To Cloud or not to Cloud.....
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- D.S Accounting
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Some of you will be busy packing your suitcases with swim gear, snorkels and sunglasses and the last thing you’ll want to hear about is cloud. But, not to worry, I’m not talking about the weather here. The type of cloud I mean is something most of you have heard of – cloud-based technology, typically associated with online data storage, but now used in almost every industry.
Cloud-based accounting solutions work by the same principle as any other cloud solution. Instead of buying software, downloading it, maintaining it and worrying about data storage, a cloud-based accounting solution allows you to easily login to your accounting books via the web. These books are conveniently stored on the provider’s host.
Benefits of Cloud Accounting
Predominantly, the ability to access your accounts from anywhere (even on a boat in the Lake District on an iphone) is what has persuaded many small businesses to go the cloud route. It’s a particularly attractive option for virtual businesses or start-ups that work without formal office premises and that have minimal, mobile staff.
Packages for cloud accounting can cost as little as £7 a month. There is a growing number of practices that provide cloud-based accounting services at surprisingly low rates, making outsourced bookkeeping solutions very appealing.
New, fully cloud-based accounting software providers such as “Clearbooks” and “Xero” have been developing bookkeeping software with non-experienced bookkeepers in mind, complete with free training and online help. This means that a small business can significantly reduce its own bookkeeping costs and year-end accounting fees by doing some, if not all, the books themselves.
With the accounts stored in the cloud, team members and third parties can easily collaborate on data by literally being “on the same page”. Users can make changes that are instantaneously uploaded and viewed by others (e.g. accountants).
No more Accountants?
Not quite. There will always be the need for tax advice. Also, even though some small businesses will opt for bookkeeping themselves, undoubtedly there will be inaccuracies. Crucially, the accountant can ‘dip in’ and spot major errors or transactions that have tax or other significant implications, and make proactive recommendations. No more waiting until year end to discover problems that are too late to rectify (a phenomena that accountants know only too well, and that we have on many occasions been able to prevent due to cloud accounting)
Accountant as Virtual Financial Director
Here is the real value in cloud accounting. With the technology available today and access to cheaper services, there is an evolving expectation of accountants to deliver “real value”. Traditionally, accountants’ work has been backwards looking and compliance-based. Increasingly, a good accountant is expected to deliver timely, relevant strategic advice and not just “keep score” of last year.
This is where cloud accounting is one with a silver lining. Using this technology, the accountant can view daily transactions, become more integrated and eventually embedded with the business. The result is a more thorough understanding of the nature of the business, identifying trends and providing strategic direction.
Always put professionalism first
There isn’t a shortage of online or high street kiosk-styled services offering tax returns for say £49 a year, but the question is what service you are receiving and what relationship you are building with your accountant. It’s important not to compromise on professional competence as numerous horror stories abound.
At Danan Silberstein Chartered Accountants we have developed cloud accounting services. This enables us to provide competitive fees for our basic compliance work, but also allows our clients to benefit from financial and strategic advisory services by seamless integration via the cloud.
Jonathan Danan ACA
Chartered Accountntants & Business Advisers
Complete Solutions for Small Businesses