Cloud Accounting – Three Different Solutions

Cloud computing is helping bookkeepers & business owners. Providing us with better interaction, productivity gains by cutting down manual data entry and realtime accounting. New systems also allows for collaborative communication between Accountants, Bookkeepers & Owners of business. There is also financial savings on infrastructure & associated costs. However a good internet connection is required to get the most advantage of these new systems.

As of today, there appears to be 3 different implementations of using the “internet” or the “cloud” to access accounting datafiles:

1. Browser based:   Accessible through most internet browsers, nothing special is stored on the local machine, all data and the program is provided to you from the providers servers. This requires an internet connection to access. Typically there doesn’t appear there is an ability to do a datafile backup to access the data offline. To maintain business records then either you must retain access to the providers servers or extract the data and reports and save it locally. There is no ability to work without an internet access. What is available in this space: XERO, MYOB LiveAccounts, Reckons CashBook Online
2. ASP / Hosted (Terminal Server type arrangement):   Accessible when the local machine has the ‘client' connection program ie “Remote desktop connection”. The data and program is provided to you from the providers servers, however typically the program and datafile could also be copied to your local machine and you could work with the file (by copying it) locally, giving you the ability to work either online or offline. This model is simply an internet based connection to running the program on a provided server. A backup of the data could be stored on the provided online servers or the backup could be stored locally. To maintain business records then you backup or copy the datafile locally and ensure you have a program that remains usable. You cannot work on the provided computers without an internet connection, if you have a copy of the program installed locally and copied the datafile to your local machine you could then work locally. This would require you copying the file back to the provided computer at some point. Reckons Quickbooks Online or by using your own ASP arrangement. MYOB version is a hosted or ASP licence to your MYOB product on a third party ASP host
3. Synched Desktop:   Accessible through the program installed on the local machine, all data is stored on the provided internet server and also a synchronised copy of the file is stored on the local machine. The concept is that you will “normally” work with an internet connection and all processing is made directly into the data that is on the provided server, behind the scenes the program will synchronise the “online” data with the local copy. However if the server is not available or the internet is not accessible then you can, if you must, work on the local copy (normally after a planned “checkout”) and synchronise (or overwrite) the server copy when you do have the internet connection. A backup of the datafile should be made and stored locally, which can then be restored either online or offline. To maintain business records keep a backup of the datafile locally and keep the program installed locally. MYOB AccountRightLive will provide this style of cloud computing

Backup in the cloud world
The “Provided server” does backups but……In each case above, the provided server will be (or should be) doing their backups and have redundancy in their server arrangements. However we also suggest you have local copies of your data in some form

Ultimately the business is required by law to have their business records for up to 5 years, so ultimately it is up to the business to maintain access to the detail. Today's internet based world continues to show cases of internet hacking, server breakdowns, redundancy plans that don’t kicking when required, identity theft (login theft or breaches) resulting in loss of online data etc .We remain of the opinion that best practice requires a copy of your business records to be periodically retained locally.

Multi-use
Multiperson access can be provided in each of these situations, subject to your agreement with the datafile/program providers and also the providers of the server.

“Anywhere / Anytime” Browser based requires a browser on any computer (easy). ASP requires the ASP program “Client” application in order to access the host server. Synch’d desktop requires the computer to first download the application and then to connect to the server. All are arguably anywhere / anytime but with different levels of ease.