You're probably well aware of the rise of cloud based bookkeeping programs such as QuickBooks Online, Wave, Xero, Freshbooks, etc. These programs certainly make a business owner's life easier. We couldn't agree more! In fact, these programs are incredibly helpful to bookkeepers and accountants as well. Never before in history has bookkeeping become more streamlined, transparent, and flexible.
Despite the advantages of these platforms, cloud based systems still have their limitations that prevent them from automatically deriving a complete, reliable and accurate result that a professional bookkeeper will provide.
However, we're commonly asked why one of these cloud based bookkeeping systems can't replace the need for a bookkeeper. Software is commonly used to store data "in the cloud" instead of on your local server, making it accessible from wherever you may be, as long as you have an internet connection. Plus, due to this software being available on a subscription basis, business owners save upfront costs involved in buying the software outright and installing it locally where its accessibility is limited. These are definite advantages, but because of the automated processes of importing bank feeds, many business owners assume that this replaces the need of a bookkeeper.
That couldn't be further from the truth, and if you are using a cloud based service INSTEAD of a bookkeeper (and not in tandem with a GOOD bookkeeper), you're making a big mistake.
Yes, you now have the ease of accessibility and definite cost benefits, there are several other factors that should be taken into consideration. Bookkeeping requires knowledge, accuracy, and precision when handling the complexities of the business transactions. Especially when a company needs to pay quarterly taxes, has various loans, imports payroll transactions, and on and on.
A professional Bookkeeper can handle complex transactions, oversee the data and systems and spot an oversight or error which a cloud program can't detect. At least not yet. We routinely hear about business owners who get rid of their bookkeeper because they now think these software programs are all they need. Then they run into problems. When they come to us, we end up finding mistakes in postings, discrepancies between profit and loss items, balance sheets, and incorrect reconciling. A software system like QuickBooks online is needed, yes, but you still require a certified bookkeeper who can process the information correctly.
In conclusion, a cloud based bookkeeping system cannot replace a bookkeeper, yes, it will reduce the time required for bookkeeping (which is why we ALWAYS suggest using one) however, it should never replace your bookkeeper. If you have questions about how to best utilize these systems, or even receive savings on QuickBooks Online at our discounted wholesale price, give The Bean Counters Bookkeeping a call at 912-376-9918.