Database

What it means

A database is structured storage where information sits in tables with defined relationships. That is what makes searching, counting and integrity checks reliable - unlike a list in a spreadsheet.

Accounting software, ERP and CRM all rest on a database, even where the user never sees it. The query language is usually SQL, which reads data and joins it across tables.

A database and the application on top of it are two different things. The application can be replaced; the data stays, provided it can be exported in a usable format. With SaaS products it therefore matters as much as the features who owns the data and in what structure the company gets it back when the contract ends.

How it works in practice

Three practical questions matter to a company: where the database physically runs, who can reach it, and how often it is backed up. The answers belong in the software contract, not in a verbal understanding.

Accounting data in a database carries the same retention obligation as paper documents, and where it holds personal data on staff or clients, GDPR applies as well.

When a client moves to different accounting software, we carry the data from one database to the other. After migration we compare the trial balance and the balances per business partner in the old and new systems. Only when they agree to the cent is the old system switched to read-only and kept available for the archive.

What to watch out for

The commonest failure is not technical - it is the absence of a tested backup. Restores need trying from time to time; a backup nobody has ever restored from is an assumption.

Editing the database directly, outside the application - a bulk fix in SQL, say - bypasses the software’s checks and its audit log. An accounting entry then changes with no trace of who altered it or when, and that is very hard to explain in a tax inspection or an audit.