Web Based Accounting Software (Advantages and Disadvantages)
The list of accounting software types includes 2 main subjects:
- Installed accounting software that to run needs to be installed on the desktop or laptop. Data provided such system is available on the computer or laptop only and not available online.
- Web-based accounting software (that also known as cloud accounting software or online accounting software) is hosted on remote servers and provides data that can be accessed through the Internet. Entered data is sent to "the cloud," where information is processed and returned to the user.
Advantages of web-based accounting software:
- clear overview of the company’s current financial situation in real-time;
- access to the financial data anytime from anywhere;
- access to information and documents from any devices;
- access to the data for multiple users;
- easily online collaboration with the company's team and advisors;
- online connecting with bank accounts;
- reduce time spent on manual data entry;
- integrating with other web-based tools;
- reducing time spent on managing financial information;
- less expensive than installed accounting software (usually, payments are made on a monthly basis);
- automatic updating;
- eliminating costs on the hardware, installation, maintenance, system administration, updating, and server failures;
- backups and data security.
Disadvantages of cloud accounting software:
- sharing business data with a third party;
- no control over where in the world the company's financial information is (it could be on a server anywhere in the world);
- no access to the data without the Internet connection;
- depending on the juridical rules of the country where the data is located governments may review and audit your businesses’ data;
- restrictions in operating systems, applications, and infrastructure options that are open to users;
- cannot be configured, changed, and customized as easily as the desktop accounting software;
- many cloud accounting software systems do not provide the data backup on the user’s computer.