What is cloud accounting?
That being said, let’s refresh our memories with what cloud accounting technology is.
Instead of each employee in a practice working on their own, individually installed, software on each computer, cloud accounting brings everyone together.
This means you’re all on a shared system (the cloud) accessed via the internet, and can easily share data and information. No more spreadsheets and back-and-forths over email, instead you can all see up-to-date information and changes in real time.
What is the purpose of cloud accounting?
Cloud accounting’s purpose is to enable collaboration and efficiency in your practice.
Through cloud accounting you can pay for what you need and pay-as-you-go, no longer paying for separate licenses with on-premise installation and updates.
Plus, the functionality available in cloud accounting platforms enables your practice to do more with less. For example, Robotic Process Automation allows you to automate repetitive tasks, freeing up your time to focus on clients and value-add activities. You can access extra functionality with APIs, meaning you can plug-in third-party software solutions to provide more business value.
How is cloud accounting different to traditional accounting?
Before software advancements, accounting involved physical bookkeeping, then spreadsheet software packages such as Excel. Now, traditional desktop-based accounting systems are being replaced by cloud-based accounting software.
The key differences between cloud accounting and traditional accounting include:
- Cloud accounting allows you to securely store your clients’ sensitive financial information online, protected by measures such as two-factor authentication and data backups—more on this later. Meanwhile, traditional accounting exposes you to more data breaches or fraud over email.
- Your data is always up to date and no longer requires sharing between devices as with traditional accounting.
- Cloud accounting can be accessed from anywhere, particularly enabling collaboration and remote working models. Traditional accounting meant you had to access the application on a specific device instead of logging in from anywhere.
Is cloud accounting secure?
Yes, cloud accounting offers more security than traditional accounting methods in many ways.
For example, cloud accounting uses technology such as two-factor authentication to ensure that only you and your employees can access your data and includes automatic backups to protect your data. Additionally, cloud accounting uses encryption to prevent data loss and protect your clients’ information.
Compared to sharing your data and documents over email, which is easily hacked, cloud accounting offers a secure and reliable solution.
For your peace of mind, Wolters Kluwer currently partners with HDUK to offer a data hosting solution. HDUK offers a secure virtual environment for your business-critical applications, making your data available anywhere, anytime. The system provides a fail-safe backup system, reassuring you that your business-critical data is protected. Plus, the Service Level Agreement (SLA) provides a guaranteed minimum of 99.9% availability. HDUK’s hosted IT infrastructure is replicated between two data centres, ensuring business continuity in the unlikely event of system failures on either site.
CCH iFirm has a 24x7x365 security monitoring service delivered by a Global Security Operations Centre (SOC). This service is the front line in proactive response to security incidents that happen any time of the day or night. Through detection and monitoring of threats and vulnerabilities, including indicators of compromise (IOCs), an experienced team continuously manages and responds to security incidents. Global Security Operations Teams also monitor appropriate channels of communication for the newest vulnerability alerts from established sources such as US-CERT, NIST, and additional sources, to protect our systems before an incident may happen.
In short: your data is very safe in the cloud.
How do I move my practice to the cloud?
Implementing change might feel daunting, but when working with a trusted vendor, migrating to the cloud is just a step-by-step process like any other. The most important part is understanding which cloud accounting system is right for your business, and training your staff to make the most out of it once implemented.
Moving your practice to the cloud involves: identifying internal bottlenecks to determine which solution you need; planning your migration roadmap with your selected vendor; cleaning up your data and removing redundancies so it’s ready for migration; understanding security considerations; training employees to make the most of cloud functionalities; then testing your new systems, as feedback is key to success.
What happens to my data during migration to the cloud?
You don’t need to start from scratch when moving to the cloud—instead, your data moves with you.
Many businesses are wary about moving their data due to fear of data loss or data breaches, however, when using a trusted provider this shouldn’t pose a threat.
Keeping your data on physical systems is wise, until your cloud accounting transition is complete. Once you’re in the cloud you’ll no longer need to rely on previous systems.
If you’re migrating from CCH Central to CCH iFirm—traditional to cloud accounting—your data is easily moved into the cloud with our migration solution. No need to worry about data loss. We work with you to make the process as smooth as possible and do it at a pace that suits you.
How long does cloud migration take?
Cloud migration timings are a case-by-case approach. Moving a single practice for a single task or job can be very quick (seconds), while moving all clients from one system to another will be very quick as well (seconds or minutes). However, practices with customised systems they want to move into the new system could take longer (hours or days).
One thing is certain though: the best way to prepare yourself for a quick migration is ensuring your data is cleaned up and ready to go. This is guaranteed to set you up for the best possible transition.
The migration to the cloud if your journey, so it’s personal to your practice. At Wolters Kluwer we understand this and will work with you in a timeline that suits.
How does cloud accounting benefit SMEs?
For small businesses or as a sole trader, expenses, receipts, and invoices all stack up. But with minimal people to get through the work, it can sometimes get on top of you.
Cloud accounting offers a solution to this, as you can directly import data and documents into your software. Options such as automation and integration with other third-party apps allow you to improve efficiencies and automate tasks. Suddenly you can get through your work a lot quicker, and you’re no longer held back by the size of your practice—you can do more with less.
For example, take KYC AML checks from weeks to minutes, using biometric checks that cut out the gruelling back-and-forth over email.
How does cloud accounting benefit larger companies?
With lots of employees, it’s important that all the accounting professionals in your company are on the same page. Cloud accounting ensures data is synced across devices in real time and allows employees to work remotely as well—resulting in flexibility and employee satisfaction.
Additionally, cloud accounting improves the efficiency of your workforce, saving your company both time and money. Instead of buying new software licences as your company grows, just pay for what you need—cloud accounting scales as your company scales.
Is cloud accounting expensive and what is the cost?
Cloud accounting is a more cost-effective solution than traditional on-premise accounting software. No need for installation on separate devices or buying more software as your needs change and your company grows. And no more investing in on-site servers and security software—your IT management costs are outsourced and therefore reduced.
The actual cost of cloud accounting solutions will vary depending on the functionality and what it is you’re buying. However, as it’s Software as a Service (SaaS), you only pay for what you use. Speak to different vendors and do you research, comparing cost, value, and quality, before choosing.
How does cloud accounting integrate with systems?
When using a cloud accounting suite, such as CCH iFirm, your different solutions will integrate with one another (talk to one another) for a seamless and easy experience.
Not only can the software integrate with other applications within the suite, but third-party solutions too. For example, CCH iFirm integrates with banks, HMRC, and your clients’ software. This is done through Application Programming Interfaces (APIs) which allow applications to plug into one another and interact, once again making your job as an accountant easier.
How often are cloud accounting software updates installed?
Unlike with traditional accounting software, where updates were manual, cloud accounting software automatically updates. New functionality is immediately available at your fingertips all the time. No need to have anyone visit your business to install on-premise software.
What happens if there’s a technical issue and I can’t access my data?
Your software provider should do everything to ensure that you can always access your data and it’s backed up.
For example, at Wolters Kluwer, we partner with HDUK, who offer the following fail-safe solutions:
- Automatic replication and backup software: Your hosted IT infrastructure is replicated between HDUK’s two data centres, ensuring business continuity in the unlikely event of system failures on either site.
- Fail-safe backup system: Gives you peace of mind that your business-critical data is protected from data loss as the Service Level Agreement (SLA) provides a guaranteed minimum of 99.9% availability, with service credits available if this is not met.
- Always available remote desktop solution: You can access your apps from any device through an internet connection, it looks, feels and behaves exactly the same.
- Quality IT support: In the event that you’re worried or need assistance, you can speak to HDUK’s dedicated IT support team, all based in the UK.
How will cloud accounting impact my clients?
Cloud accounting doesn’t just benefit your practice and your workflows, but it benefits your clients too. And any accountant knows that happy clients mean good business.
When using cloud accounting, your clients can expect to benefit from:
- More integration with their systems, making their lives easier and allowing you to access their documents faster.
- Quicker AML and KYC checks, speeding up the onboarding process.
- No more long back-and-forths over email; instead, simple communication and up-to-date data in-app.
- Access to more features and reporting, giving them greater business insights and help.
How does cloud accounting impact Making Tax Digital (MTD)?
With Making Tax Digital (MTD) looking like it’ll be mandatory in April 2026, it’s the perfect time to switch to cloud accounting. If your practice was thinking of digital transformation anyway, why not migrate to the cloud during this time of change?
Start by selecting a suitable MTD-compliant software vendor, and then begin your cloud migration process, identifying your bottlenecks and business needs, before speaking to your vendor about how to move by April 2026.
Cloud accounting makes the MTD process smoother for both you and your clients, as it’s easier to ensure compliance with all your data in one place. You can also integrate with your clients’ systems and share data with them in the cloud.
Glossary of key cloud accounting terms
API:
API stands for Application Programming Interface. It’s an intermediary software which links two applications together, allowing them to talk to one another. In cloud accounting this allows your software to interact with other applications such as banks or your clients’ software.
Cloud server:
Instead of a physical server which stores your business’ data in the office, cloud servers are virtual servers which can be accessed over the internet at any time. They work exactly like physical servers but allow you to reach your data from any device where you can log in and allow any number of users online.
Cloud hosting:
Cloud hosting involves using a network of remote servers hosted on the internet to store, manage, and process data, rather than a local server or personal computer. The benefits of cloud hosting include cost savings, scalability, accessibility, easy disaster recovery and backup, and security.
Digital transformation:
Digital transformation is the process of moving your business to a more technology-driven model. It involves changing how you operate; from workflows down to delivering value to your customers. You may enact digital transformation by onboarding new software vendors and solutions to help make workflows more efficient and enable better communication with clients.
Integration:
Software integration is usually done with APIs; it’s the process of connecting different software with each other. For example, CCH iFirm solutions integrate with one another for a seamless experience and can integrate with HMRC or many of your clients’ software.
KPIs:
Key Performance Indicators (KPIs) are used as tangible targets to measure performance. KPIs are useful during digital transformation, or migration to the cloud, as they can help you identify bottlenecks, then improve on these metrics once change is implemented.
Real-time reporting:
Real-time reporting is the process of generating and reporting on data instantly. Cloud accounting and AI enables real-time reporting through up-to-date shared data and analytics. It allows your practice to make informed decisions in the moment and respond to any changes.
Remote access:
Remote access IT services enable you to access your practice from anywhere with an internet connection. This model provides ultimate flexibility on how your practice connects with others and opens your business up to new possibilities and a more efficient way of working.
Remote desktop:
Remote desktop technology allows a user to remotely access the entire desktop environment of another computer or server over a network. It essentially mirrors the remote machine’s screen on the local device, allowing full control of the remote system.
SaaS:
SaaS is a cloud computing model that delivers software applications over the internet. Users can access SaaS applications through a web browser, without the need to install or maintain software locally. SaaS is usually accessed on a pay-as-you-go model, where you have a monthly subscription and can easily add or remove users depending on your practice growth.
