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. Some of this was fueled by the introduction of Making Tax Digital for VAT and then when COVID hit, there was an increase in remote working so cloud accounting was essential for many businesses.
What is Cloud Software?
Before cloud-based software was available we used to have to install and run software on our 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.
When Covid hit and the lockdown was enforced in the UK, this type of access was not possible for many firms and they faced the option of getting further behind or of going into the office to update their systems. This led to more companies looking into how they could do things differently and led to an increase in the number of companies looking for a cloud based alternative.
What Are the Benefits of Cloud- based Accounting Software?
Cloud-based accounting software has many benefits over the desktop equivalent solutions including the following –
Cloud-based software is accessible from anywhere 24/7 so long as the user has an internet connection. This means users no longer have to go to the office to log in and can access their accounting data when they are travelling or working from home so giving them, and their team, more flexibility.
Updates and Maintenance
Hosting, maintenance and updates of the software are all done for you by the software provider. Also, cloud software is maintained in the cloud so there is no need to buy multiple copies and install it on different computers. Instead, the software can be accessed by users who have internet access, and, in many cases, the product is purchased on a subscription per user basis.
Time Savings Through Automation
Cloud based solutions permit automation of many tasks so 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 and automation of repetitive tasks means that data entry time is saved.
Real Time Data
With the integrations available and accessibility, this means that you have access to the data wherever you are located. As this is real-time information, it means that the team members always have access to up-to-date financial data at their fingertips. 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.
There is the ability to have multi factor authentication and unique passwords with cloud-based software so providing enhanced levels of security. Also, as the data is not stored on laptop hard drives and backups are not taken, it means that there is a reduced risk of data being accessed if the laptop is stolen or lost.
One of the big benefits of cloud accounting software is the ability to add applications and expand the system. The accounting software is the core of the system, and it is possible to add on built in integrations such as for payroll, stock and expenses. This ensures that the data flows between applications and provides enhanced services and greater insight into the results of the business.
There are many advantages in moving to a cloud-based accounting system and the VFO Team at PEM are experts in this field having moved many clients to systems such as Xero. Whilst all change can be daunting, we work with you and support you throughout the process and will train you on the new system so you and the team are confident in its use.
Want to know more? Then please get in touch with the VFO team today.