What is Cloud Accounting?

The Future is Cloud

The future is cloud. 

That’s nice but what is it?

Similar to how you use the Apple iCloud or Google Drive to store photos and files, cloud accounting uses a cloud space to store accounting software for your company to use via an internet browser.

More technically, ‘cloud accounting’ refers to the use of accounting software that is online and hosting in a remote service.

Why do we need it?

Like the cloud itself, cloud accounting works to reduce hardware and software costs for businesses. As the digital advances become quicker and quicker, businesses are unable to keep up with the new hardware requirements. It is too costly and produces too much waste. Having your accounting software hosted in the cloud and accessible by a web browser means:

  • You must only upgrade hardware when your device is no longer functional
  • You do not need onsite servers
  • No updates or software patches are required

How will it benefit your business?

Cloud accounting has endless and different benefits for each business – here are just a few:

  • Being online, you can access you accounting information anywhere you have the internet and from a range of devices.
  • It reduces the amount of energy your company consumes as you no long need to have onsite hardware.
  • No software upgrades mean you are using the best version of the software every time you logon.
  • It is incredibly scalable, adding and removing users or features as you need them.
  • Integrates with CRM software, online banking portals and other programs to help create a more automated accounting process.
For more benefits, check out this helpful article from Xero. 

If it is in the cloud, how will it be protected?

Like with all technology, cloud accounting has its risks. If we look at Xero (our primary accounting software) in addition to bank-level data protection, they have the following security measures.

  • Your company admin will have total control over what your users can see and access.
  • A Two-step authentication that adds an extra layer of security to help protect your account.
  • Your information is converted into unrecognisable code using industry standard data encryption
  • All their servers and data centres have robust physical security controls, as well as 24/7 monitoring and surveillance. 
  • Multiple layers of data security mean Xero is up and running 99.9% of the time, so there’s no disruption to your business.

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