Cloud accounting is becoming the new normal for accountants, bookkeepers, and businesses alike, as a majority of them rely on it to run their accounting. And rightfully so - cloud technology is a game changer in accounting. It offers an unprecedented opportunity for accountants to serve their clients better while reducing time and costs.
The question is, how much of this opportunity are you leveraging to build up your practice? This short guide we’ve put together can help you ensure that you’re taking full advantage of what your cloud can do for you.
But first, let’s break down what cloud accounting is.
What’s cloud accounting?
“Cloud” technology simply means that all the data is stored in remote servers, rather than on your local computer. There's no software to download, nor any need for paper. It also means that you can access the information from anywhere, not regardless of the computer or mobile you're using.
In accounting software, it’s the difference between QuickBooks Online and QuickBooks Desktop. QuickBooks Online is cloud-based and you can access it from your browser on any device - PC, Mac, phone, or tablet. QBO Desktop has to be physically downloaded on your computer, and you can use it only on the computer you downloaded it to.
The same applies to other cloud-based services for business accounting and financial management, like payroll (Gusto) and Accounts Payable/Receivable (Melio). These service allow you to access your account (and the accounts of the clients your firm manages) from anywhere by just logging in.
So, you can be at home in your slippers or sipping Mai Tais on a sunny beach and still get work done. Which is beautiful, but it’s just the tip of the iceberg of what you can get out of cloud accounting, by just having a better knowledge of its abilities.
The key benefits of cloud accounting
Cloud technology has distinctive characteristics that make it stand out from older technologies in its abilities. Here are the main ones:
- Multiple people can access and edit data from multiple devices and mobile apps at the same time.
- The information in the cloud is updated immediately and automatically, with no lag time, no matter where you access it from.
- Multiple software services and accounting solutions can share data and sync together.
4 ways to maximize the benefits of cloud accounting
Create better oversight and control over your clients’ financial data
While cloud accounting software allows your team members to access your firm’s accounts, not all team members need access to all accounts. Similarly, there are several people who perform different financial functions within your clients’ organizations, but there's no reason they should have access to all the financial functions.
Most services allow you to control the assignment and permission levels for different users and create approval processes for specific actions.
For example, you can create various payment approval workflows for each client account on your accounting software (QBO), your bill pay software, or with designated invoice approval apps like ApprovalMax.
By creating customized and segmentized access levels, you’re:
- Safeguarding your clients’ personal and financial information.
- Reducing the chances of fraud and accounting errors.
- Promoting accountability within your team.
- Removing unnecessary distractions for your team members.
Tap into a bigger talent pool and cut on staff-related overheads
The job market is changing, and more accountants and bookkeepers want to preserve the sense of freedom and autonomy that comes with remote work. This is the perfect opportunity for firms that use cloud accessibility to recruit remote staff.
Hiring remote staff has tremendous benefits for your firm: where they live is no longer your concern, so you can expand your search pool to find perfect candidates for your firm.
Need reinforcement for tax season or urgent help for a specific client? You can contract temporary personnel. The cloud makes communicating and sharing documents between yourself, your staff and clients seamless, hassle-free, and secure. You control your staff’s level of access and permissions at any time with a click of a button.
By the way, if you’re thinking about ditching the brick-and-mortar model altogether, it’s a great way to increase your profit margin. Here’s a short and sweet guide on how to make the move to remote as smooth as possible.
Save time and improve efficiency by reducing manual data entry
What’s better than a great tech tool that saves you time and work? Two great tech tools that automatically sync together in sweet harmony to save you even more time and work on dual data entry and minimize the chance of data-entry errors.
Most cloud solutions and apps offer integration to the central accounting software - be it QBO, FreshBooks, or Microsoft Dynamics Business Central. You can integrate your accounting software, payroll, CRM system, AP/AR, invoicing apps, cash flow management tools, and more.
Integration has tremendous advantages. It:
- Provides you with an efficient and smooth workflow.
- Minimizes the time needed for data entry.
- Promotes transparency with your clients and teammates.
- Reduces the risk of human data-entry errors.
In short, you can streamline your workflow and eliminate unnecessary manual work by syncing the different parts of your tech stack.
But if there’s one benefit to cloud accounting that’s front and center: the ability to get a live snapshot of your client’s financial status at any given time, with no effort. Which leads us to our next point.
Give your clients what they really want - better client accounting services
Client accounting services (or CAS) is one of the strongest trends in the accounting sphere, as more small business owners expect their accountants to provide strategy, offer advice, and be more hands-on.
In a recent survey, SMBs answered that they expected their accountants to help them with advisory services such as tax planning (57%), financial projections and planning (32%), business consulting (25%), and more.
Here’s where one of the most valuable advantages of cloud accounting comes into play. It’s easier than ever to have an accurate snapshot of your client’s financial status at any given time with little to no fuss.
So, you have all the data at hand to advise your clients. For example:
- Providing real time cash-flow projections.
- Assessing your clients’ financial health.
- Giving practical advice, like whether they should change their payment terms with their customers, offer early payment discounts, cut back on inventory costs, or change their inventory management.
- Assisting them with financial reporting.
The first step to enabling your clients’ data to be up-to-date is choosing an accounts payable and receivable service that seamlessly integrates with your accounting software.
Take your first step to AP/AR cloud integration with Melio
Melio offers online AP/AR management to accountants and their clients. There are no subscription fees for you or your clients, ACH transfers are free, and it syncs seamlessly with QuickBooks Online, Desktop, FreshBooks, and Microsoft Dynamics 365 Business Central (and soon, Xero!).
With Melio, you can collaborate with your team and clients from one central dashboard, add clients, assign team members to specific client accounts, set up approval workflows and amount thresholds, and do much more. Learn more about Melio for Accountants and its capabilities right here.