Cloud-based accounting. Source: Sage Intacct.

With the current second national lockdown across the UK, many business owners and employees are facing feelings of uncertainty. Living in these unprecedented times have shaken things up, and businesses must change the way they operate to not only limit the spread of the virus, but to ensure the survival of their business.

 

A benefit of living in a digitised society means that business has never been as easy or flexible as it is in the 21st century. With the presence of modern, cloud-based technology, small business owners have the luxury of running their businesses from anywhere in the world.

 

If you own a small business and you are looking to reduce your cost while maintaining a fast-paced working environment, then cloud-based accounting is the smart option for you. You can integrate your accounting, financial function and improve collaboration with your team when operating with cloud-based accounting.

What is cloud-based accounting?

Cloud-based accounting refers to the practice of accessing your financial data through the internet. Similar to an online banking system, you don’t need to have a hard drive to save your accounting data as everything is saved remotely on the cloud.

 

As long as you have an internet connection, you will have remote access to all of your data on any device, whether it is a laptop, desktop computer, phone or tablet. By moving your books to the cloud, you can access your income, expenses, assets and invoices in real-time.

 

In addition to this, you can invite users to view your data and you can control their level of access. This is much more secure than the outdated way of emailing your files or transferring your data onto a USB stick; the chances of being hacked are reduced with the airtight security of cloud-based accounting software as your information is encrypted.

Benefits of moving to the cloud

Following government advice, office workers who are able to work from home are encouraged to do so throughout the winter. However, working from home can pose difficulties for accounting companies who use traditional methods of accounting and record keeping as their data is located in an office that is now inaccessible to workers.

 

This means that companies who use traditional accounting software will not have access to invoices, bank statements, bills or customer information. Not only will this cause businesses to have out-of-date financial records and fall behind on their work, but this can be dire for business, thus why cloud-based accounting is the way forward.

 

As a business owner it is very important to check your business’ financial health on a regular basis, and digital record keeping through by cloud-based accounting allows for instant accessibility and availability of all the information employees will need when they work from home. Having remote access to data removes delays in retrieving vital information that can determine its survival.

 

Cloud-based accounting also allows for easier collaboration amongst team members when working from home. By implementing a digital workspace, a company’s data is accessible to the whole team, wherever they are located, meaning businesses can run just as efficiently as they would from an office. Aside from the team benefits, cloud-based accounting is worthwhile for businesses as they run cheaper than traditional accounting systems.

 

There is no upfront business cost as you can pay monthly by direct debit. The payment also includes administration costs, automatic upgrades and maintenance, so these are no longer a cause of concern for businesses owners as they are automatically managed by the cloud service provider.

The benefits of cloud-based accounting. Source: Xcel Accounting.

As everything is run online with cloud-based accounting, there is nothing to install, backup or update as this is done automatically by the software. The time-efficiency introduced by this means that employees can spend less time completing tedious administrative tasks and do the work they love instead, increasing productivity for businesses.

 

Another reason why cloud-based accounting is effective at saving time is that you can integrate the accounting software with another third-party software. For instance, you can integrate your ERP and e-commerce system with your accounting software, reducing the process time as all functions are integrated into one system.

 

Unlike traditional accounting software, most cloud-based accounting software are very simple and user-friendly, so you do not need to have any prior knowledge to run this software. 

 

In terms of security, cloud-based accounting is the most practical option. Even if your laptop is stolen, no one can access your data unless they have a login to the online account. With cloud software, this is where the data lives – as opposed to on your hard drive.

 

In the event of a natural disaster or fire, being cloud-based means that your information is securely stored off-site because, as long as you have access to any computer or mobile device connected to the internet, you’re back up and running.

 

So, now that working from home has changed the face of the business landscape, business owners are encouraged now more than ever to make the necessary steps to protect their businesses.

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