Cloud Accounting

Accounting in the cloud

Believe it or not, Cloud Computing has been around since the 50s when the first supercomputers were used in research networks to carry out tasks too complicated for the smaller machines connected to them.

Nowadays, ‘The Cloud’ is often used to refer to the Internet itself, although specifically, Cloud Computing means the use of a small number of centralised servers -called ‘the back end’- to run programs and store data which are made available over the internet to ‘the front end’ a large number of less powerful machines in the hands of people like you and me.

Practically speaking, having Cloud-based data and software means that you can access it anywhere in the world without having to install it on any of your desktop computers, laptops or mobile devices, providing you can establish a connection to the internet. Programs like Spotify, drop-box and iCloud are examples of Cloud computing that you might already know.

Accountants, with Smith & Brown amongst them, have been among the first to see the benefits of this approach and get involved. Cloud based accounting software gives you, your finance team and your accountant, access to the same data simultaneously without having to send it to each other by email or physical methods like USB or CD. Your bookkeeper, for example, can upload an invoice to an application like receipt-bank and minutes later, your balance sheet will be automatically updated and instantly viewable by you, and your accountant through another cloud based application like Xero or Free Agent. Pretty clever, we think, and likely to save you time and money from the outset. Even if these new programs aren’t going to work for you, the Cloud can still be a great way to share data in spreadsheet or document format. You can even photograph things you want to share and distribute them that way too.

Software Brands

Xero

Although one of the more expensive solutions on the market, we're inclined to think that Xero might be worth the money. It's feature rich, easy to use and VAT ready.

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Free Agent

FreeAgent is a feature-rich cloud accounting application which nevertheless has a few annoying omissions and interface issues. Its most unique feature, perhaps, is a customised account which recognises your status as a sole trader, partner or limited company.

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Sage One

Sage One is an intuitive, easy to use piece of cloud accounting software which nevertheless lacks many of the features of its competitors.

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Quickbooks

QuickBooks is a piece of cloud accounting software full of useful features and reasonably easy to use, with a few hidden annoyances.

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Kashflow

When it comes to features that you might expect from a subscription cloud accounting service, Kashflow ticks all the boxes, but we found it awkward and complicated to use.

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Wave

One of the major advantages of Wave's intuitive and feature-rich cloud accounting software, is that it's free. Designed for small businesses, there is no trial period and it’s very easy to set up an account.

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Cloud accounting and you

At Smith & Brown we believe that many businesses could benefit from implementing a Cloud-based accounting system, and our reasons for thinking so are explained just below. But we know it’s not for everyone. You may not want to go that way for reasons of your own, and we absolutely encourage you to tell us that. We may also take the view, after talking closely to you and looking at the exact requirements of your business, that we wouldn’t recommend it to you either. There are some situations where Cloud accounting is not the best solution. That’s why we will never push you into adopting cloud accounting, or any other system of working, even though it makes our job much easier.

Advantages of cloud accounting for your business

Effective Data Sharing

With Cloud accounting, your financial information is instantly and automatically shared between everyone in your team who has the authority to access it. It can be updated in real-time with the minimum of data entry and easily accessed through any computer, tablet or handheld device.

Reduced Hardware Costs

With most of the software processes and data storage handled by the ‘back end’, Cloud Computing systems place much smaller demands on the ‘front end’ devices that your staff use to do their jobs. This means that you can streamline your hardware: you don’t need powerful processors or large volumes of data storage locally because all of that capacity is provided by large servers elsewhere in the world, and paid for by someone else.

Reduced Software Costs

In the past, if you wanted everyone in your workforce to have a particular piece of software installed on their computer, you would have to pay for licenses for each and every one of them. With cloud based software such as Xero, Freeagent and Geo-Op you subscribe with a single payment, or monthly subscription, and can download it onto as many devices as you like.

Increased Reliability

Cloud computing systems have inbuilt redundancy. Whenever you upload anything to the Cloud, it’s stored on a server and automatically backed up by at least one other copy stored on a different machine. This means that even if one server were to fail, your data would still be safe and accessible just as if nothing had happened. In addition to this, a streamlined ‘front end’ of similar machines running identical software presents a much smaller challenge from an IT support perspective than a mixture of desktops, laptops and handheld devices running different operating systems and end-user software.

Accounting in the cloud

Application Programming Interface (API) systems may well be the next big thing in the world of information technology.

An API gives you control over the way in which different applications interact by providing a piece of bridging code that allows one to drive the other. For example: Samantha, the owner of a small weekend pottery business is looking for a more efficient way to invoice customers who order by email.

We introduce her to an app called Quick-Books, a cloud based accounting system, and set up an API which automatically creates a new invoice every time the company receives an email from a new customer, without her having to generate it by hand. We can show you how to set up APIs freely between more than 200 cloud based applications, and the trend is growing. so the possibilities are potentially endless.

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