A business leader should maintain a comprehensive view of the financial status of their business at all times. This will allow them to make informed and timely decisions, maintain stability, and respond quickly to changing business situations.
We identify 5 immediate benefits of moving to a cloud-based digital accounting platform.
A key learning for many businesses this time three years ago, was the need to have understandable and up-to-date financial information available at all times because you can never predict when a crisis will hit your business.
As more organisations embrace contingency measures such as telecommuting or employees taking unpaid leave, reducing manual and repetitive tasks is an efficient way to mitigate workforce disruption.
In the event of a business disruption, digital accounting enables employees to concentrate on higher-value tasks and work more efficiently. Employees can automatically gather and reconcile data while spending a fraction of the time manually entering and updating information, thanks to a single platform that integrates with other business apps.
Having real-time financial analysis available supports decision-making and gives owners and senior management a real insight into where the business is performing against its goals.
Transitioning to a secure, cloud-based methodology drives information security and can reduce costs. Cloud-based platforms enable teams to work more collaboratively, despite location, which we now know is a necessity rather than a ‘nice-to-have’.
From a cost perspective, the positive news is that you pay for what you need, as the platforms offer entry level packages suited to a sole trader, right up to much broader packages for group structures.
Five of the benefits of moving to a digital accounting solution, usually online, are set out below.
Greater information security
Whilst many businesses had been cautious about moving to a cloud-based operation, it is proven to increase data security rather than reduce it, provided you have the correct infrastructure in place for your business type. Undertaking research on the optimum data storage model for your business type will be crucial ahead of moving to a cloud-based structure.
Scalability
A developing business may find it difficult to keep track of its finances using spreadsheets, and desktop accounting programs sometimes have a restricted feature set that can be a burden to growing enterprises.
Startups with growth aspirations, for example, shouldn’t be forced to use a technology they could outgrow quickly. Thanks to cloud accounting software, it’s possible to start with simple accounting operations, then add more users and advanced accounting features like subledgers or multiple-entity management during growth.
Improved cash flow
Repetition of invoicing tasks and the introduction of easier payment methods, such as ‘pay now’ buttons, can mean you are effectively receiving payments quicker on outstanding invoices. Debtor management is one of the biggest challenges facing business and auto reminders and scheduled ‘follow ups’ make it much easier to reconcile and decrease debtors.
Real-time visibility of business performance
Business leaders should have full visibility of their financial analytics in order to make decisions and to be fully aware of where there are potential cash-flow issues.
The significant advantage with cloud-based platforms is that real-time data can be retrieved with ease, from anywhere and you can create easy-to navigate reports, flows and charts, to present to senior leaders or your board.
Significant reduction of manual tasks, saving time and money
Cloud accounting however can be operated from anywhere with an internet connection. There is no need to acquire and operate servers or other IT equipment just to run your accounting software. You also don’t have to conduct frequent backups of essential financial data – your cloud accounting hub automatically provides that for you.
The more time you save on administration tasks, the more time workers can spend on the activities that build your organisation and help it prosper and grow.
At DHKN we have a team of business advisers who can help your business implement a cloud-based accounting – and payroll – solution to suit your business as it develops.
Keen to learn more? We’d be delighted to connect you with one of our experts. Reach out to me at dhickey@dhkn.ie
