The ever-expanding cloud offers a host of options for managing your business’ finances.
As a business owner, you’re probably always looking for ways to manage everything more efficiently. You also want to spend less time on tasks that take you away from overseeing progress on a job site or chasing down new leads and customers. The last thing you want to worry about is administrative tasks. To relieve the burden, more and more businesses are adopting cloud accounting software over traditional accounting programs. So, what does the technology do and how can it help run your business better?
What is the cloud?
We’ll start with the most basic question in case you aren’t up to speed on cloud technology. If you have a smartphone, you might already be familiar with “the cloud,” but maybe you don’t completely know how it works. According to mashable.com, “The cloud is a network of servers and each server has a different function. Some servers use computing power to run applications or deliver a service.”
Examples of personal uses might include storing data from your phone or computer, such as pictures or important documents. (If your smartphone has ever refused to take another picture because it is “full” and tells you to increase the amount of storage or transfer pictures to the cloud, you might understand.)
In business terms, the cloud can run entire systems and networks remotely, including computer networks, phone and Internet systems, servers, building security systems, and more.
What is cloud accounting software?
With cloud accounting software, all the data is hosted on remote servers. Data is sent into the cloud, where it is processed and stored, but still remain accessible to users. The application functions are performed off-site, not on a single desktop. Users access the software applications through any computer that is connected to the Internet or other networks via a service provider.
7 benefits of cloud accounting software
- Remote storage and access of accounting information – Because the data is not saved on a single computer, the information can be accessed by anyone who needs it. This means an employee in another office, department, or even someone out on a job site, can access the same data and the same version of software. This allows for real-time reporting and visibility within the company. “…You will be able to see the financial position of your business from anywhere in the world at any time…Cloud computing allows you to move around from one location to another but still be informed about how your business is doing as opposed to the past where this information was only accessible in the office,” according to The Balance.
- Easier way to share information – The days of emailing account information will be over. Cloud accounting software allows business owners to share information easily and safely. There’s no need for files to be backed up on flash drives, either, since everything is stored in one place, which can be accessed by anyone with the password and encryption key.
- More cost-efficient – While it might sound more expensive to pay to store data in a cloud system, the opposite can be the case. With traditional software, you are forced to incur higher software license and maintenance costs every time you need to update or expand the network. You also must pay new licenses and fees for database, systems management, and software updates. If you hire a new employee, it would mean buying more software just for that computer. With cloud accounting, you simply connect the new employee to the network. Your business might also have to absorb expensive capital purchase of new hardware, including servers. When you’re connected to the cloud, you should not have permanent and expensive equipment or licenses when business contracts run out.
- Automatic upgrades – We all know how often software must be updated. With cloud accounting software, everything is automatically updated across the entire network. The network provider also does backups and downloading or installation of new software. Financial reporting can be done in real-time as well, so account balances are always up-to-date and less prone to human error. Again, this is all done remotely and not any individual computer within the company.
- More flexibility – Cloud accounting software allows for greater flexibility. As outlined above, anyone with authorization is able to see the data. Use it to do employee payroll, find out when a vendor was paid, track spending and cost overruns, compare how much you paid for building materials, and more.
- More secured data – With all the news reports about cyber attacks that put sensitive information at risk, every business should be concerned about protecting data. Whether the breach is due to a hack, system error, or a lost/stolen computer or flash drive, cloud accounting software provides a secure way to store the financial and personal records of your company, employees and clients. Since the information is stored on remote servers (and not on an individual computer) there is a lower chance of attack. Even if there is a hack attempt, all data is encrypted and password protected so only designated people can access and read it. In order to share data among different users, you only need is a unique password that will unlock the encrypted information. In addition to encryption technology, all data is stored remotely on multiple servers so there are always backups in case of a network crash or property damage due to a fire or other disaster. This way you can always recover data, even if a hurricane destroys the building or a water pipe bursts, flooding the office.
- Specific software for your industry – One last and very important benefit is that you can find cloud accounting software that is designed specifically for industries such as construction, manufacturing, and wholesale distributors. For other types of businesses, there is software with features to meet those requirements.Cloud accounting software is something you should consider for your business. It can help you manage everything more efficiently and easily, freeing you to do the important work of overseeing jobs and planning for the next one. If you’re looking for assistance with your company’s finances, from tax planning to accounting, contact the experts at No Boundaries today.
