10 Reasons to Fire Your Old Accountant and Move to the Cloud

September 22, 2017

Let’s face it: over the past few centuries the accounting industry has not built a great reputation for cutting edge innovation.

The double-entry accounting system has been around for more than 700 years.

This year marks the 30th anniversary of the first computerized accounting package, TurboCash, launching in South Africa (later rebranded as Pastel).This was the first major platform change in centuries, i.e. from paper ledgers to desktop computers.

The good news is that this rather lackluster innovation trend is rapidly changing. As we speak the next major platform change is already upon us, which is moving accounting from desktop computers to the cloud.

According to the Cloud Industry Forum (CIF), UK businesses had an 84 per cent overall cloud adoption rate in 2015, with 78 per cent of cloud users (almost four in every five) using two or more cloud services.

South Africa is lagging 4 to 5 years behind the UK, with SME cloud adoption sitting at 39% in 2015 according to the SME Survey.

Why does this matter to your business? By looking at the crystal ball of cloud adoption in the UK, US, Australia and New Zealand, we can see how entrepreneurs are using cloud services to grow their businesses. This wave is clearly heading our way – surf’s up!

Accounting software presents a great case-study to show how disruptive cloud technology is fundamentally changing the way that businesses operate.

Here are ten ways how the new model of cloud accounting can benefit your business:

Traditional Accounting Model Cloud Accounting Model
1. Accountant has sole access to desktop accounting system.  You phone him/her when you need information. You, your team and your accountant all have access to the online accounting system (via mobile, desktop and tablet).
2. The accounting system sits out of sight and out of mind on the periphery of the business, used by accounting experts only. The accounting system sits in the heart of the business, actively used by the business owner and accountants alike to drive decision-making.
3. You use different, stand-alone systems that are not integrated (Point of sale, Customer Relationship Management, Accounting, project/task management, reporting, etc.) All your systems are integrated with your accounting system.
4. Bookkeeping and accounting is updated every couple of months (or once a year). Real-time bookkeeping and accounting on a daily or weekly basis.
5. Bank statements are manually captured on the accounting system. Live bank feeds directly from your bank to your accounting system.
6. No efficiency on repetitive tasks and entries, because everything is done manually. Automation of repetitive tasks (for example reconciling regular transactions like “bank fees”) using machine learning and matching rules.
7. Manually invoice your customers by generating an invoice and emailing them a PDF copy.  Payment usually received via EFT. Electronic acceptance of quotes, e-invoicing (including recurring invoicing) and the ability to integrate other payment options into the process (credit cards, PayPal, etc.).
8. Supplier invoices and receipts are manually captured on the system and filed in a folder/cabinet/filing room. Invoices and receipts are automatically captured using apps like Receipt Bank, which are stored by the cloud accounting system as part of each transaction (so your source documents and accounting entries are in the same place).
9. Debtors (and creditors) management is an onerous, time-consuming exercise. Automate invoice follow-ups and reminders up to a certain point, before you need to start getting personally involved.
10. Billing of accounting fees is a big unknown, as you are billed per hour. Fixed monthly billing, no surprises.

Please get in touch if you are curious to see if your business can benefit by moving over to the cloud accounting model.

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By |2017-09-26T09:13:05+00:00September 22nd, 2016|Latest Articles|