by Alan Boal
Accountants have used the trusty ledger and double-entry bookkeeping system to service their clients since the 13th century. But the birth of the cloud has turned accountancy on its head, putting the ledger to rest and making life far simpler for the business owner. In the cloud, businesses are better connected, data is accessible 24/7, credits and debits are digitally recorded and information travels faster between buyer, business and bank.
Online bookkeeping, which is more commonly now known as ‘cloud’ accounting software, is fast replacing PC based accounting packages. In fact, for SME’s there is probably no other way to go bearing in mind the government’s commitment to ‘Making Tax Digital’.
There are multiple benefits of a cloud based accounts package, including:
- No more buying annual updates or licences – it’s all automatically kept up-to-date
- Data is secure and backed up in the cloud
- Offers you the ability to manage your accounts anytime, anywhere in the world, from virtually any web enabled device. So you can use your smart phone or tablet to capture photos of purchase invoices and expenses receipts and post them directly into the accounts software
- Your accountant will be able to access live accounting information, so amendments can be made real time without the need to email backups of software or any other information
- Automated sales invoices or estimates, in your design and format, raised and emailed to clients with automated reminders if they haven’t paid within the agreed time limits
Various time saving, automated features can be added such as:
- Automatic bank feeds straight into your accounts software
- Ability to customise your data requirements by adding hundreds of apps to the main accounting package
As previously mentioned, the government’s proposals ‘Making Tax Digital’ include the possibility that SME’s will need to file quarterly tax returns at some point in the future. Although this has been shelved for now, by 2020 all SME’s will have to have an online tax profile (similar in nature to an online bank account) and from there it can safely be assumed that companies will gradually be encouraged (and then likely forced) to file their accounts in this format.
The world in which we live is becoming more and more digital with every passing day, and it’s clear that digital accounting is starting to gain momentum. However, the revolution is still ahead and not behind us.
Navigating change can be tough, especially in the middle of the storm. And the accounting industry in the UK is in the middle of one of the biggest storms we’ve ever seen. You could call it a perfect storm – but I suspect that depends on whether you leverage the opportunity or not.
At AHB Finance, we have a great deal of experience in cloud accounting and can help you pick the right package for you and your company. We’ll assist you in setting up the system, plus we can also help you with any and all ad hoc queries throughout the year. We are familiar with a multitude of the cloud offerings and have particular expertise with leading providers Xero.