Cloud accounting software will help your business
What is different about Cloud Accounting versus traditional desktop accounting systems?
“Cloud Accounting software” is a term people are beginning to use more and more these days and people are hearing and reading more about it. Everyone uses some variation of cloud systems in their daily lives.that people are becoming more used to hearing and reading about. Businesses and consumers all use some variant of cloud software in their everyday lives.
A Key Indication of a modern accounting and bookkeeping service is the use of Cloud Bookkeeping systems to streamline the flow of information to their clients. BriteBooks360 uses the latest in these technologies, providing the most secure and efficient form of transferring data between us and our clients.
What is it? And Why should you use it?
Cloud software is hosted on remote servers rather than onsite, providing ease of access and ease of backup.
Xero™ Accounting Software states that cloud software is a “a platform to make data and software accessible online anytime, anywhere, from any device. Your hard drive is no longer the central hub.”
QuickBooks™ Online explanation of cloud accounting further stated: “Employees have greater visibility within an organization and can collaborate more effectively. And for business owners, peace of mind comes from knowing that routine maintenance and updates to the software are managed by the SaaS (Software as a Service) provider.”
Cloud systems are not much different than traditional systems that Companies are used to. The main difference is that the application functions are all performed offsite, not on the user’s actual desktop.
If you have internet access, then you are able to sign into the server and access the relevant data needed.
What are the benefits when compared to traditional accounting systems?
Investing in a cloud accounting software system and support professionals that understand your system has proven long-term benefits, particularly when considered from a business expenditure standpoint. The expenses involved in new hardware, like servers, can be a real drain on company finances.
Companies with cloud accounting software can access relevant financial data, even if they are not in the office. Large companies have the ability for all interested parties to have access to the same data, rather than relying on disconnected systems for exchanging data and synchronization issues. Easily accessible cloud accounting systems allow for an increased collaboration within organizations.
Cloud accounting software compared to traditional local systems, can aid in paperless environments and reduce in storage costs of documents. Updates occur automatically, and the manual maintenance of the hard drive is not needed, due to the data being stored remotely. Cloud accounting software promotes more flexibility in Companies – global as well as local.
Problems with traditional accounting systems
Technological advances will soon make it impossible to run a business without having an effective online collaboration between employees across the company. Only one person has access to the data on one hard drive at a time, meaning that key people may not be able to immediately access the financial or customer details they need, when they need them.
Moreover, current accounting systems do not allow for simple data sharing through hard drives, unless you use a USB device. For a large company looking to share data between a number of people, this just is not feasible. From a security standpoint, transfers of data through something like a USB device means that the process is generally less secure, and open to corruption. Fires or flooding in the workplace could destroy company computers and, with them, any data that had been saved to the hard drive.
What cloud accounting software is available?
Making the decision to move from traditional accounting systems to cloud accounting software is one thing, but knowing which provider to choose can be a daunting task. We can assist companies with the decision and implementation process.
Some of the software providers available are the following:
Is cloud accounting safe?
As most applications on cloud accounting software take place on a shared remote server, there is no need for a manual transference of data. All employees will have access to the same cloud database, each with an individual password. Password management is vital in securing data. Generally cloud accounting systems are going to run on more secure servers than a smaller organization can implement.
Information can be shared between us and our clients and among team members who have the same access rights to the system. The risk of sensitive information being taken by an external source is far lesser than a security breach occurring when using current accounting systems.
Cloud providers make sure to provide backup servers in two or more locations. This means that, if one server goes down for any reason, Companies will still be able to access their data.
Cloud accounting software guards against external threats more effectively than traditional accounting. Nonetheless, there are still potential risks that firms need to consider when choosing to use cloud accounting software.
Potential risks of cloud accounting software
Employees using cloud accounting software do rely more heavily on a secure WiFi network and powerful remote computers than those using more traditional accounting systems. When systems are running as they should, this is not a problem.
However, for those employees who have chosen to work remotely, this may present complications and potential security risks. For example, an employee working in a local café may choose to connect to the local WiFi. As this is not a secure connection, they are running the risk of a data breach.
This has been remedied somewhat through the use of a two-factor authentication process. This means that, when an employee goes to sign in to the server, they will be sent a code via text message to their mobile or use a secure app to log a unique identifying number. Using this, along with their username and password, employees will have access to the server.
This does safeguard from a majority of threats, employees will need to remain aware that accessing their cloud server when not connected to a secure network does mean there is a risk of external threats.
Larger businesses that decide to make the move to cloud software will need to put a structured plan of implementation in place. For example, signing all employees up to the new system and ascertaining that all the critical data they already have is transferred over smoothly.
The future of accounting systems online
It has been predicted that, by 2020, 78% of small businesses will rely solely on cloud technology. This is a high percentage not to be ignored by Companies that have yet not made the transition.
Hubdoc has stated said: “The cloud is the future. Even if your on-premise accounting solution seems to function ‘just fine’, or if you’re diligent about managing your traditional processes, the world of accounting is inevitably changing, and it’s important for your business to keep up. The risk associated with maintaining old processes isn’t a question of capability – rather, it’s a question of whether or not you want to grow your business and maintain a competitive edge.
“Change can be difficult, but if the potential business benefits outweigh the costs, then it’s worth your consideration. As daunting as a transition to the cloud might seem, don’t be intimidated.”
Cloud accounting software is the future of accounting. Firms like ours are leading the change to get your business a proven system. Contact us for more information about a Cloud accounting system for your business. We specialize in providing bookkeeping services to business in Michigan.