Cloud-Based Accounting

Accounting departments today should be lean and mean-operating machines. You may be wondering how? It's about moving to the 21st Century, integrating and automating processes, and using cloud-based apps.

Accounting departments can now move from paper ledgers and computerized activities to automate their work. This move must be planned carefully and executed in order to ensure that the information flows smoothly through an organization. This type of setup was previously only possible for large organizations due to the high program maintenance and setup costs. This is no longer the case!

Cloud-based accounting software is more popular than downloadable programs. This allows for program updates to be quickly rolled out without the need for user action. Cloud-based applications allow users to be on any device, anywhere they are (i.e. computers, laptops, mobile).

In the past, accounting records were processed on paper. Everything, from vendor invoices to sales invoices and payments, can be sent or received electronically. There is very little that can be received in paper format. Almost any type of document can be digitalized using a scanner or an image captured quickly on a mobile phone.

How does this all make accounting more efficient? These efficiencies can be found in the reduction of human data entry, which in turn reduces human error. Next, an application must be read via OCR and then understand the transactions. Many applications can be configured with parameters to allow repeat transactions to be processed automatically. This includes accounting for sales tax.

There will be errors. There will be mistakes. After all, data has been entered, including credit card and bank reconciliations, it is time to generate a profit and loss report showing the expenditure accounts. It is much easier to scan the accounts and look for anomalies than manually entering all of that information.

A review of all accounting information must be done to find additional efficiencies. Are all third-party software applications compatible with the accounting software? Can they all be connected? You might want to rethink the applications you use to connect all information. Many of today's applications can be connected to full general ledger accounting software.

Cheques are another paper issue to be concerned with. With today's technology, you can replace cheques with electronic file transfers of payments. This is often done by companies using their bank's platform, which doesn't connect to the accounting software. It can be expensive. Other platforms can be connected and are often cheaper. This results in two-fold savings.

Payroll? What about payroll? Payroll has evolved to electronic payroll, which is now paperless. If the third-party service is used, the last hurdle would be connecting the payroll to the accounting program. This can be done by moving to a service that does.

Cloud-based accounting has revolutionized bookkeeping. It's high time for traditional accounting departments to be restructured and automated. You can spend more time on analysis and real-time reporting.