Cloud-based accounting is revolutionising the way many owners do business. But some questions remain if this is the best and most secure way to operate. John Burfitt reports
When restaurant industry accountant Alyson Garrett began moving a number of her key clients from traditional bookkeeping and accounting services over to online cloud-based systems, she knew one particular client held the key to whether this process could be a success.
“That client was using really outdated equipment, and struggling. I figured if I could get him onto cloud accounting, then I could get anyone,” Adelaide-based Garrett recalls. “He was my measure of whether this would work.”
Three months later one Saturday morning, Garrett received a phone call from that particular client and with it, she had her answer.
“He rang to ask me what he should do with his Saturdays, as for years, he had spent the day doing the week’s books. Now by being on the cloud, it was taking care of itself and he had nothing to do. That was the day I knew this could work for any business.”
The popularity of cloud accounting —a system offering software and information stored and accessed online—continues to grow. Some of the systems used in the restaurant and catering industry include MYOB Cloud, Saasu, QuickBooks and Xero.
“I believe this way of doing business is the way of the future and it is the next evolution of the internet,” Garrett says. “The cloud becomes a place where you can store as well as access information anytime so that your way of working can become more flexible.
“A common issue I have seen with a lot of restaurant owners is they believe they can never take any time off as they feel they need to be in the office to make sure everything is being paid, the roster is in place and the orders have been done.
“With the cloud, they can check in and do that from anywhere as this gives them real-time information to keep track of the business.”
Aside from allowing mobile access, a cloud system also allows integration of most aspects of the business. Many regular transactions can be automated and streamlined, so the point of sale operations can be linked directly to the accounting system and banking details, and then produce a daily report on the business.
And for accountants like Alyson Garrett, it means she can check in on the state of business of her clients at any time, and help monitor any variations that need to be done.
“What this allows as an accountant is to be proactive and see what is going on throughout the year, not just at the end of the year when I get the spreadsheets through,” she says. “People these days do not want to pay for just a whole lot of end-of-financial-year accounting. They want value throughout the year with real-time information, and that is what the cloud opens up to both of us.”
Simplifying time-consuming processes has been the biggest advantage of using cloud accounting for Sarah Munn of Fino At Seppeltsfield in the Barossa Valley.
“Formerly tedious monthly reconciliations are simplified by the live bank feeds and now become incorporated into daily tasks, freeing up my time,” Munn says. “The simple cash flow features help support the business by giving a visual picture of how we are travelling daily.
Kane Pollard of The Topiary Café in South Australia believes working with the cloud has offered his business a definite advantage.
“Since using Kounta linked to Xero, we have been able to measure and improve all aspects of the business with the freedom of doing it on the phone, tablet, laptop or PC from home when needed,” Pollard says. “This has resulted in more free time and the head space to be able to work on the business, rather than in the business.”
One of the biggest advantages of the various cloud packages is the owner does not need to purchase business accounting software programs to be uploaded onto their office computer system. The application vendor also manages IT maintenance, like version upgrades and data back-up.
The rates for cloud accounting systems start from around $10 a month.
Mark Williams of Caunt and Lowbeer in Sydney is another accountant who has moved many of his clients to a cloud accounting system. While he is also a great proponent of the many benefits the cloud offers, he does admit that this way of working is not for everyone.
“Many clients are accepting this is the way things are moving, but for others, they are happy with existing software and systems and do not want to change,” he says.
“If they have already put a lot of time into setting up and tailoring their system, it is a big decision to change and can be time consuming. We have had a few clients move to the cloud and then jumped back again as not all the features worked for them or they realised they weren’t up for implementing a new system.”
Concerns over online security and safety of confidential information remain an issue for some clients, despite all the assurances of otherwise.
“For some of our older clients, that is a really big issue when we discuss the cloud, and it is understandable. There is a reluctance for some that will still be there for some time.”
It is the benefit of doing business in a flexible way that is also adaptable to each client that, Williams says, will continue to be the greatest selling point of the cloud.
“The automation potential with cloud accounting systems can be such a big time saver and the efficiencies ensure that accounts are being updated all the time.”
Adds Alyson Garrett, “You have to consider that if your competition is doing business this way, then they have a distinct competitive advantage as reducing overhead costs and saving time might mean pricing is more competitive and costs are coming down. All the factors of the cloud need to be considered seriously.”