What is Cloud-based Accounting?

Many people still use traditional methods to keep track of their finances, but the cloud is changing that. Cloud-based Accounting software can revolutionize your bookkeeping and provide efficient financial administration; it lets you see in real-time what’s happening with critical numbers.

With so many platforms on the market, how do you know which one is right for your business? This article will show you more details about Cloud-based Accounting technology.

What is Cloud-based Accounting?

Cloud-based Accounting is a type of financial management software that resides in the cloud and can be accessed on your computer anywhere you are connected to the internet. This means employees or third-party accountants do not need physical access to understand how much money has been made, who owes us what amount for our products/services rendered, and other essential information about company finances.

The ability to track your finances has never been more accessible than it is today. With software and devices that are both modern in their design and ancient, like double-entry bookkeeping methods, finance teams can view historical data concerning revenue coming into or going out of business without sacrificing efficiency.

The drawbacks to desktop-based accounting software are numerous, including limited access to your data and the need for constant updates.

Cloud-based Accounting has all the same functionality as a desktop but moves your entire process online and extends it with added benefits. You’ll access an always-up-to-date solution anywhere in the world at any time without having a physical office or stationary computer available 24/7. Everything happens seamlessly through cloud servers.

How Cloud-based Accounting Works

The Cloud-based Accounting system allows accountants, controllers, and other relevant parties to receive login credentials for the web browser. The provider may also offer a mobile app that improves upon the phone or tablet user experience with this technology in mind.

Financial software offers several features designed to streamline transactions and make financial information more accessible. Home dashboards allow users easy access from anywhere worldwide, giving them quick updates on their available cash balance and bills due within five days for each account type. All numbers update immediately as the software receives new information, and users can drill down into the data for additional details.

An ERP system is crucial for any organization because it keeps all business processes on one central database. This means you can connect modules designed to manage different aspects of an enterprise. For example, payroll, purchase orders, and the inventory value on hand must be recorded in the accounting system as they happen.

See more: Best Accounting Software for 2022

Benefits of Cloud-based Accounting

Some of the easy-to-see benefits of cloud-based Accounting are account accessibility, real-time information availability, the range of third-party apps and tools in its ecosystem, live feeds from the platforms, updated software version and secured data sharing.

Access your accounts anywhere

Cloud-based Accounting gives you complete and immediate access to all your business numbers, no matter where they are. You can log in via a web browser on any laptop or use an app from the company’s mobile site- either way. It’s just a short click away.

Access to real-time information

Keeping your bookkeeping and bank reconciliation up to date is vital for real-time reporting. You will have an instant overview of the company’s current financial position, which can be helpful when looking at cash positions or planning future spending decisions.

Access to the app ecosystem

The possibilities when it comes to Open APIs are endless. You can add a range of third-party apps and tools that will help expand your business system while also saving time on resourcing costs by identifying problems quickly ahead of time.

Live bank feeds

Live feeds from cloud accounting platforms allow you to link your banking directly with an account, saving time and increasing accuracy. Instead of manually keying in each bank statement line or uploading a . CSV file downloaded off internet portals when live data is streamed in real-time, it can be pulled right into any business report without delay.

Always working with the latest software version

When you log in to your accounting software, it’s always up-to-date with the latest features. You don’t have to worry about applying security patches – providers handle this automatically.

Secure sharing of data

Cloud-based Accounting software is a convenient way to access your financial information when you need it. No more USB memory sticks or emailing back and forth. Your advisers have safe, secure direct connections that allow them easy real-time viewing of all the data they need for support and advice going forward.

See more» Benefits of Cloud Accounting

When should your company use Cloud-based Accounting?

With its enhanced data capabilities, Cloud-based Accounting is the perfect solution for businesses that need fast access to financials and key performance indicators. With most platforms offering an open API (Application Programming Interface), there’s a wealth of choice when building apps with custom software suites or creating general business applications like invoices which any member of your company can use without having them go through multiple systems again.

Key areas where you can utilize Cloud-based Accounting include:

Using automation to reduce workloads: Automation is a great way to reduce workloads and make your team more productive. The cloud-based accounting ecosystem offers automated bookkeeping, cash collection & bank reconciliation that can be done automatically on the backend without human intervention, ultimately saving time.
Getting more insight from your financial data: Management can get a clear picture of financial data with the help of insightful reporting and analysis. You have access to financial data and information, giving you the insight needed for making sound decisions.
Paying VAT or GST online: Cloud-based accounting software helps you record all your transactions so that tax preparation is a breeze. You can then send them digitally to the revenue with just one click.
Working remotely or flexibly: If you want your business to take advantage of remote and flexible work options, cloud accounting can help with the necessary tracking when team members are located across different geographical locations.

See more» API and RPA: Automation & Integration in 2022

Future of Cloud-based Accounting

AI & Machine Learning

AI is an important tool for accounting software. It can help identify mistakes and discrepancies between data and reality. This might signal that something was entered incorrectly or not correctly processed, which could lead to financial losses if left unchecked.

AI is beginning to be used in ways that would have been unimaginable just a few years ago. For example, it can spot potential problems coming down the road, whether with suppliers or customers, and help minimize disruptions caused by disruptive events.

Blockchain

Blockchain is a new technology that can completely change how we do business. It’s an electronic ledger or database that stores all transactions in detail and cannot be altered after it’s posted, unlike other forms of data where changes can occur at any time without notification.

However, with blockchains, every action gets logged into its permanent history making everything transparent while also creating transparency within organizations themselves since anyone who wants access does now know what happened previously on.

Blockchain can also eliminate or reduce the work of maintaining financial records and verification before settlement. When an order is reflected in your ledger, it triggers immediate payment, so you don’t have to spend time collecting.

Blockchain and AI could even make it possible to audit every single transaction automatically.

App integration

Cloud-based software has made it possible for just about any application to be available on demand. This includes niche needs and complementary systems like inventory management or payroll/CRM.

In the future, we’ll see more and increasingly seamless integrations between accounting software. This will make it easier for users to do their jobs without having to take numerous trips back and forth between programs or switch systems when they need to relate explicitly to completed financial tasks.

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So, what is cloud-based accounting technology? Simply put, it’s software that allows you to access your financial data and records from any device with an internet connection. If you’re ready to switch to cloud-based accounting, follow us for more information about it.