Many companies have discovered that they benefit from adopting cloud-based accounting software. Making the switch to new software, however, requires a transitional period. If you’re interested in using cloud accounting software, incorporate these five tips into your transition. They should make the process smoother.
Know the Benefits of Transitioning to the Cloud
Before you make a plan that helps you transition from traditional to cloud-based accounting software, you should learn about the benefits of doing so.
Here are some of the most beneficial aspects of switching to the cloud:
- Boost your business’s productivity.
- Improve transparency so that you have a better view of your company’s finances.
- Let your employees work from any location that has internet access.
- Reduce disaster recovery time.
- Update your software automatically without additional IT expense.
Of course, some software will give you better features than others. For instance, cloud accounting software from Sage One uses business insights to help you find ways to reduce business expenses and increase revenue. It can also generate electronic invoices that will help you get paid quickly. These are features that not all cloud-based accounting software offers.
Take Time to Learn About Your New Software
Good accounting software should have an intuitive interface that makes it relatively easy for employees to use. Even the best software, however, will take some time for your employees to learn. Take advantage of free trials so that your employees can experiment with the software and discover useful features. Many software developers also produce instructional videos that will introduce your employees to new accounting programs. Use this low-cost training option to familiarize everyone with the new software.
Run Parallel Systems for a Few Months
Don’t get rid of your old accounting software as soon as you start transitioning to the cloud. While cloud-based software will benefit your business, it makes sense to run parallel systems for a few months. That gives your employees an opportunity to adjust to changes. It will also help your company make sure that it transitions all of its important information to the new system. If you abandon the old software too soon, you may inadvertently lose some of the data your new system needs to do its job properly.
Make a Checklist of Crucial Information for the New System
During the transition, meet with your CPA to create a checklist of crucial information and documents needed to manage your company’s finances. Here is some information your CPA will probably put on the list:
- Gross receipts
- 1099-MISC forms
- Travel expenses
- Depreciation of assets
- Credit card statements
Your list may differ depending on your company’s size and industry, which is why you should meet with a professional who understands your business. Once you and your CPA have made a checklist, you can start using your old software less often. At this point, it won’t take long before the old program becomes obsolete.
Complete the Switch at the Start of Your Fiscal Year
The beginning of your company’s fiscal year gives you the perfect time to complete a transition from old accounting software to an option based on cloud technology. As the date approaches, you can finalize all your accounting reports to make sure you don’t ignore crucial data. It’s a good idea to move that information to your new software so that you can access it in the future. Printing a hard copy can also protect you from any hiccups you may encounter, although you should know the cloud software well by this time.
On the first day of the fiscal year, shut down the old accounting software and start fresh with the new program. That way, you don’t have to worry that you’ve abandoned income, expenses, or other data that affect your financial records.
Cloud accounting offers enough benefits that you should consider leaving behind your old software. Most companies find that cloud software helps them improve productivity while lowering costs. As long as you follow a smart transition plan, adopting cloud accounting should help your company do this as well.