Accounting or bookkeeping is a tedious task as well as a business necessity. No business can grow by avoiding it. It helps you with financial control, proper budget management, resource allocation, and maximum benefit in fewer resources/budgets.
In recent years technology has revolutionized our day-to-day activities. Initially, we did our accounting with pen-paper, you can say manually.
Later we switch to some software tools and start adapting the business software for taking full-fledged advantage of accounting.
However, after the introduction of cloud technology, the entire business has changed. It changes the way companies operate and manage their business information.
But, here is the question that arises-
Why do we need a cloud-based accounting system?
Why are cloud accounting systems better than traditional accounting?
We understand this through an example. When we use Internet Banking, every time we access our bank data by using the cloud. Cloud data and software lets you access your account online anytime, anywhere, from any device.
For this, you no longer need the hard drive of your computer or laptop. And no longer the loss of data.
All this has been possible through cloud-based technology. Let us know more about the use of cloud technology, i.e., cloud accounting.
What is cloud accounting or cloud computing?
Cloud computing is a way to keep your business data online.
It is similar to traditional self-installed accounting software. Only the difference is that instead of installing your accounting software on your computer, you can do all your accounting work remotely.
Accounting data is sent into the Cloud, where it is processed and returned to the user. It helps you in providing tools for quoting, invoicing, managing bills, and more. Generally, it includes records of income, expenses, assets, and liabilities.
How does Cloud-based accounting work?
The Cloud accounting software users send data to the Cloud, where the accounting data is processed based on the requirement and returned to the user.
Business owners, accountants, and other employees who get access can use cloud accounting software. They perform their tasks and can able to add the necessary documents/files.
These data and files are securely stored in the Cloud. It helps businesses to access them without any data loss and helps in maintaining records of all transactions.
When a company implements cloud accounting software, the need to set up personal desktop software is eliminated. Also, it enables team members to access data from different business branches in real-time with the same version of the software.
Reasons to Use Cloud-Based Accounting Software
- Simple GST Compliance
- Save Time With Automation
- View Real-Time Data
- Reporting & analytics
- Access Financial Data Anywhere
- Makes Collaboration Easy
- Software Improves Accuracy
- No Installation Required
Now let’s take a better look at cloud accounting benefits.
7 Benefits of Using Cloud-based Accounting in Your Business
Remote access, anywhere at anytime
With cloud accounting, you can access your business data or accounts data at any time, from anywhere.
Previously, when you used desktop-based accounting, your data is saved on your local drive. It limits the access you can have to your financial information.
With cloud-based accounting, you are free to access your data. Your data and records are all securely encrypted and stored on cloud servers. To use it, all you need to do is log into your software through a web browser with an internet connection.
So, wherever you are; office, home, or traveling across the world, you can always check on the status of your business.
High data security and automatic updates/back-ups
When you’re using a cloud-based system, you don’t have to worry about the security of your account’s data. Cloud systems save and back up the data with a high level of encryption techniques.
Previously, when you used desktop-based accounting, you needed to back up regularly to eliminate the risk of data breaches or loss. Also, you need to update your business according to market trends.
With cloud accounting software, you get automatic data backup and updates. In this way, it has a high level of security. You can always get the latest working and up-to-date version of the software.
For successful accounting, you will be automatically updated with tax rates and required returns. Also, your work gets saved automatically. In this way, you save both time and money.
Saves time and cost-effective solution
Using IT software or accounting software can give you a cost-effective way to do business and save your time.
However, when using desktop-based accounting software, you require an IT hardware investment and a server for additional space. Also, you need an expert to handle the maintenance of such hardware and server. This is a costly process for you.
Cloud accounting software is carried out entirely from the cloud. You no need to spend on costly IT infrastructure and its maintenance. You can access the software from anywhere; you can file your taxes, approve payments, or send out invoices to customers.
This way, you cost-effectively save your time.
Customize as per your business requirements
With standardized format, many other cloud-based accounting software solutions come with customization options.
With this flexible, customizable business solution, you can add or remove features based on your business needs. Or you can customize the options when the need arises.
Secure data share and collaborate with ease
While working in the office, sharing data/files with colleagues and clients regularly is common.
Desktop accounting software uses old approaches, where you get limited access to business documents. You share your file, but it takes time and the possibility of data/file corruption.
Thus, it becomes difficult to collaborate with colleagues and customers.
With the cloud accounting software, you, your colleagues, and your management team can access the same data at any time and from any geographic location.
It makes collaboration easy in the most secure way. For customers, you can have the facility to email the requested data/file directly.
Get better control of your financial processes
The intelligent, advanced technology base of cloud accounting software can give users a user-friendly way to manage their business online.
The use of cloud-based accounting software gives you greatly improved control of your core financial processes.
It streamlines all your business accounting processes, giving you a better view of expected income. With its reports facility, you can view outstanding loans and bills.
You can get a clear idea of customer buying patterns and can make business strategies accordingly.
Reduces paperwork and is more durable, safer
Traditionally, you used to do all your accounting through paper, leading to some dangerous accounting errors and losses. The chances of errors can be reduced after the effective use of accounting software. You can do all your data entry to settle bills in just a few clicks.
An online accounting system can eliminate the dependence on paperwork to a great extent. It gives your business the most secure way to send invoices through direct mail and speeds up the payment process.
Other associated transactions can also be done smartly and securely with cloud-based accounting software.
Wrapping Up
Data security is one of the biggest challenges that companies face, which you can easily enable using cloud-based business software. With it, your business data is always up-to-date, and you’re able to get information about it in real-time.
The idea behind this blog is to tell you about the importance of cloud-based accounting.
To learn/know more about cloud accounting systems or to speak with us about any other business issue, get in touch with us at swindia.com.
