5 mins read

What Are the Benefits of Using Cloud Based Accountancy Services?

Matt Bone
Matt Bone

No matter what business sector you work in, cloud computing and storing documents ‘in the cloud’ has become a part of our everyday working practice. With Google Drive and Dropbox offering you the ability to access your stored documents from anywhere in the world, it comes as no surprise that accountancy would become adopters of this process. After all, you talk with your accountant via email, why not have everything online? 

With Making Tax Digital, a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their affairs is being rolled out over the next few years, more and more accountancy firms are using cloud-based systems for their client work and seeing great success with. But is it really as big a game changer as you think?

Here at FC, we have been strong advocates for cloud-based accountancy for many years and have seen the positive changes using these systems has made to our clients. So it made sense for us to showcase just how many benefits there are to using cloud based accounting. 

It Is Far Safer Than Physical Storage

Data stored on any computer or USB drive is always going to be at risk when it comes to viruses and ransomware, as well as being physically damaged or erased. If you were to lose your laptop or leave it unlocked while you went to get your coffee, you are at risk of having the data stolen. 

However, cloud-based accounting data not only requires a strong user generated password, and 2-factor authentication, but it is also encrypted, meaning even if it was ‘stolen’ in an attack, it would be unreadable and useless. 

Cloud accounting benefits from a multitude of security features including having backups on backups. These backups are often stored on multiple servers at different locations, so that should anything ever happen to one location, you will still be able to access your data from another.  Not only is there more than one backup, but your data is backed up in multiple locations. Alongside this, cloud-based accounting companies such as Xero or Quickbooks have state of the art protection for their servers as well as round the clock security and protocols in place to ensure your data is secure.

See Your Accounting Information in Real Time

With traditional methods of accounting, once you have sent in your required information and tax returns to your accountant, you are unlikely to see the on-going process of your accounts or the outcome until much later down the line. With cloud-based systems your financial data will always be up-to-date and as soon as financial information has been uploaded to the system, you will be able to see it right away. 

This allows you to then see if there are any changes, extra information or queries that need to be discussed with your accountant before it is too late. Alongside this, that real time information allows you to make financial business decisions by eliminating variables and ‘what-ifs’ by knowing at any given point the state of your accounts and ledgers.

Access Your Accounts Anywhere

As we mentioned in the intro, being able to access your documents anywhere in the world, on any device, at any time has become the normal way of working for most people. Lockdown and the subsequent work from home situation showcased just how much businesses rely on being able to access documents and information when they cannot be in the office or all together in one place.

Cloud accounting works off the same process, no matter where you are in the world, whatever device you are using or whatever time of day or night it is, you can access your accounting information. No more having to listen to an automated message that your accountants are closed for the weekend or being unable to work late at night because you haven’t got the most up to date information.

If you travel for business, you will still want to see your accounts and information no matter where you are. Cloud based accounting offers you that privilege, all you need to do is be able to log in to the online service and away you go. No more having to drag around files and folders with you across the other side of the world. Access all your data from the comfort of your laptop of smartphone.

Access to Additional Integrated Apps and Services in an Ecosystem

While this sounds a bit confusing, it is actually very easy to explain. As cloud accounting platforms are built to be flexible and universal, they tend to offer additional services you can add onto your package from other companies to help streamline your business processes. 

Two great examples of this are Xero and AppAdvisoryPlus, who both have app stores of additional services you can use alongside the accountancy software. For example, you can integrate an automated invoicing system or reporting software package that will work with your accounting service allowing you to use your real-time data to greater effect and streamline your business.

Always Working with The Latest Software Version

Many of you may be sitting there thinking, ‘well I can just pay for what i need and buy an off-the-shelf program and sort my accounts at home, saving myself money’. While you can do this, and there is nothing wrong with that, there are still problems and situations that can arise. One of them is that often software providers will want you to pay extra for the latest upgrades or features, which can cost more than the original package. In the short-term this may be the most cost-effective method for you, but eventually the updates may stop coming or become unreasonably priced or fall behind competitors.

With cloud accounting however, you are always on the latest software version and security updates and usually everything is included in your service (unless you want to add on those apps we spoke about above). Cloud based accountancy providers pride themselves on having the fastest, most secure and feature packed offering, so you are always going to see the latest innovations and processes available.

Secure Sharing of Data Across Your Business

If you work in a business that has multiple locations or even teams on different floors of the same building, you know the value of being able to securely share your financial data quickly with other staff. Having authorised users being the only ones having access to your data you are far less likely to have members of staff or competitors/clients stumbling across the data and seeing things they should not.

While this can sound very cloak and dagger, the security of your financial information is paramount to your business. You wouldn’t want your friends having access to your bank account, so why would you want anyone but those who need to know seeing your business accounts?

Connected Online Payments

Having a cloud-based service that allows you to have all your products talking to each other is a very beneficial thing for any business and having your online payments under that umbrella is no exception (you see a theme here). With more and more businesses of every size, from sole traders running an Etsy store to multinational retailers offering online shopping, having an connected online payments solution that feeds directly into your cloud based accounts can prove invaluable.

If you have a customer who buys from you every month but each time their shopping basket comes to a different amount, having to constantly produce an invoice, send it out, then action that invoice can be very time consuming. However, if you have an integrated payment solution attached to your cloud-based accounting package your clients can then instantly pay the required funds to you and your accounts will be automatically updated in real time (see we told you there as theme).

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