Why Should You Use Cloud-Based Accounting for Your Business?
In the span of a few years, cloud technology has made a significant impact across all sectors. It has increased efficiency, innovation and productivity in numerous industries, especially finance. Many cloud accounting software has emerged that simplify the accounting of a business.
Unlike the on-premise accounting system, a cloud-based accounting solution is hosted on remote servers enabling you to access it online. The business and financial data can be sent to the cloud, which will be processed and returned when required.
Cloud accounting lets businesses get real-time visibility into internal operations and automate financial processes. Cloud-based financial bookkeeping frees the company from installing and maintaining the software on an individual computer. Also, it allows businessmen and employees to access the same data and the same version of the software from the branch office or remotely.
Cloud-based Vs Traditional accounting:
There are some key differences between cloud accounting and traditional accounting methods. Cloud accounting is more flexible and allows anyone with access to the cloud account to get real-time data from any device and location.
In traditional accounting, you need a specific computer to run the software hosted locally. Since these are handled manually, it takes time, and the users should use the same computer to access the software installed to handle the accounting.
The change begins with cloud accounting:
It has been rightly said that “time is money in the business world”, and it does well with the accountants who act as the company’s backbone. With cloud accounting, many things have been simplified, and it helps in knowing important information easily, which empowers the accountants to increase efficiency.
- It is a solution that will help the companies to:
- Run more efficiently
- Make better financial decisions
- Understand the finance better
- Make things better for the company
What are the benefits of opting for cloud accounting for your company?
Cloud accounting software encompasses many solutions for several accounting or bookkeeping functions. For instance, Xero is cloud-based accounting software, whereas Expensify is a cloud-based solution that helps manage employee expenses.
Here are some of the benefits which your business can get with cloud accounting:
- Ability to automate manual accounting and bookkeeping processes – These automation capabilities will enable accountants to save time and increase efficiency. This will allow the clients to spend time on the business growth.
- The ability of data to be accessed regardless of the device or location – This facilitates remote communication services at any time. It will build a strong relationship for the accountants with clients. Since the data can be accessed anytime and anywhere, it will be more beneficial, especially during remote work.
- The ability of the data to be updated in real-time – Cloud-based accounting offers the ability to access financial data and information quickly. This will help in making informed decisions sooner.
- Ability to easily scale up to meet the growing business needs – Manual accounting will be easier when you make 0-100 monthly transactions. Still, it will get more complicated when this number jumps to more than 10,000 monthly transactions. Cloud accounting will easily support this growth.
- Facilitating a paperless environment will eliminate the need for a physical store and manage paper documents. This will be beneficial in both cost and space-saving for the business environment.
- Ability to provide automatic updates – This will further improve the functionality of the applications and better enforce security.
- Ability to reduce costs – Cloud accounting will not incur the charges associated with traditional software, including upgrades, maintenance, system administration, etc.
- Ability to integrate with the other cloud solutions – These offer integration capabilities that will improve efficiency and increase the power of the cloud accounting technology stack.
- Ability to simplify tax compliance – Cloud accounting helps you show them things like how much tax you owe or how much you have paid overtime on a specific tax.
- Ability to centralize the important tasks – Several aspects like managing inventory, payroll, invoices and other details can be tied up with the cloud accounting software.
Is cloud-based accounting secure?
Security is the top concern in cloud accounting with the sensitivity of the data associated with cloud computing applications. Compared to traditional accounting with software that could be compromised if the company’s computer is stolen, damaged or lost, cloud accounting software has many security advantages.
Each cloud accounting solution has its security policy outlining how to protect sensitive data. Most solutions offer measures such as multi-factor authentication and encryption, ensuring the security of sensitive data.
What kind of cloud accounting software does your company need?
Quickbooks Online and Xero are popular cloud accounting software. The key benefit of cloud accounting applications is that you can build the accounting software stack to better suit business needs and improve workflow efficiency.
Cloud accounting software is often available for purchase as a Software as a Service (SaaS) subscription model. The pricing of the cloud accounting software stack usually varies based on the applications used to meet unique business needs. If you are running a business, then find it difficult to handle the accounting, outsource cloud-based bookkeeping services for your growing business, and maintain a competitive edge.
What will happen if you don’t use cloud-based technologies?
The cloud is the future of the business world. Even if your on-premise accounting solution functions fine, this cloud accounting will simplify the tasks. Know that the accounting world is inevitably changing, and every business needs to keep up with it.
The risk associated with traditional accounting isn’t the question of its capability but whether it will help the business grow and maintain its competitive edge. The change can be difficult at first glance, but its potential business benefits will outweigh the costs and be worth consideration.
Future of cloud computing:
Nothing stays the same forever, and every day n, new technology is being developed and introduced in the market. This will create a huge impact on the future of businesses. There is no doubt that cloud accounting will develop in the future and change the regular method of accounting.
With the right cloud accounting, you will be able to track the recent financial data and the entire industry’s data across decades of recorded data if used regularly. It will also help you check the financial health of the company.
Desktop accounting applications might be on the way out, so transitioning to cloud accounting is the smartest choice in today’s world. It will reduce the expenses of accounting and bookkeeping. Also, it won’t just make financial management more efficient but also save time so that you can start focusing on core business goals to get long-term success.
Millions of businesses use cloud accounting; hence it’s time to switch to cloud accounting to help your business thrive in this competitive world.