Unlike traditional accounting software, cloud accounting services and software like the Xero accounting software help businesses store and process data in a virtual server – which now allows small businesses to stay on top in business accounting and compete with large enterprises on a level playing field. Earlier, only established companies would have access to real time accounting data through a local server, because the process of setting up a local server for storing data was too expensive to afford for startups or small businesses. Now that any business, irrespective of its size, can store data in the cloud at a fraction of the cost – it has become easier than ever for a startup or small business to attract investments. Making this one the major benefits of cloud accounting.
Easy access to data
Prospective investors want to know how organized your business is. Do you have quick access to your company’s financial data? Do you have all the data organized? Earlier, only larger enterprises with an in-house accounting system would say ‘yes’ to those questions. But now even startups can have access to data anytime and from anywhere through the internet. Business now do not need to spend a fortune to buy expensive hardware, setting up a local server, establishing robust data security systems and hiring in-house IT staff. All you need is to subscribe to cloud accounting services Singapore at a fraction of the cost.
Cash flow analysis
Whether your business has a system in place for managing and analyzing cash flow is another thing that your prospective investors would review. They would like to know how you are planning to keep an eye on your cash flow. Traditionally, generating cash flow statements was a time-consuming and resource-intensive process. Most startups would not even have dedicated accounting staff to create cash flow reports. But now businesses can complete the task with the press of a button. Cloud accounting software like Xero helps generate cash flow statements and projection reports incredibly quickly. The reports are updated automatically as and when someone reports any income and expense. This enables you, your team members and prospective investors to analyze real-time cash flow data from a single dashboard. You’ll know how much cash you have in your account and how much you can expect in the next month or year.
Focus on core business
Your prospective investors would also want to know whether you and your employees would have enough time to focus on your core business. Some startup owners remain too occupied with non-core tasks like accounting and finance that they hardly get time to tackle their core business. You need to convince your prospective employer that your business would not fall in the same trap. One way to do so is by showing them that your accounting system is efficient enough run on its own, leaving you and your teammates free for more important business activities.
Whether your business has a proper system in place to ensure data security and backup is another area of concern for most investors. Here again, cloud computing can help you win the confidence of your investor. Cloud computing software like Xero maintains data backup automatically, and makes sure that your data remains safe and secure in the cloud. Other than multiple currency feature that Xero has, Xero also provides training for better and efficient software management.