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What are the benefits of Cloud Accounting?

Posted by Nick - Waddle's Marketing Manager on 05-Aug-2018 09:55:49
Nick - Waddle's Marketing Manager

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Did you know that if you haven't made the transition to cloud accounting you could be missing out? In this short article, we uncover the major drawbacks of using 'traditional' accounting platforms and we highlight the benefits available to your business with Australia's most popular cloud-based accounting platforms.

What exactly is cloud accounting and how is it different to traditional accounting software?

Whenever you use internet banking and every time you access that data, you’re using the cloud. The cloud is a platform to make data and software accessible online anytime, anywhere, from any device. There are several key distinctions between cloud accounting and traditional, on-site accounting. Cloud accounting software is like traditional, on-premises, or self-install accounting software, only the accounting software is hosted on remote servers, like the SaaS (Software as a Service) business model.

Data is sent to ‘the cloud’ where it’s processed and then returned to the user. All application functions are performed off-site, not on the user’s desktop. In cloud computing, users access software applications remotely through the Internet or another network via a cloud application service provider. In the cloud, there’s no need to install and run applications over a desktop computer. Instead, you pay for the software by monthly subscription.

What are some of the drawbacks of traditional accounting software?

  • The data in the system isn’t up to date and neither is the software.
  • It only works on one computer and data bounces from place to place. For example, on a USB drive. This is not secure or reliable.
  • Only one person has user access. Key people can't access financial and customer details.
  • It's costly and complicated to keep backups (if done at all).
  • It's expensive, difficult and time consuming to upgrade the software.
  • Customer support is expensive and slow.

What are some of the benefits of cloud accounting?

  • It’s easier to manage and it saves you a lot of time. There’s no need to install and maintain software on individual desktop computers. Cloud accounting requires far less maintenance than its traditional counterpart. The cloud provider completes the backups, updates occur automatically, and nothing needs to be downloaded or installed on a company computer.
  • You’ll have access to hundreds of time-saving apps like Waddle’s invoice finance, that integrate seamlessly with your accounting platform.
  • It can enable remote workforces as employees in other departments, remote or branch offices, can access the same data and the same version of the software.
  • Cloud accounting improves visibility throughout your organization, with greater mobile capabilities and collaboration.
  • Cloud accounting is more cost-effective than on-premise software, especially as your business grows. You’ll save on maintenance costs, license and database fees, systems management and expensive capital purchases of new hardware, such as servers.
  • Cloud accounting is more flexible. Accounting data can be accessed from anywhere on any device with an Internet connection, rather than on a few select on-premises computers.
  • Unlike traditional accounting software, cloud accounting software updates financial information automatically and provides financial reporting in real-time. This means account balances are always accurate and fewer errors take place due to manual data entry. They are also better able to handle multi-currency and multi-company transactions more efficiently.

How secure is your financial data with cloud accounting?

The cloud is one of the most secure ways to store information. Cloud accounting solutions provide a secure method of storing financial information, and even more so than traditional accounting software which usually stores your financial information on a local PC or laptop. If your laptop is stolen, then so too is your data, which could lead to an information breach. Cloud accounting, however, leaves no trace of financial data on company computers, and access to that data in the cloud is encrypted and password protected.

Sharing data is also less worrisome. With cloud accounting, two people simply need access rights to the same system with their unique passwords. Traditional methods often require flash drives to transport data, which could be lost or stolen.

Finally, cloud providers have multiple backup servers in more than one location, so if one server network goes down, you’ll still have access to your data. On the other hand, information that’s kept on-premises could be destroyed in a fire and may never be recovered.

There are some exceptional cloud accounting platforms on the market, and some of the most popular platforms used by Australian businesses are XERO, Myob, Quickbooks and Netsuite.

Are you already using Cloud Accounting? 

One of the benefits of using cloud accounting is getting easy access to working capital tied up in your invoices, by connecting with Waddle. Getting started is a simple and fast process. Click here to get started. 

Topics: Cloud Accounting, invoice financing, Line of credit, MYOB, QuickBooks Online, Xero, working capital

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