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Having Questions about Cloud Accounting Solutions? Get the Answers Here

Last updated: 06 Feb, 2020 By | 6 Minutes Read

Being an accountant/bookkeeper or owner of an accounting firm, you might already be aware of various technologies or software most accountants are using today to increase work efficiency, serve their clients better, and retain them for long. But if you are yet to know what cloud technology has for accountancy, you have reached the right place.

Yes, here you will get answers to all the questions you have always had about cloud accounting software. Moreover, if you are planning to start offering cloud accounting services, your clients will have a list of queries and questions about the benefits of ‘cloud accounting,’ so better be prepared. With the help of this post, get answers to FAQs about cloud & its benefits for accounting purposes.

But before we go any further, here are some statistics about cloud accounting that you should be aware of.

  • According to Flexi, the global market size for cloud accounting is estimated to become $4.25 billion by the end of 2023, which recently was $2.62 billion.
  • Intuit predicts that 78% of small businesses will rely on cloud technology by 2020.
  • “Companies relying solely upon cloud accounting experienced a 15% revenue growth each year” – Xero
  • “Cloud computing lessens the costs of labor by 50% (Forbes)” – Source
  • “By 2023, the worldwide market of public cloud services is estimated to reach $623.3 billion.”
  • “By 2020, 83% of enterprise works will be managed in the cloud.”
  • “94% of companies are already using at least one cloud service.”
  • “50% of companies spend more than $1.2 million annually on cloud services.” –Source

Cloud Accounting Services

FAQ about Cloud Accounting

1. Where does the cloud exactly exist?

As many people know what cloud means in the world of technology, many accounting professionals often skip this question. But for all those who are unaware of it, the cloud (in cloud accounting) is defined as the internet. Managing accounting in the cloud simply means managing accounting on the internet.

2. What is cloud accounting?

Cloud accounting refers to ‘accounting on the internet,’ which can further be defined as the practice of managing financial accounts and related information on the internet, in fact, on a remote server (to be precise) rather than on solid-state storage devices or hard drives in computers. This allows you to access (by using the internet) your accounting details at any time from anywhere you want. For this, you need to login to a service platform, for example, Xero, QuickBooks Online, etc.

3. What are the possible benefits of managing accounts on the internet?

There are many, but the prime ones are as follows;

24X7 AccessAs the accounting information is stored on the internet, you can view/edit (if authorized) it while working in the office or lounging at home or even while you are out on vacation.

Quick UpdatesCloud accounting applications regularly get updated (most times automatically), keeping you free from purchasing newer versions of the software you use and saving you money too.

A Cheaper OptionThere is no need to buy a server to store your entire data, no need for getting additional backup systems as a cloud accounting platform work as a package of all these.

Integration CapabilitiesIntegration is an excellent feature in a cloud accounting application that helps it to work collaboratively with other software such as net banking, payroll, point-of-sale billing software, etc.

4. Can I trust the cloud for the security of my accounts’ information?

Unlike physical data storage devices or computer hard drives from where the data can get stolen or damaged, the data stored in cloud-based accounting software is highly secure with the help of multi-factor authentication gateway and solid encryption.

5. Is there anything I can do to maintain data security?

Yes, you can, or, more precisely, you should.

Cloud accounting is secure, but negligence in not keeping your account safe on platforms might result in loss. Thus, it is vital to adopt best practices to maintain data security.

  • Use strong passwords – alphanumeric characters and, if it allows, include special characters too.
  • Never save your passwords on others’ computers and devices.
  • Set up multi-factor authentication.
  • Beware of phishing scams.

6. Will it save my firm some money?

Yes, definitely! Investing in a cloud accounting system requires you to spend less on servers and IT infrastructure. Also, there’s no need for regular maintenance and hardware tools, saving your monthly software maintenance fees.

7. What’s the major difference between desktop accounting applications and cloud accounting software?

Desktop and Cloud Accounting

To run desktop accounting software, it is vital to install it on your computer in the first place. All the accounts related data that appears when you use the software is typically stored on the same computer.

Cloud accounting software, on the other hand, runs on the internet. To access the software, you only need to sign in to the software using a username and password. This simply means you can use the software virtually from almost any computer, most tablets, and smartphones.

8. Will the software help me save time?

Balancing financial accounts takes a lot of time. The cloud accounting software will compute figures quickly and organize the information automatically. As you would not need to search for or file statements, you will get more time to focus on business growth.

9. How difficult is the software to use?

Look for an easy to understand, user-friendly cloud-based accounting software. You can also take a free trial or demo of different software to find the best suitable one. Software specially designed for small businesses might be easier to utilize and might not be having features designed for large enterprises.

10. Will the software fulfill my firm’s requirements?

Every business has its unique accounting requirements. Some businesses require industry-specific accountancy features; for example, a real estate construction company might want features that prepare individual records of expenses for different projects. Thus, know about the software before choosing one.

11. What do I need the software for?

First things first, you need to determine the accounting features your business requires, then find different software providing such features as you need not pay for features that you will never utilize. You may use cloud accounting software for;

  • Generating invoices
  • Storing accounts’ information
  • Tracking expenses
  • Paying bills
  • Preparing financial statements

12. Who would help me if I face an issue while using the software?

Many established providers such as Xero, QuickBooks, Sage, etc. offer customer support 24X7 throughout the year. You can reach customer support executives through email, phone call, or online chat.

13. What would be the benefit of switching to cloud accounting?

The main benefit of moving to the cloud is – accounting on the go.

Cloud-based accounting applications are usually very user-friendly and require basic technical expertise to set up. They perform various accountancy functions timely & accurately with the help of automation, saving your effort and time.

Data entry and processing is also a lot easier. Moreover, backup files are made and updated automatically, keeping you away from worries about data security.

According to one survey:

  • 61% of companies moved their data to the cloud for cost-cutting.
  • 57% had a desire for new features and capabilities.
  • For 30% of enterprises, their current warehouses filling up has pushed them toward adopting the cloud.

(Source: Datometry)

14. Which cloud accounting software should I choose, and what would be its cost?

The first thing to consider while choosing such software is your accounting requirements. You may get details on the features of different cloud-based accounting applications and select the one that suits best with your accounting needs and helps you provide up to the mark accounting services to your clients.

Cloud accounting software is usually provided as a SaaS subscription model (Software as a Service). Therefore, the cost of the subscription will vary with your accounting requirements.

Here is a list of popular cloud accounting software:

Software Name Country User Service
QuickBooks Global 4.5+ Million Users Worldwide
  • Track sales
  • Create and send invoices
  • Manage 1099 Contractors
  • Run reports
  • Track miles
  • Maximize tax deductions
Xero UK, New Zealand, Australia, US 2+ Million
  • Easy invoicing
  • Inventory Management
  • Reconcile foreign currency accounts
  • Attach files to data
  • Create purchase order
  • Easy payment scheduling
MYOB Australia 1 Million Users
  • Single touch payroll reporting
  • Manage inventory
  • Store Management
  • CRM
  • Manage bills & expenses
  • Handle multiple currencies
NetSuite USA, UK, Germany, Japan, Australia, Singapore, Hong Kong, China, Malaysia, Thailand, Philippines 19K customers across 200+ countries

Streamline all back-office processes like:

  • Accounting
  • CRM
  • eCommerce
FreshBooks North America 24 Million Users
  • Online Invoicing
  • Expense Tracking
  • Time tracking
  • Accounting Reports & taxes
  • Automatically recorded payments
  • Seamlessly collaborate on projects
Sage Business Cloud Accounting UK, USA, Europe, Africa, Australia, Asia, Canada, France, Ireland, Malaysia 3 Million Users
  • Accounting
  • Expense management
  • Project accounting
  • Compliance management capabilities
  • Billing and invoicing Financial reporting
Zoho Books Southeast Asia, USA, East Asia 50+ Million Users
  • Manages your finances
  • Keep your GST compliant
  • Automates business workflows
  • Organize inventory information like SKU, cost, and stock on hand
  • Track unbilled hours and expenses
  • Customize reports and filter the data further for better insights
Multiview Canada, United States 2 Million Users
  • Business Analytics & Financial Reporting
  • BI, Business Intelligence Reporting
  • General Ledger with budgeting
  • Purchasing with Requisitions
  • Work Order Management
  • Fixed Assets
  • Time & Billing
  • Invoicing & Inventory
TimeCamp Australia, Canada, UK, USA, Europe, Mexico, Germany, Japan, Africa, Asia, India, Brazil 2.8L Active Users
  • Mobile time tracking
  • Accounting Integration
  • Attendance management
  • Multi-currency
  • Electronic payments
  • Real-time monitoring
  • Task planning
  • Third-party integration
  • Billable hours tracking
  • Reporting & statistics
BigTime Canada, United States, Chicago
  • Real-Time Data
  • Workflow Management
  • Data Import/Export
  • Expense Tracking
  • Reporting & Statistics
  • Customizable Reporting
  • Billing & Invoicing
  • Automatic Reminders
Wave Toronto, United States More than 2.5 million users
  • Track all your income & expenses
  • Prepare smartly for the tax time
  • Ensures multiple banks and credit card transactions
  • Ensures data transactions
  • Fund accounting

 

Recommended Post: Why Small Businesses Should Use Cloud Accounting Software?

15. What if I don’t go for cloud accounting technologies?

Cloud is the future of computing, as well as accounting. The accountancy world is drastically changing where the adoption of cloud-based technologies is on the top, and thus, it makes sense to catch up with the trend. Cloud accounting paves the more natural way to grow while cutting considerable costs and giving a competitive edge to your business.

16. Do we need accounting expertise to use cloud accounting software?

Most cloud accounting applications are designed and developed for non-accountant users. However, you need to have basic knowledge of accountancy to ensure you get accurate financial information. The best way for non-accountants to use such software is to employ a professional accountant and keep complete control of your accounts in your hands.

17. Will Cloud accounting help with tax issues?

Cloud Accounting Help With Tax Issues

Most tax issues are a result of the miscalculation of finances (expenses & income). In terms of providing accurate financial information, yes, cloud accounting helps calculate taxes.

18. Will I be able to access my accounts using my smartphone or tablet?

Yes, most cloud-based accounting service providers have their applications designed to be used in devices other than computers. As per the software you will choose, you might access your accounts using iOS & Android-based smartphones and tablets. All you need to do is to download the application in your smartphone or tablet and log in with credentials the same as you will use for login using a computer.

19. In case I discontinue the service, how would I get my data files?

Yes, you can anytime change your mind and discontinue the service. To get your financial data as a file, you can create and save a backup, which will be downloaded on your computer. Most cloud accounting applications have this feature to provide you with the entire confidential data related to your accounts in a specified file format and organized manner.

Conclusion

These are the most common frequently asked questions along with their answers. As you are now aware of the use and benefits of cloud-based accounting software, you may start analyzing your special requirements and look for an application that fulfills your accounting needs.

And if you are planning to save some money, outsourcing some of your accounting operations would turn out to be the best option. Get in touch with Cogneesol – one of the leading brands in cloud accounting outsourcing services, satisfying more than thousands of clients worldwide.

Call us at +1 646-688-2821 or email at info@cogneesol.com today to take a limited-period free trial!

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