Accessibility

First, the ease of accessing cloud accounting software platforms aligns with the fast paced model of the startup world.  You need to be able to access your financial information from anywhere, anytime and through any device.  That type of flexibility isn’t afforded under desktop versions of the various accounting platforms out in the market today.  Furthermore, most startups either do most of the accounting and bookkeeping functions themselves, or they hire someone to do it.  The value of cloud accounting really manifests itself in the latter scenario.  The reason being is because your accountant doesn’t need to manage the books on site from your machine.  He or she can sign in anywhere and complete their work remotely, which in turn should lead to more affordable rates (as there are less costs incurred to complete the work, and a good accountant should pass those savings along to you in the form of lower rates).

Additional Functionality

The second major advantage of cloud accounting is the level of integration with other services your business may rely on.  For example, if all cash receipts flow through your PayPal account, you can sync this account up directly with most cloud accounting platforms.  The transactions are downloaded in real time, and you don’t have to worry about ever manually importing them.  This offers tremendous time savings, as now bookkeeping simply becomes a matter of assigning transactions to the appropriate accounts because they are already synced to your registers.  Another example is the ability to integrate time tracking apps like TSheets to make your payroll processes much simpler and fluid.  There are countless other examples where the real-time integration and syncing capabilities offered by cloud based accounting software provides value, but there is another communication and organization based capability offered by some platforms.

The last capability alluded to is the ability for accountants and clients to request and load documents via some of these online platforms.  Gone are the days of back and forth requests via e-mail and subsequently compiling large .zip files and sending.  Now you can simply request, load and download documents all under one single platform, which offers time savings and easy organization.

Conclusion

I am not advocating that cloud accounting is perfect, nor am I suggesting that it be implemented for every type of business.  However, for your startup (again, assuming you are indeed a startup) cloud accounting probably makes the most sense for the aforementioned reasons.  If you aren’t already using an accounting platform, I suggest you consider implementing one of the many cloud account platforms out there.  If you’re already using a desktop version of a particular software platform, consider migrating to the cloud sooner than later.  The purpose of this blog is not to steer you towards a particular platform (we’ll do an in depth analysis on the options available for you at a later time).  The idea here is to get you to buy into the value of cloud accounting vs. the more rigid and limited capabilities of your standard desktop version because the more technology improves over time, the faster desktop versions will trend towards obsolescence, and we want to make sure you’re ahead of the curve in this regard.