Everyone is moving to the cloud, why not Accounting? Accounting has really benefited from the development of technology. It has come a long way from manual journalizing and posting into automated systems and applications. Today, as new tools and processes evolve further, finance teams are starting to move to online or web-based accounting. This is a departure from the traditional accounting software that comes in boxes, wherein you install it on each computer in your team and set those computers to form your accounting system. In this manner, your accounting is setup in-house or in-source. With cloud accounting, you accounting system is offered by a service provider online. Since businesses are still hesitant for this change, the old school accounting software still works. But as your business grows, your accounting also grows. You will soon find out that maintaining and processing all those financial information will soon outweigh the cost more than the benefit.
With this shift in accounting systems, there has been a considerable growth on online accounting providers. Several companies have risen such as Xero, Zoho, FreshBooks and Wave that give small to medium businesses a choice on improving their accounting tasks from the point of view of end users and stakeholders of accounting information. Both of these old and new approaches have their inherent advantages and disadvantages. I have personally used both desktop and cloud systems and I can tell that online accounting may have a slight advantage here.
A slow accounting system is bad for business. This is probably one of the greatest frustrations an accountant could have. Imagine doing a journal entry that would take 10 to 15 minutes to complete. This maybe the result of an outdated desktop accounting software being administered in an old company server. With cloud accounting, this is rarely the case. Your speed is only limited by the speed of your internet connection. All your data is stored and transmitted from your provider’s servers.
NO SOFTWARE, NO HARDWARE
Well technically there is still software and hardware but very minimal. You still need to have a device that can connect to the internet. And you need to have also an internet browser to access your accounting software. No software is being installed in your computer. No company server or networking setup here because it’s all in the cloud.
If your company offers laptops, then you are lucky because you can access your installed accounting system even from home. Most of us still use desktops at work so working from home is not possible. With online accounting, you can work anywhere anytime. This is the best feature of the cloud that I really love. If you are on the middle of an accounting task at work and you can’t finish it then and there, just save it to the cloud and access it later from home or even from your smartphone.
Financial records are considered highly confidential in any organization. You always want these records away from prying eyes. It is important to understand that the cloud is still a physical server somewhere. Although online accounting offers enterprise level of security, your data is still vulnerable as any other information across the web. So make sure to choose a provider that can give security you can trust.
Cloud accounting services come in subscription pricing. It means you only pay what you actually use. The services are highly scalable and flexible. There are even free plans you can avail so if you need just a basic double entry bookkeeping, you can use it at no cost at all. As your business grow, you can always upgrade to premium subscriptions.
An accounting system is as much as important as any CRM or ERP system for any business.There are options out there other that the legacy systems in place. If you ever start an accounting system or consider an upgrade, there is no better place to start than up there in the cloud.