Because we are living in an increasingly connected, increasingly online society, plenty of businesses rely on e-commerce. The Internet Age has revolutionized every industry and accounting is no exception. Introducing, cloud accounting; a faster and more efficient method of tracking your business’ expenses and financial reporting. However, financial departments can take advantage of the fact that large amounts of data can be stored online, through cloud-based accounting services. These are programs that do not need to be installed on computers or laptops; instead, you log into a website and access your information on an encrypted system.
Read on to learn more about why you should consider moving to cloud-based accounting or partnering with CPAs who are well-versed in this service.
Automated business tasks
When you subscribe to cloud-based accounting, you have the option to mechanize tasks that require manual labour, such as data entry and journal updating. Being able to do so reduces the impact of human error on your company’s data. In addition, AI can also handle transactions with clients and customers, like paying invoices and accepting payments. Because a portion of your business is automated, you will be able to devote your manpower to higher-level tasks, such as strategizing and improving cash flow.
Cost-effective and efficient
Moving to cloud-based accounting means that your company does not need to cover hardware maintenance and electricity expenses. It slashes a big portion of your IT overhead off. Cloud solutions are also typically subscription-based, meaning you don’t have to purchase and update your own accounting software. Because you are essentially contracting your accounting service, you don’t need to wait for weeks or months for the software roll out; once set up, your employees can get on board.
Centralized information system
All documents pertaining to company expenses are in one place. As such, it promotes better collaboration among accountants, financial officers, and other personnel in charge of company funds. Because there is no physical copy of your data onsite, it is less prone to natural disasters and loss due to misplaced equipment. It is common for managers to ask if data is secure in a cloud-based service. However, prospective users need not worry, as these cloud accounting companies prioritize quality encryption and security software.
Improved transparency with clients
In financial operations involving cloud-based accounting, anyone logged into the system can view the same data and see it updating in real-time. It means the client will be able to follow the accountant or finance officer’s analysis on their own and have an informed opinion about their recommendations. Including an employee timekeeping function on your subscription gives people you work with a better idea of how the company is billing them for hours, which contributes to client satisfaction.
Adding services only as needed
Companies using cloud accounting services pay only for space allocation and services they use. The service may be able to provide more than what they’re receiving, but if the company opts out of the other features or the larger space, they can. This is great for companies that are just starting out. What is great about this system is that upgrades and system administration is not left to the client, and they have the option to scale up their plan as the business grows. All they need to do is upgrade.
With cloud-based accounting, human error, costly (and unnecessary) onsite upgrades, and disorganized financial documents will be a thing of the past. For you to build your company, you need good cash flow, and the detailed documentation to match. Hire accountants who are well-versed in cloud-based accounting tools, who can provide you with much more than bookkeeping and financial reporting and help scale your business.
If you are interested in further exploring cloud-based accounting, the next step is to look into companies and software that offer the tools best suited to your business. QuickBooks has been a long-standing favourite of smaller companies and can be expected to add more features to their cloud-based solutions over the next few years. Xero and Wave are two other software companies that specialize in cloud accounting software. Net Suites has been offering cloud-based solutions since 1999 and Microsoft is rolling out new cloud solutions for accounting.
Ultimately, cloud accounting holds a promising future of the modernization and improved efficiency of accounting. It has the potential to be a top tool for both accountants and business owners alike and its value to business operations should to be embraced. Contact us at (647) 667-0040 to learn more.
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