The definitive guide to cloud accounting

The definitive guide to cloud accounting

If you’ve heard of the cloud but are a little hazy on what it actually means, you certainly aren’t alone. A YouGov survey carried out in 2013 found that almost half (4%) of IT and business decision makers within UK SMEs listed a lack of knowledge as the biggest challenge to adopting cloud-based services.

So what exactly is cloud accountancy and how could it help your business?

Cloud computing and accountancy

Depending on who you ask, the term ‘cloud computing’ can have slightly different meanings. In layman’s terms it usually refers to the process of using software, platforms and infrastructure that are physically hosted at a remote location and accessed via the internet. This means that you do not have to have the hardware, servers or even the software yourself.

Cloud accountancy is a specific application of cloud computing. It allows for you to have access to the resources you need without having to install or maintain your own accountancy software or store data on expensive and bulky servers.

What can I do on cloud accountancy software?

You can use cloud accountancy software to do all the bookkeeping and other tasks that you would do on a traditional accountancy software package. If you are a small business and simply need to keep track of your cash flow you can use cloud-based software to keep accounts and track the money that goes in and out of your business.

You can manage your finances, create invoices and manage simple VAT. If your requirements are more extensive you can also access more advanced features that could be useful if you have started trading abroad or need to manage more than one business.

One of the great things about online accounts software for the Cloud is that you can choose the level of service you require and pay only for what you need. If you were buying and installing traditional accountancy software you might be faced with a complex and potentially expensive upgrade if your requirements change. With cloud-based software you can up- or downscale as and when you need to.

What are the other advantages?

Cloud based services allow you to access and use them on pretty much any computer with an internet connection. If you need to access your financial information on a business trip abroad, travelling on a train (assuming it has adequate Wi-Fi) or working from home, you can do so without having to download and install anything on your desktop. Multi-user access can allow you to collaborate with others authorised to access your accounts.

The fact that you don’t need any extensive infrastructure to run the software or store data can reduce your start up costs and you will not need to maintain or update the system or security.

Cloud subscriptions usually present you with a fixed monthly cost that you can build into your budget.

Is cloud accountancy secure?

The information you send to and retrieve from the Cloud is securely encrypted and the only people who can access it are those you are authorised to do so. Your data itself will be housed on physically secure servers and will usually be automatically backed up.

If you leave your laptop on a train it might be a pain but at least you will not have to worry about who has access to sensitive financial data. You will also be at less risk of break-ins at your physical premises, fires and natural disasters such as floods.

Sponsored Post: This helpful guide was provided by Sage.

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