How can Cloud Accounting benefit your Businesses?
Accounting is a well-known terminology for every businessman irrespective of the nature and size of their business. Keeping a proper record of day to day business transactions in accurate books is one of the most important factors in achieving long term business success.
After the introduction of high-speed internet and cloud technologies, the accounting industry is also making a shift to cloud accounting from traditional ways of accounting. According to a survey, it is predicted that about 80% of the businesses will shift their bookkeeping to cloud technology by 2023 which is more efficient and secure. If you also own a business and confused to decide whether you should move to cloud accounting or stick to the traditional ways, this article will give you all the information you needed to make that decision.
What is Cloud Accounting?
Cloud accounting is referred to as an accounting application based on the internet instead of installing it on your hard disc or storage device. The cloud application is using a remote server rather than running on your local server. It means that all the data is stored on a remote server which can be easily accessed through any internet-enabled PC, laptop, mobile, etc.
This technology gives business owners and other stakeholders, freedom to access information regardless of their location.
Benefits of Cloud Accounting for Businesses:
Let’s discuss some common benefits of cloud accounting
1. Access to Information:
To compete in the race, business owners always want to have the latest financial information about their business for critical decision making and get one step ahead from their competitors. With cloud accounting applications they can easily access their entity’s financial information from anywhere anytime even with their smartphones.
Cloud base accounting applications are cost-effective as compared to traditional accounting applications, which usually need a high-speed PC or laptop with a decent storage device. While running a cloud accounting application only requires a device with a browser connected by the internet. There is no startups cost for cloud accounting and without any hard and fast commitments. You only have to pay as long as you need the services.
3. More Secure:
The security of financial information is a big concern for businesses today. Normally, the security measures adopted by small businesses are weak due to limited resources and expertise.
The cloud accounting applications run on dedicated servers and maintained high standards regarding physical and digital security. Backups are done on a regular basis to retrieve data in case of any incident.
4. Automated Updates:
The cloud accounting providers are regularly working on their products regarding improvements and introduction of more features to help users. These updates are automatically available to users and do not need to download or install manually on the system.
Risk Associated with Cloud Accounting:
You will not find anything useful without with zero side effects. That is the case with cloud accounting. Following are the risks associated with the cloud accounting
- Sometimes the vendor goes away due to losses or any other reason which can badly hurt your planning.
- If someday you are not able to get connected to the internet, you will not be able to access your data.
- Your data is secure with cloud accounting, but it is not totally secure but if hackers succeed in breaching the security measures, your data may be at risk
Yes, there are benefits to cloud accounting with some disadvantages, but the benefits outweigh drawbacks which can be overcome through proper planning.