December 12, 2022

Should I Move All my Accounting to the Cloud?

What is ‘the cloud’?

Think of it like this: instead of storing and accessing your data from your own computer’s hard drive, you’re accessing other computer hard drives over the Internet.

So, all the information you’ve stored online are actually in physical computer storage areas on the ground – all over the planet. As long as you have your login details, you’ll always be able to access your files, photos or software. No more worrying about your hard drive crashing, or someone stealing your laptop.

It also means you can access your data from different devices, including your smartphone. Most phones are capable of running accounting software apps, so you can manage your finances from anywhere – even relaxing on a beach.

Why should I switch to cloud accounting?

Updates happen in real time, so you no longer have to upgrade or buy a new piece of software that you installed years ago. In fact, you often don’t even notice when an upgrade has taken place.

One of the best reasons to switch to the cloud is increased security. You’re not relying on one machine to hold all your data. We all know what it’s like when you discover you haven’t saved something correctly, or your computer flat-lines one day. Storing information in the cloud means you are continually backed up, and you can get access from any device with an internet connection.

And consider this: if your laptop is stolen, the thief won’t be able to access your financial secrets. Just make sure you haven’t recorded your login details anywhere on the machine itself!

There are lots of other good reasons to move your accounting to the cloud, including:

  • Physical flexibility – the Internet doesn’t know if you’re in an office on your laptop or at a worksite on your phone. It frees you and your business away from a physical location. Your work and lifestyle balance just got a lot better.
  • It’s a time saver – because everything happens in real time and because you can access it from anywhere, cloud accounting software reduces the amount of time you spend having to ‘do the books’ on the weekend. It also means you won’t have to keep entering invoice data manually into spreadsheets. You’ll save hours.
  • Outsourcing bookkeeping – you can login anytime to see reports and make sure you’re happy with how your books are being recorded. Even if you don’t outsource your bookkeeping, with cloud accounting software, your accountant can easily access your books to prepare the year-end.

What ‘the cloud’ can do for you

When considering the switch to cloud accounting software, there are a few things to keep in mind. When you’re searching for the perfect product for your business and testing various options, make sure you can:

  • Keep up to date with tax obligations – this minimizes the chances of a nasty tax surprise. You should be able to get accurate estimates of tax payments that are due. It’s important that you’re reassured on a regular basis of what you owe.
  • You should be able to see how much cash you have on hand anytime – every business owner likes to know the bank balance is in the black and not red.
  • Identify what invoices are outstanding anytime – less chance of having bad debts as you can clearly see who owes you money.

The term ‘the cloud’ is just referring to the internet which allows you to access software or applications on the computers that Microsoft, Google, etc., own and maintain. One of the latest innovations is the transfer of traditional accounting software you would load onto your own computer. Now you can access it all online from anywhere.

Pros and Cons of Cloud Accounting

Improved security
It’s an ongoing cost (usually a subscription)
Use it from anywhere
Online only (you can print or download reports to view offline)
No need to update the software
Requires a good internet connection
Makes it easier to go paperless

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