New doors open from the cloud

One of the benefits of cloud accounting is the ability to make square pegs fit.

Cloud accounting offers opportunities to a wide range of businesses.

Need a better way to measure road freight and pay the taxes? What about replacing your cash register with an iPad? Want to take on a new client and, regardless of its accounting system, not have to make a change to your own practice?

A new crop of technology companies that write cloud software is highlighting the potential to transform a range of businesses, even those you would least expect.

On the road

Although there are few firms rushing to sell new technology to trucking companies, eRoad in New Zealand (NZ) is an exception. 

Every semi-trailer or road train has to pay applicable fees to the roads authority in its country through petrol tax excises and levies on the distance travelled. For example, in NZ a typical mid-size truck incurs NZ$40,000 to NZ$80,000 a year in road usage charges. 

Drivers buy prepaid licences based on the distance they expect to travel but often underestimate, risking large fines, or overestimate, thereby wasting money. 

eRoad already tracks a quarter of the tax revenue raised in NZ through road licences via digital systems that have replaced paper-based forms and mechanical odometers with online records and GPS technology. 

Trucking companies have signed up to the service because they know they will always be compliant, save on administration by migrating from a paper-based to electronic system, and confidently be able to buy licences entitling fewer kilometres without fear of fines. In addition, eRoad refunds the cost of any unused kilometres.
"We’re using technology in a way to help businesses be the best they can." – Steve Newman, eRoad
The organisation has now expanded its product range into areas such as a fuel consumption service that measures costs and CO2 emissions across a fleet. It identifies fuel-inefficient vehicles and undesirable driver behaviour such as speeding and unnecessary idling. eRoad claims its service can slash fuel consumption by 5 to 10 per cent. 

In addition, driver behaviour reports can feed into training programs that, in turn, reduce the amount of maintenance required on vehicles. 

“We’re about solving compliance concerns,” says eRoad CEO Steve Newman. 

“We’re using technology in a way to help businesses be the best they can.”

eRoad is not just focused on reducing fuel taxes for truckers. It is looking to reinvent the way governments apply taxes to cover road maintenance. The standard approach is a petrol excise, but as cars become more fuel efficient and use less fuel - or even no fuel in the case of electric cars – it’s clear the existing regime is reaching its use-by date.

The logic of excises collapses at the high end of the scale, too. 

“The relationship between fuel and weight breaks down at six to eight tonnes. A 50-tonne truck causes 10 to 16 times more damage than a 40-tonne truck,” Newman says.

“Bigger trucks reduce the number of conveyances. So to improve national productivity, trucks will get even bigger to reduce congestion but they will do more damage to the roads.”
 

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Made to measure

Vend is a software company with a mission to replace the clunky old cash register. Its point-of-sale (POS) software can work on an iPad or iPhone and is able to share customer information with various marketing and loyalty programs. Further, by automatically sending information to third-party software, Vend reduces data entry and related errors.

NZ-based bespoke tailoring firm, Crane Brothers, had long avoided using a cash register because it would have clashed with the “gentleman’s club” aesthetic of its showrooms.

“They resisted a POS for many years because it was so ugly and they didn’t want a counter,” says Vend marketing director, Nick Houldsworth. 

After the tailor’s owner, Murray Crane, installed Vend, alongside online accounting program Xero, he found he could save more than 40 hours a week in typing up spreadsheets – the equivalent of one full-time salary.

Vend’s cloud-based POS pushes customer and sales data seamlessly into Xero, in turn cutting down data entry errors. Vend can also email customers an electronic receipt – instead of having to issue a paper one – while the address can be automatically pushed to electronic marketing programs such as Campaign Monitor and MailChimp. 

“If your POS is not integrated, someone has to type out receipts at the end of the day and then type them into a computer,” Houldsworth says. 

“There’s always going to be a margin of error.”
 
Sharing data between different programs can also generate valuable insights into a business’s operations. 

Vend can push through sales data to another cloud program called Deputy, which calculates employee rosters based on availability and performance. Over the course of a week Deputy displays sales through Vend to show when the business was busy or quiet, which staff members made the most sales and whether everyone was occupied. 

“It may seem crazy to put four people on at 11am, but if you’re missing out on sales at that time then it might make sense,” Houldsworth says. 

Indeed, Deputy goes further by suggesting a roster that prioritises the most productive employees.  

“Giving people business analytics is one thing, but telling them what to do about it is where it’s at,” Houldsworth says. 

“It can get you to a point where the stuff that would normally cause you headaches just happens.”

One for all

Of the many companies looking to reinvent the accounting practice, one of the most interesting is NZ start-up Common Ledger. Although still in Beta, the web platform aims to solve problems caused by the deep fragmentation of the Australasian accounting software market, which currently boasts about eight different applications for SMEs.

The objective of Common Ledger is to transform accounting firms by acting as a clearing house for transactional data derived from all accounting programs. 

For example, if a MYOB-based practice had a client that insisted on Xero, the client could connect its cloud accounting app to Common Ledger, which would then send the data directly to MYOB Accountants Office or Accountants Enterprise.

By liberating data from accounting programs, Common Ledger gives back choice to businesses and accountants, says CEO Vince Warnock.

“Whatever accounting provider the business is using, accountants can deal with it,” Warnock says. 

“An accountant can take on any client without having to change internal processes or tools.” 

As such, time is saved that would otherwise have been spent on establishing and learning an unfamiliar system for a single client. In addition, it becomes possible to take on a much wider client portfolio, regardless of the preferred accounting solution. 

Common Ledger is unusual in that it’s a cloud technology that extends the life of desktop accounting software by pulling transactional data for reconciliation and reporting in the accountant’s own systems, in real time. 

“It’s elongating those [desktop] ecosystems,” Warnock says. 

“Sometimes clients are happy using desktop and we’re enabling them to make that choice. We’re allowing accountants with legacy systems to move forward into the cloud.”

Common Ledger starts trials in July 2014 with a limited number of firms and will launch in October for Xero, MYOB AccountRight (Live and version 17 Plus) and Essentials, QuickBooks Online and Reckon Accounts (formerly QuickBooks desktop software).

So, whether driving trucks, selling suits or reconciling accounts, cloud technology can offer a plethora of new opportunities to businesses looking to lift their everyday performance.

Key benefits of cloud accounting:

•    Opportunity for multi-faceted cost efficiencies
•    Greater regulatory compliance
•    Reduced margin for data entry errors
•    Less labour-intense than legacy systems
•    Seamless integration with electronic marketing programs
•    New business perspectives
•    Clients with square pegs can still fit

November 2019
November 2019

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