Small Businesses Gain Multiple Benefits with Cloud Accounting Systems by Laurence Bernstein, CPA
Accounting is a crucial component to business success. It demonstrates how money flows in and out of an organization and provides a basis for end-of-year tax planning. However, business owners should neither underestimate the value that regular bookkeeping can bring to their profitability and future earnings nor should they ignore the countless opportunities they may have to leverage to modernize and improve these processes.
The once painstaking process of maintaining accurate financial records on a desktop computer located in a physical office building is today much simpler and easier to maintain, thanks to accounting software, such as QuickBooks Online, Xero and Freshbooks for small business, or Net Suite, Intacct and Microsoft Dynamics for larger organizations. These cloud-based solutions automate accounting processes and reduce the need for businesses to hire staff with accounting skills to manage them. Moreover, in today’s 24/7 on-demand society, a business’s stakeholders can access and manage important financial data at any time and at any place with the click of a button on mobile devices.
Cloud-based accounting systems are the future, and the future is here. By combining the following benefits of these services with the expertise of qualified accountants, business owners can gain accurate insight about their operations’ financial picture before making critical business decisions.
Improve Organization and Productivity
Accounting software eliminates the need to spend time searching through files and pages of data to find financial and operational data, such as when a specific payment was received, a bill was paid or a piece of equipment was purchased. These solutions organize information in an intuitive and systematic manner that makes it easy for users to find what they are looking within seconds.
Access Real-Time Financial Data
Cloud-based accounting software connects seamlessly to a business’ bank and credit card accounts and automatically imports data to sync in real-time with recorded transactions. This eliminates the need for manual entry of bank deposits, payments, purchases and withdrawals, and helps to improve recording accuracy by automatically populating financial transactions in the general ledger. Moreover, these platforms are constantly evolving and adding new features that they automatically update to end users’ desktops, laptops and mobile devices.
Improve Business Process Efficiency
Accounting platforms can easily integrate and share data with other cloud-based business management applications, such as Bill.com, which manages account payables and receivables; Tallie for automating employee expense reports; Tsheets for tracking employee time and automating payroll processes; as well as a wide-range of inventory and sales-force management solutions. With these and other add-on applications, businesses can sync relevant data back to their accounting software and create powerful and efficient solutions for managing all of the core systems that make up their general ledger. Users may also employ trend analysis and analytic reporting features to gain further insight into their businesses’ financial picture, and they may deploy this information to share with key stakeholders, including members of the management team, employees and professional accountants.
Store and Access Backup Data Safely
No business is immune from computer failures or natural disasters, including hurricanes, which can wipe out data stored in file cabinets, on desktops and even on backup systems. However, with cloud-based solutions, businesses have the security of knowing their data is stored and easily accessible on the internet rather than on a computer’s hard drive, which is susceptible to damage. Business owners need only an internet connection to access general ledgers, financial statements, budgets and forecasts required to sustain operations and substantiate any insurance claims for accidental loss of data.
Even with all of the conveniences that cloud-based accounting solutions provide, business owners should still meet with their accountants on a regular basis – not just at tax time. By combining technological solutions with face-to-face professional counsel, owners can ensure their businesses are on track and are flexible enough to manage challenges and take immediate advantage of opportunities that can lead to future growth.
About the Author: Laurence Bernstein, CPA, is an associate director in the Tax Services practice of Berkowitz Pollack Brant, where he provides tax and consulting service to high-net-worth families, entrepreneurs and privately held business owners. He can be reached at the CPA firm’s Miami office at (305) 379-7000 or via email at firstname.lastname@example.org.