Accounting management is one of the key business operations that determine the overall efficiency and performance of a business. Effective accounting operations can lead to increased compliance, better cash flow management, and improved financial decision making.
Back in the day, accounting was increasingly manual and paper-based. Traditional accounting systems resolved several hurdles, but they didn’t really impact the bottom line.
Then arrived cloud technology, and the way businesses managed their accounting operations entirely changed.
Today, we’ll discuss how cloud accounting software can revolutionize your business operations.
What is Cloud Accounting Software?
First, let’s quickly talk about accounting software in general. An accounting software solution is a computer program that allows you to record and process accounting transactions. It consists of functional modules like accounts receivable, accounts payable, trial balance, general ledger, and more.
Back in the day, most accounting software systems for on-premise and self-installing. You had to pay a one-time license fee and install the software on your system.
Cloud accounting software works similarly to traditional accounting systems with only one difference. Instead of being located on your computer system, it resides on internet servers. Hence, you can access the software from any device connected to the internet. This eliminates location restraints and allows you to access your financial operations remotely.
Comparison with On-Premise Accounting Systems
According to Verified Market Reports, the global cloud accounting software market size is expected to reach $4.3 billion by 2024, growing at a CAGR of 8.6% during 2017-2024.
More small and medium businesses (SMBs) are implementing cloud-based accounting solutions to attain superior efficiency and productivity.
When the concept of digital accounting was initially introduced, businesses were more aligned with on-premise systems. These systems offered robust security, as only you can access the software and that too from the system on which it’s been installed.
But on-premise systems have few major drawbacks. Since they’re installed on the system, you can’t access them remotely. If for some reason, you couldn’t make it to the office, you won’t be able to run the operations.
Second, they come with one-time license costs, which are quite expensive. Don’t forget the additional installation, maintenance, and upgrading costs you’d need to incur.
How Can a Cloud-Based Accounting System Enhance Your Business Operations?
Cloud-based Online Estimate & Invoice Software for Businesses is changing the way companies manage their finances. This is especially true for small businesses as 82% of small businesses use accounting software, a CPA Practice Advisor report stated. Of those businesses using a cloud-based expense tracking app, more than 60% of them agreed that accounting software had a positive impact on their bottom line.
Here are 6 reasons why you should consider a cloud accounting system for your business.
Cloud accounting automates various recurring tasks. It prevents human errors and duplication, thereby ensuring accounting accuracy and efficacy. It also speeds up cumbersome accounting tasks, helping your employees stay focused and concentrate on core, productive activities.
2. Cost Effectiveness
As discussed, cloud-based solutions are less expensive than on-premise systems. These solutions are available on monthly or yearly subscriptions, so you don’t have to pay for a hefty, one-time license and then stick with the software forever. You can subscribe to a small plan to test things out, and if you like what you use, you can subscribe to a longer plan.
In addition, cloud systems are offered as Software as a Service (SaaS), so you don’t need to install, maintain, or upgrade them. The provider takes care of maintenance and upgrades. Hence, you can alleviate your operational costs and invest them in the right place.
The security of business and customer information should be the topmost priority of any firm. Traditional accounting systems have security vulnerabilities. If an authorized individual gets access to the system, he or she can access your entire information, steal it, and even wipe it. Sine on-premise systems don’t have effective backup capabilities, you could end up losing all your business data.
Cloud-based online Estimate & Invoice Software for Businesses excel when it comes to security. They feature robust backup and restoration capabilities that ensure you never lose your data. They also come with multifactor authentication and spam protection features to make sure your financial and business data stays secure.
Growth and scaling up is unavoidable in running a business. You might have a small office with a team of five individuals now, but a few months or years down the line, you’ll grow and scale-up. It is essential to have an accounting solution that makes scaling up seamless.
Here’s where cloud-based systems truly shine. Subscription plans of cloud apps are based on the number of users. If your team size increases, you can simply subscribe to a bigger plan with more users. And since your expense tracking app is installed on the server, you can change your office location without worrying about transporting all the hardware.
One of the biggest benefits of cloud accounting software is the ability to centralize your business operations. If you have an important data file to share, you can upload it to the cloud software for everyone to see. This eliminates the need for sending information individually to all the departments and employees. You can simply upload the data for everyone to see.
Cloud solutions also allow you to set access and login permissions to avoid unauthorized access. Therefore, you can decide which personnel will access the information.
6. Remote Accessibility
With remote work becoming the new normal, companies need to implement remotely accessible business solutions. Since cloud applications can be accessed from anywhere, they make excellent companions for your remote work initiatives.
Cloud accounting solutions help you reduce operational costs and management complexities. They make your business processes seamless and centralized, enabling you to become more efficient, productive, and profitable. Hence, cloud accounting software is a must-have for every small business.
If you’re looking for a robust, cloud-based accounting application, check out MoonInvoice.