Cloud accounting has been at the forefront of accounting conversations since the pandemic. With work-from-home and remote work increasingly popular, business interest and investment in cloud accounting have risen dramatically. Cloud accounting has seen major growth, with AI integration and sophisticated automation technology trailblazing a financial revolution.
Before discussing what’s new in cloud accounting, let’s provide a brief overview of the subject and why it is such a big deal going forward.
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What is Cloud Accounting?
Cloud accounting is the use of accounting software connected to an online server: the cloud. All of the accounting data and financial information is uploaded and stored directly on the cloud. bookkeeping, invoicing, and almost all other accounting functions are then done on software using that data.
It’s very similar to using spreadsheets for bookkeeping, but unlike spreadsheets, cloud accounting software is fully equipped to handle many complex accounting tasks. Cloud accounting has been around for a good while now, but until recently, organizations mainly used it for data integrity purposes. Going paperless and preserving data on a server was just more cost-effective and streamlined as a process.
After the pandemic, the big change was the realization that cloud accounting is perfectly set up to integrate with remote work. All of the accounting workload is already on a computer, so why can’t your accountant sit across the globe and do the same work?
The already booming outsourced accounting industry then experienced a meteoric rise. As reported in a previous EA publication titled “Top 5 Challenges in Modern Accounting & Their Solutions: Strategies for Success”, businesses that solely utilize cloud accounting software are experiencing five times the client growth compared to those that do not.
US businesses are investing heavily in offshore accounting resources for various reasons. Let’s examine some of the main benefits cloud accounting will bring in 2024.
The Benefits of Cloud Accounting Technology in 2024
Cloud accounting offers a slew of benefits that business owners across the US are clamoring to take advantage of. Let’s quickly go over some of these to get a better idea of their mindset:
A Cost-effective Accounting Option for Everyone
Cloud accounting and remote work make for a dynamic duo that small businesses just cannot ignore. With how complex financial work can get, not to mention the volatile economy and sky-high inflation, financial help is a must. Unfortunately, funding an in-house accountant and covering the associated overhead costs have long barred the way.
With cloud accounting software, small businesses now have the ability to access this coveted financial help. Remote professionals and off-shore accounting services are offering top-quality accounting at incredibly affordable rates. All thanks to cloud accounting technology and everything it enables.
Gone are the days when SMB owners were forced to burn the midnight oil reconciling the books. Now every mom-and-pop store and local business can have a professional accountant guide them through the financial maelstrom of 2024.
Airtight Security and Data Integrity
Cloud accounting platforms are equipped with state-of-the-art security features. Everything from data encryption to multi-factor authentication and strict access control is available in cloud accounting. On top of that, accounting software is very difficult to tamper with, leaving no room for any mistakes or fraud to go unnoticed.
The data storage capacity of cloud accounting platforms is also vital for maintaining data integrity in 2024. Going paperless or even going beyond Excel spreadsheets is a massive step in the right direction. Accounting software is built-to-purpose for accounting, with everything set up to deliver the most secure accounting experience.
With data hacks and social engineering attacks increasingly common now, cloud accounting is a stalwart defense against malicious actors. The software comes with numerous features to ward off unwanted visitors and keep you and your customers’ data safe and sound.
Breaking Down Business Silos
You can integrate cloud accounting into the business’s ERP system, breaking down many business silos in one go. The accounts department must deal with every part of the business at some point, given that everything takes money to run. By breaking down the silos between the accounting and other functions, collaboration blooms among the team leading to productivity boosts.
Sustainability and a Green Workplace
Climate change and environmental concerns are at the center of social conversation these days. Customers want to support businesses actively trying to save the planet. The sustainability mission is in full swing, and going paperless and shifting to remote work are steps in the right direction.
Also Read: The Impact of Sustainability on Sales in the CPG Industry
Remote work means businesses consume fewer resources. This indirectly impacts power usage and reduces the carbon footprint. Meanwhile, cloud accounting adoption is effectively going paperless, saving trees, and saving the environment. Businesses looking to do their part in saving the world will find cloud accounting and remote work well within their power. Change begins with small steps, so why not start with your accounting?
Challenges Facing Cloud Accounting in 2024
Data Security Concerns
Despite the robust security measures in place, there remains a general air of distrust in cloud-based data security. The coming generations are especially wary of cyber threats, and doing their best to minimize any unfortunate accidents.
These concerns are a challenge for cloud and remote accounting. While cloud financial management and accounting experts have built up a lot of good rapport, there is much work to be done before everyone comes on board.
Over-reliance on Technology
There are also those among us in the crowd who are skeptical of technology invading previously sacred places. From education to the accounting sector, the cloud seems to be this looming presence plotting in the dark. Such claims are, of course, unfounded, but there are kernels of truth present there.
The fact is that many of our business processes are dependent on technology these days. It is only going to get worse in the future, and the concern is what happens when the technology goes down.
If a storm takes down an area’s internet, they have effectively been cut off from their finances. Modern infrastructure is built to account for such cases, but the thought of all your data in a server somewhere ready to poof any time because of a glitch makes it no less comforting.
Cloud accounting needs to overcome this barrier and prove that the technology can be trusted just as much as physical books and accountants in the office.
Conclusion
Cloud accounting has opened up many new doors for businesses of all stripes. Accounting services in the USA are all moving towards cloud accounting, with remote accounting a highly coveted service by small businesses.
Only time will tell if cloud accounting is just a flash in the pan or the start of a technological shit. All we can do for now is wait and see. Our recommendation will be to invest in basic cloud accounting and give remote accountants a shot.
You would be surprised at the level of professionalism and talent on display in the global talent pool. Expertise Accelerated offers a doorway into the magical world of remote accounting and cloud financial management. Take a step across the threshold and see what awaits you on the other side.