Cloud Based Accounting Systems – Should Your Business Make the Leap?

Gone are the days when general ledgers consisted of huge paper spreadsheets that required manual updates and calculations leaving room for multiple errors. The storage and probability of loss of the physical documents also posed a large risk. Along came the desktop era that helped shape and automate the accounting process, but this came with many drawbacks. As we all know, the desktop was and still is limited to two key disadvantages: software and location. Cloud based accounting systems can be a good solution.

As companies adapt to labour shortages, striving to keep existing employees and attract new ones has become one of the greatest challenges yet. Flexibility is key to keeping employees’ content and, currently many different options exist. Some prefer being fully remote while others opt for hybrid roles and some prefer to remain in a more traditional on-site setting.

Cloud based accounting systems allow people to work remotely from any location and remains accessible at any time. The only requirement is a subscription to the cloud and a fast and reliable internet connection. The amount of flexibility this type of software permits has never been so important as it has in the last two years during the COVID Pandemic.

Advantages of Cloud Based Accounting

Online accessibility 24/7 from anywhere in the world with multiple user access and access level control. Allows for real-time collaboration, team members can work in sync with each other or with clients and is ideal for a remote home office setting.
Accurate information that is streamlined automated and up to date. The data is centralized in one file. Bank and credit card transactions can be linked to flow straight from the bank to the cloud software and third-party apps can also be connected and integrated.
Value-added cost efficiency, cloud-based accounting systems require minimal manual entries, saves money on licenses and upgrades. Most cloud applications use encrypted connections, the information remains confidential and secure with automatic backups done on offsite online servers. Expensive hardware purchases and management of servers by IT staff is less required.
Allows for backup documents and receipts to be saved into the system either via a mobile app or by setting up an email allowing for a paperless system.

Disadvantages of Cloud Based Accounting

A slow and unreliable internet connection could compromise efficiency.
Most cloud-based systems come with standard packages and are not easily customizable.
There can be possible down times on the cloud when upgrades are necessary. Possible outages may occur and can incapacitate the accounting process.

Whatever your business needs may be, the many advantages of cloud-based accounting systems prove to be a smart and cost-effective choice by providing a competitive edge over desktop versions. Aside from the advantages listed above, most cloud-based systems also allow for smooth transitions from the desktop versions.

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Giuliana Papandrea

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