What is Cloud Accounting for Business Owner?

DAVID FAČKO

11 min

·

June 6, 2024

Remember the old days of spending hours in front of your computer, trying to clear up hard drive space? It was a tedious process, especially for small business owners who had to manage their data storage regularly. This constant struggle with storage can be a significant burden when you’re trying to keep your business running smoothly from a small workspace.

Managing large amounts of data isn’t easy, but there is a solution that can make your life a lot easier: cloud accounting. By migrating from traditional computer hard drives to cloud accounting software, you can eliminate many of your storage and data management problems. It may seem like a big change, but exploring the benefits and workings of cloud accounting can be a game-changer for your business. In this article, we’ll dive into what cloud accounting is and how it can benefit your small business. So, let’s start!

What is Cloud Accounting? 

Accounting that takes place online using remote means is popularly known as cloud accounting. To explain it better and in a more comprehensive way, cloud accounting or cloud computing involves storing data, structuring it using different types of data models and accessing that data over the Internet. Cloud is a word that is used synonymously with the Internet.

The imagery produced is that the Internet is a vast cloud of information that prevails in spaces around us but is not perceivable or tangible. The cloud helps you to take your business to a whole new level and puts it right on top with all the big names in the business world.

cloud accounting, accounting principles

This transformation is even more seamless and secure with the integration of a cloud-based VPN service. It acts as a critical layer of protection, ensuring that your business data is transmitted and accessed through encrypted channels. It represents a huge technological and functional reset but is definitely worth every penny that is spent, especially when coupled with the added security and accessibility provided by a cloud-based VPN service.

Cloud accounting is similar to desktop accounting, but with a crucial difference: it operates on a cloud platform, expanding your data storage capabilities. Before cloud accounting, businesses relied on desktop software, which limited data access and required costly updates and installations. Recognizing the benefits, many business owners are now switching to cloud-based accounting systems, finding them to be a more efficient and cost-effective solution.

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How Does Cloud Accounting Work? 

Many people are curious about how cloud accounting software works. Here’s a straightforward explanation. When users sign up for an online accounting software, they transfer their business records to the cloud. Using a VPN (Virtual Private Network) enhances security and allows access to business accounts and records from any web browser or device, at any time.

Users can manage their accounts through an app on their smartphone or via a web browser on their laptop. Additionally, cloud accounting software can be linked directly to their business bank accounts. This integration allows for automated expense reports and transaction details to flow seamlessly from the bank to the software, eliminating the need for manual data entry and saving valuable time for business owners. Here are a few steps:

  • Sign Up for Online Software: Users register for an accounting software online, initiating the transition to cloud-based storage for their business records.
  • Transfer Business Records: Business books and records are shifted from local storage to the cloud platform.
  • Use a VPN for Secure Access: A Virtual Private Network (VPN) ensures secure access to business accounts and records, allowing users to connect from any device or web browser at any time.
  • Access via Multiple Devices: Users can access their accounting software through an app on their smartphone or a web browser on their laptop.
  • Automated Bank Integration: The software can be connected to business bank accounts, enabling automatic updates of expense reports and transaction details.
  • Eliminate Manual Data Entry: The integration with bank accounts removes the need for time-consuming manual data entry, streamlining financial management processes.

What are the Benefits of Cloud Accounting? 

Cloud accounting offers numerous advantages that streamline business operations, enhance data accessibility, and improve overall financial management.

cloud accounting, computer, accountent

1. Getting Access to Real-Time Information

The ultimate need for speed would eventually bring every business owner to this pivotal element offered by cloud accounting software. You would want your company to move as fast as it can and for that reason a cloud accounting software helps you to get a real-time overview of your company’s financial situation.

When working with a desktop-accounting software you would have to spend a lot of time scouring through historical records of data from days or even months ago. Real-time access to data will not only help you to make big business-related decisions more accurately but will also help you in creating a steady future plan for your business.

2. Handle Your Accounts from Anywhere

You get 24/7 access to your business numbers and accounts with cloud accounting software. You have access to this information from any location, any part of the world. You just need to have the log in information that is exclusive to your company and a stable internet connection and you’re good to go. This would help in building stronger bonds between yourself and your employees; between yourself and your clients. Since getting access is so easy, organizing the data and working on presenting it in a systematic manner is also an option for all the users.

3. Facilitating a Paperless Environment

It is no surprise that the bigger the business, the more the transaction records and massive the clutter that is generated. You wouldn’t need to physically store any of your invoices, bills, expenses or anything when you are working with cloud-based software- mainly because everything is present and available online.

Every deal and every record ever made will be securely stored on your cloud for years and years together until you feel the need to delete them or get rid of useless information. Paper documents can be easily eliminated through this process and you wouldn’t have to scour through your belongings trying to find a single piece of paper that had some transaction details dating months back.

3. No Need for Monthly Software Updates

When you log in to the cloud accounting software that your business has invested in, you would immediately start using the latest version of the software. Unlike desktop accounting software, there is absolutely no need for you to sit and update your software again and again for every new feature that is incorporated into the software.

This saves a lot of your time and utility costs. You wouldn’t need to fix technical issues that go wrong in the software as the software provider is solely responsible for it. All problems that arise in the software are almost immediately taken care of by the software provider and this takes a lot of burden off of your shoulders.

4. A Secured Method of Sharing Data

Using cloud accounting software is a safe way of dealing with confidential information regarding your business transactions and dealings. You, as the owner, have to give access to whomever you want and only those who get access directly from you will be able to handle the data that is stored in your cloud software. The people who need urgent access to the data are your accountant, the financial advisers of your company, your bookkeepers and you yourself. You have the utmost control over who else gets access to your company records. This is a highly secured and quick way of sharing and updating exclusive information as it cuts down on the emails sent back-and-forth that anybody can get access to.

5. Live feed from Bank Account 

There are many cloud accounting software that offer you live feed from your bank account when you link it directly to your company’s account on the software. You wouldn’t need to sit and manually type in all the bank statements that you receive as it gets directly updated on the software. When there is a live feed, information from your bank account will immediately make its way into your software without you having to deal with any of it.

This will definitely speed up the whole process of gathering and storing data and would also give you a precise overview of your bank balance. An updated view of your saved capital will help you take better company-related decisions that require large investments. You can be a better judge of company needs when you have easy access to the financial situation of your business bank account.

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What are the key features of cloud accounting?

Cloud accounting offers a range of features designed to simplify and enhance your financial management. From real-time access to automated updates, these tools ensure that your accounting tasks are handled efficiently and accurately.

When selecting cloud accounting software, it’s important to choose features that align with your specific business needs. Tailored functionalities ensure that you get the most out of the software, enhancing efficiency and accuracy in your financial management.

Feature

Description

Real-Time Access

Access your financial data anytime, anywhere, from any device with an internet connection.

Automated Updates

Receive automatic updates for software improvements and security patches without manual effort.

Data Security

Benefit from advanced encryption and secure cloud storage to protect your sensitive information.

Integration with Banks

Connect directly to your bank accounts for seamless import of transactions and expenses.

Collaboration Tools

Allow multiple users to access and work on the accounting data simultaneously from different locations.

Cost Efficiency

Reduce the need for expensive hardware and IT maintenance with subscription-based pricing models.

Scalability

Easily scale up or down based on your business needs without significant additional costs.

User-Friendly Interface

Enjoy intuitive and easy-to-use interfaces that simplify accounting tasks for all users.

Effective Cloud Accounting Software for Small Businesses

Cloud accounting has made businesses run smoothly and has cut down on a lot of maintenance costs and utility bills, there’s no doubt regarding that. But, for small businesses that run on very simple grounds and with a limited hands-on deck, a cloud accounting software that is huge and complex may not be the right option.

You would then want something that is simple and also very effective. A software made solely and exclusively for small businesses, catering to all the needs and whims that a business with a limited stature has.

For times like this, you need software that makes good use of technological tools and serves only the best features to its users; for times like this, you need Billdu.

A one-stop software that takes care of all the needs of either an established or a newbie small business. Starting from creating invoices, expense records, professional estimates, a comprehensible dashboard, payment reminder and a lot more- all available on a single platform that is user-friendly and easy-to-handle.

Benefits of cloud accounting

Are you thinking of a Smart Solution for Small Businesses?

Although Billdu is not positioning itself as a cloud-based accounting software, it definitely is cloud software for small businesses. The main difference is that in Billdu, you can handle or your invoicing and expense tracking, along with other possibilities, and then your accountant can login to access this financial data and take over the invoices and expenses (or just the balances) to their accounting software.

Some of the features of Billdu cloud software platform you will like:

  • Achieve high efficiency and save time with Billdu instant invoices and faster payments. You can make invoices in the easiest way possible using the free invoice generator. Just click ‘Create new invoice’, fill in the data and the invoice is ready to be downloaded and/or sent to your customer.
  • There is small business expense tracking that you can do on the Billdu software. Expense tracking is a crucial step in keeping a track of all the revenues that are gathered by your company the ones that are spent as expenses relating to various business-related operations. Expense tracking with Billdu will help you get a clear idea of what part of your business requires your attention and what needs a complete reset. Count your assets and your savings before leaping onto another big investment.
  • Billdu blog posts financial advice for all small business owners and are filled with tips and tricks to overcome a financial crisis
  • Rest assured that your confidential documents and business-related records are kept safely at the Billdu cloud software. This is achieved using a secured server that is similar to the functioning of a bank. You can also create or edit your professional looking invoices while your device is offline. Billdu software supports offline mode that can be very useful if you were to travel to places with a low broadband speed.

All the features of cloud-based accounting discussed in this blog are highly essential for the smooth workings of a business, be it small or large. You absolutely need cloud-based software for better accuracy, precision and efficiency in your business.

Discover the Outstanding Features of Billdu!

Discover the outstanding features of Billdu! Streamline your business operations and enhance your invoicing process today—start exploring now!

Free 30-day trialNo credit card requiredCancel anytime
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DAVID FAČKO

SEO Specialist at Billdu

David Fačko works as an SEO and Content specialist at Billdu, best-rated invoicing software solutions for freelancers and small businesses.