As far as professional accountants are concerned, the debate over cloud-based accounting software has already been well and truly settled. An estimated 94% of accountants are believed to have already adopted cloud platforms.
And no wonder – research suggests that accountancy firms that manage to go ‘full cloud’ are winning new clients at five times the rate of those refuseniks that hold out with more traditional methods.
However, it isn’t just up to accountancy firms to make the switch. Despite the apparent benefits to them, fewer than one in five (18%) of UK accountants have all their clients on cloud-based systems.
Individual businesses are, of course, free to make their own decisions about how their finances are managed. Some may still feel nervous about the idea of having all their sensitive financial data uploaded to web-based software and made accessible online. Although modern cloud security arrangements, especially with regards to cloud accounting systems, are highly robust.
A more likely reason why some businesses stall over migrating to cloud accounting software is simple resistance to change. If you’ve got a system you are familiar and comfortable with, why change? Even if your accountant recommends it…
But cloud accounting can be a game-changer for any business. Here’s why.
Real-time access and collaboration
Unlike conventional accounting software installed on a local server or device, cloud accounting platforms offer the convenience of real-time access to financial data from anywhere, as long as you have an internet connection. This means that you no longer have to be tied to your office computer to access your financial records. Whether you’re on the road, at home, or meeting with clients, you can view, update, and manage your financial data on the go. Furthermore, it enables seamless collaboration between your team members and your accountant, empowering more efficient decision-making across your business.
Cloud accounting systems do more than just increase the flow of financial information around a business. The fact that they can do this at all is partly down to automation – the digital automation of data entry, bank reconciliations, invoicing, PAYE, remittances and so on. This carries multiple benefits, including reduction in errors, better control of cash flow, synchronization of insights across accounts and different parts of your business, and of course reducing the task burden on staff, so they can focus on more value-added activities, such as financial analysis and strategic planning.
Another benefit of the automation cloud accounting platforms bring is the scalability they create. In the past, certain cloud software packages were designed and marketed for businesses of different sizes. They would perhaps have limitations on the size of their databases, or how many user seats or branch offices you could connect. As your business grew, you’d get to the point where you would have to upgrade to an entirely new platform.
Cloud accounting is much more agile. You can expand your accounting tools and system capacity in line with your business’s changing needs simply by changing subscription plans, without the hassle and cost of new licences, software or infrastructure.
Better financial reporting and analysis
Another major benefit of the cloud in general is the ‘open architecture’ approach it has brought to software development. Put simply, if someone, somewhere develops a high quality software product – say, for example, a financial analytics suite – then other developers can quickly and easily incorporate the same or similar applications into their product.
This has certainly been a game-changer for financial reporting. With best-in-class analytics tools now standard in nearly all accounting software, and the option to pick and choose or customize the tools you use, firms benefit from more sophisticated and more relevant insights, delivered in n real time for more responsive decision-making and in user-friendly formats that aid interpretation.
Adopting cloud accounting can help your business stay competitive, save time and money, and make more informed decisions. Embracing this technology is not just a trend; it’s a strategic move that can help your business thrive in an increasingly digital world.