Cloud Accounting: What role does it play in the future of accounting? | Accountroots

Cloud Accounting: What role does it play in the future of accounting? | Accountroots

As an accounting and bookkeeping firm, you are probably always on the lookout to be more efficient. You would want to implement different strategies and would use different soft wares that may benefit your clients and make your accounting processes more well-organized. Cloud accounting is one such strategy you can implement.

However, even if you know about cloud accounting and its benefits to accounting,  getting your clients to agree to use cloud accounting software is not always that easy. They may ask to have questions. They may ask questions.

These questions can be about anything from data security to software prices and as their accounting partner, you should have the answers.

Clients usually have a problem because changing any process, especially with so much sensitive data, can be complicated. Not to mention the fact that cloud accounting is probably not your client’s area of expertise. It is your job to convince them that cloud accounting is very beneficial and help them make the transition too. Some of your client’s questions are answered in this blog.

What is Cloud Accounting?

Before the invention of Cloud Accounting, accounting software was hosted locally on the hard drives of desktop computers. An example of this type of software is QuickBooks Desktop. On the other hand, cloud accounting is executed using accounting software that has to be hosted remotely on the cloud, which means online.

To put it simply, “cloud” means Internet. Cloud computing is the delivery of different computing services over the internet. These services can include storage, servers, databases, analytics, networking, etc. This allows for faster innovation and more flexible resources. You only have to pay for the services you use, which lowers the operating costs. Another benefit is that cloud computing allows for more effortless upscaling.

Over the past few years, the cloud’s invention has disrupted and positively transformed many different industries. It has allowed different businesses to operate remotely with ease and work more effectively and cut costs.

What are the Benefits of Cloud Accounting?

There are many accounting functions and services for which cloud accounting software has come up with new advanced solutions. For example, Xero is accounting software that can help with invoicing, bank reconciliation, reporting, contacts, and much more. Although the benefits of cloud accounting vary depending on which services perspective you look at it from. Some general benefits are highlighted below.

Real-Time Data:

Cloud accounting software allows businesses to have ability to access their financial data in real-time. This can help them make informed decisions as they will be able to see any changes that are made immediately with all of their numbers accessible at once.

Easy Scalable:

Cloud accounting software allows its users the ability to scale up their businesses easily and supports their growth as well.

Paperless Environment:

It also helps facilitate a paperless environment. Since its users no longer have to store their data physically; it also helps them manage their office space.

Automation:

Its users can also automate their accounting and bookkeeping processes. This automation allows for better time management and more efficiency. It also allows them to focus on their business growth.

Not Location Dependent:

Cloud accounting software also allows its users to access their financial data anywhere. This not only allows the implementation of remote services but also facilitates better communication between the bookkeeper and their client.

Automatic Updates:

It provides automatic updates which not only help improve the functionality of the applications but also allow for better security.

Reduce Costs:

Cloud accounting software help accounting firms reduce costs. This is because they do not incur costs the way traditional software does. They do not require costs for maintenance, upgrades or system administration, etc.

Integration:

These software also allow their users the ability to integrate with other cloud solutions. This capability can improve the efficiency of the software and also increase the power of your accounting technology stack.

Is “The Cloud” Secure?

As an accounting firm, you are probably already aware of the importance of data security and so are your clients. Given the sensitivity of accounting data, whether the cloud is secure or not, is usually one of your client’s top concerns.

When considering the security of traditional desktop accounting software, it is obvious that it can be compromised if the company computer is stolen or damaged. Cloud accounting software on the other hand has many security advantages. Each software has a unique security policy that explains exactly how it protects sensitive data. Most cloud solutions use multi-factor authentication and encryption to ensure that the data remains secure.

What kinds of solutions are available in the market?

Some well-known solutions are Xero and QuickBooks Online. However, the benefit of cloud accounting is that you can build a technology stack as per your needs. For example, Expensify helps manage employee expenses and Hubdoc automatically fetches financial documents and extracts key data. When these are integrated with Xero and QuickBooks, the value of these and your general ledger software increases.

Luckily, cloud accounting solutions are almost always available as a SaaS (Software as a Service) subscription model. This means that the cost of your accounting software stack depends solely on the applications and services you need to meet your business needs.

Get a Free Consultation Today!

As a remote accounting firm for accountants, we know all there is to know about cloud accounting solutions, their benefits, and how to utilize their services to help our clients better manage their work.

Accountroots is a virtual team of accountants and financial experts that provides outsourced accounting services to accountants. Out offshore team for accountants will help you build your accounting technology stack as per your business requirements.

For more information, head over to our Contact Us page to book your first free consultation. What are you waiting for, start your outsourcing journey today!

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