The changes that technology has brought to business are pervasive, affecting aspects from how you communicate with vendors, to how customers can pay for goods and services. Technology has also enabled a new way for business owners to handle their accounting: in the cloud.
What Is Cloud-Based Accounting?
“The cloud” is simply a metaphor for wireless computing; having a cloud-based system - including for accounting - refers to all records and files stored remotely and accessed via the Internet.
Note that this isn’t the same as simply doing your accounting on a computer as opposed to having paper-based records. Rather, using cloud-based accounting means that none of your bookkeeping is stored locally on a computer (or server); instead, it’s stored “in the cloud,” accessed from anywhere at any time, whether you’re in the office, at home, traveling, etc.
Security as a Priority
We feel it’s important to point out that the technology used for accounting in the cloud places a priority on security. While there are many additional benefits to cloud-based systems, cloud-based accounting is more secure than utilizing paper records or local, company computers.
Cloud-based accounting service providers perform the necessary maintenance and security tests to ensure client data is constantly safe. Being cloud-based also removes the use of unsecured devices and accessories, such as USB drives; even if a company device is stolen, the information remains safe because that data isn’t stored locally on the actual device itself.
Prevalence and Growth of Cloud-Based Accounting
By 2015, 37% of small businesses in the U.S. had switched to cloud-based accounting, and estimates show 78% will migrate their accounting to the cloud by 2020. That number is likely to be higher than the estimated 78% by 2020 since the number has already climbed to 65% in just two years (reaching this number in 2017).
What’s more, of the accountants and bookkeeping professionals that aren’t using this type of accounting already, 60% consider it extremely likely that they’ll adopt cloud-based accounting in the next 2-3 years. That’s because accounting in the cloud provides some powerful benefits, which we’ll cover in detail in our next blog post.
Technology is changing and improving the way businesses operate, and cloud-based accounting is a direct and beneficial product of that. Want to learn more about the type of cloud-based accounting we do for clients, or what a partnership with KYB might look like? Contact us here to talk to someone on our team.