EmbaarqBK combines our panel of experts + cloud-based technology to make bookkeeping easier for small and medium business owners. What is cloud-based bookkeeping? We interviewed our experts to learn more about the practice, and how it can help small and medium business owners in their day-to-day finances.
Could you describe what constitutes a cloud-based vs non-cloud-based bookkeeping system?
A Cloud-Based accounting system operates exactly how it sounds: on the cloud.
When we think bookkeeping, we often think of stacks of papers, or a software on a select handful of desktops. These non-cloud-based systems, where you need to be around those papers to do any kind of bookkeeping function, are not ideal for managers in modern workplaces. The time delays and data collection capabilities result in a lot of grey areas for managers when they make financial decisions.
That’s where cloud-based accounting comes into the picture.
Using technologies like QuickBooks Online®, cloud-based accounting lets owners make bookkeeping decisions on any device, anywhere, at any time. Simply login to your accounts and get to business. This can help bookkeepers in so many ways, from organization, to timing, to reconciliation, which in turn helps the business. We’ll explain how below!
Purely from a functional approach, what are the benefits of a cloud-based system over a non-cloud-based system?
Nobody wants to be stressed out, flipping through several pages of numbers to find the right number. One of the biggest boons to cloud-based systems is the digitization of data, and how easy it becomes to interpret it from there. When you need to make a financial decision, you can do it from anywhere using real time information about your business. This helps to ensure you can get the full picture and accurately assess your decisions’ impact.
Cloud-based systems also give you a chance to de-centralize financial information, which can help when important financial decisions need to be made. Now, a manager can remotely collaborate with his bookkeeping expert(s) to make the right decision. This de-centralization can make getting outside help more peaceful for managers, as you retain control over what records can be shown to outside partners.
There are these benefits as well:
- 24/7 Backup: don’t worry about losing important financial information with everything saved on the cloud automatically.
- Integration capabilities: most technology options within cloud-based bookkeeping can be integrated with each other, enhancing the user’s overall experience.
- Multi-user collaboration: anyone with the right credentials can access your bookkeeping information, helping with decision making and efficiency
WATCH: Case Study: Bookkeeping Support Frees Up Owners Time
What are the organizational benefits of a cloud-based system over a non-cloud-based system?
The biggest benefit that cloud-based bookkeeping has for organizations is the cost and time savings. One example of time savings is how often bookkeeping processes require stages of approval and monitoring that can result in a simple transaction taking days to clear. With all the information digitized, approvals (amongst other things) can be done much quicker, and errors can be easier to identify.
The speed of cloud-based systems enables you to have invoices or bills ready for clients or customers faster, and with most of the systems attached to major banking networks, you’ll be able to communicate financial details with your banking partner faster and easier.
This makes a bookkeeper’s day far less cluttered, allowing them to bring more value to the organization with more time to put towards critical thinking for financial decisions while using more accurate information in their insights. This accurate information is key – it will reduce errors in your financials and help to make forecasts more accurate.
Finally, a cloud-based system means you can do accomplish bookkeeping from anywhere, and we mean anywhere. No more cluttered folders or receipts that you need to hold onto forever, it is all available on devices you have connected to your cloud-based software. This provides flexibility and succession.
Is cloud-based bookkeeping a one size fits all approach? What is needed within organizations to successfully use cloud-based accounting systems to their benefit?
Cloud-based systems are not a one size fits all approach, but that’s one of the biggest benefits to it. The technology makes it very easy to customize data and processes based on a particular user needs and expectations. To do that, however, you need an understanding of your business processes and what your industry requires.
It gets a bit more complex from there. There are a vast number of technologies available to help make the bookkeeping process easier, however none of them are the cookie cutter solution a business might expect to solve all their problems. The wrong technology could set an owner back, disrupt important workflows, or end up costing more than its worth.
This is where experts can help leverage the use of technology. Bookkeeping experts, like the ones at Business Sherpa Group, work with business owners to understand their requirements and business model, and then recommend the best software to make your bookkeeping more efficient and cost effective. With the right people, and the right mix of technology, any business can find the right mix for themselves in a cloud-based bookkeeping system.
Read: The Value of Digitizing your Finance Function
How can small business owners make the switch to cloud based accounting in a way that doesn’t take up too much of their time?
Switching to a cloud-based system is not overly complicated, but often the time needed to analyze the tools available to managers is time they do not have. That’s where experts can make a world of a difference, meeting with your team to understand your needs, and then finding, implementing (and managing your bookkeeping afterwards if needed) the right tools to help achieve your goals.
Get Started on your Cloud-based bookkeeping journey with BSG