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Advantages And Disadvantages Of Cloud Computing To Accounting Firms
The cloud computing concept is really very simple. The software programs are on the World Wide Web which accounting firms do not need to manage, install, or buy. There is no need to hire IT professionals because these firms only need a robust internet connection and a browser. Network switches, operating systems, applications, and servers are unknown to these accounting firms. For these organizations, such things belong to the cloud, the World Wide Web, and the cloud computing supplier.
An accounting firm can benefit from cloud computing in different ways. One, the overhead is quite low. System administration, upgrades, and maintenance become the responsibility of the supplier and everything happens in the cloud. Therefore, the firm does not need pay a supervisor to monitor any software/hardware work which usually occurs during weekends or at night. For a small firm of 100 employees, cloud computing software usually costs 50% less than software installed in the firm’s premises in a span of 4 years.
Software housed in the cloud can be easily accessed anywhere, anytime thereby providing an opportunity for the firm to grow more rapidly because workers can easily access data wherever they are. Cloud computing software supports those businesses which has highly mobile personnel like service and sales teams. The application on the cloud can also be accessed using every browser, mobile device, or desktop all around the world, as long as internet connection is available.
For the best network performance, the architectures of cloud applications are designed from the bottom up thereby ensuring better availability of applications as compared to the traditional applications which are housed on-site. Most of these cloud computing suppliers commit 99.5% uptime and offer data security which is compliant with Payment Card Industry Data Security Standard which is too costly to achieve if a firm is to have its on-site application certified.
The level of availability and security, backup and disaster recovery offered by a software-as-a-service supplier greatly exceeds the level which a company can provide if the application is housed on-site. Any ecommerce, CRM, or ERP application may run in a global or local scale in lesser months as compared to the time it will take to prepare software and servers on-site. Cloud computing can also adjust to the accounting firm’s needs for performance by adjusting automatically to spikes of the business and designating dynamically server cycles wherever and whenever it is needed.
Cloud computing suppliers also charge through subscriptions, usually on a yearly basis. In most traditional software applications, the up-front investment for software, licenses, and hardware is typically high. With cloud computing, an accounting firm can have improved IT flexibility and far greater cash flow. Also, because the accounting firm does not need to maintain servers on-site, electric consumption also goes down. More importantly, an accounting firm won’t be saddled with IT resources but can redistribute them to a more important business undertaking. The problem of system upgrades, uptime, scalability, maintenance, and security are often left to the cloud computing vendor.
Some common disadvantages of cloud computing include restrictions in the applications, operating systems, and infrastructure options. Because the cloud computing supplier can only offer what they already have. Also, an accounting firm doesn’t really know where its data is because everything will be in the cloud. Attestations, client files, and tax returns will be somewhere in that cloud.
In most cases, other entities will get to review, audit, and peruse an accounting firm’s data for reasons of operating efficiency and security especially if the data happens to be stored in a different country where the laws could have been different. This way, the accounting firm has no control about its access to its data. Although those cloud computing suppliers ensure to safeguard the firm’s data, these suppliers are usually those big ones, which have a long track record of reliability. It must also be noted that that a government regulation will always open the firm’s data in the cloud for any of its purposes. Also, bribery or threats can also be good reasons why the accounting firm’s data can be opened to unscrupulous persons, especially if the said firm has well known clients.
The best suggestion is for the accounting firm to tread with caution. It can make a move to the cloud slowly. Necessary matters must be ensured by the supplier like data and client securities. It is also good to read thoroughly the fine print of the contract before finally agreeing to move the firm’s applications to the cloud.
By Florence de Borja
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