Cloud Computing in Accounting
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As companies continue to get larger and their accounting requirements get more complex, emerging technologies are playing a prominent role in enabling accountants, both public and private, to keep up with the large amounts of financial data that needs to be processed and analyzed. One of the technologies that is having a significant impact on the accounting profession is cloud computing. Cloud computing is the practice of using remote servers to securely store, access, and process data via the internet.
The application of cloud computing in the accounting world is changing the way accountants work in a variety of ways. The accessibility of accounting documents and records is one area that is seeing significant improvement as a result of cloud accounting. Accounting records stored in the cloud can be accessed from anywhere as long as the user has an internet connection. This allows multiple users to share data and collaborate in real time (CIMA, n.d.). This eliminates a lot of effort and potential for error that is inherent in creating and sending multiple versions of documents back and forth between users (CIMA, n.d.). Additionally, accountants have much more flexibility in how and where they work because there is no need to be onsite in order to access and maintain the accounting records.
It is also easier to keep accounting software updated and secure than traditional systems because it can be updated regularly by the provider without needing a time-consuming and costly upgrade to locally stored instances of the software (CIMA, n.d.). Additionally, multiple cloud accounting systems can be easily integrated via APIs to create a highly customized and scalable accounting system (CIMA, n.d.). For example, a company can connect their financial accounting software with their AR/AP system, treasury software, intercompany systems, and data analytics software to create a powerful technology ecosystem that allows all the finance functions to easily share the data needed to effectively manage the business.
References
An overview of - what is cloud computing in accounting?. CIMA. (n.d.). https://www(dot)cima(dot)institute/blog/an-overview-of-what-is-cloud-computing-in-accounting
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Cloud computing is truly a game changer in accounting. It has opened phenomenal possibilities. As you have observed, some of these possibilities include the ability to store securely, access and process data via the Internet. The other great thing that cloud computing has brought about is the ability to access data from any device connected to the Internet (Huttunen et al., 2019). Therefore, data is not lost when physical hardware malfunctions or becomes damaged. In addition, you have observed that cloud computing eliminates the need to work o...