Doing Business in the Cloud - an Accountant's View

When it comes to cost-effectiveness, ‘the Cloud’ clearly rocks. The evidence is everywhere. You may remember a time when the word ‘cloud’ was only associated with the weather – those fluffy white, sometimes angry grey, things floating in the sky. But in 2016, thanks to a legacy started by a group of tech execs at Compaq Computer in Houston, Texas, 20 years ago, ‘cloud’ is a popular cliché that stands for the ‘online hosted’ model of delivering software services to businesses.

Time to read: 4 mins

There’s no doubting the fact that the accounting industry and business owners have wholeheartedly embraced cloud software. Mark Kingsford, Business Advisory Director at Staples Rodway, has seen a massive uptake of cloud-accounting tools amongst their clients in recent years. From minimal cloud clients just five years ago, Staples Rodway now has more than 1,600 clients using a cloud-accounting system, he reports many with cloud add-ons such as Payroll, Inventory and Point-of-Sale.

“New businesses are driving the trend, with most setting up in the cloud. It’s the more established businesses that tend to be slow adopters,” he says.

Staples Rodway has embraced the changing accounting landscape by launching a cloud-based service offering called RealTime.

“RealTime blends the latest cloud technology with Staples Rodway’s tried-and-true service to provide unique solutions for progressive clients,” explains Kingsford. “We also contribute to the development of many cloud solutions rural accounting platform Figured, for example.”

Cloud-accounting solutions deliver a big efficiency booster for accountants by providing ready access to online data. “Traditional means of gathering information seem antiquated and just plain slow,” says Kingsford. “Benefits for clients include access anywhere, anytime, and the automation of many tasks.”

However, he says the accuracy and integrity of data must continue to be managed. “A cloud-based system doesn’t overrule the ‘rubbish in, rubbish out’ rule. We work regularly with clients to make their process fit for purpose and to ensure that the monthly financials are accurate, reliable and allow business owners to make good decisions.”

Cloud accounting also means reporting is becoming more powerful. Cloud tools enable automatic feeds of data up into graphical dashboards, assessing business performance against KPIs. “Big data, benchmarking and other analysis are going to be big in the next few years as businesses make more use of, and commercialise, the aggregated data now residing in the cloud,” explains Kingsford.

When clients switch to the cloud, the biggest advantage to accountants arises from the ability to work directly with the financial data, adds Kingsford. “It means we can give proactive, real-time advice at a fraction of the traditional cost.”

Another advantage is utilising the ‘single ledger’ concept, he says, whereby client data is used directly to generate the statutory financial statements, instead of having to use accountant proprietary systems.

Then there’s the ability to integrate or ‘bolt’ other systems or apps onto a core cloud-accounting platform to deliver operational objectives. “It gives small and medium companies the same functional efficiencies that have traditionally been the domain of the larger corporates,” says Kingsford.
“This technology competitiveness, combined with conventional agility, results in small businesses starting to disrupt business dynamics.”

As for making the transition from desktop to cloud, Kingsford says planning is paramount.

“Depending on size and existing infrastructure, businesses may want to stagger their shift to tie into the end-of-life of fixed hardware. Staples Rodway specialises in transitioning accounting systems to the cloud and has learnt the best, most effective way to do this.”

Here is his list of things to consider:

    • Do you want to take across balances or transactional data what use will you have for the data?
    • Do you need weekly, monthly or yearly comparatives?
    • Open items (debtors, creditors, etc.) need to be brought across accurately.
    • I t is an opportune time to clean up the chart of accounts and, for multi-entity groups, put in place aggregation/consolidation tools to make reporting easier.
    • Cut over on a good date ideally, but not necessarily, the end of the financial year. Avoid mid-month cut over.
    • Remember that a system doesn’t work in isolation and that focus should be given to the business processes around the system.

Kingsford can see an exciting future ahead for cloud deployment.

“At present, most cloud applications are geared towards the client. In time we expect to see more apps that manage the deployment and maintenance of a suite of apps. This will make it easier for accountants to manage large client lists on a universal level.

“Going forward we will be releasing industry-focused solutions that manage all financial aspects for certain industry groups such as RealTime Farms, RealTime Motor Vehicle Dealer and RealTime Architect. These provide the financial tools these groups need to run their business efficiently.

“We will also look at tools that can help clients manage costs and identify possible savings, better handle their debtors and manage FX transactions more effectively.”

DISCLAIMER No liability is assumed by Baker Tilly Staples Rodway for any losses suffered by any person relying directly or indirectly upon any article within this website. It is recommended that you consult your advisor before acting on this information.

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