Kathy O'Connell, CPA

Cloud computing is all the rage these days.

But what exactly is it? And is it secure enough for accountants?

As financial professionals, we need to make sure our clients’ data is protected. We don’t want their financial information compromised in any way.

How do we balance the efficiencies of cloud computing with the potential threats?

What Is Cloud Computing?

Wikipedia defines “cloud computing” this way:

“Cloud computing is Internet-based computing, whereby shared resources, software, and information are provided to computers and other devices on demand, like the electricity grid.”

So what does that mean?

Basically, when you use the cloud for your IT needs, you no longer need to have servers and copies of software at your office. You just need access to the Internet, and you pay a fee to access programs for things like tax preparation, workflow management, and file storage.

The term "cloud" refers to the Internet. It's based on the cloud drawing historically used to represent the telephone network.

If you’re familiar with Software as a Service – or SaaS – then you’re familiar with the cloud. Think of SaaS as what’s delivered, and the cloud as the medium by which it’s delivered.

Here are some examples of common computer programs that run in the cloud:

• Google Docs

• QuickBooks Online

• online access to bank accounts

Is It Safe?

Accountants are the safeguards of our clients’ financial data. We take that very seriously, as we should.

So should we feel comfortable sending off their data to data centers all over the country – and around the world? What if the files are hacked into, either at the data center or while in transport from our computers to our SaaS provider?

And will we truly own and control that data anymore once it’s left our hands?

I think these are important concerns – but they must be balanced by the benefits of this brave new world.

What Are the Benefits?

The benefits of cloud computing outweigh the risks, in my opinion.

Cheaper

Instead of buying and maintaining servers and software at your office – which usually means hiring an IT guy – you do away with all those needs.

Plus, you get the chance to purchase just what you need, rather than an entire software program that’s far too complicated for the size of your firm.

Greener

Instead of keeping filing cabinets full of paper versions of your clients’ tax returns and financial statements, you have it all online.

You also can likely downsize to just one or two printers per office, instead of one per workstation.

More Efficient

Brian talks a good deal on this blog about the efficiencies offered by our websites for accountants (the secure Client Portal, an emailed Monthly Client Newsletter, the Workteam Collaboration Suite, and so on – see the Increasing Efficiency section of our blog).

When you think about it, all of these are courtesy of the cloud. They save you hours of tedious work and allow you to focus more of your time on client work.

So… What Should You Do?

There is a way to take advantage of the pluses of cloud computing while also guarding against the risks.

Before you jump up into the clouds with any SaaS provider, Greg LaFollette suggests you ask these questions:

1. What’s their privacy policy? Is it published?

2. Is all data safeguarded with 128-bit SSL encryption?

3. Is it compliant with SAS 70? (Starting in June 2011, this becomes SSAE 16.)

4. How well protected are the data centers where your files are stored? (And I would add, are they in the U.S. or outside of the country? If outside, are they in a country with a stable political situation?)

If the answers satisfy you, then go for it. After all, within a year or two or three, you’re probably going to be forced to.

In the words of Mr. LaFollette…

“Cloud computing as we know it now is still a few years away from full acceptance, but I guarantee you, within 10 years there will be no premise-based software in the business of tax and accounting.”

You Might Already Be Up There!

If you participate in online banking, then you’re in the cloud.

Likewise, if you have a website with CPA Site Solutions, you’re also in the cloud!

And just to reassure you, we take your security – and your clients’ – very seriously. Please read about our 14 layers of security for the Client Portal.

If you have any concerns at all, please don’t hesitate to reply to this post or email us at support@cpasitesolutions.com. You can also call us at 1-800-896-4500.

If you don’t have a website with us but you’re ready to get started in the cloud, try us out free for 60 days.

Enjoy running your business from the clouds!

Any CPA website hosted by CPA Site Solutions automatically has the benefit of email, online documents and more via the Workteam Collaboration Suite. Email integration is easy enough however using online documents, part of a paperless office solution, is sometimes a longer process. The integration of online documents within Microsoft Office through Officesync is easy. It also makes your accounting firm efficient and is one more step towards a paperless office.

Integration. A quick free download gives you access to your Google docs via Microsoft Office 2003 or 2007. The free version gives you the ability to collaborate using Office and Google Docs. There is a premium version that allows collaboration via Google Sites that could be worth it.

How It Works. Officesync shows up directly within your Microsoft Office software. Right below the Save As button you should see an Officesync option. From here everyone in your accounting firm has the option to open, create, or share an online document.

The Benefits. If your accounting firm collaborates on documents between team members, then you have the benefit of instant updates. This shortens the time it takes to work on a project between accounting firm team members. All team members have instant access to any and all updates that have been made to a document, while never leaving Microsoft Office.

Most accounting firm’s are used to using Microsoft Office. Having Officesync means no one in your accounting firm has to learn much more. Accounting members do get the benefits of Google docs within their existing workflow. These benefits include being able to share documents online, access a document from any browser, and team collaboration.

More and more accounting firms are recognizing the benefits of a paperless office in terms of efficiency. Since Officesync integrates with Microsoft Office, there is little or no learning curve.

Do you already use Google Docs within your accounting firm? How has it helped your accounting firm get things done? Comment below.

If you have a website hosted with CPA Site Solutions and have email via the Workteam Collaboration Suite, then you should be aware of some changes with Internet Explorer 6 and Google. Google plans to discontinue support for Internet Explorer 6.

Shared Calendars is One Feature Offered by the Workteam Collaboration Suite

IE 6 Not Supported. Google plans to discontinue support for Internet Explorer 6 starting March 2010. According to an email sent out to those who use Google Applications, “over the course of 2010, we will be phasing out support for Microsoft Internet Explorer 6.0 as well as other older browsers that are not supported by their own manufacturers. We plan to begin phasing out support of these older browsers on the Google Docs suite and the Google Sites editor on March 1, 2010.”

Since the Workteam Collaboration Suite is powered by Google Apps then the proposed change potentially affects those who use it. If you are of the 10% of those who still use IE 6 then you might consider some alternatives.

Switch to Firefox. In a previous post there is mention of many reasons to switch to Firefox. The decline of IE 6 can now be added to the list of reasons to switch.

Update Internet Explorer. It is free to just upgrade to IE 7 or just jump to IE 8 (option available within the same link). If you are like the other roughly 36% of users who like Internet Explorer then this is probably your best option.

Use Chrome. Google’s browser is called Chrome and, although only launched in September of 2008, already has over 10% of the browser share of users. It is faster than many of the other browsers and is easy to use. If you are interested in new frontiers this might be your option.

Use Safari. Safari is the default browser for those people who use a Mac. Even so if you own a PC you can use it as well.

Use Opera. You can also download Opera for free. Although only 2.2% of people use it, it is still an alternative to IE 6.

Although support for IE 6 is declining, there are alternatives. If you use the Workteam Collaboration Suite provided with any website hosted by CPA Site Solutions, then you want to be sure to choose one of the alternatives above.

Have a comment? Fill out the form below.

Despite current technology, one of the more time consuming tasks that remains for a CPA is getting a signature for a document. That is why the fax machine, with earlier machines developed before the phone, remains with us still today. This post continues where a previous post on exchanging files left off.

(Disclaimer: The following are some ways to get a digital signature, just be aware that there may be legal requirements within each state that you may need to look at. In general because of the Uniform Electronic Transactions Act of 1999 you should be able to use the electronic signature for your CPA needs.)

Using a Service. This is the easiest and the best option in terms of making sure the signature you receive can be trusted. Considering the time you could save this option, even though costing some money, this can really be worth it.

EchoSign

There are a number of services available to you. Here is one you can look at as an example of what you can expect. It is called EchoSign and is used by larger companies such as Dell, PayPal, and HP.

How the Service Works.

• Upload the document.
• Enter the email of the client with a description or helpful details.
• They receive the email, click to sign, and send it back.
• Here is a link to a full description. This works great for contracts as it cuts down on the time it takes to get the contract signed.

If you are a really small firm and only need 5 signatures in a month then the service is free. Otherwise the service starts at $14.95 a month and can be worth it if you only use it for the busiest part of the year and then discontinue.

Integrates with Google Docs. If you have a website with CPA Site Solutions and use the Workteam Collaboration Suite, then you have access to Google Docs. EchoSign integrates well with all the existing documents you may have online.

An online service such as EchoSign is only one way to get signatures from a client. Look for upcoming posts reviewing some PDF alternatives and some fun ways to use images of signatures.