Someone else’s server
For many years there was a general nervousness about running accounting and financial systems hosted on someone else’s server, and that’s made available over an Internet connection from anywhere on any device. Concerns were mainly about loss of data either deliberately hacked or accidentally lost due to the service provider crashing their servers without adequate backup.
Now most of these concerns are being overcome by the exponential growth in cloud applications including accounting. We are starting to see the impact of cloud computing in the accounting industry.
We have always maintained that clients should be able to view their financial data on a regular basis, an essential need to ensure that clients can take corrective action if their results are less than planned.
Traditionally, many companies relied on their accountants processing data and reporting results, sometimes not until the end of an accounting period. Our approach has been over the last 30 years to ensure that clients used appropriate software packages to run their own regular book-keeping and send reports to us for interpretation and advice.
This was done by sending files over the internet which meant that we and clients had to have compatible versions of the accounting software. Operating real-time updates over cloud computing now means that accountants are better able to review up-to-date results avoiding using redundant data files.
Being audit compliant
The key source of data which is required for audits by HMRC and Companies House are the bank transactions. Most Cloud accounting allows companies to link their bank accounts with their accounting records, thus avoiding the time-consuming tasks of traditional reconciliations.
The client can either input data into the system themselves or contract the accountant’s bookkeeper to enter from documents produced. Scanning documents is also being used as another way to save time by collecting e-format documents with ease and have them available for use, whenever and wherever required.
Access to the accounting system by the accountant is essential to support the client in setting up or amending the chart of accounts to produce a balance sheet which is the most difficult concept for unqualified operators. Being able to discuss entries over the phone rather than needing to make a visit improves the client/professional relationship.
As time is money, clients can be more productive in running their business than worrying about deadlines to process their transactions to meet VAT and Year End company and tax returns as processing will be in real-time.
For us Cloud Accounting gives us the opportunity to spend more time in assisting our clients in developing their business through planning, tax advice, consultancy and coaching.