CPA Magazine cloud survey results

For accountants working in the cloud, the future looks sunny.

If CPA Magazine’s first-ever cloud survey is any indication, CPAs are generally a cloud-friendly group. About 40% of you are already using the technology and the rest plan to do so within the next year or two.

The idea behind the survey, which we ran in December 2015 along with a primer on the subject, was to take the pulse of cloud computing in the accounting profession. We wanted to know how familiar you are with the technology, what types of applications you use for business, and how satisfied you are.

We received almost 100 responses from CPAs working in a wide variety of industries. It’s interesting to note that about 30% of you were in professional services, and about 90% came from small and mid sized organizations.

APPLICATIONS

The survey included ERP/accounting, Time & Billing, CRM, Business intelligence, HR, Payroll, Document Management and Office. Payroll topped the popularity list with about 50% of respondents using the cloud for that function. Not too far behind were ERP/Accounting systems and Office. Trailing the list was business intelligence – possibly because of lingering concerns about data security.

PUBLIC VS. PRIVATE

For business, most of you currently use private clouds – in which a platform is dedicated to just one organization, rather than many. With ERP, for example, 56% of cloud deployments are on private clouds, 32% on public clouds, and the remaining 12% on hybrid systems. However, those percentages should even out in the next couple of years with 42% on public clouds and 46% on private clouds.

For time and billing, the shift is expected to be even more pronounced. Currently, 57% of deployments are on private clouds, while 40% are on public clouds. But in a few years, 55% will be public versus 27% private. That is probably because there will be more public cloud solutions to choose from. At the moment, many vendors are not able to offer public cloud deployments because it requires a big change to their systems. But as the public cloud gains wider acceptance, vendors will find it worth their while to make the change. Public clouds are significantly less costly for vendors because of the economies of scale they can realize by using the infrastructure for multiple customers.

A SAFE PLACE TO BE

Most of you are quite satisfied with cloud computing. On a scale from one to five, where five stood for very satisfied and one for very unsatisfied, the average rating was close to four or more:

Return on investment: This had the lowest rating, which is interesting. There could be many explanations for this, including unexpected setup costs. But the score is still high.

Cloud security: Although one respondent said the cloud was not an option because of security/confidentiality of client data, most of you had no problems in this area. In fact, if you work for a small or mid-sized company, you might look to the cloud for protection because you don’t have the in-house expertise to deploy secure computer systems. It’s a different matter for large organizations, which have confidential information (such as credit cards) that hackers can potentially turn into big money. No wonder Ebay, Home Depot and Target have all suffered massive security breaches in the past couple of years. Hackers can use also confidential information for blackmail, as they did in the Ashley Madison breach. However, we don’t hear about security breaches with small companies. This could be because there is less profit in hacking a small company’s data. Or it could be that we don’t hear about such breaches because they aren’t newsworthy, or because the company would prefer not to let anyone know. We are considering a follow-up story about security risks in the clouds for small and mid-sized companies.

AFFORDABILITY

One respondent commented that “We were able to have features [with the cloud] that we could not afford under a standard licence arrangement. It's easier to plan for the annual licence fee than a large upfront cost.” It’s true that the cloud has many advantages. You don’t need to:
  • invest in computer/network infrastructure to support the system;
  • invest in people to support the infrastructure;
  • upgrade the software, since you are always using a current version;
  • install the software on your PC, because you just need a browser and a high-speed connection;
  • ramp up for a busy time that is just temporary. Instead, you can get instant access to computing power as needed;
  • have secure financing to acquire the software.

Just as customers are beginning to realize the advantages of the cloud, vendors are reaping the benefits. An article in Business Insider, recently reported that between Q4 2014 and Q4 2015, Amazon Web Services’ revenue grew by 69% and its profits nearly tripled, from $240 million to $687 million. That same article noted that Microsoft is growing its cloud revenue even faster than Amazon.

So it definitely looks as if the clouds are rolling in. And as our survey shows, CPAs will be going right along with them.

About the Authors

Michael Burns


Michael Burns, MBA, CPA, CA, is president of 180 Systems (180systems.com), which provides independent consulting services, including business process review, system selection, business case development and project management.

Margaret Craig-Bourdin


Margaret Craig-Bourdin, MA, DEA, DESS, is editor, online edition, at CPA Magazine.

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