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Holding back from embracing cloud bookkeeping

Is this a good enough reason to hold off embracing cloud bookkeeping?

We ran a poll during this morning's webinar on the subject of preparing for MTD if you're not yet on the cloud.

The webinar was hosted by Tom Herbert for AccountingWeb with me as the guest influencer 'expert' speaker and Varun Singh, head of marketing for ZohoBooks who sponsored the webinar.

The audience comprised accountants who had not, I assumed, embraced the cloud. No doubt some were hoping I would wave a magic wand but sadly each accountant has to decide for themselves what preparation will best suit them, their client base and their future.

In this context we posed the Q: Do you plan to still be in practice in ten years time?

Over half (52%) chose the option: "NO. I will have retired or sold my practice".

I had made the point that “Within 10 years there will be new ways for clients to access most of what general practice accountants do for them in 2018” Some of those changes will come a lot sooner than 10 years, but perhaps not as soon as some commentators and vendors suggest.

Of course, if you don't plan to stay in practice for too long you can probably afford to hold off doing things very differently. And that includes adopting cloud bookkeeping for your practice and encouraging clients to make the move.

I'm keen to hear what AccountingWeb members think on this topic.

Replies

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By tom123
13th Dec 2018 16:39

Well, I often feel at the other end of the spectrum from the more typical Aweb user, but, working in industry, with medium sized corporate systems, I have no desire to replace on premise systems with cloud for something core like finance.

I can see us using web based applications for some more niche things, and we must be registered with dozen different customer/supplier portals.

The speed is not really there at present, to cope with volume transactions being posted by experienced and trained staff.

Also, with proper IT regimes, I trust my own location.

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By Maslins
13th Dec 2018 16:44

5 years ago I used to mock the old codger accountants who responded to every new change (eg RTI) with "I've had enough, I'm retiring".

At the tender age of 37 I feel I am now one of said old codger accountants.

99% of our clients use FreeAgent so MTD shouldn't be too big a deal...but things like GDPR, AML, and IT in general, I do feel as though the risk of getting in massive trouble for making a non accounting/tax mistake is ever growing.

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13th Dec 2018 17:08

Whilst the tools may be there for clients to "DIY" people choose not to.

Talking of DIY, I can go and hire all sorts of tools, but if i dont know how to use them, I will bodge it and it would be easier and quicker to hire a pro.

I have clients on the cloud and clients who are not. Both are happy. I don't think I should dictate to clients, but allow them to use the best solution for their business.

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By Matrix
13th Dec 2018 17:10

My practice is client driven so clients choose, although there is one cloud software which I may make new clients use going forward which will make our life easier.

While I am not retiring anytime soon, many of my larger clients probably will in the next 10 years. They are averse to change so will only move to the cloud when mandatory. They have been in business 20-30 years and have never paid for software (although their internal bookkeeping fees are probably quite high).

Most of my smaller VAT registered clients have come to me as start ups and are on the cloud. Some use excel but not VAT registered (although they could use me more for real time advice if they did change but their choice).

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13th Dec 2018 19:39

Inherent inertia still rules meaning that changes that might be embraced and encouraged in other business sectors will take twice as long in ours and I often feel that, if it wasn't young clients and .GOV, we, like the NHS, would be faced with offloading thousands of fax machines.

When small biz accounting first started to computerise in the early 80s, the same loss of security fear that was used to dismiss it, is now used to dismiss cloud, ie "I want to know that the numbers are safe in the book in my safe" has become "I want to know my data is safe on my pc" (before logging in to internet banking and shopping!)

As far as clients are concerned, there's an element of cart & horse in that most clients still rely on and expect their accountant to advise on the best methods and systems to use and so are infected by inertia, bias and fear.

Fortunately, younger entrants to business now research and find their own accounting systems online whilst others wonder at how suppliers are able to email them invoices from their bookkeeping when they are still printing out and posting theirs (before taking a photocopy for their accountant).

I've spoken to several firms who only finally succumbed when they had to turn away the second potential client because they couldn't support their cloud accounting.

As far as DIY is concerned, you either treat cloud accounting as you did Sage desktop and tell clients they are still too (if not more) incompetent to handle it, or you embrace the main benefit of it, and share the work around.
The fact that desktop software restricts use to the person sitting in front of it, is a barrier to progress and not a natural way to keep the client in the dark and protect your fees.

So, thank .GOD (sorry .GOV) for MTD and it's such a shame that on the day it hits I'll be waking up to retirement (that bit IS tongue in cheek :)

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By jane
13th Dec 2018 22:38

Cloud based software is ok if one is operating in the metropolis with fast, reliable broadband.

However, up the farm track, when the internet drops in and out several times a day, whilst I'm there anyway, a program that sits on the desktop is the way to go!

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to jane
14th Dec 2018 10:28

Yes, of course, it's pointless banging on about the wonders of cloud accounting if you have no internet service, a bit like banging on about deskbound software during a power cut, but it's a fallacy to believe you need a fast or broadband connection.

For many weeks each year, since I started using it 7 years ago, I have run my entire cloud based practice from a caravan in a field in Dorset using the 3G hotspot on my phone.

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14th Dec 2018 10:36

I am waiting for one of the big cloud bookkeeping services to be blatantly hacked.

Can you imagine the chaos and outcry?

I would assume it is more likely that, despite improved security, these would be hacked as there would be greater "fame"/"glory" for something larger and more public rather than breaking into a single firm's system.

No idea how easy it would be to tell if any system were hacked for a subtle profit making objective...

SC

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to Sperethiel
14th Dec 2018 12:45

Really? I'd rather wait for Easter or worry about something with more certainty, like climate breakdown.

When I look at how many times I and clients access the internet for everything, not just accounting, surely cloud accounting, that uses bank security, is at the bottom of the glass half empty anxieties?

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By mumpin
to Sperethiel
14th Dec 2018 12:47

One of my clients' server got hacked.
They went into Quickbooks and edited the bank payment details on his sales invoices to their own.
He lost £25k.
His customers paid the bogus account.
His insurers said he wasnt covered for Cyber Crime.

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By jane
to mumpin
14th Dec 2018 16:14

mumpin wrote:

One of my clients' server got hacked.
They went into Quickbooks and edited the bank payment details on his sales invoices to their own.
He lost £25k.
His customers paid the bogus account.
His insurers said he wasnt covered for Cyber Crime.

Wow - terrifying!
One of my customers, having suffered 3 occasions of cheque fraud and two spurious standing orders being set up, was advised by the Bank not to include his details on invoices any longer.

Generally speaking customers of a business only need the bank details once to set up a payee - my customer and I are more than happy to take a phone call - rather that than see his account emptied!

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By Mr_awol
14th Dec 2018 16:29

It depends on the practice.

I used to be amazed by the number of people on AWeb who seemingly operate a cloud only practice, make a real success of it, and made me feel like a complete luddite. Then, I gradually realised that most of them are one man bands with c30-40 clients in total (making a good living, admittedly, but where it's much easier to follow the no timesheet, flat monthly charge model).

For a more traditionally sized/structured practice, cloud accounting can be helpful but in many cases an 'old fashioned' approach works better. It certainly provides a more reliable/accurate end product.

Of course, the software companies are pushing us all to embrace the monthly billing option - because in most cases it's a ball-ache to recharge so it's better for us to increase the monthly retail sub and absorb the cost. In fact this just means that they get paid for a whole lot of business and we suffer the bad debts and the extra time taken to take 'automated' records to the level of accuracy that we are used to providing.

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By Matrix
to Mr_awol
14th Dec 2018 17:26

We became a Xero partner and set up our first client, we pay and recharge to the client which is now a failed start-up. If they don’t transfer the licence to themselves then we will have to pay a cancellation fee which Xero won’t refund us. Clients can sign up directly from now on since we could end up with unpaid subs yet Xero win.

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17th Dec 2018 13:03

Although I have no aversion to the cloud, the vast majority of my clients are on VT. I do their bookkeeping and year end accounts (on Taxfiler) so I do not feel the need to spend out unnecessarily on cloud software. That said, I will work with it, and my latest client, who is on Xero, will continue to use cloud, albeit Pandle, because she doesn't need all the bells and whistles, all she did was raise invoices, the Accountant did the rest, thus saving her £300 a year.

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19th Dec 2018 14:24

We are one of the aforementioned "I would love to just retire" practices. I and my partner are both in our early 60's. I have ever embraced change and love the challenge of it - but am feeling definitely drained now by all of the recent challenges.

Our clients are 50/50 older established business's and more recent startups. The older business's don't want to change and don't see the need, the younger business's are very focussed on driving their business forward so don't want the distraction.

On another front - for interest: since MTD became a red hot potatoe we have deregistered 5 clients from VAT, had 6 clients finish their business's, have at least another 6 who are going to retire early, and 4 business's are up for sale. Are they sure that MTD will increase the tax take???

Not Cloud for us - we will stick with VT for our work and allow the clients to choose a package to suit themselves. Now VT has announced MTD filing functionality it's all good. We file through TaxCalc anyway and see no reason to change.

Ready to retire - Yep sure am!

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19th Dec 2018 15:46

Sounds like scaremongering bullshit to me!

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