Filing your confirmation statement, annual return, VAT return and annual accounts has been a process that has stuck in the craw of many an entrepreneurial business owner for as long as we can all remember; and despite the UK government recently catching up with the technology-era; it still feels like a disjointed, difficult but compulsory process, which repeats annually to add to the discomfort.
The financial management of a business for some is more difficult and taxing than the actual running of the business itself, and in time gone by Managing Directors have employed a room full of bookkeepers, all with accounting software individually downloaded onto their computers to input and update information to keep compliant and enable business function.
But the days of Sage Sterling and Sage Businesswise are long gone; as is the whirring noise from the bank of dated PCs that businesses used to depend on to process their accounting information; and Cloud Accounting Software has since taken its place.
Cloud Accounting Software is a term that first broke ground in people’s minds around 2009 after Google CEO, Eric Schmidt, mentioned Cloud Computing and Software at an industry conference a few short years earlier, in 2006. At the time, the notion of Cloud was a foreign concept and a revolutionary prospect; but quickly tech savvy entrepreneurs got a handle on what it was, and started to develop programs and applications to utilise the technology and make it accessible to the broader person.
Essentially, Cloud Accounting Software is similar to its more traditional, on-premise accounting software predecessor; only rather than the companies data being held and manipulated on desktop PC’s in office, this now takes place in a far more automated fashion through remote servers, where data is sent to the cloud, processed and then returned back to the user almost instantaneously.
In Cloud Computing, all accounting functions are performed off-site (not on the users desktop), where users log in through application windows to access, update and amend the data.
Whereas in earlier iterations of Accounting Software, where you would have to be physically present at the PC which held the data (which often meant in the office), Cloud Accounting Software gives you the ability to access your accounting data from anywhere in the world, providing you have internet access, and your software login credentials. This has enabled teams to be remotely located, even when businesses operate out of multiple premises (such as large multi-site manufacturers).
Software crashes were commonplace in on-site accounting software, largely because of the depth of data and bandwidth being consumed by the software at any given time, compared to the bandwidth capacity of the PC itself. With the burden of the software bandwidth sitting firmly on gigantic remote servers and the actual accounting activity happening in the cloud, the software and the laptops that facilitate access are more reliable and less open to glitches and issues.
Besides the possibility that your computer may fail to start one day, the accounting data was only as secure as the user and the building that the software was controlled from. This left hours of work open to loss or error, which could risk or compromise the security of the data. Despite famous ‘cloud hacks’, the security of your accounting data while it sits on remote servers in the cloud is multiples higher.
Not strictly an impact of the cloud, but an impact of technology developments generally; it is now possible to manipulate accounting data more precisely and with more purpose. The connectivity between one piece of software and another, and the ability to integrate multiple software applications, has enabled accounting data to be sliced and diced like never before; this has led to faster and smarter data insights that can drive business decisions more accurately and with greater confidence.
One word, speed. Cloud Accounting Software is faster for a number of reasons. Firstly, the remote servers have a much larger capacity which enable data input and movement quicker; but more prominently, multi-user access makes it easier for team members to collaborate online to draw input and outputs much faster than on-premise solutions used to enable.
If the five reasons above weren’t quite enough to entice you to transition away from the jurassic solutions afforded to you through on-premise, computer hosted, accounting software; perhaps considering the concept that ‘time is money’ will. If your accounting processes can be compressed into a shorter amount of time, due to the advancements in technology, speed of manipulation and accessibility to data, then the cost of your accounting process will inevitably be cheaper; but more than that, it’ll be better.
For more information on how to transition to a Gravitate Accounting solution, get in touch with our team today.
Find out about the type of expenses you're able to put through a limited company.Read Article
Payment runs are a thankless task and can often be very time consuming, getting together the invoices, processing them and getting approvalRead Article
A question I get asked all the time is: ‘What can I take out of my business?’ and ‘how do I save more tax?Read Article
Last week, the Chancellor of the Exchequer – Rishi Sunak – announced a wave of tax reforms...Read Article