There are lots of jokes about using Excel and our favourite one at MJF Accountancy is “you never finish a spreadsheet, you just stop working on it”. It’s not really funny (none of them are), but it’s the most accurate in the world of accounting.
Smart businesses that want to work faster and more intelligently invest in cloud accounting. Working with the cloud gives a much better indication of your finances and allows anyone within your team to view them easily.
What is cloud accounting?
Cloud accounting, also known as online accounting, utilises software that is similar to desktop or traditional accounting software, which was previously dominated by Sage accounting, but the accounting software and business data are stored securely online within the 'cloud'. The information within the online software is encrypted, similar to online bank accounts; only users who have logged in to the cloud accounting account will be able to view this highly sensitive information.
Cloud accounting is not a new solution; many limited companies and small business owners started utilising cloud accounting software as far back as the early 2000s. Most modern cloud accounting systems such as XERO, Quickbooks or Sage also incorporate features to help with the management and scheduling of invoices and quoting facilities.
You might be asking, what exactly is the cloud? If you think of how internet banking works, it’s the same principle. The cloud is a platform that allows access to your financial data online at any time, from any place and from any device.
How Does the Cloud Benefit Your Business?
- Provides an overview of your financial situation in real-time.
- Multi-user access allows for easy online collaboration with your team and advisors.
- System administration costs and server problems are no longer a problem, as everything is managed by the cloud and its service provider.
- No need to install or back things up manually on hard drives. Everything is run online and backed up automatically.
- Automatic updates to the latest version of the software are free and available instantly, all you need is an internet connection.
When should your company use Cloud Accounting?
For businesses of all sizes, whether you are a limited company or small business now is the perfect time to start utilising cloud accounting, especially those that are VAT registered, as VAT registered companies now need to adhere to the rules of 'Making Tax Digital'.
From 2024 all self-employed and landlords generating more than £10,000 revenue from property needs to adhere to Making Tax Digital rules and partnerships turning over £10,000 or more need to comply by 2025.
Not only will businesses need to legally utilise cloud accountancy software as a result of Making Tax Digital, but businesses that effectively utilise cloud accounting will also reap a number of other business benefits.
Cloud Accounting platforms provide added value, allowing you to closely monitor a critical key performance indicator by leveraging the additional digital connectivity that cloud accounting software provides. This type of solution utilises real-time data services such as bank reconciliation through live bank feeds to accurately monitor your cash flow.
Cloud accounting provides the most powerful and efficient real-time accounting capabilities in the business world, it will allow you to save time by reducing the time-consuming need for manual data entry.
How cloud accounting works?
Setting up a cloud accounting software account couldn't be easier. Users sign up for an online accounting software platform such as XERO, Sage and Quickbooks. A user's account is accessed via a web browser or an application installed on a desktop computer, laptop, tablet or mobile phone. The software is usually linked with a business bank account, ensuring that transactional data is automatically transferred between the accounting software and bank accounts.
Cloud accounting software options
The Cloud accounting marketplace is crowded and extremely competitive in terms of the various solutions provided. To ensure you get the most benefit from your accounting software, it is essential to engage with Cloud accountants who are most suitable for your needs and the software you utilise.
Xero is seen by many as the best small business accounting software solution, producing not only simple accounts but also reports and financial information that highlights key information required for successfully growing businesses.
The QuickBooks Online platform is designed specifically for small businesses, it has all the accounting capabilities of QuickBooks Desktop software, but is a more robust solution as all of the data is encrypted and stored centrally within the Cloud.
The advantage of cloud accounting software is that it provides you with the opportunity to run your business from anywhere with absolute ease. The data is accessible and fluid, long gone are the days of copying files from computer to computer, collecting folders full of receipts and invoices or wasting hours upon hours processing for VAT or end of year tax returns.
What is a cloud accountant?
A cloud accountant provides the same services as a traditional chartered accountant, the only significant difference is how you provide the information to your accountant. Instead of visiting your accountant in person and dropping off boxes of traditional paperwork such as invoices, receipts, and paper copies of your bank statements, all of this data is stored securely online utilising cloud accounting software. These records include incomes and costs, assets and liabilities. All of the data uploaded to the cloud is encrypted, just like internet banking, and only the people with login credentials can see the data stored.
Work with cloud accounting specialists
If you're looking for cloud accountancy services Liverpool based MJF Accounting is here to help.
Here at MJF Accounting, we are cloud accountancy specialists and we provide a range of professional services to take the stress out of running your business.
- Xero - This cloud-based accounting software lets you track and organise your business finances from your smartphone, tablet, PC or Mac. You’ll be able to run every part of your business thanks to a huge array of features. Xero allows you, among other things, to send online invoices, track inventory, pay staff, connect your bank, pay bills and tailor smart financial reports and budgets to track what matters most to your company. Its uses are virtually endless, and it is one of the very best cloud accounting solutions Liverpool businesses can opt for.
- Quickbooks - The perfect piece of accounting software for smaller and middle-sized businesses. Quickbooks handles bookkeeping and paperwork, generates reports, and allows you to share data with more than 100 business applications and popular programmes such as Excel, Word and Outlook.
- Receipt Bank - This ingenious app allows you to take a photo of your receipt or invoice and then throw the paper away. The photo is instantly uploaded and stored online and is fully HMRC compliant. The data from the receipt is obtained automatically and sent immediately to us. No more nights spent huddled over a table sifting through bits of paper for hours on end. This app is one of the best cloud accountancy services Liverpool firms will find.
Our cloud accounting knowledge
The team of chartered accountants at MJF Accountancy is Xero certified, with our practice achieving the required qualifications and proven competency to be awarded Gold Partner status.
If you are looking for cloud accounting solutions in Liverpool, cloud accountancy specialists MJF Accountancy offers everything to satisfy and exceed your accounting needs.
We use a number of cloud based accountancy packages and we have detailed these in the following links: