Cloud hosting has been around since long before technology marketers made “going to the cloud” a slogan. Here at CPA Practice Advisor, we’ve been covering cloud solutions for more than a decade, but the concept goes much further back.
Even back in the era of mainframe computers (1950s-1970s), the practice of time-sharing was popular, since it helped maximize the usage of the computers. Even tax preparers were affected by this system, because many of the income tax service bureaus rented time on these mainframes to process returns sent to them by tax preparers. As technology advanced, many of those same service providers would become the major tax and accounting software developers serving the profession.
The more modern incarnation of hosting is focused on two areas: First, and the area that most professionals are at least somewhat aware of, is what used to be more commonly called an ASP, or Application Service Provider. In this model, a Hosting Provider makes it possible for a firm, business or individual to have online access to software that is normally installed and maintained on the firm’s own computers or servers (such as a desktop version of QuickBooks, Sage 50, ProSeries Tax, Microsoft Office or virtually any other program).
Whichever software the firm chooses to have hosted by the provider, the firm usually must possess their own user license agreement with each of the software providers. In some cases, the hosting provider can manage these licenses, as well.
The second usage of hosting is for private virtual servers, which let a business or accounting firm have more flexibility with scaling up their servers, but without their servers actually being in their firm. The servers are accessed online, but can be used in the same manner a firm would use internal servers, but without costs or hassles of IT management.
The Benefits of Cloud Hosting
While online variations on these and many other programs are available, some professionals prefer to work with the original desktop version, but also have the anywhere/anytime availability of a cloud-based program. Hosted solutions also relieve the firm from having to install program updates, since these are managed by the hosting provider.
Hosting providers also offer their own live help desks staffed by experienced users of the programs being hosted, often at times and days outside of the software maker’s help desk hours.
For 2014, we looked at the services offered by the following cloud hosting providers. Check them out to see if they have the software and functionality that your firm needs.
In this issue, we also review online client portals for accounting firms. Some of these portals also include integration or partnerships with cloud hosting providers to offer a firm’s clients hosted access to the business software they use. So, your best bet is to find a combination of solutions that best fits the needs of your firm, while also helping you collaborate and serve your clients.
Benefits of Hosted Programs
Scalability – Easy to ramp-up or ramp-down, depending on changing needs.
Maintenance – Firms no longer have to perform upgrades or maintenance.
Expertise – Cloud hosting providers are experienced at helping firms with these specific programs.
Cost – Implementation of systems can be less, or at least require less start-up capital, as they are usually billed across a specified period.
Desktop Functionality – Allows use of the full system, with convenience of online access.
See inside November 2014
IT’s Role in Mergers and Acquisitions of Accounting Firms
So what is technology’s role in all this activity? Unfortunately, in a lot of these deals, IT is involved too little and too late.