Evolution of Accounting Platforms: From Desktop to Cloud-Based Solutions

A popular book’s title—Out with the Old, In with the New, by Nancy Robards Thompson holds significance for many things. Cloud based solutions for accounting are the perfect example of it in the world of accounting and finance. For years, desktop-based accounting software held the reins in the world of finance. However, as businesses grew and became more agile, their accounting needs evolved beyond local access and manual updates. Several startups and SMEs have realized its benefits and adapted it, replacing it with the traditional desktop-based or on-premise accounting.

Looking at statistics, the cloud accounting software market was globally valued at $3.5 bn. In 2023. It is projected to reach $7 bn. by 2032, growing at a CAGR of 7.8%. Report further suggests that this growth is driven by the increasing adoption of cloud-based solutions among businesses seeking flexibility and scalability in their accounting processes. Additionally, advancements in technology and integration capabilities with other enterprise systems are further propelling the market expansion.

History of Accounting and Shift to Cloud Based Solutions

As we move into the future with the evolution of accounting software, it is important to reflect on the past of accounting systems used industry-wide. In 1965, IBM quietly revolutionized accounting behind the scenes. They created the first-ever program to automate accounting tasks, but it was kept in-house, running only on their IBM System/360 for their employees.

It wasn’t something businesses could access yet. Fast forward to 1978, after over a decade of internal use, IBM finally released the program to the public, calling it the Commercial Financial Statement Preparation System (CFSPS). This marked the beginning of a new era in accounting software, making life a little easier for businesses everywhere.

The earliest accounting software was straightforward—hard copies, manually filled and maintained by accountants. As technology developed, desktop-based software began to replace these ledgers. Cloud-based accounting packages have since taken the baton, allowing companies to break free from the limitations of physical and on-premise systems.

The shift to cloud technology was inevitable. Globalization, remote work, and the increasing complexity of financial operations called for systems that were always available, scalable, and capable of integrating with broader business tools. This transition has unlocked potential far beyond just balancing books with the help of a cloud based bookkeeping software—it’s enabled businesses to predict trends, collaborate across geographies, and maintain real-time visibility of their financial health.

Benefits of Cloud Accounting

Shifting from desktop to cloud based solutions is not restricted to upgrading software for the sake of it. It is rather about changing the way in which startups and companies function. Cloud based accounting is the future of financial management and here are the 10 reasons why—

1. Access Anytime, Anywhere: Whether you’re at your desk, on the move, or working remotely, cloud computing accounting software gives you instant access to your financial data from any device. Your numbers are always at your fingertips, wherever you are.
2. Cut Down on Costs: Forget about spending on expensive hardware, constant updates, or IT maintenance. With cloud solutions, you just pay a subscription, and all updates happen automatically, so you’re always on the latest version—no hassle.
3. Collaborate Seamlessly: No more back-and-forth emails or version control issues. With cloud based solutions in place, your finance team, accountants, business stakeholders, or even its external advisors can all work on the same data in real time, making collaboration smooth and easy. Role-Based Access Control (RBAC) helps define access rights to people across hierarchies and departments within or outside the organization.
4. Effortless Scalability: As your business grows, so do your accounting needs. With cloud based solutions, scaling up is a breeze—you can add users or features as your needs evolve, without missing a beat.
5. Top-Level Security: Cloud based solution providers offer robust security measures like encryption and regular backups, giving you peace of mind that your financial data is safe and protected from cyber threats.
6. Stay Compliant Automatically: Tax regulations and financial reporting standards are ever-changing, but cloud based accounting programs automatically update with the latest rules, keeping you compliant without the stress.
7. Fewer Errors, More Automation: Automated tasks like invoicing, accounts payable and payroll reduce human error, ensuring that your records are always accurate and up to date without manual intervention.





8. Instant Financial Insights: Waiting for end-of-month or quarter reports is a thing of the past. With real-time dashboards, you can track your financial health and make informed decisions on the fly—all by using online accounting systems.
9. Seamless Integration: Using and managing multiple software and tools is not only challenging but also can lead to costly mistakes and confusions. Cloud accounting integrates effortlessly with your business systems like CRMs, Tax Compliance, and ERPs, keeping everything connected and ensuring smooth data flow across your operations.
10. Go Paperless: Moving to the cloud means fewer paper trails and a more sustainable way of doing business. You’ll not only reduce your carbon footprint but also keep your records more organized and accessible. Imagine not having to rummage through tons of papers and files to find specific transaction trails and invoices.

Key Features to Look for in Cloud Based Accounting Software

Choosing the right cloud-based bookkeeping software can be the difference between a streamlined operation and financial chaos. Here’s what to look for when making the switch:

1. Easy Access and Team Collaboration: The ability for multiple users to access and collaborate on the platform from various locations is essential. Whether you’re a business owner or CFO, this feature ensures the entire team remains on the same page, literally and figuratively.
2. System Integration: Look for cloud based accounting packages that seamlessly integrate with other essential business tools—be it your ERP, CRM, or payroll systems. This eliminates duplicate data entry and keeps all your operations connected.
3. Workflow Automation: Automating routine tasks such as invoicing, expense reporting, and payroll frees up valuable time for you and your team, allowing more focus on strategic decision-making.
4. Real-Time Reporting and Analytics: Gain access to real-time reporting that offers up-to-the-minute insights into your business’s financial health, empowering you to make agile, informed decisions.





5. Mobile Access: Being tied to a desktop is not practical for any professional. Ensure your cloud-based accounting solution has mobile compatibility on browser or through a dedicated application, so you can check financials or approve expenses while on the move.
6. AI and Predictive Analytics: AI-driven financial insights help businesses forecast trends, understand potential risks, and make proactive adjustments. These insights are essential for those looking to stay ahead of the curve in today’s times.

Conclusion

The journey from desktop accounting software to cloud-based accounting solutions is what any business needs to future-proof it. For startup founders, business owners, and CFOs, making this switch isn’t a question of if, but when. And with that decision comes the need for a financial partner who understands your needs.

At Febi.ai, we offer a robust cloud-based accounting solution that simplifies tax compliance, enhances collaboration through smart invoicing and payment systems, and provides AI-driven predictive analytics to help you forecast and plan with confidence. Whether you’re managing your finances in real-time, keeping up with compliance, or streamlining invoicing, Febi.ai is here to simplify your processes.

Book a demo today and experience the benefits of cloud accounting firsthand.

Are you prepared to stay ahead of the curve in this rapidly evolving financial landscape, or will you be left behind in the days of desktop systems?