What Is Cloud Accounting?
One of the latest trends in small business accounting is the use of cloud accounting packages rather than in-house software programs. The main feature of cloud accounting is that your accounting software and data are hosted by a remote server, as opposed to being stored on your in-house computer. Your accounting software and data are stored online, in the cloud, and you enter or review your transactions online. Data that you enter is processed by the online software which provides the various financial statements and reports which you can view and save to your computer.
There are several cloud accounting providers to choose from. You simply sign up through the internet, make the necessary payment, and establish an account with a password. You can then log in, set up your accounting, and start making your transactions. Many of these providers have Apps for your phone and tablet which allow you to make transactions with these devices. Want to record your business lunch expense? You can do this with your phone while still in the restaurant.
Advantages to cloud accounting:
- Updates are eliminated. Your accounting package is always kept up-to-date by your service provider, which eliminates the continuous software updates required with in-house software. There is nothing to install and backups are done for you.
- Your accounting package is more accessible by employees and by your accountant. Rather than being kept on one computer in your office, your accounting is readily available to whomever you wish.
- Cloud accounting allows you to make entries from any computer or device that is hooked up to the internet, rather than from one computer in your office. You can keep your accounting up-to-date while traveling, or from home, even during vacation if you wish.
- Your data is more secure. Even though there is some fear of online storage, your accounting is much more secure in the cloud than it would be if it were stored on one computer in your office, where it can crash, be stolen, or damaged. Most cloud providers have very sophisticated backup procedures for their clients.
- In most cases, cloud accounting will be less costly than hosting and maintaining software and data in-house.
Please contact me if you would like more information about Cloud Accounting.