Online Accounting – what’s that about?

Recently, I’ve been looking into on-line accounting software (also known as Cloud Accounting or SaaS Accounting.  I am interested in it for a number of reasons.

I have a number of friends who want me to act as their accountant but they are located quite far from me and it did not seem practical to have them as clients.  That’s what got me looking at it in the first place.

Secondly, having a background of improvement projects and business process reengineering, I was looking for something that would simplify or streamline the annual accounts process.

Finally, I believe that many businesses need to improve their management improvement and I was looking for practical ways to help to do that.

There are many things that I like about on-line accounting.

As the accountant, I can either setup or help set up the accounting system at the very start.  In doing so, I can let the client have the benefit of my experience from the beginning.

With all of these systems, the client can give me a log-on and if the client has a question about something, they call me, I log-on and deal with the query quickly and much more cheaply than if I had to go to the clients premises.

If the client is nervous about filing a VAT return, they can give me a call and I can quickly review the VAT before its submitted.

Similarly, I can log-on every now and again, say every quarter, and have a quick review of the clients account’s and if I see something unusual or strange I can raise and deal with it there and then.  And remember, its always much easier as an outsider to see something than it is for the person who is looking at the numbers every day or every week.

You will have better information to be bringing to your bank manager.  Right now, lack of good information is one of the things that stops banks lending.  They want to eliminate uncertainty and if you can only show last years annual accounts that’s not great.

At the year end, I will have much better and more reliable information.  This will make preparing the accounts easier but will also mean I have more time to analyse and advise compared to the more traditional approach.

Finally, when the accounts have been completed, I can post any adjustments to the accounts so that the accounts are up to date.  You would be amazed at the number of clients whose accounts have not been adjusted to agree with the last years accounts.

Finally, most online accounting have much better back up routines than your typical SME office.  So the chances of losing key data are greatly diminished.

Is online accounting for everyone?  I don’t think so.  It is definitely a good solution for independent consultants that use computers in their work anyway.  It will work for SMES where one person looks after the book-keeping/accounting.  You need to have a good broadband connection – although I am told that it does not need to be the fastest. or anyone with good computing skills.

In my research, I spoke to a number of people using the various packages.  The most common response I noticed was the increased sense of knowing what was going on in the business and of feeling in control.

If you have any comments on this article or if there are any areas you would like to address, please do let me know.

Best Wishes