Technology is an integral part of any accounting practice in the digital age. Business owners are more tech-savvy than ever, so it’s increasingly important to offer them a high-quality accounting software experience. If your firm is going to meet clients’ technology needs and expectations, you’ll need to choose the right cloud accounting platform. But if you’re new to cloud, which one should you opt for? And if you’re already using a solution, should you switch to a new platform?
We’ve rounded up the latest pick of cloud accounting platforms, with a summary of each solution. And we’ve also highlighted the important benefits of working in the cloud.
The advantages of being a cloud practice
Accounting software isn’t a new innovation. There have been basic bookkeeping packages available since the 1970s. And highly sophisticated desktop-based accounting software that emerged in the 1990s and beyond. But the emergence of cloud accounting in the 2010s was a real game-changer for accounting, for a number of reasons.
With cloud-based accounting, your firm has the benefits of:
- Working online with your clients’ accounts – cloud accounting removes you from the shackles of an office-based server. Instead of being tied to a desktop application, you simply log into your online accounting through your browser. It’s more flexible, more convenient and it allows you to work from any location with an internet connection.
- Easy access to clients’ numbers – there’s no emailing of files, or sharing of memory sticks when you’re cloud-based. Your team and your clients have ‘one point of truth’ where all their financial information is stored. This makes it far easier to collaborate and review numbers, and means less wasted time looking for the latest figures etc.
- Paperless documentation and storage – client receipts, bills and invoices can all be scanned in and digitised. Apps like Receipt Bank, Auto Entry or HubDoc let clients snap their receipts and upload the digitised information straight to the cloud.
- Real-time financial information – integrations with live bank feeds and automated bookkeeping apps allow for a real-time view of clients’ finances. There’s no bottleneck of paperwork to input, and no outstanding bank reconciliations to worry about. With a streamlined cloud set-up you have a real-time view of each client’s accounts.
- A huge ecosystem of business apps – many of the popular cloud accounting platforms have their own app stores. These are filled with hundreds of different tools and solutions, from fintech apps to practice management software. By cherry-picking your firm’s own choice of apps, you can create a customised suite of integrated software tools. This ‘app stack’ becomes the tech heart of the practice.
Selecting the best cloud accounting platform
Becoming a cloud practice, or switching to an alternative platform, is a big operational shift for any accounting firm. But the advantages of switching to your choice of cloud accounting platform far outweigh the initial time investment.
During the recent Covid pandemic, being based in the cloud has allowed firms to work from home and become ‘virtual practices’. And cloud-based firms also have the potential to be far more efficient, productive and profitable. The tech removes much of the time-wasting, manual processes and human error that dogs the average practice’s operations.
You may be a brand new practice looking for the latest cloud solution. Or you may be an established firm that’s switching from a traditional desktop accounting platform. You may even be a cloud practice already, but thinking about moving to a more effective cloud platform.
Whatever the scenario, the advantages of having the very best cloud software are obvious. But with so many different online accounting software options out there in the market, which one should you choose?
Here’s our breakdown of the top cloud accounting providers:
- Xero – Xero was one of the first accounting platforms to come out of the initial cloud renaissance. 'Beautiful business' is Xero’s motto and the platform is aimed squarely at the small business market. It has an easy-to-use dashboard that’s very simple to learn and perfect for newbie clients. But the platform also offers excellent customisation and reporting as business clients grow. Xero has a growing ecosystem with a large and very well-specced Xero app store.
- QuickBooks Online – Quickbooks was originally a desktop application, but has very successfully moved over to the cloud. It has a simple interface that’s aimed directly at small business owners, but with deeper accounting functionality when you need it. There’s a growing QuickBooks app store and the platform is evolving to cover many different business functions – 'Taking care of business' is their latest strapline.
- Sage Business Cloud – Sage was the UK market leader in desktop accounting for many years. Their cloud offering is ideal for bigger business clients and offers all the scalable accounting and business functionality the firm is likely to need. The Sage app store offers access to some third-party apps, but extra Sage proprietary modules like payroll and tax will add to the underlying costs of opting for the Sage platform.
- FreeAgent – if you deal with a lot of contractors, freelancers and microbusinesses, FreeAgent is the ideal choice of cloud platform. It’s a simple, no-frills accounting solution which makes it as easy as possible for clients to manage their books. It lacks some of the bells and whistles of more advanced platforms, but covers the basics admirably. There’s also a reasonably well-specced FreeAgent integrations page for adding apps.
- Thomson Reuters Onvio – as a new contender in the market, Onvio is worth a look for firms needing an enterprise-level solution. Thomson Reuters has a big presence in the accountancy world, with its expertise in tax and accounting news and reporting. The new Onvio online accounting platform includes bookkeeping, accounting, document management and firm management. It’s a self-contained cloud suite that can be customised with various Thomson Reuters add-ons to tailor your system.
Making the most of the cloud benefits
The cloud accounting platform that’s right for your firm will vary from practice to practice. Xero or Quickbooks are great for small business clients, and FreeAgent has cornered the market for contractors and freelancers.
Ultimately, it’s the needs of your clients that will drive your choice of platform. It's a good idea to do your research, talk to existing clients and see which software they prefer. Think about the accounting needs of the firm and which platform is best at servicing these needs.
Whatever platform you choose, making the move to a cloud system is a proactive and progressive step towards a more streamlined and productive accounting firm.