Growing Your Business

Is it Time to Switch to a Cloud Accounting System?

Is it Time to Switch to a Cloud Accounting System?

Having a robust accounting system in place is a concern for every business owner. Cloud accounting systems have risen in popularity in recent years, on account of work no longer having to be geographically-bound and more business owners needing the ability to update their financial records from anywhere in the world. The additional conveniences many cloud accounting systems offer such as mobile scanning and data entry with automated integration with online payment systems like PayPal, Shopify, Squarespace, and other providers only adds to the appeal.

But despite these conveniences and advances made to accounting technology, many business owners still find themselves hesitant to move into the cloud whether it's out of security concerns, costs, the ability to adapt, or other reasons. We asked several trusted accounting professionals for their input on the pros and cons of moving to a cloud accounting system, so that you can determine if you're in the right time and place to make the switch from analog to cloud.

Cloud Systems Let You Easily Share Your Data with Your Tax Professional

Lisa Foster of L.A. Foster, Inc. says your accountant being able to see your books at all times is the best upside of using a cloud system. Jeffrey Quatrone, EA concurs and feels that the challenges of adapting from a desktop to cloud system are worth it for his clients.

"[My clients] also like the comfort should they have a question their accounting/tax professional can see the records in real time remotely and simultaneously. In my experience, you may find less stress and uncertainty if you accept that your historical records are better left in their original format and use a start date of no less than 30 days prior to your switch."

One drawback: if your internet speed and device compatibility leaves a lot to be desired, such as if you live in an area of the country or world where high-speed internet isn't available, you won't benefit from this aspect of a cloud accounting system as much. If high-speed internet is readily available where you are, then you definitely won't want to miss the benefits of having your accountant being able to get real-time updates of your financial records so they can quickly answer questions and take care of your books right away.

Your Data is Only as Secure as You Make It

Guillermo Birmingham, CPA feels that the security weaknesses in cloud accounting systems are more perception than reality. "If your security practices are constructed effectively, data security concerns be essentially eliminated." Birmingham frequently travels around the world for his business and recommends using a highly-secure cloud host with backup service. While a cloud server may not be as secure as a local area connection, if you take basic security precautions such as using secure devices and two-factor authentication, then you shouldn't be at any more risk than using a desktop accounting system.

The Software Is Always Up To Date

Peter Flournoy, CPA says that the best benefit a cloud system offers is that your workflow will never be interrupted by having to manually update the program and Birmingham agrees. "Another tax pro doesn't have to maintain your accounting software since cloud-based systems are always running the most current software." If you're not that mindful of manually updating your computer system and the programs you use, a cloud system is definitely beneficial here.

When All Else Fails, Just Leave Accounting to the Professionals

Joshua Stadley of DKK Accounting LLC swears by this sentiment. "If you're unsure of what you're doing in the first place, chances are the software [you use] isn't going to change that. It's always cheaper and easier to leave it to the pros." There's definitely nothing wrong with leaving your accounting to the professionals if you can't or just don't want to handle financial recordkeeping on your own.

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Lee Reams II

Lee Reams II

CEO

I am a tax and business news junkie who has spent the last 20 years developing and executing "best in class" word-of-mouth marketing campaigns for tax and accounting professionals. With TaxBuzz and CountingWorks we have taken that same commitment to quality content directly to the consumer. Keeping you up-to-date with the latest tax law changes, business growth tips and planning strategies to help you reach your best financial outcome.

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