Many people have heard about “cloud accounting” but how many truly understand it. Cloud-based software giants such as Xero are regularly discussed nowadays. It’s said that one-third of all small to medium sized New Zealand businesses use Xero and have benefited from moving their accounting to the cloud.
So, what’s so different about the cloud?
Operating in the cloud simply means that, instead of using software on files on your computer, you’re using the internet to access it and to store files. Many businesses have already adopted cloud-based solutions for their email and storage needs. Solutions such as Drop Box and Google Drive offer ways to store and share documents, for example.
Cloud-based accounting is another alternative that astute business owners are turning to. Their accounting is now done via the internet and allows users to access data remotely.
The benefits of cloud based accounting
Using cloud-based accounting offers several benefits:
Cloud accounting doesn’t require your accountant to be physically present to manually record and code your accounting records. Instead, important accounting information can be sent via the internet and saved on-line.
For example: If you operate a Point-of-Sale system you can integrate it with cloud accounting software. When a customer makes a purchase, the information is transmitted automatically to the software and your sales figures updated. You can grant access to your cloud-based accountant, so that you don’t have to physically send your bank statements and vouchers to them…ideal for preparing GST returns and regular accounts.
Prompt and Accurate Accounts
Due to automation, cloud accounting increases accuracy. Manual processes, such as entering numerical information, increases the chances of costly and inefficient human error and mistakes.
Because cloud accounting is undertaken in real-time, business owners can see an up-to-date and accurate view of their financial position. Compare this to the old-fashioned way when accounts are typically only looked at when tax returns are prepared.
Business owners now use cloud-accounting to access information that can be used to forecast cash-flows better than previously.
Cloud accounting eliminates many manual and non-value added tedious tasks. Both you and your accountant can use this time more effectively to manage and add value to your business. Using real-time financial information will alert you to issues that need addressing. It will also give you more time to focus on identifying and exploiting new opportunities.
Chakra Partners offers you convenience, promptness and accuracy and will add value to your business. You’ll have more time to focus “working on your business” and to help identify more opportunities
Thanks for clarifying