Cloud Accounting: Work Smarter Not Harder
When working as a sole trader you aim to reduce the time you spend in the office bookkeeping so you can get on with doing your trade. You may have heard buzz words like ‘The Cloud’, ‘Cloud Accounting’, ‘Automation’, ‘Xero’; this blog post will explain why adopting this technology can increase your productivity and streamline your processes to allow you to get on with the task in hand, conducting your business making money.
What Is The Cloud?
Chances are you’ve already heard of or used the cloud. If you use online banking, social media or email you have already experienced using cloud hosted platforms. In its simplest terms the cloud is the means of storing and accessing data and programs over the internet instead of your computer’s hard drive. Anything uploaded to the cloud, or that you run from the cloud, exists on dedicated servers and hosted in vast secure warehouses.
What Is Cloud Accounting?
Cloud accounting is about using programmes on the cloud to your advantage, enabling you to streamline your accounting processes. There are a number of applications on the market including packages like Xero, QuickBooks, and SAGE; along with supporting packages such as Hubdoc, AutoEntry, and Receipt Bank.
Benefits of Cloud Accounting
Cloud accounting is both time and cost effective as it negates the need to install and periodically update software or backup data on your hard drive. Working on the cloud can also reduce the amount of paper records you keep, allowing for paperless offices. Networks are secure and allow for easy collaboration with colleagues, suppliers, clients, and your accountant. It also allows you to access applications from any computer, tablet, or mobile device at any time allowing you to work anywhere you have a 4g or WIFI connection.
The main draw is the ease of control over your financial processes and access to live data using accounting applications, some of which we will delve into next.
While there are many software packages out there to utilise, each with varying features and draws, among our favourites here at Price Davis include Xero Accounting Software, and Hubdoc’s Document Collection & Management Software, for the following reasons:
Xero Accounting Software
- Xero accounting software is easy to use and integrates seamlessly with many other cloud software providers such as Hubdoc, giving a joined-up approach to accounting.
- Xero gives business owners the freedom of managing their cashflow with real time information on the go and from many mobile devices.
- Security of your information is handled by the cloud service provider meaning that the software is automatically kept up to date, your data is backed up and is fully secure without any time or effort required from you.
- As no data is saved on your own hard drive, in the event your laptop is stolen or your office is off limits due to flooding for example, you can login and carry on as usual from another device connected to the internet allowing complete business continuity with no loss of data and significantly reduced downtime.
- If you invite users (such as your accountant) to view your data, you can control the level of access. This is much more secure than the old-fashioned way of emailing your files or sending out a USB stick with your data on it.
- The software is future proof and scalable; it can grow with you and your company.
Hubdoc – Document Manager
- It auto-fetches your bank statements, bills and receipts from (currently) over 700 suppliers, and, and will convert your bank statements into a format for importing into your bookkeeping package.
- There are multiple ways of uploading a document, you can email it directly to your dedicated Hubdoc portal, scan into your computer or capture an image on your smart phone.
- The software then extracts key data from the document (supplier name, date of invoice, totals, VAT etc), using optical character recognition.
- The software automatically creates folders and sorts documents by their supplier name after they’ve been fetched or uploaded
- Hubdoc integrates with Xero (and other accounting software packages) for reconciliation and audit-proofing.
- The software ensures organised and verified data: providing confidence that all financial documents are organised, secure, and always available. All data is “verified” with the source document, stored and easily searchable on any device.
Businesses of all sizes can benefit from embracing the cloud. Cloud applications can particularly be a godsend for sole traders to manage their bookkeeping, sales and purchase ledgers effortlessly and being able to interlink various parts of your business processes with your bookkeeping allow you to be efficient, streamlined, and make informed business decisions based on live information on the go. The functionality of Xero and Hubdoc allow you to stay organised and allows your accountant to see the records they require to keep you and your business compliant. Although there are many software providers on the market, we have highlighted our tried and tested cloud accounting favourites.
Price Davis are Xero Migration Specialists, with Xero Gold Partner status and over 20 years’ accounting experience. If you’re ready to embrace the world of cloud accounting, you could not be in better hands! Get in touch for a free consultation by emailing firstname.lastname@example.org or give us a call on 01452 812 491.