Your First Hour with Cloud-Based Accounting

Financial applications and institutions have used the internet to send and receive data since not long after the World Wide Web’s inception in the mid-1990s. Banks and personal finance software makers quickly built user interfaces that allowed consumers and businesses to access their account information and pay bills online.

Mint, a personal finance management solution, was one of the first websites to provide access to all of your online accounts within the same application. If you could log into your bank and credit card and investment accounts and view transactions, you could supply Mint with those same access credentials and get a comprehensive view of your financial status.

Small business accounting software was not far behind. And today, there are a lot of cloud-based accounting apps – even a handful of very good ones. Each has its own distinct feature set and user interface, but they share some common startup tasks. If you’ve decided to start doing your company’s bookkeeping online, here’s what you can expect in your first hour or so.

Just as you would have done in desktop accounting software, you have to supply information about your company and its financial management needs.

Setting up Settings

The best cloud-based accounting solutions have mobile counterparts, apps that run on smartphones that contain at least the most critical features of the browser-based version. You cancreate your account using one of these, but it’s better to get started on a desktop computer or laptop or supported tablet, then download the app when you can just sign in and start using it.

Once you’ve created a user name and password for the accounting website, you’ll probably see some kind of welcome message and possibly a list of steps that will walk you through some of the early setup tasks. If you get the latter, take advantage of this step-by-step guidance. If not, once the introductions are out of the way, you’ll head to Settings. This is usually either a menu item in itself or it’s accessed by an icon near the top of the screen, to the right.

Here again, each site is different, but there are some settings that you’ll need to at least look at, if not enter information, change what’s there, or select your preferences from lists. Here are some common elements:

  • Chart of Accounts. This is a comprehensive list of all of the accounts that comprise the backbone of your company file; they’re used primarily in transactions, and as filters in reports. Most accounting websites ask you early on what type of business you are, and they provide an appropriate Chart of Accounts. You’ll probably notice that you can modify this critical list, but that’s a task best left to your financial advisor.

Though it’s possible for you to modify your Chart of Accounts, this is something that your financial advisor should take on if necessary.

  • Company information. Name, address, and other contact and descriptive details
  • Sales tax rates. You can enter multiple rates that will be used in transactions and reports.
  • User access permissions. If more than one person will have access to the site, you’ll need to specify what screens they can visit and what they are allowed to do there (create invoices, pay bills, approve transactions, etc.).
  • Financial settings. Does your company operate on a cash or accrual basis? When does your fiscal year start and/or end? Do you want to establish lock dates (periods whose data cannot be changed)?
  • Conversion balances. If you have existing accounting data for your company, you’ll want to enter opening balances for accounts where they’re needed.
  • Payroll settings. If you’re going to be managing your own payroll from within the application or via an integrated solution, you’ll be entering a lot of related details. This is a complex, time-consuming process that should be done under the guidance of your financial advisor.

The process of setting up payroll within a cloud-based accounting application is complex and time-consuming.

There are other setup tasks you’ll need to undertake after you’ve completed the initial setup, like importing or entering lists of contacts, suppliers, and inventory items. You may want to customize transaction forms, edit email templates, set up a payment gateway so you can accept credit cards, etc.

Your financial advisor should be a part of this entire journey so that when you’re ready to start creating transactions and reports, you can do so with confidence. It’s a lot easier and more cost-effective to build an accurate, comprehensive foundation from the start than to try to locate problems after the fact and untangle them.



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