Cloud accounting 101: Three reasons to get on board

Man holding a cloud computing diagram in his hands

If you’ve read anything about accounting software in the past year, odds are you’ll have come across references to cloud technology. So what is cloud technology? And why would you be interested?

Essentially, accounting software with a cloud component enables accounting data to be stored securely offsite – usually on servers managed by a cloud provider – and accessed remotely by you anywhere, anytime via the internet.

Today, most offers are based on either terminal server or browser technology. Although it’s recently become a buzz word, the cloud is not a new a concept. If you’re using email then you’re using cloud technology. If you’re accessing your bank account online then you’re using cloud technology. And so on.

Large businesses have been using private clouds for many years to help facilitate multiple users accessing central business systems at the one time, and to connect their ERP systems with 3rd party providers or customers (eg. online ordering). Now we are seeing the emergence of a number of affordable solutions for small to medium businesses, so that you can take advantage of the same technology big businesses use to drive efficiency, enhance the customer experience and keep up with the competition.

So why might you consider moving to a cloud based accounting system?

1. Work on your business where and when you want – in the office, at home, or on the road:

When your accounting software is held on a hard drive on a computer, it can only be accessed when that computer is available. For many businesses, this means access is restricted to a single computer and a single location. When you move to a cloud solution, you have the flexibility of being able to access your company files anywhere you have access to the internet. So, you can have one team member out with the laptop recording quotes or sales while another does the book keeping at a different location. Both are inputting their data into the same place. No double keying necessary and no need to take turns when accessing files.

2. Peace of mind – you’re always backed up:

With your business information held in a secure third party server, you always have a secure data back up, so that essential business operating data is still available if something goes wrong with the office computer. Think about what you would do if your office was flooded, ravaged by fire or raided by thieves. Is your important business information safe and accessible no matter what?

3. Build your business by sharing data with your financial advisor in real time:

If you choose, you can give your accountant or bookkeeper (or both!) access to your company files via the cloud. This eliminates time consuming file transfers and travel, and also gives you the opportunity to have your accountant, book keeper or other collaborate with you on building your business by monitoring in real time key business indicators such as inventory levels and debtors.

There are a number of product options out there – MYOB LiveAccounts is one. Be sure to do your research on the credibility of software providers, compare the benefits and cost of all-in-one software versus software that requires a number of “add-ons” and – most importantly – make the most of the product you choose. Using your cloud accounting software without compromise could see you move faster on the road of business growth…

  • Peter Quodling

    Well, this is an area of interest and I was hoping to see some objective input, but I was sadly disappointed.

    I agree on some points – Conceptually, the cloud, is not dissimilar to “Computer Service Bureaus” that existed as far back as the 70’s and 80’s.

    However – “large businesses have been using private clouds for years” – Care to cite specific examples of this – I have worked with a range of Large Organizations, and have seen little evidence of this. Yes, they do run their own internal datacentres, but to call these clouds, is stretching the truth. Clouds typically involve hardware deployment which is highly agile, and implementation of most levels of functionality “as a service” – there are very few that work in this mode.


    1. On the road – there is an assumption of ubiquitous connectivity – this is still not always the case, and more importantly, most “systems” are not designed with this in mind – the optimum approach would be an environment where a “local” dataset, is sychronized with a cloud based “master dataset”, based on a range of triggers (i.e. end of Month, reporting requests and so on).

    2. ALways backed up? Many organizations will tell you, that “outsourcing responsibility does not outsource accountability”. Assuming that because a service now sits in a cloud, in a Data Centre, that that environment will have a certain level of backup functionality, or disaster recover/business continuity functionality, is misguided at best. I am aware of large corporation, that have been “burnt” in both contexts (outsourcing, and cloud) by assuming that the actions taken for backups etc, by their supplier were fully cogniscant of their business risks and priorities.

    I find it interesting that there are a number of product options out there, but the only one rating a mention is the one supplied by the emplyer of the author of the article – a better attempt at objective assessment would be more credible.

    But, remember, Australia still lacks adequate definition of the regulatory requirements of “Systems design and implementation” as things like Sarbannes-Oxley, have at least attempted to implement, but more importantly, Australia’s regulators do see the risk. APRA, the regulator dealing with Banks and Insurance Companies, have issued “advisories” regarding the risks associated with “Cloud Services” and associated security and related issues.

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  • Matt

    Depending on the type of business you are and plan to be in 2-3 years there are plenty of competing cloud accounting products out there now with varying features. I’ve just moved two of our businesses to Gem Accounts cloud accounting software – They offer a complete export of all our data and are very clear on their data policies etc… which has given us the comfot to now move to the cloud.