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What is Cloud Based Accounting for Small Businesses?

Cloud Based Accounting Software is not only reserved for BIG Businesses.

“BIG Business” has always had the competitive advantage, of being able to invest in computer hardware and software that would enable them access to vital accounting functions that are accessible to all the individuals within the organisation, simultaneously.

For example; A sales team that works on the road could access client information, view stock holding and place orders directly at the client’s location.

Another example; A client  is looking for a specific item. The item could be sourced from another branch ,at another location by logging into the company’s accounting system.

These computerized resources required large capital investments to acquire and to maintain.

Fortunately for small business owners and entrepreneurs, the internet brought with it, technology and applications that now give access to these solutions at very affordable prices.

Cloud Based Accounting for Small Business is the application to advance your small business and get access to powerful, user friendly functions.

It is simple to get started and maintenance does not require a team of IT specialist because the Cloud Accounting Software company does all the maintenance at the back-end. 

Why is accounting important at all?

Accounting is the most important system of information gathering available to a business.

It tells business owners a story.

The information that is being gathered is recorded and classified in a logical manner. This information will enable people to read and understand the story of the business.

This story about the success and progress of the company is presented in a numerical format. By using numbers the business can be measured and analysed further, resulting in certain courses of action being taken.

The business story can be of a story of profitable nature, which may result in payouts of dividends and rewards to the owners or managers. It can be a story of loss which may result in negative consequences for all those involved. It can tell a story of assets being utilised optimally or of inefficiencies and wastage. It can tell a story of over-commitments with debts or a much-needed investment of funds being required.

Start Comparing - Use Accounting

Accounting and the storytelling through numbers enables businesses to compare it’s progress over time. The numbers can be presented in certain periodic terms. You can then determine if the business is improving or deteriorating over time.

There is always movement in business. The question is: Is the business moving forward and towards the goal? or is the business deteriorating and moving in the wrong direction?

Accounting tells you in which direction the business is moving. The performance of the business can be compared from one year to the next and it can be determined if there has been growth in sales, expenses and profit or whether there is a decrease in these important numbers.  

Accounting also enables you to compare your business with other businesses in your industry. That is exactly the reason why there are certain accounting rules. Accounting numbers enable people to compare the financial results. If everybody plays by the same set of rules, comparisons can be made between businesses. This information helps the users of accounting information with vital decisions like investment decisions, recruitment or downsizing, debt or equity, capital or expense.

Accounting tells you what your number is

With the start of every business, you have an objective or goal that you want to achieve. For example, you want to earn a certain amount of money or you want to have a certain amount of available funds or you want x amount of money to retire with or to invest. Accounting is the measurement of the degree to which those objectives and goals are being achieved. Accounting simply tells you in a number format how far you have progressed in achieving those objectives.

Identify trends early with Accounting

When you start to look at your business’ accounting reports. You will start to identify certain trends. Accounting may reveal a positive swing in the right direction or a trend that your product range is dying or that the marketing efforts do not pay off. By identifying these trends early enough you can take corrective action before it is too late for your business. If you don’t see it, you can’t fix it. It is therefore important that your accounting story is up-to-date and that you are able to receive this information from your accounting system timeously.

Accounting is the first step of a valuation

Your business has a value at any given point. As a business owner, you want the value of the business to increase. Accounting enables you or any person to be able to establish a value for your business.

The numbers provided by accounting immediately tell you whether the business is solvent and liquid. By being solvent it means that the assets measured at fair value are larger than the liabilities at fair value. Liquidity provides information about the ability of the business to pay its short-term liabilities. In simple terms whether the business has enough cash resources to honor its commitments. By getting these numbers from your accounting you perform the first step of valuing your business.

Remove emotion because numbers don’t lie

The organised system of accounting enables the owner or managers to remove emotion from the business equation. People are emotional beings and emotions may play a role that prevents the business from achieving its objectives. Family emotions, strong characters that dominate decision making can be referred back to the actual results presented by accounting. The numbers don’t lie, there should not be any grey matters. Your revenue or income and profit for the year is an exact number.    


Accounting is the backbone of compliance because it is such a clear-cut number and definite measure, certain taxes and regulations can be placed on it. The starting point of taxes is the accounting profit.

Due to the fact that accounting measures the performance of your business, you as the business owner will be able to take some action with this measurement. It might tell you that you are on the right track, it might mean that you need to seriously consider your business strategy and revisit that plan for an overhaul. Or it might mean that you can take some funds and treat yourself to that much deserved holiday.

The Evolution of Accounting - "The Cloud"

Accounting has changed dramatically especially over the past 10 years. This field is not reserved anymore for people that crunches numbers all day by entering information into large ledger books and only keep records of transactions. Accounting has been integrated with important business functions whereby these functions are being performed directly in the accounting system. Think about time tracking systems, linking directly to invoicing and debtor management systems that are now being  used.

In a fast pace moving world, the entrepreneur needs up-to-date relevant information. It is required by everybody who invest their time and or money into any form of business. Things can change rapidly therefore the accounting story needs to be relevant and this is how accounting has evolved where today it is accessible in the cloud and up-to-date.   

People are much more mobile that years ago and people are able to travel across the globe with the development of the travel industry. Cloud Accounting Software enables entrepreneurs to have easy access to their vital business information.

People are required to use money wisely and for that money cannot be wasted on out-of-date stock items. Sales of certain products and services are measured by accounting systems and continued, adapted or discontinued based on the information accounting provides. Business has become leaner with optimal stock levels. With Cloud Accounting these stock items can be up-to-date at all times and the information available to all the necessary people in the organisation. Better purchasing decisions and planning for future cash requirements can be made with cloud accounting.

Point of sales system has become more that just an invoice generating tool with integration with the full accounting function of the business, giving sales, cash-up, stock level, purchases and banking information.

Cloud Accounting for small business makes the integration of all the business aspects for small business owners so much easier.  Sage Business Cloud Accounting for small business is an accounting system that works and provide easy accessible accounting system for entrepreneurs and bookkeepers. Sage is affordable and it is able to simplify the lives of entrepreneurs. Through Sage Accounting small business now can have access to a comprehensive accounting system in the cloud.  

I have successfully installed and utilise Cloud Based Accounting in my own practice and at many entrepreneurs. What  I love the most is that it is an all-inclusive system. All aspects of your business are covered by Sage Business Cloud Accounting no additional modules required.