Over recent years there has been a dramatic increase in the use of cloud-based accounting software as more and more businesses have moved away from the traditional desktop options.
What is cloud software?
Before cloud-based software was available we used to have on-premises software. This was software that had to be installed and run on individual computers. We took regular back-ups to ensure no data was lost and ran all the updates and maintenance tasks ourselves. This meant that we had to do the work where we had access to the systems and usually this was in the office at our desks.
We also had to buy multiple copies of the software and install it on more than one machine which was costly and time consuming. Over the last five years we have seen a vast increase in the use of cloud-based software. This is software is accessible via the internet.
What are the benefits of cloud-based accounting software?
Cloud-based accounting software has many benefits over the desktop equivalent solutions including the following:
Accessibility
Cloud-based software is accessible from anywhere 24/7 so long as the user has an internet connection they have access to their accounting data. They no longer have to go to the office which can result in less unproductive time when they are travelling and more flexibility over working location as we have seen with the increase of working from home.
Updates and maintenance
Hosting, maintenance and updates of the software are all done for you by the software provider. There is no need to buy multiple copies and install it on different computers as it is maintained in the cloud. Cloud based software is constantly being updated with improvements and new features such as AI support to enhance a user’s experience.
Time savings through integration and automation
Cloud based solutions permit automation and the ability to add applications to expand the system allowing for time savings to be made. For example, bank feeds now make the reconciliation of the bank much more time efficient, automated invoice processing removes the need for manual entry, integrations for areas like payroll, stock and many others ensure data flows between applications. All of these provide time saving of repetitive tasks.
Real Time Data
With the accessibility and integrations available, this means that you have access to real-time information. That the team always have access to up-to-date financial data at their fingertips to make informed decisions. Also, everyone has access to the same information so no one is working with old data – instead, everyone works with the same data and so this ensures consistency in reporting across the business.
Data Security
There is the ability to have multi factor authentication and unique passwords with cloud-based software so providing enhanced levels of security. With all data being stored in the cloud the risk of data being accessed or lost if a laptop is lost or stolen is reduced.
Cost
There can be cost benefits to using cloud-based software. The subscription costs are often lower, there are no additional operational costs like maintenance or physical storage space for servers.
With software providers performing the maintenance there can also be internal resource savings with this not needing to be dealt with in house.
How can PEM help?
Our VFO team have many years experience assisting clients with moving over to cloud accounting software such as Xero from the first step of initial discussions about how is best to approach the change all the way through to training your team and beyond.
Want to know more? Then please get in touch with the VFO team today to schedule a discovery call.
Please note that this content is not intended to give specific technical advice. It is designed to highlight some of the key changes rather than provide an exhaustive explanation of the topics. Professional advice should always be sought before action is either taken or refrained from as a result of information contained herein.
