If you are a small business owner, you undoubtedly understand the importance of keeping your finances in order. However, you likely realize how difficult such a task can be. With all the effort required to run a thriving business, getting caught up with menial back office tasks can be frustrating. When the books need to be reconciled, bills need to be paid, or invoices need to be followed up on, other responsibilities can get pushed to the back burner.
Attempting to use traditional desktop accounting software to take care of you financial chores only makes matters worse. It’s clunky, requires a great deal of manual effort and is only accessible from the computer it is installed on. This often means you have to devote a few hours each week to taking care of tedious but necessary housekeeping-type tasks. Fortunately, cloud computing has led to the emergence of a new type of accounting software that removes many of these inconveniences.
Why you should switch to cloud accounting software
Online accounting offers a number of advantages over the desktop alternative. The most significant is that the cloud lets you access your financial data from any computer with an internet connection or on your mobile device while on the move. This means that your accountant, financial advisor and other stakeholders can also access your books remotely, allowing everyone to collaborate around the finances. Your accountant can dig in deep from the comfort of their home or office and find ways for you to save money. If you ever find yourself in over your head or have a burning question, you can leave a note that your accountant will see next time they login. Desktop systems, on the other hand, contains your financial data to a single hard drive, preventing any semblance of collaboration.
Cloud accounting also removes much of the data entry hassle common with classic desktop systems. Data can be fed into your accounting solution from third-party sources, automating much of the accounting process. For example, your online bank and credit card accounts can sync with your online accounting platform and send all your transactions into your ledger on a daily basis.This makes it possible to reconcile your books as often as every day, without having to enter a bit of data.
Choosing the ideal time to make the switch
Converting data from one software solution to another can be intensive so it’s important to prepare for the change. Generally, the first day of your business’s fiscal year is the best time to make the jump to a new accounting platform. It’s a clean transition point because the previous year’s transactions have been closed out and don’t need to be converted with your live data. This is beneficial for two reasons. The first is that the conversion process is much quicker and cleaner, due to the fact that less data is being transferred and altered. Secondly, the the first day of the fiscal year lets you start fresh in your new accounting system.
For many small businesses, January 1st marks the first day of the new fiscal year, as well as the end of a busy holiday season. If this is true for your business, consider if changing your back office workflow during a busy stretch makes your life easier or harder. If January 1st doesn’t make sense, late January or early February could still be practical options as the year-to-date data is still minimal. If you have data that will need to be converted, talk with your accountant. Many specialize in helping business transition to a new platform.
Get comfortable with your new platform
Once you’ve decided on a switch date, plan on spending a few days familiarizing yourself with the new solution before it has live data in it. Like most new applications, it will take some getting used to. Terminology and workflows can be unfamiliar. Buttons and menus will be in different places. There will be new functions that make things easier quickly, but can seem foreign at first.
Almost all cloud accounting software providers offer free trials and training resources. Take advantage of the videos, webinars, online communities and even live events ‐ if feasible. By doing so, you’ll save yourself a lot of time and frustration when it comes time to do your actual accounting work.
Make use of the add-on ecosystem
Many online accounting providers integrate with several other software providers, which lets users build an all-in-one business solution tailored to the needs of their business. For instance, an online retailer could integrate their online ledger with their eCommerce platform and payment application. Freelancers can link their accounting software with their time tracking and invoicing systems.
If you decide to use add-on software, build your custom setup before you go live in your new accounting platform. By doing so, you can upload your data into the third-party software first, which will then be automatically pulled into your new accounting app. When it’s time to start the conversion process, much of your financial data will already be in the new solution.
Successful small business owners are also masters of efficiency and savvy at finding ways to save time and money. Thankfully, cloud accounting software is a tool that makes it possible for any entrepreneur to bring great efficiency and financial insight to their business. If you could benefit from a solution that lets you stay on top of your finances while saving time and effort, consider making the switch to cloud accounting software.
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