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The Cloud

I just don't get the fuss

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I know this has probably been debated until everyone is blue in the face but reading through Aweb there appears to be a lot of people rushing to become a cloud only practice and I just don't understand why. Will this not lead to a potential loss of business where the client could be a fantastic client but they would prefer you to keep their records digitally rather than be involved in the whole process by entering items on the cloud. 

bank feeds are great but I have hit a stumbling block when the bank want you to have the card reader when refreshing, this wastes time having to get in touch with the client etc. Apart from that I have found the cloud to be a lot slower than desktop. We use VT and this allows us to get jobs loaded so much quicker. 

There is also the argument that you can work from anywhere but surely no one wants to be sat at home at 9pm working away on the cloud? 

Am I missing something fantastic about the cloud? 

Replies (35)

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By NLB
25th Jul 2017 08:20

Probably.....

For me the cloud is a tool to be deployed to achieve a client (or practice) objective rather than cloud for clouds sake.

Implementation is also important. If you are using tokens/readers to refresh feeds then perhaps your choice of cloud or feed type needs reviewing?

There are more considerations on choice and implementation than perhaps the vendors would like to admit so go back to basics and understand the 'WHY' client by client first and the rest will follow, including a decision that perhaps it is not appropriate.

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By Chris Mann
25th Jul 2017 08:36

Paul Scholes (long standing Aweb member) has great experience of this topic and, you may find some benefit from his contributions
https://www.accountingweb.co.uk/profile/paul-scholes

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By mabzden
25th Jul 2017 10:31

I'm a cloud fan. It makes running IT systems easy, cuts the time you waste installing software and updates (and calling the support line for help), reduces the need for back ups and leaves you far less vulnerable to disasters (e.g. sudden hardware failure, flood/fire and, increasingly, ransomware or other viruses).

Running desktop software is like keeping all your money under the mattress. It will probably be OK, but you're only one piece of bad luck away from losing your life savings.

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Teignmouth
By Paul Scholes
25th Jul 2017 11:10

Hi PennyPincher & thanks Chris - there are so many ways that firms make use (or don't) of the full benefits of the cloud that it's difficult to summarise them here.

For me the main benefits have been a far easier route to training clients up to keep their own books and then to monitor and support them throughout the year to keep the books accurate and up to date, resulting in them being useful to run the business. This then cuts my year end work to a fraction of what it used to be and, in most cases, the year end accounts are pretty much a form filling exercise over in a few hours.

It also means I keep in regular contact with clients and so am able to grab opportunities to help them on other, more interesting stuff.

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By andy.partridge
25th Jul 2017 11:28

I'm with the OP. I have not experienced the positives because in my experience:
1. Some clients are reluctant to change the way they do things or spend additional time on a something that doesn't create sales
2. Some clients use the software just for things that are important to them and not the bigger picture
3. Some clients have confidence that no matter how (poorly) they use the software, their accountant will sort it at the the year-end. It saves them the hassle of learning and developing their skills in something that doesn't sufficiently interest them.

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Replying to andy.partridge:
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By newby
01st Sep 2017 18:49

I agree with OP, yet to be convinced. Small practice just a few clients but found cloud software slow and inflexible.
And don't get me started on the problems with invoices to EU!

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By mabzden
25th Jul 2017 11:47

Despite being pro-cloud in general, there are issues with allowing clients access to a bookkeeping system (whether cloudbased or not) that they don't know how to use.

My least-favorite client (from an accounting perspective) does his own bookkeeping "because it's cheaper" and sends me with the worst set of data you've ever seen a few days before the deadline. Debtors will be showing as a credit, P&L items will be included as balance sheet items, advances from the director will be included in turnover plus many, many other issues.

It normally takes me weeks to untangle the data and work out a sensible TB. I would much prefer a spreadsheet or even a carrier bag of paperwork.

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Replying to mabzden:
By mrme89
25th Jul 2017 12:10

Have you considered writing down all the issues you have with their records, and sending it across with a quote with what it would cost him if he did a better job of the record keeping? To keep the balance, send him another quote outlining a large increase with what it will be if the issues are not addressed.

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Replying to mabzden:
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By Robbo
27th Jul 2017 11:45

And still expects it to be cheaper because of his efforts.

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By Glenn Martin
25th Jul 2017 13:14

You need to look beyond just the bookkeeping software. Break the job down into it elements.
Now you can get tills that link to xero so when you z the till it posts the journal to xero for your days takings, you can get feeds for pdq machines as well as bank feeds, through in AutoEntry to sort out the purchasing and you have end to end system

Compared to a desk based system it's far slicker. Yes the benefits are not all there for a 1 man band but for trading business that buy and sell products and looking to grow their business the benefits are there and clients are looking to
Buy this sort of service. I was dubious at first but penny dropped with me once you start tying in the add ons

And as for do people want to log in at 9.00 pm and do some invoicing yes they do as many people work outside 9to5

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Replying to Glennzy:
Teignmouth
By Paul Scholes
25th Jul 2017 16:27

On the POS apps that link with Xero, my client showed me the EPOS app he developed that also posts the staff hours logged in to Xero payroll!

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Replying to Paul Scholes:
By Glenn Martin
25th Jul 2017 16:45

That's a nice touch and I could use something like with my bar/restaurant clients as the staff clock in via the rill system.

It's the future Paul.

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By Eric T
25th Jul 2017 13:17

I've always been a bit wary of clients who try to use what are, in effect, double entry book-keeping and accounting systems when they haven't had any sort of grounding in "ye olde" debits and credits and the other fine points of accounting - such as then concepts of "revenue" and "capital".

These issues began a long time ago, way before the cloud was even a wisp of vapour. I remember seeing clients making a total hash of Sage/Quickbooks etc (pick a bookkeeping software system - any system).

I always likened it to letting a youngster drive a bus. They might know where they want to go - but they don't know what all the controls do.

As for "The Cloud", it's just more of the same.

I've looked at The Cloud from both sides now
From up and down, and still somehow
It's cloud illusions I recall
I really don't know The Cloud, at all

(Apologies to Ms Mitchell - but she was very prescient).

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Replying to Eric T:
Teignmouth
By Paul Scholes
25th Jul 2017 16:52

Eric - resisting the temptation to have a go at your blasphemy in taking the words of Joni in vain, I think you are missing the point here.

The Cloud systems are a complete rewrite of the old deskbound stuff with many designed with the user rather than accountant in mind, so just because you can't see any debits & credits anywhere doesn't mean it does what it says on the tin.

My clients are no different to anyone else's it's just that I've helped them to use the software, something I would have loved to have done with deskbound stuff but it was just too time consuming.

We con ourselves if we think this stuff is still rocket science, having trained both accountants and users in this stuff I often find many users are as proficient (if not more so) than the accountants, with much of this being down to "it doesn't look and work like Sage so it must be rubbish".

In many cases clients won't be able to handle everything but a key difference between Cloud and terrestrial software is that you can share the tasks, with the client, and bookkeeper/accountant each doing what they are willing and able and best suited to do.

So many accountants just replace deskbound software with Cloud stuff without changing any of their previous processes, so they leave the client alone for a year and get the same old bunch of crap they got with Sage. I've even known some refuse to login to the client's books at all and ask them to print off and post year end TBs and nominal ledger prints!

Then of course when nothing has changed and the accounts are a mess it's all the cloud software's fault, it isn't.

Yes, it won't suit everyone and I still have a few clients using spreadsheets and even one on S*ge but we now have a wealth of products to chose from to best suit how we and the clients want to work and so, if clients don't use it it's because it doesn't suit them, or, for goodness sake, if you can see the benefits of cloud working but a client refuses because they don't like change, then get rid of them, why should they determine what's right for you and the rest of your clients?

Joni's song is "Both sides now"

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Replying to Paul Scholes:
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By D V Fields
28th Jul 2017 09:37

Paul Scholes wrote:

Eric - resisting the temptation to have a go at your blasphemy in taking the words of Joni in vain, I think you are missing the point here.


I don't think anyone is missing the point. Cloud technology is here. If you say “cloud is the future” often enough it may be believed. However it remains a tool for accountants to use. It is a means to an end – it is not the end. Ultimately people make the decisions.

“The Cloud systems are a complete rewrite of the old deskbound stuff with many designed with the user rather than accountant in mind, so just because you can't see any debits & credits anywhere doesn't mean it does what it says on the tin.”

Similar thing – different location. You can access desktop stuff via the internet, so the choice is really about where you want a) the software located and b) your data located. The pricing model for cloud based is obviously attractive for the suppliers. Obviously security is not a big issue because you have total guarantees that your data will never be compromised; no passwords will be revealed or temporary access granted to government officials that ask for them. Reassuring. You could safeguard it a little more - they cannot give away what they do not have!

So they are for end-users not the accountant. Maybe that says everything that needs to be said.

"it doesn't look and work like Sage so it must be rubbish".
If it does not work and look like SAGE – that’s a good thing isn’t it?

“if clients don't use it it's because it doesn't suit them, or, for goodness sake, if you can see the benefits of cloud working but a client refuses because they don't like change, then get rid of them, why should they determine what's right for you and the rest of your clients?”
Yeah – they are just idiots aren’t they?

Those that like cloud based technology will use it; those that do not will not. The choice is ours. You pay your money you make your choice.

“But now they only block the sun
They rain and snow on everyone
So many things I would have done
But clouds got in my way”

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By Eric T
27th Jul 2017 11:46

As Joni could see "both sides" I reckon she was a Debit/Credit girl at heart.

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Replying to Eric T:
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By john hextall
27th Jul 2017 12:17

No doubt about that! Her colleague, Janis Ian definitely was - So remember those who win the game
Lose the love they sought to gain
In debitures of quality and dubious integrity
Their small-town eyes will gape at you
In dull surprise when payment due
Exceeds accounts received at seventeen...

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By Eric T
27th Jul 2017 11:50

I will ask though - are you saying that using these new software techniques somehow endows the untrained user with accounting knowledge superior to that of professional accountants?

Or was all that blood sweat and tears and years of study and deprivation followed by 40 years of workplace experience all now of no use to me?

And is the Trial Balance REALLY of no relevance?

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Replying to Eric T:
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By andy.partridge
27th Jul 2017 12:12

Eric, what troubles me is the over-simplification, yet the facility to do more advanced things. Real life examples:
. where the program 'automatically' calculates corporation tax for the user without any sense of period-end adjustments,
. the 10p a month automatic depreciation when the user has put a new stapler to 'equipment',
. the program prohibiting a posting to dividends because it had wrongly deemed there were insufficient reserves.

It's like making driving a car so easy a small child can do it then putting them on the road at the wheel of an F1.

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Replying to andy.partridge:
Teignmouth
By Paul Scholes
28th Jul 2017 09:38

1. So put the year end adjustments in the books as the year progresses, you don't have to wait till the year end anymore the books are no longer on the director's laptop. This also means that the books are far more accurate throughout the year, helping the client see how they are doing and to give more confidence when deciding on dividends

2. So tell them not to put anything under £X to fixed assets accounts. My clients' books have accounts such as "Equipment expensed <£100" to act as aprmpt when they go to post the cost. Yes they will forget sometimes but, as I'm logging in every few months I spot it and it only takes a few seconds to correct and to remind them, in fact when I changed the category on a FreeAgent Fixed asset last month the depreciation automatically vanished.

Try the glass half full approach, even if the depreciation that's being automatically posted to the books every month is £10 overstated, surely it's preferable to having to wait till months after the year end when you come along with your fixed asset register spreadsheet, spend hours updating it and calculating depreciation, only to find that the dividends are no longer covered?

3. None of the software I use prohibit a dividend being posted, I'd be interested to know which one you're referring to. Again though, with glass half full, as I say above, I'd much prefer my clients to have some idea of the profits available for dividend than no idea at all till I come along. Two of my ClearBooks clients now handle their own dividends, something I'd not have imagined a ew years back. The books are 90%+ correct so they can see the profit levels and the software produces the minutes and voucher and a year end certificate for each shareholder, this is progress.

Re your driving analogy, as I say on another post, many accountants still just sign up the client for software and leave them to it with no training, whereas it's in my interests that they use it correctly and so, until they do, I sit in the passenger seat with full dual controls, till, in 2-3 months, I'm happy they know what they are doing.

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Replying to Eric T:
Mike Cooper HJS
By mike_uk_1983
27th Jul 2017 13:15

Paul is not saying that experience and training is not useful what he is saying is do you really what to use that time and experience to once a year on each client undo the mess they have created or would you rather work with them through the year so they can get the basic TB together and you can then come in make the final adjustment, look at the tax and carry out tax planning.

Use your skills and experience to do the part of the job the client cant do and add value to their work.

Most the bookkeeping isnt double entry its data entry. All they need to know is how to enter in the transactions. With the cloud you can log in and check how they are getting on. If they have an issue they can call you up and you can look at the same screen as them while discussing the problem.

This is the way forward. Spending less time on compliance and more on planning and adding value.

Thanks (1)
Replying to Eric T:
Teignmouth
By Paul Scholes
28th Jul 2017 09:13

With regard to use of software to do basic bookkeeping, yes, I've trained "punters" that end up doing a better job than the accountants I trained, or rather, in some cases, tried to train. The problem with many accountants is that they have had little hands-on experience of bookkeeping in the past (feeling perhaps it was below them) and, with those that did, being so fixed with Sage or VT, found the transition to 21st century software hard to get through.

One accountant I trained, who had only ever used VT, was still trying to get his own practice's accounts right three months after I'd trained him, only to find that his cloud accounting unearthed the fact that he'd been wrongly accounting for VAT cash accounting for years.

Give me a fresh non-accountant trainee any time, they have no preconceptions and the software is presented to them in terms they understand. They also tend to be less fearful of letting an unknown server hundreds of miles away look after their data.

Whether or not accountants, or users, are "professional" is more to do with ethical considerations than software. I've just taken over a client from a supposedly "professional" accountant where my dog could have made a better job of the accounts.

If you've spent 40 years trying to get to grips with bookkeeping software then I'd have some understanding of your question and might suggest that you'd chosen the wrong "profession" but, having said that, the majority of my clients on Cloud software, with the occasional login from me during the year, now produce a P&L and balance sheet at the year end that might only need an hour's work from me to get them fit for the stat accounts.

Of course the TB still has relevance but I don't ask clients to print it off and post it to me, or even email it to me, I login and download it myself, after I'm happy the books are perfect, and instal it in my year end software.

So, other than sometimes having to tweaking the CT provision, there are no post accounts year end adjustments in the books and no need to explain to the client where the debtors, creditors, fixed assets or P&L items come from, they can login and see for themselves.

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Replying to Eric T:
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By D V Fields
28th Jul 2017 13:46

Eric T wrote:

And is the Trial Balance REALLY of no relevance?


... have you seen the ones that give a trial balance between two dates? (Not a cloud one either).
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By raybackler
27th Jul 2017 13:07

I have to agree with Paul Scholes on the benefits of cloud accounting.

I have about 50 clients, all on Liberty Accounts and, as I write, only 5 have not had their 31st March year end accounts completed. In each case on the last 5 it is just waiting for a few final bits of information, with no significant information missing.

We don't expect our clients to do all of the bookkeeping. Most raise sales invoices and receive the money against them and that is it. Some process expenses and the larger clients run a purchase ledger. We run the fully integrated payroll each month and complete bank reconciliations from a bank feed or upload the transactions from a csv file if we don't get a bank feed. The result is that as I sit here virtually all of our clients are up to date to 30th June and those who are VAT registered have had their returns filed with no hassle.

Whilst doing this work, we can contact any client with a problem and discuss what needs to be done. When it gets to March, the data is up to date to the end of February, so we can go through each client making sure dividends are up to date and the tax position is clearly understood for December Corporation Tax and January self assessment. Clients get reliable forecasts and no surprises.

This all comes about because we work with clients during the year, collaborating as we go, rather than having a post tax year end exercise completed just before the tax is due. This is only possible with the shared workload between us and the client using cloud systems.

What I am talking about is the different way of working from the traditional practice, outlined by Paul, that can only come about because of cloud based systems.

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By Briar
27th Jul 2017 15:49

What about clients who have a lousy internet speed? How does that work with the cloud? Indeed, what about accountants who have a lousy internet speed (like me - never faster than 800kb per sec!!!)?

I banged on about this when we were discussing MTD. Everyone seems to assume these days that everyone has fast internet speeds - it isn't true. Come to Cumbria and find out (and our mobile signals are not good either!).

But our lakes and fells are fantastic.

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Man of Kent
By Kent accountant
27th Jul 2017 17:02

It brings a big smile to my face when I hear about so many accountants NOT embracing the cloud.

Means more business for those of us who do 'get it'.

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Replying to Kent accountant:
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By andy.partridge
27th Jul 2017 17:28

It brings a smile to my face when accountants fail to realise that proportionally more clients need to 'get it' than accountants for there to be more business for them.

I'm not convinced it's clients driving this.

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Replying to andy.partridge:
Man of Kent
By Kent accountant
27th Jul 2017 18:08

That will depend on the type of clients you attract, if its younger tech/online/professional services business, then highly likely they will already be cloud users - no 'sell' needed.

If your client base is older businesses, construction & manufacturing sector, cash based and/or with manual records then you have a big job on your hands - it will need a major shift in mindset and business admin.

All of our new clients have to use Xero or they won't be clients.

We get a steady stream of referrals, no need to advertise or chase business. Every client that has started to use Xero has seen the benefits it brings.

...still smiling... :o)

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Replying to Kent accountant:
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By andy.partridge
27th Jul 2017 18:19

No Luddite here.

We have our accountant login to Xero, Clear Books, Freeagent, Quickfile etc. Interesting that you stipulate Xero or the highway. We are totally flexible and recognise that there is no one-size-fits-all program or client. Seems to me there is a case of you being restrictive and others having the last laugh unless you are confident that Xero is today's VHS or Excel in the marketplace.

I think there is much more jockeying for position to do yet.

Well done on the referrals, but it could it be because you and your firm are good rather than the merits of Xero?

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Replying to andy.partridge:
Man of Kent
By Kent accountant
27th Jul 2017 18:57

Yes, could be being restrictive but I find it far easier to stay on top of one software package than several.

Jockeying for position - I agree but I think its important to have a strong position on where you stand, rather than flit between software, business strategies that some prominent members on here do - doesn't send a very good message out to clients.

I have also had client say that it refreshing to be 'told' which package to use rather than be given several alternatives and told to choose.

Also allows us to streamline our processes and to be able to pick up and get to grips with a clients records and processes quickly

I think we've backed the right horse for us, others will be different and that's great.

Good service - I'd like to think so, and yes that's mostly down to attitude and personal standards rather than software.

That being said Xero is integral to the practice.

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By raybackler
27th Jul 2017 22:59

Totally agree with Kent Accountant. Once you decide on the best software for your practice, you quickly become an expert, which cuts client costs. Being a jack of all software trades is wrong. Of course, no accountant should ever force a client into inappropriate software, but today's cloud offerings are capable of handling virtually all small business requirements.

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Replying to raybackler:
Teignmouth
By Paul Scholes
28th Jul 2017 10:04

I certainly agree that being an expert in one system is far preferable to having a sparse knowledge of several but, in my client base, no two clients are the same and there will be occasions where another one of the apps is preferable to my chosen favourite. So whilst clients used to accounting principles fit well with Xero I find accounting newbies far easier to train on the less fussy and overburdened screens of other systems.

I'd also put building contractors on Clearbooks as it has a fully functioning CIS system. Similarly, despite the hype about Xero and charities, any charity I dealt with would be directed to Liberty Accounts.

This is how I and my client base work but that's not a gospel for all firms and the one app approach for Kent Accountant clearly works for him, as it does for bookkeeping practices, where clients are allowed little access to the books.

Ironically, having managed to get my Xero client numbers, down to 1, a new Xero double company client arrived a couple of months ago who have used Xero for years and, being an interesting proposition, I wasn't going to let the fact they used Xero put me off saying yes. Similarly, after having tried Kashflow (and I mean tried) I promised myself I'd never get involved, but a brilliant proposition turned up and, despite it taking a year to work out how the hell it does what it does, or doesn't, I'll stick with it as it suits the client.

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By Glenn Martin
28th Jul 2017 13:58

A big thing for me when returning to practice 4 years ago after 13 years in FD roles was all the choice that was now available which has to be a good thing.

I spent (wasted) a lot of time looking at them all before deciding on my weapon of choice, although at this stage i will support clients on other products but only actively recommend Xero.

When looking around though I noticed a lot of new startup practices that after a few years of trading were boasting client numbers of 500 + all were Xero based practices.

I trained with a 60 year old firm with a very good reputation but i would be suprised if we signed up 500 clients in the 10 years I worked there.

So I kept coming back to how these Xero practices should enjoy such rapid growth, something you couldn't ignore.

You don't really see this level of success with other cloud platforms although I appreciate Xero shout about it a lot more.

After a lot of digging and speaking with the guys from the practices the penny dropped as to why it works.

I left my industry job as I had become bored with the whole process of spreadsheets and endless drab reports that no one ever really looked at and where just filed after ticking a box with the bank.

I actually enjoy working in accountancy again now as you are actively working with your clients to do a better job for them, the new tools available allow you to do this.

The benefits for a sole trader are less but anyone looking to grow their business would need to use this to be succesful IMO.

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Replying to Glennzy:
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By NLB
28th Jul 2017 12:43

Similar story here to Glennzy. I just laugh at threads like this where accountants still are not sold on cloud. Paul above explains the benefits very well so I don't need to reiterate those. I am actually looking forward to MTD as see it as a big opportunity.

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Teignmouth
By Paul Scholes
28th Jul 2017 15:02

The nature of the debate is very reminiscent of 10 years ago on here over going paperless and dropping time sheets and I always wonder what happened to the accountants that swore they'd never go with either, maybe changes were forced by clients?

Somebody above voiced doubt over client lead pressure but my experience has been that new clients arrive already in the cloud or wishing to go there.

And on the topic of experience, as 10 years ago when people said the new approaches would never work, that's fine if you've given it a serious go and decided that it's not for you, but, you really have no idea of the benefits until you try it properly.

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