How we communicate and use data has changed significantly in the last few years. Gone are the days when small business owners skimmed through hordes of those physical accounting registers once a month or rushed to the office to access those Excel sheets to know where their business stands. Technology has made communication and office work much easier and faster. It has also made it imperative to have your books of accounts up-to-date at all times. Most official tasks, like client quotations, business loan applications, GST and advance tax, need updated business numbers at your fingertips. With technology making the world come closer, everything is happening at lightning-fast speeds. You need to speed up your accounting processes to keep pace with this fast-growing world. And that is what cloud accounting enables your small business to do. But do you need cloud accounting for your small business needs? If your business is still local and is yet to expand, wouldn’t continuing with your present desktop accounting regime suffice? Let’s find out.
Accounting Software: Habit Vs. Upgrading
While almost everybody has done away with maintaining manual books of accounts, not everyone has warmed up to the idea of cloud accounting. With technologies advancing almost weekly or monthly, many small business owners tend to stick to the comfort of desktop accounting rather than trying out the latest in online accounting. Having been using desktop accounting for years makes it seem easy.
While desktop accounting has its merits, cloud accounting is not very different. For one, both give convenience and speed to computerized accounting. Also, the main functions of both are doing all sorts of accounting tasks like budgeting, invoicing, processing payments, tracking expenses, making inventory reports, and banking. However, there are some differences as well. Understanding these differences can help you decide which accounting system is right for your small business.
Desktop Accounting Vs. Cloud Accounting
The main difference between desktop and cloud accounting is that the latter requires an internet connection while the former doesn’t. This, in itself, is what the whole “desktop vs cloud” debate rests on. While it was worth pondering over till a few years ago, today it is a moot point as most people have access to the internet. Still, if the internet connection is unstable, it might be better to continue with desktop accounting.
Number of Users
Desktop accounting is restricted to the device it is installed on. To access the data, you need that device, and if that device is a desktop computer in your office, it would be difficult to carry it with you on business trips. This mobility restriction also restricts the number of users that can use the application, which is a good thing security-wise but an obstruction when the data is needed to carry out work. Cloud accounting, on the other hand, offers packages that allow you to share data with 3 or 5 or, in some advanced plans, up to 25 users. A few even allow unlimited users!
If you want to share data in desktop accounting, you must either put it onto a flash drive and send it to the concerned person, download and email the data, or take paper copies and deliver them physically. On the other hand, cloud accounting allows ease of sharing data with other employees or clients simply by granting them access to the files.
Since desktop accounting is restricted to the device it is installed on, data backup is done manually. Any lapse in taking regular backups could result in a significant loss of data. Also, you could lose all your data if the device is damaged. With cloud accounting, all your data is saved automatically on an off-site system. This backup system is constantly working in the background in real-time, so the chances of you losing any data are slim. Since no data is saved on the devices, any physical or other damage to the device does not affect your accounts. You can access the data from any other device.
All processes on desktop accounting plans are done manually. There is hardly any scope for automating routine tasks such as paying utility bills or sending invoices at predetermined dates. It is possible with cloud accounting, which supports automation and can sync with other apps for better convenience.
Security and updates
Most cloud accounting plans have built-in security and upgrade features. With every upgrade, the security is updated, keeping any vital business data secure. Desktop accounting plans also come with upgrades, which are installed manually.
Cloud accounting is an upgrade to desktop accounting, and you can use both simultaneously for different data sets. Several cloud accounting software offers desktop services with cloud support.
Contact Edelkoort Smethurst CPAs LLP in Burlington for Your Cloud Accounting Needs
Cloud accounting can help you communicate better with clients, employees, suppliers, and accountants. A skilled accountant can help you transition from desktop to cloud accounting efficiently and ensure you make optimum use of it. At Edelkoort Smethurst CPAs LLP, our trained and experienced accountants can provide services to handle all your accounting needs. To learn more about how Edelkoort Smethurst CPAs LLP can provide you with the best accounting expertise, contact us online or by telephone at 905-517-2297.