Cloud Accounting – ERP Software On Premise versus Cloud

The latest trend in computing is cloud.   One of the last categories of software to transition to new technology is accounting, perhaps due to its complexity and perhaps due to the mission critical nature of its use.

Today’s accountants are provided a choice . The first option is ”On Premise”, where software is purchased, hardware is provisioned, workstations connected, followed by implementation and data conversion.    Software is replaced every 3 or 4 years.  IT staff are needed to manage the system and provide backup and connectivity support.    Software maintenance is paid annually to keep the on premise software available on the current version.   Most of the cost of this choice comes early in the project and budgets run from $50,000 to $500,000 depending on number of users and complexity.

The new option is “”Cloud Accounting.    In the cloud accounting scenario, accountants rent the software and pay a modest monthly fee.    Included in the monthly fee is also all the server hardware, IT support, backup services, and data center security.   In some cases the implementation and data conversion can be rolled into the monthly fee.   Costs are spread over the life of the use of the product, preserving cash for other priorities.   One huge savings is a reduced demand on internal IT resources.  Although difficult to measure, the savings can often pay for the entire project monthly fee.

So if your firm is considering a new accounting solution, are you going to chose On-Premise (like last time) or will you consider Cloud Accounting?

SSi Consulting, a Maryland Microsoft Dynamics Partner and provider of Hosted Microsoft Dynamics