Systems Design Key Principles

The saying - KEEP IT SIMPLE, STUPID isn't an insult. It's a design principle attributed to a legendary aircraft engineer working for the US Navy in about 1960.
According to the story, Kelly Johnson handed a team of design engineers a handful of tools. He challenged them to design a jet aircraft that an average mechanic could repair under combat conditions with only the tools he'd given them.
I was first introduced to the Kiss Principle by an accounting instructor in college. And for the longest time I thought it was one of the fundamental accounting principles.
Over many years of going to school, learning (which isn't the same thing), and working – I’ve learned that keeping it simple just makes sense.
In many ways, working with very small businesses as a public accountant isn’t all that different from aircraft repair under combat conditions (minus the danger of course.)
Bookkeeping and recordkeeping are often done badly, and key bits of data may be missing.
Despite this we do our best to manage our clients’ tax compliance needs and, in my firm’s case, to help them qualify for generous tax incentives for R&D.
Keeping it simple allows us to build adequate accounting systems on-the-fly. I use my clients’ recollection of what happened and compile transactional data from online sources, to build a comprehensive financial picture of what happened during their most recent tax year.
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In Part Three of this series on accounting systems design for very small businesses, we focus on some key design principles and concepts for designing these systems. In short, we discuss HOW to do systems design.
I have to admit here that I really don’t understand the difference between a principle and a concept. Most accounting textbooks provide long lists of fundamental accounting principles and underlying concepts. But I did note that standard dictionary definitions list “assumptions” as synonyms of both words.
In other words, I suspect that my occupation of accounting sometimes deliberately complicates things – presumably to make practitioners appear more ‘educated’.
Getting stuff to appear simple is sometimes harder than it seems.
Legendary US investor Warren Buffett has been quoted as saying:
“Business schools reward difficult & complex behavior, but simple works better.”
The point is that, when we’re designing systems for non-accountants working in the very small businesses that dominate our Canadian economy, public accountants have always known that keeping it simple works better.
I spent more than a decade working for the tax department, and small accounting practices on Vancouver Island. During that time, most of the systems we designed or encountered were single-entry, cash-basis journals.
They worked because they were simple.
We designed cash receipts and disbursement journals, sales journals, and payroll journals that our clients understood. They understood them because we didn’t confuse them by trying to explain the intricacies of double-entry bookkeeping or the theory behind the balance sheet equation.