Online accounting: busting the myths

28th October, 2016

Going online raises concern for some people, but the reality is that online accounting can make your accounts more secure, not less so.

Between multiple layers of security and backup, an online accounting solution is a sensible choice – but the myths still persist.

Here are the three most common myths around online computing, and how they don’t stack up.

Myth #1: Local storage methods are safer

If you’re keeping paper accounts in a more traditional bookkeeping fashion, the moment there’s a flood, a fire or a burglary your entire accounts are completely gone – and you’re in trouble.

Having your accounts in digital form avoids some of these issues, but you’re just as prone to accidental data loss if the system crashes or your onsite backup becomes corrupted.

An online accounting system provides protection against data destruction and theft while also gaining the advantage of portability with access from any properly authenticated device.

Just as you’d want a good lock on a desk drawer if you were storing physical accounts — or decent security software on a PC that housed your accounts — you need good security, oversight and transparency in an online storage solution.

The key factor in hosting your accounts online is trust, and that comes down to a matter of diligence.

MYOB uses Microsoft’s Azure service together with Amazon Web Services for online storage because they meet the key diligence criteria that any good online business storage service should meet.

Key diligence criteria includes making sure certain checks and controls are in place. These include things such as:

  • Making sure security and privacy are addressed by encrypting data – so that information can’t be understood by unauthorised people
  • Making sure the provider is financially stable and has supporting infrastructure – so there’s no concern about them going out of business and leaving you in the lurch
  • Making sure there are geographically distributed data centres – so that your data is still safe in the event of a disaster in one location

If the above criteria are addressed, an online solution may be comparatively safer than either physical data entry or locally stored data.

Myth #2: If I put my accounts online, they’re no longer private

There are two misconceptions at play here.

In the same way that online banking has revolutionised your ability to access your bank accounts remotely, online accounting gives you the flexibility to access your accounts from just about anywhere with a network connection.

You can authorise others, such as your accountant or co-workers, to have access to your accounts as well. This is a strength – not a disadvantage – of an online accounting package, because it’s up to you who has access. In that sense there’s no difference in real trust terms between an online accounting system and one that you lock away on a desktop or self-hosted network.

Then there’s the issue of privacy as it relates to your content on a server somewhere on the planet.

Here’s where it’s doubly important to use a trusted and secure name with a strong interest in your privacy and an open attitude to showing you where data is stored and how it’s encrypted. Azure data centres by Microsoft operate on strong privacy principles to ensure your data remains private.

Myth #3: Once it’s in the cloud, I don’t know where it really is

It’s wise (and in some jurisdictions, a legal obligation) to know where your online provider is actually hosting your data.

If you’re using a secure provider, such as Microsoft Azure, the company is quite specific and transparent about where it stores your data. This way, you can confidently meet your legal obligations and can rest easy with regards to the security of your data.