Should Your Small Business Adopt Cloud Accounting?
The cloud, which is really just online storage, is a means of sharing computer processing resources with other devices also online. For small business owners, the cloud represents a real step forward in terms of what is accessible for their business. Instead of needing to purchase multiple copies of expensive software for each computer used by the business, the company can have a single account that allows for access to certain software or storage programs. Cloud accounting is a perfect example of how cloud computing can truly benefit small businesses.
What Is Cloud Accounting?
Cloud accounting is simply accessing accounting software via the internet instead of physically installing it on a company computer. There can be a wide range of products and services involved, which may have previously been cost-prohibitive for the small business, either because of the cost of the software itself or the cost of the required hardware upgrade to store and run everything. Effectively, you are performing your bookkeeping and accounting on a program which is hosted on the cloud, freeing up your computer-based resources.
Instead of storing critical programs and records on a single hard drive which can fail or be stolen, they are instead stored digitally on the cloud, usually with redundant backups to ensure that nothing critical can be lost in the event of the failure of a single computer. Cloud accounting levels the playing field for small businesses by letting them access some of the same top-shelf accounting programs as the biggest, most established companies.
How Can Cloud Accounting Benefit Your Small Business?
Cloud accounting comes with a plethora of real-world benefits. First and foremost, when your company chooses to upgrade to cloud accounting, the accounting software and data for your company can be accessed from any device. In most businesses using traditional accounting software, that software package is only installed on one or a few computers (probably the ones used by the accounting department).
With cloud accounting, any computer, smartphone, or mobile device can be used to access the accounting software. This makes it easier for companies to update and access their critical financial records. If more than one person are working on an accounting project, there is no longer any need to print and share files, store files on USB thumb drives, or email copies of records to one another, making the entire process far more efficient.
Because anyone with the proper login credentials can access the cloud accounting software when connected to the internet, that means that data entry and record keeping are simplified as well. Records can be updated in real time by any trusted member of your team and viewed by anyone who has a need to access them. Paper documents and receipts can be scanned, digitized, and stored online in the cloud as well, freeing up precious storage space and ensuring that all your financial records are easily accessible and well-organized in one centralized online location.
Cloud accounting software is typically user-friendly as well, which can eliminate the burdensome overhead expense involved in retaining an accounting professional on staff or paying one weekly, monthly, or quarterly to perform bookkeeping and tax preparation. Most, if not all, of those services can be directly performed the software itself, ensuring that so long as records are up-to-date and accurate, the use of cloud accounting can save your company quite a bit of money.
How to Switch to Cloud Accounting
Whether your company was using an outsourced accounting and bookkeeping service, had a part-time bookkeeper on staff, or was using traditional, single-computer accounting software to perform its critical bookkeeping and accounting tasks, there are certain steps to take that can ease the transition from those methods of accounting to cloud accounting. The first and simplest is to immediately begin working on making your existing financial records digital and continue that process as new receipts, bills, and other financial records are acquired. By scanning and digitizing critical financial records and organizing them appropriately, your company can take the first real step toward cloud accounting.
The Next Step
The next step in the process is to analyze what cloud accounting services make the most sense for you and your small business. Whether you need an extensive accounting suite or simple bookkeeping programs, there are plenty of customizable options available. Ideally, you can find a cloud accounting system that can scale with your business as it grows to prevent the need to make any changes or major data transfers from one system to another in the future.
Consult the Pros!
Finally, when you think you’re ready, consult with a real-world accounting and bookkeeping firm to ensure that the program you’re looking into is appropriate for your business. It may also make sense to have them access your records to prepare your taxes and verify accuracy of your bookkeeping records on a regular basis, as data entry errors can happen even in the most straightforward of projects. By working with professional accountants, you can ensure that your company’s records and taxes are accurate, accessible by those who need them, and completed in a timely manner.