When installing SharePoint 2013 in single server mode on a machine that is not connected to a domain , you might want to use SQL server 2008 R2 or SQL server 2012 instead of SQL server express. But SharePoint 2013 configuration wizard wouldn’t allow you to do so and will throw an error stating local system accounts can be used only on standalone mode.
To work around this SharePoint validation and install SharePoint 2013 with a local system account and still use SQL Server, we will have to use the PowerShell command New-SPConfigurationDatabase to create a new SharePoint configuration database and rerun the configuration wizard. The New-SPConfigurationDatabase command will prompt for database name, server and farm credentials as user input. When prompted for the farm credentials you can supply the credentials of the local system account. The command will create a SharePint 2013 configuration database in the SQL server you have provided.
Once the SharePoint 2013 configuration database is created, you can re-run the SharePoint configuration wizard again and will notice the SharePoint 2013 farm is created and you will be able to proceed with the installation.