Gone are the days of pushing the accounting files around. Since the digitalization of the accounting process has picked up the pace, every firm around the world wants to adopt new and improved methods of accounting operations (Cloud Technology).
Some of the technologies that have caught the eye of accountants are AI and blockchain. These futuristic technologies help in automating accounting tasks and optimizing data analytics, thus, reducing human effort. Moreover, there are various accounting software products in the market that help in performing accounting operations.
However, these technologies, as well as accounting software, need a flexible platform to function and a large storage capacity to facilitate large amounts of data. Cloud technology is the platform that offers the level of flexibility, mobility, and storage that is not possible in an on-premise IT setup. Cloud adoption in the world has been growing at a rapid pace, which is evident with Gartner forecasting an increase of 17% in public cloud services.
The accounting industry’s adoption of the cloud has been gradual, but accounting firms have started realizing the perks that cloud accounting brings to the table. Moreover, to relieve you from building a cloud infra of your own, various cloud service providers offer hosting services for your accounting software and data.
Let us look at some aspects of cloud technology that enable you to future-proof your accounting firm.
1. Cloud Technology Help in Mobility
One of the challenges that the accounting sector face on a daily basis is the restrictive nature of their work. You, as an accountant, have to commute to the workplace every day to accomplish the daily tasks. If you have a personal errand to run to attend a seminar in a distant location, you run the risk of missing out on some critical work. Moreover, sitting behind a desk all day also affects your mental health.
Cloud technology creates a digital workplace that empowers you to access your accounting software and data from any location at any time. You get access to your accounting process on your smartphones, laptops, and tablets, but the data is stored in remote data centers. Hence, you can pick up any internet-enabled device to log in to the cloud, where your data is hosted.
Having this level of mobility not only helps you in managing time better but also maintains a work-life balance.
2. Cloud Technology Makes process Cost Efficiency
Having an on-premise IT infrastructure leads to significant capital and operational expenditure. Firstly, the cost incurred on purchasing high-end hardware and equipment takes a big chunk out of the budget. Once the machines are set up, an additional sum goes into their maintenance and upgrade.
With cloud technology, all these expenses are reduced significantly. If you opt for cloud hosting services, the entire hardware setup is owned by the hosting provider. You are only hosting your accounting process on their setup. Hence, there is no need for a dedicated hardware setup at your location. Moreover, they also take care of all the hardware maintenance and upgrades.
The accounting process is hosted in state-of-the-art data centers with multi-redundant infrastructure, which is not feasible in an on-premise setup. Hence, you save revenue that can be utilized for other short-term and future goals.
The most common problem in getting your accounting firm prepared for the future is the rigidity of the legacy hardware setup. Let us assume that you currently have a workforce of 50 accountants. Over the course of a year, as the business grows, your workforce doubles. Since you have to accommodate all those employees, you need new systems, more seating space, and bigger office space.
This process of scalability is continuous with the growth of your business. A significant amount of revenue earned by attaining new clients is spent on expansion.
When it comes to scalability, the cloud environment is second to none. You can ask the cloud provider to add as many users as you want, according to your business requirement. This is possible due to the flexible nature of the cloud infrastructure, which is made up of a cluster of servers pooling their resources. Hence, at any point in time, if you want more storage, it can be provided to you instantly.
Moreover, the cloud provider offers you pay-as-you-use pricing plans, which means that you incur costs only on the resources you use on a monthly or annual basis. This enables you to grow your business without any worries about the underlying hardware setup.
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4. AI and Big Data
It is not possible to prepare your accounting firm to be future-ready without considering the adoption of futuristic technologies like Artificial Intelligence (AI) and Big Data. With Big Data, firms can extract useful information from big chunks of data to get insights based on advanced analytics. AI, on the other hand, can make use of big data to make informed decisions without any human intervention.
However, both these technologies work optimally when integrated with the cloud platform. Cloud technology solves the issue of storing large volumes of data as it can be scaled as per demand. Moreover, AI demands fast processing speed and performance, which is possible in a cloud environment. Competent cloud service providers offer a High-Performance Computing environment (HPC) that facilitates parallel processing, suitable for AI-based applications.
5. Cloud Technology Helps in Global Operations
In the era of globalization, every accounting firm wants to expand its reach and serve clients on a national as well as global scale. Given that, according to Report Linker, the global cloud computing market is expected to exceed $623.3 billion by 2023.
Moreover, to collaborate with clients situated at distant locations, all communication needs to be done via email. This causes a hassle-free process with the constant to and fro of information. Moreover, accounting firms cannot hire skilled employees as they are situated far away from the office.
Cloud technology helps accounting firms go global by addressing both these issues effectively. By adopting cloud accounting, you can collaborate with clients and colleagues on the same cloud platform. The files stored on the cloud can be accessed and edited by multiple users, irrespective of their location, provided they have the right credentials.
Also, since cloud technology encourages the work-from-home model due to its remote access feature, any individual from any corner of the world can work for your accounting firm.
Cloud Is The Future (Cloud Technology)
Cloud offers a complete accounting solution for your firm by bringing all the accounting applications and data on the same platform. It reduces capital and operational expenses while making on-demand scaling possible.
If you want to compete in the market and prepare for the future, it is imperative to make some alterations in the current accounting process and migrate to the cloud.