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A blessing or a curse?

Online accounting for SMEs

Traditional accountants are facing competition from the internet: more and more SMEs are switching to online services. Are you also considering fighting the red tape via an internet browser in future? Here is a summary of the pros and cons of online accounting:

Benefits of online accounting

  1. Access from any location: All you need is a browser and an internet connection and you can access your accounting data wherever you are
  2. Up-to-date data: Depending on your preferences, your data will be entered daily or weekly, and can be accessed or retrieved at any time.
  3. Mixed forms of document recording: You can either record your documents on the user interface, write invoices yourself or, depending on the provider, scan documents for automatic recording.
  4. No software installation or updates required: Online accounting is an SaaS solution (Software-as-a-Service) and doesn't require users to install software or have specific IT skills.
  5. Save time: Without accounting specialists and IT specialists, the company can better focus on its core competencies.

Disadvantages of online accounting

  1. Dependence on the provider: With online accounting, access to the data and the web interface for preparing documentation is dependent by the provider and cannot by controlled by the client.
  2. Data management outside of your own infrastructure: With regard to the data security, you must check carefully whether the provider operates a professional data processing centre with the appropriate safety precautions. Smaller providers often work together with large data centre operators and are also able to provide the necessary infrastructure. Ask for a detailed description of the IT security measures and protect yourself with a contract.

Based on the benefits described here, online accounting is a good – and often cheaper – alternative to traditional outsourcing for SMEs. We still encourage you to learn about the various providers and their security standards before switching completely to online accounting. Many internet accountants also offer free trials of their services. That way, you can get a feel for the particular interface before you make your decision.