In recent years, cloud accounting services have become a more commonplace as businesses gradually adopt the technology˳ In most ways, cloud-based accountancy software is like traditional software, with the key difference being that it is hosted by remote servers˳ This means that all data is stored off-site, rather than on person’s own computer˳ It brings with it several advantages, although for some it also raises potential security concerns˳
Perhaps the biggest advantage cloud accounting offers is much greater flexibility˳ Instead of only being available on specific, onsite computers, accounting data can instead be accessed on any device, anywhere, at any time˳ This is especially useful for businesses with several locations, as they can all access the data simultaneously˳ Furthermore, as the computing is performed offsite, the technical capabilities of devices are less important, meaning smartphones and tablets share the abilities of powerful desktops˳ Combined, these factors make it perfect for those regularly travelling˳
Cloud accounting also helps protect vital data from being lost˳ Those using traditional software face a constant risk of hard drive failure, fire or theft˳ However, as cloud-based accounts are stored on multiple external servers, they are safe from such disasters˳ This also saves time by eradicating the need for some laborious tasks, such as producing and storing backups, and installing software updates˳
Data is usually more accurate and up to date when using cloud accounting˳ As it is updated in real time, whenever someone log-in, they can be certain that they are being informed by the most relevant information˳ Additionally, as the data updates automatically, it saves additional time and eliminates the inevitable human errors that comes with manual data input˳
Adopting cloud accounting can lead to cost savings˳ It reduces the need for much of the server and IT infrastructure necessary for traditional accounting software, freeing up assets to be invested elsewhere˳ The costs of cloud software also scale well, making it especially useful for smaller, growing businesses˳ There are lower upfront costs and you can pay for greater capacity only when you need it, with no wait for new software or hardware to be installed˳
A key concern, for many, regarding cloud-technology is security, and with financial data being highly sensitive, this is no less the case when it comes to cloud-based accounting˳ Fortunately, they utilise security features, such as firewalls and encryption, to ensure that no data can be accessed by prying eyes˳ Some argue that these features actually make cloud-based accounting more secure than traditional accounting software, as a work computer or USB drive containing sensitive data can easily be lost or stolen˳
Cloud accounting services are likely to continue its growth, with some in the industry predicting it soon will be used by over 90% of small and medium sized enterprises˳ This is understandable, considering the benefits it provides, especially for those smaller businesses˳ Concerns surrounding security are likely to fade as people become more used to the idea their financial data being available online, much like has been the case with online banking˳ These factors mean that the rapid growth of cloud-based accountancy looks set to continue˳
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