There are a significant number of small to medium-sized enterprises that still rely on traditional methods of bookkeeping despite the ever-changing market where businesses are moving their whole operations online. Because of this major transition to the cloud, online bookkeeping is becoming a successful replacement to traditional paper bookkeeping as a reliable method of handling financial data. This “virtual” method of managing a company’s financial operations also has several unique advantages.
Let’s take a closer look at some traditional bookkeeping processes and explore how digital methods can handle them much more efficiently and safely.
Traditional vs Digital Bookkeeping
Prior to the development of quick and affordable computers, bookkeeping was generally carried out manually with all transactions being recorded on columnar sheets and preserved in large binders. These activities migrated into the digital landscape after computers became common and software became more accessible; concepts remained the same, but mechanics switched from paper to digital programs.
With small to medium size businesses, the sole entrepreneur or a small number of staff frequently have to bear the full burden of bookkeeping. The majority of tasks, including writing checks, keeping track of inventories, managing payrolls, and filing taxes, are handled by a select group of people who may lack the competence required to meet the demands of precise bookkeeping. In most smaller businesses, entries are frequently made at random and may only be evaluated once or twice a year, giving potential for many errors to creep in and lead to incorrect business decisions.
Instead of relying on traditional bookkeeping methods, many companies have switched over to virtual bookkeeping software, like QuickBooks, to help keep records and manage everything online. Specialized software lets teams make payments, generate valuable reports, and submit documentation electronically to appropriate parties instantly. Online bookkeeping also enables organizations to remotely manage financial and tax records. Having this level of accessibility and automation can strengthen and protect any size business’ financial operations.
Advantages of Online Bookkeeping
Online bookkeeping is functionally similar to software that has been on the common computer for decades. The biggest difference from traditional bookkeeping is that all financial management and control are performed online or remotely – this provides several advantages.
First of all, small firms can benefit from such a service, especially those who are just getting started and can’t afford to hire a full-time accountant. Online cloud services are intended to assist companies with independently resolving financial issues without involving an expert. Likewise, larger companies are utilizing cloud services to help streamline their massive workflows.
It’s important to point out that virtual bookkeeping services are more than just automated software – humans are also a part of the whole virtual process as well. Practically speaking, virtual bookkeeping is a type of service where an organization performs bookkeeping for a specific company remotely. Virtual bookkeeping clients have access to many in-person services like accounting consultations and assistance with technical specialists as needed.
This virtual approach has been shown to be much more cost-effective, as it reduces the costs of hiring in-house employees on a regular wage. Organizations don’t need to purchase the infrastructure, servers, system administrator wages, and so on – these expenses are on the bookkeeping provider and not the business. Using a laptop or mobile device, a bookkeeper or business owner can perform virtually any bookkeeping activities whenever they want, anywhere they are, unlike traditional bookkeeping, where all the records are normally kept in the office.
In addition, virtual bookkeeping is much safer and less time-consuming than traditional bookkeeping methods. The security of today’s cloud services is substantially higher than that of traditional bookkeeping records. Sensitive records are stored in safe data centers, where data security is ensured by the most recent encryption standards and methods for defending against the latest virus and hacker threats.
Tenace – A Virtual Bookkeeping Solution
With all the advantages of virtual bookkeeping over traditional, it’s easy to see why big businesses have already moved their bookkeeping records online. The capabilities of virtual bookkeeping software and services are expanding each and every year with many online platforms being a major part of a business’s growth and success.
Tenace is a professional bookkeeping service that can help with any number of virtual bookkeeping and accounting solutions for your business. From seasoned staff to the latest digital technologies, Tenace can handle all of your bookkeeping requirements in the cloud. Contact us for a consultation today.