Seven reasons why your business should use cloud accounting software
Automation and digitisation are big trends in scaling up companies. Streamlining your processes goes a long way towards building a successful and investable company. Very real progress in the field of cloud accounting is allowing business owners to do more, faster. This progress is resulting in incredible jumps in growth and profitability potential.
While the entrepreneurial journey requires passion and perseverance, the right systems are key for success. Accounting and software are not always the most exciting words in an entrepreneur’s vocabulary. However, a deeper look into the benefits of cloud accounting clearly makes it an attractive option for any company looking to scale up.
What is cloud accounting?
Cloud accounting refers to using cloud-based software to run the accounting arm of a business. This kind of software is making accounting faster, easier and making data more accessible to key role players than ever before.
More and more companies are seeing the value of taking this essential step in scaling for rapid growth. This new approach is beginning to replace the old desktop versions of accounting software at a rapid rate. And for good reason!
Here are the top seven reasons why your business should be run in the cloud:
- Live access to financial informationEasy access to financial information is something that has frustrated business owners for decades. Critical business decisions have to be made on accurate and real-time data.
One of the biggest advantages of cloud accounting software is its ability to link directly to your company’s bank feeds. By linking up with your bank, transactions are being pulled through from the bank straight into the accounting software.
What does this mean for your business?
- This means no more uploading of bank statements, saving you and your staff a lot of time.
- It also means live access to your financial information. All bank transactions as well as all debtor and supplier invoices are captured within the cloud system. Your financial info will always be up to date.
- Business owners and management can now monitor sales, cash flow, debtors, financial targets, payables and more at any time.
All this has never been possible before in the history of doing business. It will play a massive role in allowing entrepreneurs to make fast, informed decisions, leading to more effective businesses.
- Work from any device from anywhere in the worldCloud accounting is making the traveller lifestyle possible.
Owners of fully digitised companies are able to work from anywhere in the world, making extended travel much easier. Co-working and co-living spaces like Roam (www.roam.co) are a testament to this trend. Cloud accounting plays a huge role in enabling this doing-business-from-anywhere lifestyle. No longer bound to a specific computer at the office, cloud accounting software allows you to access your financials from any device with an internet connection, anywhere in the world.
- Beautiful, fast, customised reporting and analyticsA simple, summarised, easy-to-read management report is a rare find in business today. There are a lot of reporting tools out there, but few of them give a good overview of what is really happening in a business.
With access to live financial information, producing great management reports can be as simple as pushing a button, if set up correctly. The leading cloud systems have strong reporting tools that can create graphs, variance reports, key metrics and many other financial snapshots to form a financial dashboard for your company.
Beautifully presented, these reports and dashboards give even the least financially savvy director an edge when it comes to being on top of company finance. Powerful dashboards can be customised to help all participants in a business track key performance metrics in an easy-to-read snapshot.
- Direct link to your advisors, investors and boardHaving trusted advisors as part of managing company finance is key. Your investors and directors are going to make key decisions based on the numbers and data you present them with. Therefore it is essential that they have access to correct, real-time data.
With functions that allow you to invite your advisors to access your company’s cloud accounting profile, both you and your team of professionals will now have a complete bird’s eye view into your of company finances.
What does this mean for your business?
- Your team all receive a full live view of company finances.
- You receive the best possible strategic direction to the business.
- Investors, directors and managers receive complete peace of mind.
- Auto-allocations through machine learningThis is the most exciting growth area of cloud accounting software.
It is able to recognise recurring transactions in order to auto-allocate them. Learning from millions of accounts being process all over the world, the software is also able to allocate transactions into their correct accounts. After just a few months of using it, your actual manual allocations should be less than 20% of all transactions.
As this function increases in strength, bookkeeping work will diminish. Entrepreneurs will be able to focus on doing business, not recording it. Accountants will be able to focus on value-adds and working in an advisory capacity instead of capturing transactions.
- All the advantages of cloud technologyCloud-tech beats desktop software six-love every time.
Top-end encryption ensures that data security is taken care of. Data accessibility is instant, with no barriers to accessing key financial information. All of the physical risks to information – like a computer crashing, being stolen or having coffee spilt over it – are completely eliminated. Data also does not corrupt as in the case the offline versions of desktop software.
With cloud software, business owners now have complete access to all the great benefits and advantages of running a business on the cloud.
- Save time and reduce hasslesScaling your business for growth takes time. But you won’t have this kind of time if you are stuck in the trenches of your business. Freeing up founder time is key to unlocking further growth in a company.
An automated finance function is a great time-saver. Accounts are captured faster and with less hassle. Source documents are uploaded digitally, which will help you save time on those dreaded audit queries. Everything works in a paperless environment. You eliminate the hassle of keeping slips and invoices that leave your wallet and desk full of last month’s paperwork.
Say hello to more time and mind space!
Watch our latest video: The Benefits of Using Xero Accounting Software to Grow Your Business.
Xero: cloud accounting software for scalable growth
At Outsourced CFO, we have partnered with Xero as our leading cloud accounting weapon of choice. Xero is a New Zealand-based accounting software technology company that is taking over the world.
Plugged into entrepreneurial eco-systems worldwide, they are currently the leading solution for SMEs in the marketplace. Their products include all of the above advantages of cloud accounting and more. We’d recommend them to any entrepreneurs who wish to streamline their company’s accounting function.
We live in exciting times, with new technology making our lives as entrepreneurs easier. But even with the best tech, it is still all about the people behind it. You need great people to assess, implement and advise in order to unlock the power of cloud accounting software. Get in touch with our team of professionals today to learn more about how you can rethink, automate and scale your company using Xero and other top financial technologies.
Scaling for growth: When is the right time to call in an OCFO?
How do you know when it’s the right time to shift gears in business? There are a number of indicators that it may be time to call in the help of the experts:
- Is your company on the forefront of tech and innovation?
- Are you staying up to speed with developments in AI, cryptocurrency, digitalisation and the Internet of Things?
- Is your turnover growing rapidly? Do you want to engineer your business to be even more profitable?
- Do you want to have live access to your company financial information and key metrics to help you make fast, informed decisions?
- Are you wanting to attract an investor soon?
If the answer is yes to all of the above, it sounds like you are ready to scale your business for growth.
This significant shift into a new gear will require you to adjust to a new pace. Markets and business models are changing at a rapid rate. This means that scaling up companies like yours have to be faster, sharper and ahead of the competition. These new business opportunities will also entail new risks to be considered. In other words, there will be more i’s to dot, more t’s to cross and more complexities to navigate.
Scaling up and the CFO
One of the key role players to help your business navigate this new arena and come out on top is your chief financial officer – the CFO. The CFO has their finger on the pulse of your company cash flow, your financial strategy and mitigation of risk. They hold the financial reigns, making sure that your business operates on the best systems, like cloud accounting. They also ensure that your business can raise your future growth finance.
At this point in the scale-up phase, a full-time CFO might not be necessary for your company. You will likely only need one once you start making tens of millions in revenue. But you still need CFO expertise during the scale-up phase: your business is growing rapidly, but won’t be able to handle the burden of a full-time CFO. Nevertheless, it is important to navigate this phase properly and effectively.
The solution? An outsourced CFO. This is your go-to financial expert who will be able to offer expert advice and strategies for your rapidly growing business. An outsourced CFO will help you take your business to the next level.
Step into the arena with other successful, scaling companies
Is it time to get the experts in? Your scaling up business can’t afford to skip this critical step towards success. Don’t get left out in the cold while your competitors cash in on your customers. Building a successful business is incredibly difficult, and the odds aren’t always in your favour. What places you in the category of other successful business owners is the vision you’ve cast for yourself and your business. Your purpose and vision is far bigger than the obstacles you are facing. Don’t let that vision die, just because you didn’t think to ask for help.
So there are so many good reasons to start thinking about enlisting the help of the experts. Join a growing group of successful entrepreneurs who are now raising hundreds of millions from millions. These are the forward-thinking people who are placing the growth of their business into the hands of capable experts, like Outsourced CFO.
More about Louw Barnardt and Outsourced CFO
Louw Barnardt CA(SA) is the founder of Outsourced CFO, a financial management company that renders CFO and cloud accounting services to emerging tech and innovation companies.
Outsourced CFO helps ambitious SMEs build scalable companies through the provision of strategy and high level financial management. We believe that a growing company has the power to change the lives of the entrepreneur, their family, their staff and the community in which they operate.
Through Outsourced CFO, we have helped many entrepreneurs on the road to giving life to their dream companies. We have seen multiple stages of growth funding and investment into many young, tech-savvy companies, as well as the impact that this makes in their lives.