Cloud Accounting SystemBy Rizwan Rauf on
Cloud accounting applications provide much of the same functionality as desktop accounting software with one major difference: Cloud accounting apps run on remote servers and are accessed via a web browser.
Cloud accounting applications are typically offered in one of these two formats:
Hosted applications – The hosted solutions involve your desktop or client/server accounting application running on a remote server. You gain access to your accounting software using a remote session via the Internet. This solution allows you to use your existing software and data.
Software as a Service (SaaS) – In this format, the accounting software and your data are stored on the vendor’s servers and are accessible via a web browser. If you have ever used a social media site or online banking, you have used a SaaS solution.
Advantages of Cloud Accounting
Save time with automation
Don’t waste time posting and chasing invoices. Cloud accounting software automatically generates invoices— as well as reminders — at regular intervals, meaning you don’t have to manually keep track of debtors. If you combine your accounting software with HR and Payroll applications you can also automatically generate payslips and other HRMS documents.
Work from anywhere with an internet connection
Cloud accounting software means you no longer need to worry about maintaining spreadsheets or installing a programme on one machine. The cloud allows you to log in to your business’s account anywhere with an internet connection. Once you sign up, you can get started straight away.
Value for money
Instead of paying a huge one off fee for accounting software, with the cloud, you can spread the cost by paying monthly — helping you to manage your business’s cash flow. If you do prefer to pay up front, you’ll benefit from a discount.
Automated bank feeds allow you to keep track of your business’s balance sheet in real time. You can also view a variety of reports that give an up-to-date snapshot of your business finances. Online accounting software makes it easier to get closer to your business and gives you a clearer picture of your finances as a whole.
Do you have specific needs unique to your business? Perhaps you require a robust inventory system or a modern CMS platform. With cloud accounting you have the ability to integrate these systems together by using Add-Ons. In addition, staying up to date with compatibility is a seamless process compared to the inevitable issues businesses face with outdated versions of PC based software.
Security is critical for any organisation with large amounts of data, and it’s particularly important for accounting. The obvious advantage to keeping vital and sensitive information on the cloud is removing the human element and the possibility of lost or stolen hardware. People do make mistakes, misplacing their laptops full of important data and losing months of work, and servers can and do fail. Fortunately, cloud services manage backups for you, so you don’t have to worry about losing your data!
Cloud-based accounting also addresses other safety concerns with higher, uniform security standards, automatic redundancies for data and scheduled, seamless security upgrades at no cost to the user. Xero for example use the same level of encryption that is used by banks, and the data is located in enterprise grade hosting facilities that have biometric systems and onsite security guards. Far better protection that small businesses would employ to protect their information. It really is the safer choice.