Cloud software targets SMEs with cheaper accounting packages

The days of businesses paying for original accounting software and licenses may be numbered, as even iconic accounting software such as QuickBooks roll over to a new generation of cloud accounting services.

QuickBooks goes for about Sh40,000 in Kenya while the new service would cost as little as Sh1,500 a month with additional capabilities including online user support.

The new services, which would not be installed on a computer, are seeing growing numbers of small companies subscribe, fill in their daily or monthly figures, and accounting and business processes done for them online.

Typical of the new online accounting services for SMEs is Kashoo. Costing less than £10 a month, it generates invoices, calculates budgets and expenses, reconciles bank statements and produces cashflow and financial reports. Subscribers can also access their accounts from anywhere: they don’t have to be in their offices.

The cost savings come almost immediately, say users, with one recent survey from an Australian ICT firm Tecala, reporting that more than 70 per cent of the country’s SMEs had recorded cost-savings after switching to cloud computing software.

Moreover, more than 26 per cent of the businesses surveyed were planning to migrate completely to the cloud by mid-2012 and 95 per cent of the 113 IT decision makers surveyed claimed the advantages of the cloud surpassed the would-be risks.

“It’s clear that SMEs are increasingly highlighting cloud computing as a major to maximise core infrastructure, improve service levels, lower ongoing operational costs, increase agility and enhance user experience and employee profitability,” said Gleuto Serafim, CEO of Tecala.

Another report by a UK based technology analyst firm, Tech Market View, recently reported that cloud accounting software will account for 24 per cent of the UK software and information technology services market by 2014.

Kenyan firms too have been embracing the cloud. Flexus Technologies recently entered into a partnership with Quintica, a data services company, to host their Kopesha Cloud for East Africa’s Sacco’s accounting and banking processes.

Cloud computing enables the sharing of resources over a broad network with clients paying per use, saving on software licences and upgrades and “renting” space on someone else’s computers, meaning hardware savings too.

A challenge, however, is that Kenyan SMEs now moving to rent accounting software applications over the web face a proliferation of services.

Nez Zealand firm Xero, now with offices in East Africa and among the world leaders in accounting software on the web, is planning to launch a native Android app coming months making it accessible on mobile devices such as iPads, iPods and cell phones.

Xero’s dashboard gives users immediate sight of the balances in their bank accounts, and allows SMEs to create, approve and send invoices right from their phone, with users citing examples of leaving a sales meeting and issuing their invoice even as they travelled back to the office.

Xero users could even use their mobile device’s camera for recording expenses, ending hassle with crumpled paper receipts by taking photos of their receipts and attaching them directly to expenses. Xero also allows multi-currency functionality with foreign exchange transactions, clients contacts Google maps.

The application also integrates with other online business applications such as Freshbooks, 37 Signals’ Highrise, Salesforce, PayPal, Shopify, Zen Cart and Magento.

But the software is only one of the top contenders. According to a ranking of Top Applications for Business last month by GetApp.com, based on popularity, user reviews, comments and analyst reports, Zoho comes number one among the top 25 applications.

Xero is at number eight; Netsuite, used by close to 10,000 organisations, comes in at position 10; Intact, a north American accounting and financial management software, comes at number 20, and Kashflow, the UK’s SME accounting application at 21.

Users’ choices are being driven by the size of the organisation and specific features that suit their types of businesses.

They all offer free demos to help users decide.

The debate nonetheless rages over which is best, even fuelling accountants’ jokes on one site quips that “Intuit said you fire your accountant but Accounts Relief wants to empower accountants”.

Another strongly emerging service, popular with many SMEs is Danish E-conomic, which now serves more than 35,000 customers for just £20 a month.

Some limit the number of users, but others don’t, such as Liquid, an award winning UK based accounting software, also at £20 a month for unlimited users, unlimited transactions, unlimited storage, dashboard, budgeting, value added tax, factoring, human resource and employment documents and an integrated help centre, foundation training, data import (and export), automated upgrades, back-ups, secure hosting and maintenance, as well as sales order processing, purchase order processing, payroll, stock control, multi-currency support and job costing.

Such packages are proving so compelling that even the world’s Big Four accountancy firms – PwC, KPMG, Deloitte and Ernst & Young - have now moved their finances to the cloud.

-African Laughter