I know there have been volumes written here on the subject of cloud accounting, but I am as intrigued now as ever as to the benefits of them, and what painpoint they have solved, or do they serve only as a different way of doing what we have always done. I would love to find out if the pro-cloud bookkeepers and the 'not-so-pro'-cloud bookkeepers have the same day to day painpoint in your daily chores? or has cloud solved some problems but created new ones?
Hope this isn't too surveyesque, but would be intrigued to get a general perspective of what the cloud has really done for us.
They are more profitable for the software companies as they introduce a pay forever model and hold your data to ransom.
They are sold as more convenient but simultaneously take all control away from you so if the internet is down you are stuffed and not a damn thing that you can do about it where with a desktop solution if your PC goes down its your own fault if you don't have a backup solution.
I've had to use a few cloud packages and across the board they seem designed to look pretty but really, really, really slow down data entry as they seem to be designed around the idea that if you are using them then you must be on a mobile phone. Of course, that has given birth to a whole new industry of add on's to make data entry faster such as via receipt bank.
So, you take something that works, make out that there's a problem when there isn't. Create problems with the solution for the non existant problem then build an industry out of creating add on solutions.
My one concession to the cloud is Dropbox which keeps a local copy of everything that you use it for on every hard drive that you use so if there's no net then you can still work with your data which will be synced when t'internet returns. That I use extensively although I don't trust it as my only backup soluition.
In general then my issue is with the cloud for applications and the whole concept seems to be working on solving a problem that never existed.
At some stage some software house will announce a great new technology where speed of data input is the key driver... Oh, wait, that already exists doesn't it with all of the desktop solutions that we've been using for years!
Lol. well thats my grump for the day.... Morning Tia.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
"the action (generally illegal) of advertising goods which are an apparent bargain, with the intention of substituting inferior or more expensive goods".
And that was one of the nicer definitions of it!
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Should the whole 'cloud accounting' settle down and be seen not to actually be solving anything, How long before they end up in the loft with the bread maker and the home printer?
The modern internet cloudy/SaaS version of bait and switch is to live up to the promise at first, and actually deliver what was offered - the switch to an inferior product comes later.
It also covers things that you get for free: Get xGB of online storage free of charge: Yeah, store your files with us, completely free... "oh, hey, we've noticed that lots of you are using your full xGB; we can't really sustain that, so we're dropping it to nGB and you have 1 month before we implement this change. You'd better download your files if they're (stupidly) the only copy... alternatively, pay us £££ to keep that amount of space..."
And even things for which there's no payment *of money* expected from you: Yeah, put your information into our website, it'll be perfectly safe, and we keep private those things you want kept private... "Oh, hey, we're changing our terms and conditions about what we do with your data, and we're going to use it to track what you do online and delivery annoying adverts - and we've also decided that you don't really want some of that stuff private, so we've changed your settings for you. You can of course change them back, but really it'll be too late. And see how our CEO's settings weren't change? Neat, huh?"
And then there's the long game: Buy our software, it's sold under a perpetual licence, and you can carry on using it for as long as you like. "What's that? You need support? Actually, that version you're using is too old for us to support it, buy this newer version. In fact, buy a support contract because sod how expensive it is, we're only giving you 30 days free support. Still think it's good? Buy a new version. And a new version. And, oh, hey, we've decided that newer versions only run while you carry on paying us..."
Edit: A couple of typos, and a question: How many examples of each can you identify? :)
-- Edited by VinceH on Tuesday 13th of September 2016 02:02:34 PM
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
I am in the opposite camp to Shaun and Vince and see that cloud accounting has improved our efficiencies.
1. We can now work with the client on a remote basis and solve any issues real time.
2. Clients finding "bookkeeping" time cut with things such as bank feeds with the bank transactions automatically brought in and saving the client typing in.
3. With bank feeds such as paypal and cash coding in Xero hundreds of transactions can be reconciled in no time at all.
4. Where we do the bookkeeping we are using autoentry and importing purchase invoices/sales invoices/bank statements and saving about 50% time compared to previously.
Whether we like it or not with the MTD programme everyone is going to have to use cloud accounting or some form of app in the future to maintain their record if the government has its way.
The result unfortunately for the accounting/bookkeeping profession is that a lot of compliance work that has traditionally existed will become redundant with technology enabling clients to do a lot of it themselves. There will always be those who find too difficult or cant be bothered and use the services of an accountant/bookkeeper. However there will be competitors in the profession who are set up in such a way that they can show your clients how to be more efficient and offer other added value services as opposed to bookkeeping and year end accounts which most people see as a necessary evil.
thats not actually true about making tax digital as in the links that John (Leger) put on here it states that MTD will work with desktop sollutions in a similar way to RTI. I think that its one of those things that been bandied around for so long by those confusing online and the cloud that people such as ourselves are seeing even official announcements from software companies and professional bodies refering to the cloud where they should simply be stating online.
I have seen a statement from VT that they will be able to handle MTD but they like all of the other software companies need to see the specifications.
On that matter, that the government is making promises about what third party software will be able to do but not even giving the software companies the specifications (as I don't believe that they know themselves) yet still expecting everything to just fall into place is a whole different debate. i.e. this sort of thing should have a two year lead time for software companies but the way things are going they'll be lucky to get six months. And of course the Government is also promising small businesses that these independant companies will also be offering free sollutions!
Can you imagine a situation where the Government just makes a promise that every taxpayer can go to an accountant to have their self assessments filed for free without any money coming to us from anywhere for providing the service! Thats pretty much what they seem to be saying to the software companies and I for one cannot see that happening. These will be paid sollutions that will need to be filed and accessed online. I only disagree with these being purely cloud based solutions.
On the maelstrom effect of this I am in almost total agreement with your last paragraph. I believe that to varying extents it will affect us all but I believe that the worst effected will be those who deal with the smallest clients which will disproportionately affect the readership of this site as their clients are to my mind those most likely to try and save a few bob by doing it themselves.
Where I will disagree slightly is over year end accounts. In most instances what you say is true but even though people see stats as an overhead, if people want a mortgage then they need to have accounts signed by a professional who is recognised by the finance provider so people will always need year end accounts and we're not going to sign accounts unlesss we are sure that the bookkeeping is correct.
kindest regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I'm of the opinion that, whilst certain small businesses will attempt to do the accounting themselves, aided and abetted by the cloud companies saying it's as easy as pressing a button, not all will. I have a variety of different companies/traders, including a handful of yearly subbies Other than the subbies they're all too be busy to be bothered with messing around with the accounts. However, without knowing what exactly will be required in the quarterly submissions, it's a;; up in the cloud at the moment
Shaun, I can see them pushing it back a year, we're 18 months from implementation and no one has a clue yet, as you say not even HMRC!!
-- Edited by Leger on Wednesday 14th of September 2016 09:50:32 PM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
"Whether we like it or not with the MTD programme everyone is going to have to use cloud accounting or some form of app in the future to maintain their record if the government has its way."
I've highlighted five very important words in that sentence - "Making Tax Digital" (stupid sound bite term) is not just about cloud. There is a problem with the word 'app', however, in that there seems to be a growing tendency to conflate it with software running on smart phones and tablets - and some people also conflate apps running on phones and tablets with cloud.
But an app - or application - is just another word for a software package. (Which, for me, started to be used around 1989sh*)
Sage, Quickbooks, VT Cashbook, et al, are apps just as much as Angry Birds is an app.
My reading of the "Making Tax Adhere to our Silly Sound Bite" bumf is that it covers two things:
1. For the public, it's about driving people out of the 1970s and earlier when it comes to maintaining manual accounting records (yes, some still do) - and worse, out of the shoebox/carrier bag mentality whereby they just dump everything in a box/bag until they hand it off to the accountant once per year - and into the 1980s, when computers became more widespread and affordable for small businesses and home users.
2. For the government - and to benefit the public - it's about joined up thinking/joined up systems.
My conclusion, therefore, is that there's a lot of panic over nothing - so I refuse to panic.
Until the time comes and I'm shown to be wrong. Then I'll panic.
* 1987 was when Acorn introduced the Archimedes computer. The original release ran an operating system called Arthur (which, probably apocryphally, is said to stand for "A RISC operating system by Thursday" and is a reference to them needing an operating system to run on their ARM-based systems a bit sharpish). Arthur was the precursor to RISC OS 2, released a couple of years later - i.e. 1989ish. (My own first computer of this type was around then, so I started with RISC OS 2 - my previous machines all being 8-bit ones, like the Beeb.)
In RISC OS 2 (I'm not sure about Arthur), software packages that users bought and run - or which came with the computer - were called applications. When RISC OS 3 was introduced, 1991ish?, some of the bundled applications were supplied in ROM along with the OS, accessed by clicking on an icon on the icon bar (think taskbar or dock in Windows or MacOS) that was labelled (ta-da...) "Apps"
And it's still labelled "Apps" to this day in more modern versions of RISC OS that run on things like the Raspberry Pi.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
Well my take on things is that the biggest change will be more frequent submissions to HMRC for most businesses, ostensibly so that they'll have a better picture of their tax position sooner, allowing them to budget for it - but for businesses that are already on top of their accounts, they probably have a good idea anyway, and (as with a couple of mine) may even put money to one side as they go.
Noting, though, that (IIRC) in some of the examples that are given in some of the material, the fictional businesses were paying HMRC sooner in order to reduce the burden/manage cash flow, I suspect - very cynically - that this is really step one in making it due earlier. Give it 10-20 years after Making A Silly Sound Bite out of Nothing Significant, and remember I said that.
(Where the budgeting for it can be helpful is those cases that adopt a shoebox or year-end only approach. These businesses don't have a clue until their figures are worked out.)
So, if anything, it'll possibly mean more work for us as more people need things done earlier - or if you already have any of those shoebox/year-end only clients, it'll mean their work spread a little more over the year.
Any talk of cloud with any of this is, IMO, just a conflation. Sure, there will be some who adopt cloudy rubbish thinking it's necessary - but that's always going to be the case anyway now it's an option. People always believe hyperbole.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
Hey. Yes there seems to be an assumption that all people will be able to use the software: have time to use the software; and also be willing to use the software. Knowing how to fix 'things' when they go wrong comes to mind. It could be argued that even today's smallest business' are able to complete their own accounts and bookkeeping - yet obviously not all do. I do think that maybe some of the younger business folk will give it a 'go' themselves due to them being, in general, more 'tech' aware than the older folk. That's not a blanket assumption, but I have a point. But what is the point in being able to change the piston rings and alter the timings on an engine, if you have no idea how to remove the engine from the car? I personally believe it to be almost dangerous to rely on Xero, et al - together with HMRC for accountancy and tax advise....
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
So what's the solution from our side? All becoming management accountants and tax advisors? Will this be what is left?
Hi Johnny,
My view on this is that the client bases most effected by this will be the micro-micro £0k to £40k turnover and all personal service businesses who only tend to have a few larger transactions each year.
I do not think that the issue will be long lived once the self employed and small incorporated entities find that it has now become impossible for them to raise finance for things such as buying a house. But conversely this may see a change in demographics to using smaller (cheaper) accountancy practices by micro entities where their primary driver for using representation is the perceived legitimacy of the financial statements by financial institutions.
Thats not a sky is falling type line for bookkeepers, quite the opposit as if that does happen then accountants would need to regear to handle the volume change so I would expect more work for independant bookkeepers and practice roles available than there are at the moment so I expect to see perhaps less independant bookkeepers as a result of this fundamental change but more employment in the sector and people genuinely able to make a living without going beyond trial balance.
Not that things are a bed of roses on the accountancy side either. Personally I'm finding the Governments eternal tinkering with no concern for the consequences of their ill conceived actions annoying. RTI, AE, Tax Simplification (yer right!), MTD, even IR35 tinkering nearly 20 years after first botched... Its not that I cannot accept improvements to the system but it does seem that the changes are more for the sake of change than improvement.
I must concurr that going back to management accounting / consulting does seem quite appealing with the the current backdrop of eternal change on the practice side.... But of course the grass isn't really any greener and that life comes with a whole different set of problems (severe sleep deprivation, eternal travel, the price of red bull, methodologies changing at a similar rate to tax changes on the practice side, etc.).
Time to do a lottery ticket I think...
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
