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Cloud-based Accounting Software vs. Desktop Software, which is Better?

William DawseyBy: William Dawsey

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Cloud-based Accounting Software vs. Desktop Software

The overwhelming majority of accounting software providers have been moving to the cloud. However, it is crucial to understand the differences between cloud-based accounting software and desktop accounting software.

While they are both accounting software, there are subtle differences that mean a lot for your business. They each offer some benefits over the other, and it is up to your business to figure out which direction you want to go towards. The rise of the Internet has made cloud accounting software more widespread, but there are still many use cases for desktop accounting software.

The option you take will depend on your specific situation and your budget. It will also depend on how you are most likely to use your accounting software.

Desktop Accounting Software

Contrary to online accounting, the traditional method of doing accounting is using desktop software. This desktop software is typically paid for upfront, and new updates are provided until a new version has been released. There is a normal upgrade cycle, and the business has to pay full price for each new version. It is often used by one person on a single computer.

There are several advantages to doing things this way. For example, you know you have access to the software and all of your data on your computer. It means you don't have to worry about losing access to your data stored in the cloud. It also enables you to get work done without an Internet connection. For most small companies, this is a popular option.

Desktop Accounting Software

Cloud-based Accounting Software

With the rapid rise of the cloud, accounting software developers have seen the possibility of having people pay monthly instead of yearly. The cloud has meant that they can now charge companies a monthly price for their software. However, there are still many great benefits that cloud online accounting software brings to the table.

These benefits appeal to many businesses, as it provides a way of streamlining accounting operations and minimizing the amount of work the accountant has to do. There are also tertiary benefits that come from not having to maintain your own hardware infrastructure to run your accounting software tools. It is one of the many reasons why cloud accounting software is only growing.

While there is a significant downside with cloud accounting software, there are still many more positives to offset this downside. You cannot access your accounting software without an Internet connection. However, the Internet is so ubiquitous today that it is almost impossible not to have an Internet connection. The cloud brings key advantages that make it a practical choice for most businesses.

Key Differences

There are fundamental differences between cloud and desktop accounting software. You can find an accounting software company that will provide both options, but it is usually not the case.

The key differences are often based on pricing, scalability, security, and reliability. It always has to do with your organization's work to ensure that your accounting software works as you intend it to. For example, you could not access cloud accounting software without having an Internet connection. However, you still need a good computer to run your desktop accounting software.

It is these simple nuances that make the decision so difficult.

Accessibility

Accessibility is a big issue for desktop accounting software. Only one person can use it at a time, and you have the downside of having to be physically present near the computer.

If you have installed your desktop accounting software on a computer in your office, you won't ever have remote access. It means that those weekend accounting jobs that you could potentially do will no longer be possible. The cloud wins in this category by a large margin, as you can access your accounting software from anywhere in the world.

If you are an accountant managing many accounts, you can work from home without any issues. It also enables other people to look into your accounts as well. You are no longer beholden to one accountant that could be on vacation at a bad time for your company.

Cost

Pricing is also a place where the cloud usually wins. That is because you pay an affordable monthly price to access the cloud software. Desktop accounting software is typically expensive upfront. While you do own it forever, you will have many reasons to upgrade to the newest versions that come out every year. In reality, you are paying a yearly price for your desktop accounting software. On top of all of that, you have to purchase your own computers to run your desktop accounting software. Depending on the model you buy, it could be a substantial price that is much more than the price of the desktop software.

Accounting software in the cloud is updated regularly. You never need to worry about having the latest version, as the accounting software company maintains the newest versions at all times.

 Accounting software cost

Scalability

Scalability is another area where cloud software wins. The cloud offers almost unlimited computing capacity, and it means your software can grow as large as you like. The only thing stopping you will be the requirements of your business.

You can also purchase packages that let multiple people log into your accounting software at the same time. With desktop accounting software, each person has to have physical access to the computer that the software was installed on.

Security and Privacy

The security on your desktop computer or laptop is more likely to be weaker than the security you would find in the cloud. It is one of the many reasons why cloud computing has taken off in recent years. Professionals maintain the data, and it is encrypted and protected at all times.

The data on your computer could get lost or stolen quite easily. You also never need to worry about hiring your own IT staff to investigate problems with your computer hardware. That is an extra cost you never have to worry about with accounting software in the cloud.

Backups and Updates

Most accounting software providers give you some way of backing up your data. It is a lot easier to backup your data with desktop accounting software. However, cloud software allows you to do the same thing, and you can guarantee that your data will never get lost. Your desktop computer could crash, and that would cause your data to be wiped out. You could also inadvertently delete important data on your desktop computer.

Backups and Updates

Reliability

With desktop accounting software, your software will only be as reliable as your computer system. It means your IT department has to be excellent to ensure that you always have access to your software. The cloud has reliability built-in, which means you never have to worry about having data get lost.

Cloud software also includes payroll accounting software to guarantee that you have everything in a reliable package. Accounting software integration is a more efficient thing to do in the cloud. It makes it easier to hire accounting software developers to provide the add-ons your organization needs.

Making a Choice

If you are a small company that requires simple accounting software, desktop accounting software might be the right choice for you. However, for everyone else, accounting software in the cloud will be the right choice. It provides many more benefits than you get with desktop accounting software.

Wrap Up

You might want to have an accounting software integration developed for you. For example, you might want a payment gateway developed as part of your accounting system. That is why you should trust Chetu and its experienced developers with your financial accounting software development needs.

Disclaimer:

Chetu, Inc. does not affect the opinion of this article. Any mention of specific names for software, companies or individuals does not constitute an endorsement from either party unless otherwise specified. All case studies and blogs are written with the full cooperation, knowledge and participation of the individuals mentioned. This blog should not be construed as legal advice.

Chetu was incorporated in 2000 and is headquartered in Florida. We deliver World-Class Software Development Solutions serving entrepreneurs to Fortune 500 clients. Our services include process and systems design, package implementation, custom development, business intelligence and reporting, systems integration, as well as testing, maintenance and support. Chetu's expertise spans across the entire IT spectrum.

- See more at: www.chetu.com/blogs

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