Accounting software: Online accounting software products: finally right for any business?

Together with “traditional” accounting software products, running on local machines, there’s now a new category of programs not requiring any download or installation, and with a whole new commercial packaging. Cloud accounting software packages are fully online accounting software, and they are snapping a growing share of the market. But are they right for any company?

Advantages of online accounting software

Cloud accounting software products boast a great deal of advantages over more traditional alternatives: they are basically much more convenient, and often cheaper to use both from the onset and in the long run.

Anytime, anywhere, any user

As cloud accounting software needs no installation on a local machine, it can be accessed from any machine, anywhere an internet connection can be found - in any office, on a business trip or at home.

And as all it takes to use it is login credentials, anybody within the client organisation and the password can use it.

This all makes multi-user, and even international cooperation, so much easier.

It is all inclusive

The main advantage of online software is that it only requires an internet connection and browser to operate. Computing resources required are so minimal it usually can even be used on smartphones.

No installation, no server, no updates, no backups, no maintenance are needed on the user side - the publisher takes care of all this, remotely.

Attractive pay schemes

Initial infrastructure, installation, backups, customer support, server maintenance and upgrades all require some investment - in the case of online accounting software, none of this is needed.

Everything - or almost everything - is included in the flat, or usage-based monthly fee.

This makes it much clearer, and depending on usage, often cheaper than purchasing a traditional accounting software CD or license.

Security is getting better

Some might still be afraid of data security when considering cloud accounting software - but see no problem transferring confidential files with USB drives among virus-infected computers.

Taking care or the servers and multiple backups is the software publisher’s business, and they invest much more in security than any of their customers could afford.

Limitations

Nonetheless, online accounting software products suffer from several limitations which may put off some prospective users.

Technical limitations of online accounting software

Some users may complain about a certain lack of maturity with regards to the features included in the software. While basic accounting operations like invoicing, accounts payables management and general ledger are easily piloted, more complex operations related to inventory, HR, purchasing or asset management may be off the mark.

Also, no program will be completely “unlimited” in terms of number of users or data usage.

One size fits-all approach VS vertical software

The business model of cloud accounting software also relies on quick adoption, on the biggest possible scale. Therefore, the product is often designed to meet the most commonly shared needs in terms of accounting functionalities. Users looking for vertical-specific features, and software designed for industries with special accounting practices, may not find what they need in the cloud.

Not for control-freaks

The fact that the software is remotely operated means that users rely on third-party servers to back up their data. Some concerns may arise related to the difficulty of importing, or exporting data from the cloud-based software to a local backup, or to a format which can be processed with other software.

The software integration dilemma

Publishers of online software compete to build alliances and operational solutions to operate smoothly with major players like Amazon, Salesforce, Google, Android, Apple... And the product will not necessarily be compatible with a specific software package which really matters to one given customer.