In today’s world of accounting, cloud computing has helped to ease the work of professionals and guaranteed optimum management of all the critical data. Cloud provides all the features of your on-premise systems with the added convenience of any time, anywhere access to your accounting data and applications.
According to a survey, 64% of accountants use the cloud for their accounting software. Also, this number is predicted to grow by manifolds in the upcoming years.
Many accounting professionals and CPAs prefer moving their practice on the cloud because of the following reasons:
- Remote access to the data
- Multi-user collaboration
- Scalability of resources
- Integration of multiple applications
- Automatic data backup
However, moving your accounting practice on the cloud requires careful consideration of some critical factors. Here are some points that every accountant should keep in mind when choosing cloud for their accounting process.
1. Security Measures Followed by The Cloud Service Provider
One of the most important factors to consider when shifting the accounting process to the cloud is the security of sensitive financial data. Data stored on the cloud is prone to various security threats such as unauthorized access, data breach, and malware attacks.
It is crucial to know about all the measures taken by the service provider to protect the data. Some of the underlying security standards offered by the vendor that you must check out include end-to-end encryption of data, multiple firewalls (hardware and software), multi-factor authentication, anti-virus, intrusion detection and prevention system, automated backups, etc.
Note: Carefully go through the security policies in the service level agreement of the vendor to get better insights before moving to the cloud.
2. Location of The Data Centers
When your accounting data is hosted on the cloud, it’s backup is stored in large data centers with a high level of security to safeguard it from various accidental losses. These data centers are preferably located close to the firm’s base. This ensures high performance and faster response time.
Always check for the physical location of the data centers and in which country it is located so that you are comfortable at the technical as well as the governance level. Many cloud vendors store your accounting data at distributed data centers. This eliminates the risk of storing all the data in one place and the possible data loss.
3. Support and Training Offered by The Cloud Service Provider
The cloud service provider is as good as the customer support it offers. Always check for customer support availability and the contact platforms provided by the cloud vendor in case of any issue. The most competent cloud providers in the market offer round the clock support over chat, phone, or mail.
Moreover, ensure that the cloud service provider helps your employees gain familiarity with the technology. It can be done using different resources like live video demonstrations, team training, webinars, etc.
4. Take the Team Onboard with The Decision
Always take the concerns and suggestions of your team into consideration before implementing new technologies like cloud computing. CPAs, accounting professionals, tax professionals, and all of the stakeholders should be comfortable with the decision.
Some of the necessary steps you can take to ensure the readiness of your team are:
- Consider implementing software which is same or similar to the existing technology
- Ensure all the employees are trained on how to access the accounting software on the cloud
- Communicate with your staff and understand if they are willing to work with the cloud technology
These steps will further lead to better outcomes and improved efficiency in the accounting process.
5. Understand the Pricing Plan
The cloud providers offer a pay-as-you-use pricing structure that enables you to scale your business resources as per the requirements. It provides the advantage of paying as per the use of resources, but there is an unforeseen risk that prices might shoot up unpredictably in the future.
Therefore, it is essential to read the terms and conditions of the service provider before migrating your accounting practice to the cloud. Always check for the hidden costs, commitments and if there are additional charges for added functionalities.
To Sum It Up
Cloud technology has helped businesses of all sizes to get better ROI and improve their accounting process. However, there might be a lot to consider when it comes to moving the accounting process to the cloud. There’s a need to analyze every aspect like security, cost, uptime guarantee, service termination terms, and more. But, if it is appropriately managed, it is worth the investment.