If you want your business to work smarter and faster, consider cloud bookkeeping.
This well-regarded financial practice gives you a good overview of your business’s finances.
But what exactly is ‘the cloud’ and why is it important for your business?
‘The cloud’ (or ‘cloud computing’) refers to the delivery of computing services – including storage, data analysis tools, or, in this case, accounting services – via the internet. It can revolutionize the efficiency of your bookkeeping by streamlining the administration of your finances and providing a real-time view of your key numbers.
In this post we will discuss some of the core benefits of cloud bookkeeping to help you understand its importance.
Why Should You Use the Cloud for Online Bookkeeping?
Every time you use internet banking or access data, you are using ‘the cloud’. This platform makes data and software accessible online anytime, anywhere, from virtually any device. You can access data and files from multiple computers.
Traditional accounting software has fewer advantages:
- It only works on one computer. So people had to use USB drives to access the data, which is not secure or reliable.
- It is expensive, difficult to back up, and time-consuming to upgrade.
- It used to be desktop-based, which means limited access to your data.
- Customer support was slow.
Accessibility is the primary benefit of cloud accounting as users can access data from anywhere with an internet connection. There’s no desktop application. You log into an always-updated online solution and all data is safely stored on a cloud server. With the world becoming more mobile-friendly, online bookkeeping allows you to work from anywhere.
With cloud accounting, users just need access rights to the same system with their unique passwords. There is no need to email large files or share them via flash drive.
You may feel concerned about storing confidential or sensitive accounting data on the cloud, but these services enhance security in many ways:
- Cloud providers incorporate multiple levels of security, including advanced encryption and access control, to ensure that only authorized users can access your data.
- They scale and flex to match your business’s needs. You can start with basic accounting functions and add features and users as your business grows.
- They improve accuracy by eliminating many error-prone manual steps that are required when using spreadsheets.
- They automatically back up your data, so you don’t run the risk of losing vital financial records.
It’s easier to steal a laptop with a spreadsheet of data than it is to hack a server. So, if one laptop is stolen or a desktop is broken, having remote storage will keep the information safe from breach.
Virtual bookkeeping allows you to benefit from many upfront cost savings. Here, the capital investment is minimal since there are no servers at your location. Remember: infrastructure is one of the largest costs associated with storing and managing data.
Since the entire system is cloud-based, you need less IT staff as you don’t need to maintain any servers in-house. Reduced labour and equipment costs can mean significant savings.
Cloud accounting has many advantages, as noted above. Once you understand how these factors impact your business, you will be able to determine if a cloud bookkeeping service is right for you.