Cloud accounting is basically the same as traditional accounting software but “lives” on remote servers aka the “cloud” while traditional accounting software resides on the computers in your office.

The accounting functions are still done on a physical computer(s) in your office but are saved and stored either:

a. In the “cloud” i.e. another remote location. Basically, it is online accounting software or Web-based accounting software.

b. Desktop – on the hard drive of your computer(s).

Both QuickBooks and Sage offer cloud and desktop versions. They can also assist with the transition from desktop to the cloud.

Benefits of Cloud Accounting System

Access to data is probably the biggest advantage over desktop accounting.

• The service provider automatically performs accounting files backup. Accounting record backup and disaster recovery are typically part of your cloud computing accounting software services.

• Cloud accounting systems are often a subscription model that allows for easy expansion in your company without additional software purchases.

• The service provider automatically updates the accounting program.

Lower expenses as there are no new software purchases or IT (information technology) personnel required.

• Cloud accounting programs and files can be easily accessed by various team members without having to install and maintain individual desktop computer software.

• It allows other employees in the office down the hall or in another country to access the same records and files. This makes the system very flexible.

Greater mobile capabilities.

Sharing data is simpler and more secure vs. a flash drive that could be lost or stolen.

Your accountant can access your accounting files from their office.

Easier to process multi-company and multi-currency transactions.

No requirement to purchase and update or expand servers.

Less time to maintain the system and your data is typically stored on two or more remote servers.

• Financial data in the cloud is encrypted and password protected.

• Extensive workflow automation such as downloading and importing bank transactions.

Benefits of Desk Based Accounting System

Available even if the Internet goes down as all data is stored in house.

Can have off premises data and software backup.

Flat cost upon purchase with additional costs to update. Cloud software has a monthly or annual fee which could be higher.

• Backups are manual but can be automated with a server.


Hands down the cloud option is the best choice for the many reasons listed above.

Accountants can Help with the Transition

Your accountant can assist you with the evaluation of your existing systems and make recommendations to make life as business owner a bit easier.

Then help with the implementation and staff training.

This should be a relatively painless process if you plan to switch from desktop accounting to the cloud.

If you do decide to implement a “cloud” solution, know that your accountant will be able to access your accounting records from his office and provide advice and counsel.

Creative Commons Attribution: Permission is granted to repost this article in its entirety with credit to Doug Hay & Associates and a clickable link back to this page.