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The Future of Accounting is Online – Part One

hamish-16270809Last week I introduced the key elements I looked for in an online accounting system as a Chartered Accountant in practice. Today I’d like to look at:

Access to the clients’ accounting systems and the ability to collaborate in real-time, anytime, anywhere and on the mobile…

Old technology means accounting systems are installed on a PC in the office where the only people that can access important financial information is the person sitting in front of that PC. This tended to be the internal accounts person or the business owner. The inherent problem with this is that only one person can have access to the accounting system at any one time.

In the current environment, businesses are becoming more aware of the importance of their financial information, access to it and mobility. Businesses also understand the value of providing sensible access for their employees and their accountant. Instead of going it alone, they are becoming more aware of using their biggest resource: other people. They also see the value of having experts close and at hand to help when needed.

With installed software, providing access is difficult. Traditionally, all users would need to have the same and correct version on their computer and then files get sent around, which means as soon as data is exported, it is out of date. One of the main problems here is the risk of data being lost. It also evokes Key Person Dependency, whereby only one person can have access to the ‘master copy’ at any one time. It’s no longer acceptable to have to go back to your desk to make a phone call – that’s why we have mobile phones. So why is it still acceptable to keep installed software on our PC which in effect chains us to our desks?Xero is delivered as software on the web, which means you can access the accounting software and financial information from anywhere.  All you need is an internet connection and a computer or a mobile phone that has internet access. Furthermore, Xero allows unlimited users so you can invite as many people as you deem appropriate to access the accounting system. If the client has a question, I want them to email or call me. I also want to be able to answer the question fast, and if we can both see the accounting system at the same time, it makes it so much easier.

More and more accountants and small business owners are embracing this new, emerging technology. Soon it will be commonplace to have all your business processes operating online. US based salesforce.com has proved the online collaborative model works for customer relationship management (CRM), so why not for accounting?

 

Read more about Accountants, Accounting

 

12 comments

John Birse
12 September 2009 #

I agree Hamish. The amount of time wasted in transfering data files between client, bookkeeper and accountant and the possibility for error makes Web based accounting solutions a cost effective solution. It also means that remote clients can be serviced by professionals without having to travel and continue to use their accounting program while their bookkeeper is updating information.

Hamish Edwards
14 September 2009 #

Thanks for your comment John. The benefits to Bookkeepers using Xero online accounting are certainly numerous. The most important being saving travel time and fixing problems fast and easily because they can be connected to the accounting system whenever it suits them.

Caleb
15 September 2009 #

Interesting – i am looking at both desktop and online systems and my comments are below – Agree that if the cost was the same an online system would be better. But cant we simply email our data to our accountant and thats basically the same thing, safe, secure, fast etc… I understand we will need to import some transaction when we get the file back but for the cost why not? Destop products maybe less flexible at the moment but total ownership cost is alot less and we are not locked into a provider…

Prospect

Rod Drury
15 September 2009 #

Hi Caleb,

Wow we haven’t had a non-believer here for a while. Welcome.

I hope someone from the desktop solution you’re looking at also takes the time to state their case.

1. With online. No servers, no back up and support is included. Online software will be cheaper and make your business more successful.TCO is much less if you count everything.
2. You’ll find that the time the Accountant takes to load up the right version of software, then load your file is probably way more than the monthly charge of an online solution. And now you have multiple copies of your data.
3. With an online solution your accountant can be your real time business coach and help you make better decisions.
4. Emailing your data file is less secure than dealing with an online solution.
5. You are not locked in. No contracts. SaaS providers have to earn your business very month.
6. Online accounting is new. We’re updating the software every month as we can do more and more for you.

We’d suggest trying our free demo for a month, and seeing the difference for yourself.

Hope that helps you make the right decision.

Rod

[...] running series with the not-too-modest title “The Future of Accounting is Online”. In the first post Hamish introduces the first key theme for accountants to look for in a software solution “Access [...]

[...] running series with the not-too-modest title “The Future of Accounting is Online”. In the first post Hamish introduces the first key theme for accountants to look for in a software solution “Access [...]

[...] week I looked at having access to client accounting systems and being able to collaborate in real-time, anywhere. This week I’d like to look at how the client relationship can change if they have a better [...]

[...] week I looked at having access to client accounting systems and being able to collaborate in real-time, anywhere. This week I’d like to look at how the client relationship can change if they have a better [...]

Neil Gray
24 December 2009 #

We use salesforce.com. Do you have an integration implemented or planned?

Neil

Catherine Walker
24 December 2009 #

Hi Neil, actually yes we do have one planned! And really soon as well – just working on making the set up easier then all going to plan will be releasing it early January.

Regards,
Catherine

Bookkeeping
27 January 2010 #

This is informative. However, the idea of web-based accounting records raises security/confidentiality issues. Though I agree that web-based accounting brings in all the convenience.

Rod Drury
27 January 2010 #

I think the security perception is swinging in favour of cloud applications which have a robust security framework. Compared to desktop software where there are few controls, passwords often available over the internet, and entire data files emailed around. But it will take time for people to build trust in new models.

Rod

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