In the olden days, accounting records were stored in books and desktops that required day-to-day bookkeeping. In other words, someone needed to be in the office daily to record daily transactions such as paying bills and invoicing clients. Often, such tasks were postponed until the end of week, month or even the end of the year. This is because business owners were busy spending their working hours on clients rather than on accounting and bookkeeping.
Due to this procrastination, when tax time rolled around all expenses were either miscategorised or completely forgotten. Bank accounts were.t reconciled so errors slipped through unnoticed and personal expenses were co-mingled with those of the business.
Fortunately, cloud accounting offers an ever-growing suite of technologies and tools that can assist in reducing the headaches of managing bills, receipts and invoices. Cloud technology as revolutionised the accounting world for all business sizes and tax professionals.
So what exactly is cloud accounting?
Online accounting or cloud accounting has the same functionality as computer (desktop) accounting software. The bonus factor about cloud accounting is that it moves the whole accounting process to the cloud and expands on it. In other words is makes managing a business easier. There is no single application required. With cloud accounting, you can log in to an up-to-date online solution, and all your data is secured on a cloud server. Most of the cloud platforms also have an open API, that allows third-party software to connect with your system to provide further value to business owners.
Here is how a cloud accounting software can help your simplify your workday:
1. Best Bookkeeping for Small Businesses/Large Organisations:
Accounting is a technical field that can be heavy on the pocket if your business requires you to employ a finance professional or outsource to an independent practice. Cloud-based accounting software is intuitive and simplified, so employees with no financial experience can use them to maintain business records.
Cloud software is often built for non-accountants, with guides, tips, and automated hints to ensure that every entry is made accurately. Another option is to include approval permissions, so a junior-level member can also manage a couple of data entry tasks under the supervision of a senior financial director.
2. Security of Data on Cloud-Based Accounting Software
Security is crucial, and any records of other information stored on a physical server can be at risk of getting tampered with, lost or stolen. Cloud accounting software is one of the safest methods to protect your private records. It offers advanced-level encryptions and security controls that ensure only permitted users can log in. The software automatically backs ups data, so you won't lose any records if a staff laptop suddenly shuts down or they lose the laptop.
3. Work on the Go
Most business owners and entrepreneurs started their businesses because being your own boss is a bit about flexibility and freedom. That could mean working when you're on a vacation at the beach or travelling and not being tied to a desk or an office. With traditional accounting software, it would be nearly impossible to keep running the business
while you're away. There are many records that you can't report unless you're in the office.
Here's where cloud accounting is essential; no matter where you are, cloud accounting gives you access to all your financial information wherever you are. You can also access it at any given point in time.
4. Track Data Easily
You can easily track all the expenses of your business as it connects with your credit cards and more. It isn't necessary to log in to the accounting system every time. You'll just get a text when your transactions occur. You can also track your reports daily. Some entrepreneurs tend to keep their credit statements to show their expenses. However, if an IRS audit is conducted, these statements do not hold any value as auditors require receipts.
Cloud accounting enables you to take a photo of your receipt or save it as a PDF to attach to your expenses. This will help support your deductions in the case of audits.
5. Faster Software Updates
With cloud accounting, you don't have to worry about updates and downloads. Your software will automatically update, thus saving you time and energy. All your data is backed up and there is no license required for the program.
6. Fewer Overheads
Due to the user-friendly environment of software, you can easily carry out your task. Raise invoices, check the flow of your transactions, generate financial reports and all with an accountant. This helps cut down some overheads. Even IT problems are less and can be solved easily. This will cut down overall expenses and be beneficial for the business.
Conclusion
In the end, using cloud-based software can make everyday work easier with its excellent benefits. No matter if you're a small or large-scale business, accounting software is crucial and quite beneficial. To learn how to choose the right cloud accounting service provider for your business, read this blog.
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