Cloud Accounting

More and more of our clients are interested in cloud-based accounting packages.  Cloud-accounting is book-keeping software on the internet not on a local hard drive or server.   You pay is a monthly fee for the privilege of using the software,  you don’t have to download anything on your computer; you don’t need to back-up data; you don’t pay for annual subscription and updates.

What are the benefits of cloud accounting software?

  • Price – there is no need to pay upfront fee as you would with a desktop accounting package, because you pay monthly. It requires no updates as they are automatically included in the price as is the cost of maintenance, system administration costs and server failures.
  • Ease of access is the prime advantage of cloud accounting.  You or your employees can access the business’s financial data from anywhere worldwide, at any time without having to download and install anything on their desktop. All you need is a smartphone or laptop connected to the internet!
  • Real time financial information – cloud accounting will give you and your business up-to-date and current financial information.
  • Backup and data security are included – The level of availability and security, backup and disaster recovery offered greatly exceeds the level which a business can provide if the application is housed on-site.
  • Making Tax Digital – when the business requires a digital tax account a cloud based package should streamline with HMRC requirements.
  • Availability of apps which can be used to tailor the cloud package to the requirements of the business.

The disadvantages of cloud accounting?

  • If you are a small business then you might pay more for an online accounting package than for a desktop accounting package, over a number of years.
  • Having your information in the cloud means that you don’t have control over where in the world it is.  It could be on a server in the UK, in Asia, or probably the USA.   For some this may be a problem.
  • As the software is designed for a large number of users there will always be restrictions in the applications, operating systems, and infrastructure – there will be things the cloud accounting package won’t do.
  • Backups can be a problem – Many cloud accounting software don’t have the facility for you to take a backup of your data and export it or save it to your own computer, merely to printout selected reports

The challenge for business owners and accountants is how to tailor the cloud package to suit the needs of the business, for example, how to tailor invoice or manage stock.

The leading providers of cloud accounting are QuickBooks Online, Sage One, Xero, other packages include KashFlow and FreeAgent, Quickfile.

Many of our clients are familiar with QuickBooks desktop and we find QuickBooks online works just as well as the desktop version.

R H Jeffs & Rowe is a certified QuickBooks advisor