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5 Improved compliance - increased automation ensures you don’t miss HMRC reporting or payment deadlines and that your business is ready for change, such as HMRC’s Making Tax Digital programme (if implemented, this means that companies need to be ready to pay their Corporation Tax quarterly from 2018). Furthermore, all financial data is backed up and stored securely in the cloud for a minimum of six years in order to comply with HMRC requirements.
Is it expensive? In short, no! Businesses pay a monthly Software-as-a-Service (SaaS) subscription and systems update automatically without any expensive upgrades. The cost for a medium-sized cloud accounting package, including support, can start from £22 per month (source: Xero).
Is my business ready for cloud accounting? There has to be an appetite for change and a basic level of IT literacy within the business to start with. It’s then a matter of reviewing the systems you have and working out how you would use and benefit from the technology. These assessments are usually best done through your professional
advisor, or an accountant with cloud expertise. If you decide to go ahead, your advisors should be able to recommend the cloud accounting packages suited to your operating systems and business requirements. Sage, Xero, Quickbooks and Kashflow are the main software vendors
and usually offer a 30-day trial period with online tutorials. There are also product testimonials and user forums that you can refer to.
Other considerations Timing is important. Whilst it’s possible for businesses, even with more complex finances, to switch to cloud accounting in less than a month, there may be year-end considerations, or more preparation time needed for getting your processes, systems and accounts ready for the cloud. Any switchover should always be implemented on a case-by-case basis. Finally, it’s worth pointing out that cloud accounting isn’t meant to
replace your accountant! If utilised fully, it should increase the amount of collaboration you have with your advisors to check and fine-tune your business performance throughout the year.
JANUARY/FEBRUARY 2017 insight 23
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