You have carefully planned your company’s goals and budget for coming years and decided to move to the cloud. Now you also must decide whether you want to host the accounting application in private, public or hybrid cloud. Each model comes with its own benefits as well as challenges.

To select the right cloud accounting solution, it is important to understand the impact it can have on your accounting operations.

What Type of Cloud Is Right for Your Accounting Firm

Let us first evaluate different types of cloud:

  1. Public: This model is the most recognizable model under which services are provided in a virtualized environment by third-party providers over public internet. It makes them available to anyone willing to use or buy.
  2. Private: Private cloud provides services over the internet or private internal network to selected users, limiting the number of users who can access the data or applications.
  3. Hybrid: Hybrid cloud is an integrated service which combines private and public cloud by allowing applications or data to be shared between them. Gartner’s research suggests that companies should design private cloud services with hybrid future in mind, ensuring future integration.

To understand which cloud platform is the best for your accounting firm, consider few questions below:

1. How important is security for your business?

Security is the most important factor for any accounting firm. Compromising accounting data of even a single client can prove to be costly for your firm and damage reputation. Having the right cloud model can make a lot of difference for your company.

While public cloud provides security to some extent, private clouds are more secure. This is achieved through different pools resource having restricted access to connections created from company’s internal hosting, firewall or dedicated leased lines.

2. How much do you spend on your IT?

When was the last time you checked your IT costs? An article by CIO explains the operational costs which should be considered while going through the company’s IT costs. With public cloud, you share hardware, accounting applications, data center and operating system with other users.

This makes it a low-cost option. Companies like Amazon, Google, Salesforce, and Microsoft have used the concept of the public cloud to offer small accounting firms a competitive advantage with affordable access to leading services or software which otherwise would be unattainable. If you want to keep the IT cost minimal, a public cloud would be the best option.

3. How many offices do you have?

If you are planning to expand your firm into multiple locations, it would be important to have backups in a secure location. However, if you want to downsize and reduce IT expenses, a private cloud or hybrid cloud would be best fit. For example, in a warm disaster recovery scenario, a firm can keep its recovery environment in public cloud and production environment in private cloud.

Firms can spin up whenever it is necessary. in this case, firm’s data is replicated across the public cloud while other resources remain non-operational unless required.

According to a survey by Right Scale, there is a huge growth in hybrid cloud adoption in 2016.

Respondents Adopting Cloud

Why should you care?

Making a shift to the cloud – and deciding which model is the best fit for your accounting firm – is as much a business decision as it is role of IT. And the probability is, you will be taking the decision sooner or later.

Cloud has enabled small business owners to take control of their data and take the reins. Instead of purchasing products or hardware which will likely be unused, they would get an option to select the processes that would work for them.

There are numerous cloud providers, deployment options and software publishers in the market, but a good understanding of different models of cloud would help you get the right answers and make the right choice for your firm.

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