The accountancy dread, something that all business owners have experienced. It’s five minutes to midnight the night before you are due to meet with your accountant and you are reluctantly sifting through piles of papers trying to figure out your finances. For SME and start-up business owners in particular, ensuring that you are on top of your figures can make or break your business. Here, Richard Stonier, co-founder and partner of online accounting software, Tally, explores how cloud based accountancy can stop you from burning the midnight oil.
Currently, 93 per cent of businesses worldwide are using cloud-based systems as part of their day-to-day business operations. As digital advances continue to revolutionise the way we do business, cloud based software is at the forefront of the latest FinTech developments.
A significant proportion of cloud computing users are entrepreneurs and SME owners who are choosing to implement cloud systems into their everyday business activities. The reduced cost, increased flexibility and ease of use that the technology provides allows entrepreneurs to streamline their operations.
So what does this mean for the accountancy industry? If you were asked to describe the sector, the term innovative would probably not be the first thing that comes to mind. However, the latest cloud technologies, combined with behind-the-scenes human support, have revolutionised the way in which the accountancy industry operates. While online accountancy software is nothing new, cloud based services created and supported by real life accountants offer a range of benefits that are available at the touch of a button.
Behind the scenes support
In 2015, over 600,000 start-up businesses were launched in the UK alone, equating to 1,643 new businesses every day. In such a competitive market place, one that is becoming fiercer by the day, entrepreneurs cannot afford to spend hours on business tasks that can be completed in minutes.
Rather than taking three days to reconcile their accounts, SME owners can use cloud accountancy software to achieve this in under 20 minutes. And there’s not a piece of paper in sight. By automating the reconciliation of personal and company bank accounts, the process can be completed behind the scenes each day without time-consuming input from the user.
To further simplify the reconciliation process, cloud software can intelligently monitor regular outgoings and identify certain transactions that are made more frequently. Regular transactions including wages, insurance payments and bills can all be automatically identified, providing SME owners with comprehensive knowledge of exactly how and where their money is being spent.
Not many people want to spend until four in the morning trying to figure out what the £1,489 that left their account three weeks ago was. This is especially true for entrepreneurs and small business owners. Being able to access easily digestible information from any device at any time allows an SME owner to spend valuable time and money on other important aspects of their business that would have otherwise been spent trawling through accounts.
This is why online accounting specialist, Tally, offers integration of its cloud-based accounting software, with up to 100 other apps. By allowing users to streamline their business operations into a single process that improves efficiencies and reduces costs, entrepreneurs can rest assured that all aspects of their business are operating in harmony.
Tally’s accounting software also integrates with existing company databases. This is crucial for entrepreneurs when making important decisions on whether they have the financial capacity for potential expansion or improvement.
Keeping control of communication
Just as the above decisions would need to be effectively communicated to the rest of the business, this is where cloud based accountancy services can actually improve the communication of a company’s finances between its directors, managers and executives.
Rather than reducing human interaction, the effective use of cloud based software can actually improve the channels of communication between all employees.
Relevant contacts can instantly be updated with useful financial information that they require to inform business decisions regarding procurement levels, employment roles and product development. While a business owner may have complete understanding of just how well a certain area of their company is performing, if this information is not effectively communicated to the rest of the business, it can lead to strategic misalignment.
Just as financial communication is important internally, the same is true for external communications. All entrepreneurs have experienced the annoying feeling of repeatedly sending invoices to various contacts and clients only to hear the not too sweet sound of silence.
Cloud based accountancy can relieve the annoying hassle SME owners endure when chasing up payments by automatically invoicing the relevant contacts each month and following up if the payment is not received. Simplifying the financial communication between the business owner, the employees and the company’s clients goes a long way to improving operational success.
For SME owners, time is always of the essence. The misconception that their days are spent in coffee shops leisurely trawling through emails could not be further from the truth. While launching a business may initially seem like a daunting task, successfully keeping it afloat is even harder.
Streamlining accountancy processes into a single platform that can automatically complete financial tasks 24 hours a day, seven days a week, provides entrepreneurs with the continued support they need to survive.
However, while there is an abundance of cloud based accounting software readily available online, finding a service that is complemented by an experienced team of accountants makes all the difference.
At the current rate of growth in the FinTech market, it won’t be long before we see the industry go from 93 per cent adoption of cloud computing to 100 per cent. This will not only deliver increased efficiencies and minimise human error, it might finally put an end to the age-old need to burn the midnight oil.