In recent years, cloud accounting services have become more common as companies gradually adopt the technology. For the most part, cloud-based accounting software is similar to traditional software, with the main difference being that it is hosted by a remote server.
That is, all data is stored off-site and not on the person's computer. This has several advantages, although to some it increases the potential for security issues. Perhaps the biggest advantage of cloud accounting is that it offers more flexibility.
Instead of only being available on certain local computers, cloud solutions for accounting online data can be accessed on any device anytime, anywhere. This is especially useful for companies with multiple locations because everyone can access the data at the same time.
As calculations are performed offsite, the technical functionality of the device becomes less important, which means smartphones and tablets have powerful desktop functionality. Together, these factors make it ideal for those who travel regularly.
Cloud accounting also protects important data from loss. Anyone using traditional software is always at risk of hard drive damage, fire, or theft. Since cloud-based accounts are stored on several external servers, they are protected against such disasters.
It also saves time by eliminating some time-consuming tasks like creating and saving backups and installing software updates.