function. "It's interesting to currently available. Trials are currently (the main holding account, cash, owners because it provides an easy underway and she has received captain's account, chief stew's, way to compare and analyse costs and good feedback so far. If this is what etc.). As one of the key purposes of spending across categories. It really innovation looks like for our industry, the accounting program is to track helps them make decisions about what bring it on. ■ outstanding bills and invoices and areas of the budget can be trimmed or requests for expense approvals, these otherwise adjusted." Opening image: istock.com functions are front and centre. Every user has access set at the appropriate There's also a custom report capability•. To comment on this article, email level (as determined during the initial which gives the captain or manager the consultancy and build) and can track ability to hand over clear snapshots on with subject: Keep It Simple their own requests and requirements. any aspect of the yacht's spending. "To do something like this in Excel takes Key to its functionality for superyachts a long time," Grupman pointed out. is the sync feature, which keeps the "Excel reports calculate item by item data synchronised between a land- down incredibly long spreadsheets. TIE SLPERY/tafT FGDORT I ISSLE 142 99 EFTA01122481