Cloud Accounting has been around for a few years and with rapid technological advancement this has evolved to a fully fledged automated accounting system. The large Accounting software houses such as Sage, Intuit (Quickbooks), Xero have invested millions continually developing their online software and the progress has been startling since they have launched online.
It is apparent that many companies are unaware of how accounting in the cloud can help their business to save time and money. Real Time information has enabled companies to benefit through increased efficiency as well as connectivity and security
BENEFITS OF CLOUD ACCOUNTING
1) Data is stored securely in “the cloud and no requirement to take backup resulting in reduced infrastructure costs
2) Automatic upgrades
3) Enables remote working
4) Different departments can update on real time basis simultaneously
5) Accountant can check and review
6) Integration with online Apps (more about this later)
7) Go paperless
8) No longer to manually input information
A client of mine has a small business – he doesn’t have time to take care of the book-keeping and has trouble with keeping track with the paperwork. He doesn’t mind employing a book-keeper but still has to spend time compiling the paperwork and giving to the book-keeper. He wanted a solution that saved him time so we helped him to integrate some of the items below that allowed information flow directly into his online software package without any manual intervention.
With the various apps available we had set up a fully integrated system that enable direct information flow into my client’s online software. The main benefit is time saving as well as costs but not an obvious benefit is the client is in control of his finances and understand what is happening day to day instead of a sporadic basis.
BUSINESS EFFICIENCY THROUGH APPS
Invoices can be sent by a supplier to an email address especially setup to receive invoices and this will automatically flow into the Online Software package. It will capture Supplier, Date, Invoice number, VAT and Amount (including different currency) without any further action by the accounts assistant or book-keeper. Furthermore the same result will follow if a receipt or invoice is photographed by an App and with one click to process it will go straight into the online software. Other useful apps would be mileage through either inputting destination or GPS data will again flow to the online software.
Bank Feeds can upload bank statements and then simply allocate payments to the invoice. The system will recommend the invoice that should be matched with the payment
Expenses can be directly relayed into online software packages (with an approval process) and provide key metrics for example – which hotels are being used the most by the employees. This will be useful information to negotiate better rates with the hotel in the future.
Cloud Accounting can benefit everyone be it in the service or goods industry – ebay/Amazon trader with sales, ordering and stock elements can be synced with the various application so each system gets updated with any changes. Can be incorporated with ecommerce and different payment methods too like importing PayPal sales in online accounting.
With the Software Accounting Apps you can get clients to pay by credit card resulting in an improved cash flow and less hassle chasing debts. While on a client site you can raise an estimate/quote and convert this to an invoice with a click of a button which be sent to the client immediately.
There are many more useful apps available and if a company has a requirement then most likely be an app available to fulfil that need
DASHBOARD AND REPORTING
It is not just that the way we input data has changed but that accounting software industry has invested into designing the software to make it as user friendly and creating dashboards to show the company position on a real time basis. For example the front screen may show the current profit, latest invoices that have been processed in and how much is in the bank. If you click on the Supplier Tab the dashboard will show how many invoices are overdue, open bills etc which you can drill down further (same for customers). This is useful as with business owners being involved in all aspects of their business they want to be alerted to areas of their business that require attention. It is showing key information on which decisions can be made like which customers need to be chased for an overdue invoice. Making important data easily visible and accessible was an important consideration for software developers when designing the user interface for example
- Introducing a new visual design which modernizes and standardizes the look and feel.
- Reduce the cognitive burden by using larger fonts, bigger rows, and brighter Colours.
- Less clutter on pages
- Easily accessible menu for each category.
Previously, for users with little accounting knowledge it was difficult to navigate through the myriad of menus. Font was small and colours dull.
In addition, enhanced reporting features that enables you to create a Professional Management Reporting Pack in minutes and despatched to the board within seconds as the software can be scheduled to send out the management pack at a certain date and time on a monthly basis.
With desktop versions of software packages the number of reports was limited and software developers did not deploy resources into developing the reporting whereas now it has become a focus area as users demand better quality reports.
We all seem to suffer from a clutter of paper resulting in lost time looking for paper or even losing important documentation including receipts which are still required either online or through paper as evidence for tax claims. Lost receipts are often due letting time lapse before they are submitted. With the various apps you can just take a picture and submit and a record is stored. Expenses App is a useful tool for those on the go into storing receipts as well as sending the data to the cloud.
To have all documents online and to find a document just simply locate it by entering the name on the online accounting search engine is definitely quicker way of finding information than trailing through files.
With the increased competition between the main players in the industry has led to fast technological advancement as each company try to emulate each other. Despite the intense competition, massive investments and huge losses in some cases, prices charged by the online software providers on a monthly basis is fair and reasonable. Possible to have a full functional online system with integration for less than £50 a month.
There are still many users still using desktop software packages and even in some cases excel which is tedious and time consuming. Time is money and if business owners are spending too much time with administration then the opportunity cost is lost sales.
Embracing cloud accounting will improve the efficiency of their business as well as reducing costs and improved cashflow. It is a must have for all businesses.