In the last few years, the increased offering of cloud software for accountants is appealing to many; meaning that standalone accounting systems are becoming less popular, with modern accounting firms in favour of a more innovative approach.
And it was inevitable. What with the use of laptops, smartphones and tablets at our disposal; the continual flow of the latest technology advancements make our lives easier and more enriching than ever. So, when it comes to dealing with vast amounts of payroll, tax information and profit and loss accounts: as an accountant, who wouldn’t want a similar, pain-free experience when dealing with clients?
At the rate of which cloud computing is growing globally, it’s no wonder that buzzwords such as ‘FinTech’ are making their way through the accounting industry; making standalone accounting systems seem slow and out-dated. Within a competitive and evolving industry, flexibility, productivity and security are just three improvements that can be made by implementing a cloud software solution.
As an example of just how quickly the SaaS (software-as-a-service) industry is growing; a report by IDC saw that public cloud revenues will double 2016 predictions by the end of 2020, generating $195bn (£150bn) of revenues. (Cloudpro)
When comparing both standalone accounting systems and cloud software for accountants, there are notable differences that should be taken into consideration if you’re weighing up your options.
Cloud software provides accountants with fast and easy on-demand access to important documentation, as well as real-time communication for clients and team members who may be located worldwide. Bring up client financial data, edit and approve files, and track deadlines, all from a secure and central cloud workspace. Standalone accounting systems, that are hosted locally, provide less convenience; as they can’t be immediately accessed from anywhere other than on in-house computers. This can make it difficult for international clients and team members to instantly retrieve files and folders.
Collaboration has the potential to be improved significantly for accountants with cloud software. Clients can be more involved with their accounting processes by having access to file versions, upcoming tasks, and conversations with their accountant. As standalone accounting systems offer restricted user and location access, it can be significantly harder to collaborate with clients and team members on important files that may require multiple user editing.
An increase in clients and storage requirements equals the need to scale up the existing solution.
With cloud software, accountants can choose to upgrade their subscription instantly – leading to immediate access to increased storage space and new accounts for clients and team members. There will be minimal hassle, and business can resume as normal, without any hold-ups. Scaling standalone accounting systems can require a significant amount of effort. If new employees are hired, new licences will need to be purchased and uploaded manually. And if more storage space is needed, another server will need to be bought.
Cloud software is the more cost-effective route for rapidly growing firms, where standalone accounting systems can be costly.
Security should be a high priority when looking at cloud software for accountants, due to the nature of the industry. With the required storage of highly sensitive documentation, such as payroll and tax information – most cloud software vendors offer a minimum of bank-grade level security and also private cloud solutions to accommodate more demanding requirements. Some companies may want complete control over their accounting data and don’t want it accessed anywhere where they cannot directly monitor the usage; meaning that more traditional accounting systems could be more appropriate.
It’s also worth thinking about backups: cloud software vendors continually and automatically back up data, whereas standalone accounting software needs to be backed up manually.
With cloud software, the solution is purchased through the Internet. Generally, this will mean a monthly payment is made to the software vendor each month – a subscription. As there will be a number of solutions available, research is recommended, so that the required needs are met by the cloud software solution. For the purchase of standalone accounting systems, a large upfront cost is required for the hardware, software, servers and facilities – all of which are needed to set up the system. It’s likely that additional personnel will then need to be hired, in order to set up and maintain the system.
If the trust is there, then cloud software appears to be the more flexible, secure and cost-effective solution for accountants. Cloud software makes it easier for accountants to analyse and report financial information to clients – from anywhere, at any time. (Read: How The Cloud And Client Portals Are Transforming Collaboration For Accountants)
So, cloud software for accountants focuses on the financial and regulatory accounting requirements. But there is an additional benefit that the cloud approach can bring – increased collaboration with your clients, to exchange documents, automate approval flows, and so on. A client portal can provide you with the right tool for that.
Have a look around our website, find out some more information about our client portal for accountants and sign up for your 10-day free trial if you think Clinked could be the right customer portal for your business!