What is Cloud Accounting?

In today’s technologically-driven world, more and more of what we create and manage is stored on the cloud—an online server that can be accessed anytime, anywhere, and on any device.

Cloud accounting is simply the process of completing a business’ day-to-day accounting operations, but instead of being saved onto a hard drive, all files are uploaded and stored in a cloud-based server.

Cloud technology is evolving at an extraordinary rate, and the popularity of cloud accounting will continue to snowball—the market sector is predicted to reach $11.76 billion by 2033. This, coupled with the increase in functionality for all users, makes it a very appealing choice for businesses. 

This article will look into the key benefits that cloud accounting brings to the table.

Key benefits of cloud accounting

There are several benefits of cloud-based accounting, including:

• Accessibility and convenience
• Real-time access and collaboration
• Cost-efficiency
• Increased encryption and protection
• Scalability

Accessibility and convenience

The internet is everywhere, and can be accessed on almost all devices. This means you can access cloud accounting software from wherever you are in the world, at any time.

This has become vital for modern businesses, particularly with the rise of remote and hybrid working. Employees no longer have to be sitting at their desk in front of their work computer to access key documents and software.

Real time access and collaboration with cloud accounting

Cloud accounting software lets multiple people work on a project at the same time. All changes and updates are automatically saved to the cloud. 

This means that, regardless of whether an employee is working in the office, at home, or even abroad, everyone can still complete their work. 

This can lead to a more unified workforce, with smaller aspects of a much larger project taking place simultaneously. Senior staff are able to provide real-time feedback, and employers can immediately amend any errors or misunderstandings.

Cost efficiency with cloud accounting

With businesses now blending in-person and remote work, many can reduce infrastructure needs and save significant costs.

Many examples of cloud accounting software, including QuickBooks, can automate a large number of processes, mitigating the risk of human error and associated costs. 

There’s also no longer a need for things like paper and printer ink, so cloud accounting is also more eco-friendly.

Increased encryption and protection

Some businesses are still wary of cloud-based technology, worrying it’s less secure than traditional in-house methods.

That may have been true in the early days, but today’s cloud accounting is built to handle security threats. It’s now a reliable way to protect your business’s sensitive financial data.

For one, cloud-based software is automatically kept up to date, meaning that there is no risk of losing data due to outdated, defunct platforms—it’s saved automatically and securely, ready to be accessed and used at any time. 

Cloud accounting also offers multiple levels of security and encryption, dramatically reducing the chance of a breach. Businesses can also set up user access to ensure only authorized personnel can gain access to the data they need. 

Scalability of cloud accounting

One of the benefits of cloud-based accounting is the ease with which businesses can scale up their operations. 

Traditional spreadsheets can quickly become tricky to manage as a business expands, slowing down day-to-day activities. 

With cloud accounting, the ability to scale and manage complex financial ecosystems becomes straightforward. Businesses can simply purchase more storage, and digitization means documents are easier to find once they’re categorized. 

What is the key benefit of cloud-based payroll accounting?

Payroll and staff salaries are among the most important—and often most stressful—tasks for any finance team.

Without good systems, records can become messy, and human error is always a risk. Add in complex tax obligations, and even experienced accountants can make mistakes.

That’s where cloud-based payroll shines. It streamlines the entire process, end to end. Automation helps you update records and calculate taxes instantly, making compliance much easier.

With a reliable cloud-based payroll system in place, the stress and strain put on your business finance team, as well as the overall workload, will dramatically decrease, leading to higher employee morale and productivity.

Why transition to cloud accounting?

There are a number of common objections that still occur when deciding whether to switch to cloud accounting: 

Long-term cost benefits

A business may be put off from making the transition due to the perceived upfront costs of a cloud platform, but consider the initial cost as an investment. The long-term savings you can achieve will be substantial. Office costs and infrastructure, as well as the cost of human error, will be reduced dramatically. 

There are also many pricing options available, so there’s always a solution to suit your budget. 

Enhanced data security

There’s also the reluctance to put high levels of sensitive financial data into the hands of third-party software. Accountants who are used to being able to save their data in localized areas may be wary of putting their faith in the cloud.

However, today’s cloud-based accounting platforms offer highly secure, reliable solutions.

With features like data encryption, multi-level user access, and compliance with industry standards, these tools are designed to keep your company’s financial data safe.

Efficient integration and collaboration

There may also be some doubts about how to effectively transition from legacy software to cloud accounting. Many businesses believe that it’s a time-consuming process that will be difficult to fully achieve. 

Cloud accounting is the ideal end goal, but that doesn’t mean the transition needs to be instant. If your business implements a plan of steady integration onto cloud-based platforms, the transition can be gradual and seamless. 

The result will be a system of business financial operations all working efficiently with one another, with automation, enhanced security, and real-time collaboration contributing to creating a powerful and robust accounting team. 

Work smarter with accessible data in the cloud

Cloud-based accounting is becoming attractive for all businesses, no matter the size or industry. 

An increased amount of storage space, high levels of advanced security protocols, automation, collaboration, and long-term cost benefits are all reasons why successful businesses are making the transition to cloud accounting.

At QuickBooks, we provide a cloud-based accounting solution that will provide all of these benefits and more. With over 6.5 million satisfied customers and price plans to suit all businesses, we can help you automate the accounting process, giving you more time to grow your business. 

Want to try it for yourself? Register today for a free 30-day trial and see what we have to offer.