Accounting is one of the most crucial departments in a company. After all, a successful company knows where its money is going and how much money is coming in. While traditional accounting methods have proved useful for the last couple hundreds of years, the introduction of the internet and the cloud has changed the financial world.
Despite the many benefits of cloud accounting, however, several business owners still hesitate to tap into its features. A better understanding of how cloud accounting works and its perks may help them see this new way of accounting not as an unnecessary innovation, but as a lucrative opportunity.
How Does Cloud Accounting Work?
Cloud accounting is also called online accounting. As its name implies, it refers to the act of performing accounting processes through the internet on an online server called the “cloud.” It means that instead of installing software on an on-site computer or maintaining multiple ledgers, accountants and other personnel will be performing most—if not all—of their tasks online.
Bear in mind that cloud accounting performs all of the functions that traditional accounting does—only this time, everything is on the cloud. Moreover, you also have access to extra features, including upgradable storage services and analysis tools, among others.
How Can Cloud Accounting Help Your Company?
Using cloud-based accounting software has proven to be a beneficial investment for numerous businesses. Aside from saving time, money, and labor, it has also helped company management make better financial decisions to increase their profit margin and reach company goals. To elaborate further, here are some of the advantages of implementing cloud accounting for your enterprise.
Synchronized and Accurate Data
The manual input of data into ledgers and different computers is highly prone to human error. With cloud accounting, all information that employees enter is uploaded into a centralized data center. Hence, the information is consistent for everyone who accesses it.
Aside from entered data, you can also sync bank accounts and other payments for more efficient tracking. Cloud accounting also calculates currency exchanges based on fluctuating exchange rates. All numbers are updated in real-time, leading to more accurate financial reports and data-driven decision-making.
Streamlined Accounting Processes
Cloud accounting automates several time-consuming accounting processes. Entering data, management of invoices and bills, and calculation of countless data points are only some of the functions that cloud accounting can accomplish. With so many processes automated, accountants can focus on analysis instead and assist company management in making financial decisions for the company.
With cloud accounting software, people can access the system from anywhere at any time. This feature is particularly useful if you have a work-from-home setup, a separate virtual team, or decide to outsource accounting tasks. Thus, if you need to look up specific company data, you do not need to go to the office. Simply log into the system through a web browser or the provider’s app, and access the data you need with no problem.
Increased Data Security
Data security is a serious thing, but it is especially the case in accounting. Information on cash flow, salaries, incomes, and other similar items are exceedingly sensitive and have to be protected. Traditional accounting software and ledgers are more susceptible to getting lost, stolen, or destroyed in a fire or natural disaster.
On the other hand, cloud accounting’s server is located in a separate place and protected with bank-level security. The software provider will also ensure that the system is compliant with all legal security guidelines to ensure that company accounting information is safe and secure.
Flexibility for Expansion
As a company grows, it is almost inevitable to outgrow the programs and software it uses as cash flow increases. That is no problem with cloud accounting, which often comes in tiers and has customizable features. Businesses have the option to pick the tools they want and build a personalized accounting suite. Once the business expands again, they can upgrade their cloud accounting system—whether in terms of storage space, users, or accounting tools.
More Effective Management
Keeping track of a growing company’s finances is difficult—without the right tools. With cloud accounting, company management can access a centralized platform where they can get a bird’s eye view of the operation and look into the details with a single click. The software allows them to have a clearer understanding of the business’s financial standing, which is crucial to company decision-making.
Indeed, cloud accounting software is a highly beneficial tool that can help your business significantly improve its accounting operations. However, it is also quite complex. To implement the program efficiently, it is essential to search for a software solutions provider that has the skills and background to help you make that transition.
ANSI has at least 30 years of experience under its belt and has helped countless both local and international businesses over the years. No company is the same as another, so we believe it crucial to tailor the software to the company’s needs. For more information, contact ANSI and take the step to upgrade to more efficient accounting today.