Reasons Why Startups Are Preferring Cloud Application Software for Accounting

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There’s practically no function that on-premises software can perform that cloud application software can’t, and vice-versa. The main difference between the two is with regard to hosting; on-premises software is hosted locally (within the business premises) while cloud application programs are hosted on remote servers.

For those entrepreneurs who have already embraced the use of cloud-based application software, the lure of the cloud is obvious. In addition to hosting a company’s software, many cloud hosting companies offer additional benefits with regard to security and storage.

Just to give you an idea of how popular cloud application software has become, TrackAbout Container Tracking Software that tracks dumpsters is cloud-based. The number of companies still using on-premises software is dwindling faster than anyone would have predicted just a decade ago.

One of the more recent developments is the apparent excitement with startups and fast-growing firms who are preferring cloud-based accounting software to the conventional on-premises software programs. While banks and other financial institutions still take a cautious approach to cloud computing, these companies are seeing the potential benefits of doing business in the cloud and embracing the possibilities.

Here are some of the benefits that are making startups and fast-growing companies switch to software applications based in the cloud:

Avoid loss of data through loss of computer hardware

If you have handled computers long enough, then you must at some point have lost your data and tried ways to recover it. Things can be even worse when you lose the hardware in which you had stored your data. Using cloud-based application software ensures that your business does not suffer loss even when you lose your computer hardware.

Showcase an up-to-date financial state of the company

Using cloud-based accounting software, makes it easier to keep track of every financial transaction of a company without the delays and hustles of manual bookkeeping. This is especially important for fast-growing companies whose growth rate would typically be a nightmare for the staff responsible for bookkeeping.

Reduce the probability of exploitation and fraud

Available statistics indicate that 29% of startups are affected by fraud. This fraud often goes undetected, sometimes even longer than 2 years. In Mumbai India, for example, 69% of companies are adversely affected by fraud. By design, accounting software in the cloud has the necessary controls that reduce significantly the company’s risk to fraud.

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