Cloud computing - a matter of survival for the accounting industry?

Cloud computing - a matter

of survival for the accounting
industry?
A national research study commissioned by CCH
April 2013

Cloud computing - a matter of survival for the accounting industry?

Contents

1.0

The adoption of cloud-based solutions is low but rising rapidly

2.0

What are the key benefits of cloud-based software?

3.0

Reasons cited by accountants why they have not adopted cloud

computing

4.0

Will cloud-based software ultimately mean some SMEs replace their

accountants?

5.0

Are accountants concerned about losing work if SMEs embrace the

cloud?

6.0

How fast are accountants moving to adopt cloud-based solutions?

7.0

For accountants, what are the most important features of cloud-based

software?

8.0

Security is a key priority when considering making the transition to a

cloud-based system

9.0

Methodology

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Cloud computing - a matter of survival for the accounting industry?

1.0 The adoption of cloud-based solutions is low but rising rapidly

Fourteen per cent of SMEs use a Cloud-based software to manage their accounts.
SME owners / managers aged 18 to 34 are more likely to use a Cloud-based software (31%; cf. those
aged 35 to 49 12%, 50+ 6%).
More accountants (23%) use a Cloud-based software for their client work.
Accountants aged 18 to 34 are more likely to use a Cloud-based software (29%; cf. 35 to 49 21%, 50+
13%).

Adoption of cloud-based software solutions for accounting in 2013 (SMEs and accountants)

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Cloud computing - a matter of survival for the accounting industry?

2.0 What are the key benefits of cloud-based software?

Accountants believe the biggest benefit of using a Cloud-based system is that it can be accessed
from multiple locations (62%).
Other key benefits include that they dont need to worry about maintenance (32%) or purchasing
hardware or accounting software (32%).
Accountants aged 50+ are more likely identify that you dont need worry about purchasing hardware
or accounting software as a benefit (44%; cf. those aged 18 to 34 23%, 35 to 49 36%).

Key benefits of cloud-based software

(%)

Gain access from multiple locations

62%

I don't need to worry about maintenance or hardware system up

32%

No need to purchase hardware or accounting software

32%

Easily scalable as my clients grow / needs change

30%

It requires no updates, tax table updates or version upgrades

28%

Reduced overall costs

27%

Lower up-front investment required by my clients

25%

Access to improved reporting

21%

Better security of data

18%

Advanced / specialist features available

12%

Don't know

17%

Other

2%

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Cloud computing - a matter of survival for the accounting industry?

3.0 Reasons cited by accountants why they have not adopted cloud
computing

The main reason why some accountants are not using a Cloud-based system is simply because they
have a working system (37%).
Other key reasons include that they have security concerns (31%), they havent had enough time to
investigate (29%) and they are not familiar with what is available (28%).
Accountants working in large businesses (i.e. 200 or more employees) are more likely to have
security concerns (43%; cf. those in small businesses 29%, medium businesses 31%).
Accountants aged 50+ are more likely to be reluctant as they believe their clients are nervous about
Cloud systems (41%; cf. 18 to 34 18%, 35 to 49 23%).

Reasons why some accountants have not adopted cloud

computing

(%)

Have a working system

37%

Security concerns

31%

Not enough time to investigate

29%

Not familiar with what is available

28%

Clients nervous about cloud-based systems

25%

Downtime

12%

Not worth the cost

12%

See no benefits

6%

Don't know

16%

Other

5%

Have a working system

37%

Security concerns

31%

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Cloud computing - a matter of survival for the accounting industry?

4.0 Will cloud-based software ultimately mean some SMEs replace their
accountants?

Almost two thirds (64%) of SMEs would consider replacing some of the roles that their accountant
currently performs with a Cloud-based accounting system.
This is higher amongst SME owners / managers aged 18 to 34 (86%; cf. those aged 35 to 49 67%, 50+
49%).

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Cloud computing - a matter of survival for the accounting industry?

5.0 Are accountants concerned about losing work if SMEs embrace the cloud?

More than half (52%) of accountants surveyed are concerned about losing work due to SMEs
replacing their services with Cloud-based services with only 3% extremely concerned.
Accountants aged 18 to 34 are more likely to be concerned about losing work (58%; cf. those aged
35 to 49 54%, 50+ 36%).

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Cloud computing - a matter of survival for the accounting industry?

6.0 How fast are accountants moving to adopt cloud-based solutions?

Six in 10 (60%) accountants who are not currently using a Cloud-based system consider it likely they
will adopt one in the next 2-3 years.
Accountants aged 18 to 34 are more likely to consider adopting a Cloud-based system in the next 2-3
years (66%; cf. those aged 35 to 49 58%, 50+ 53%).
Additionally, half (51%) of accountants who are currently using a Cloud-based system believe that
they are likely to increase their use of Cloud-based accounting software in the next 2-3 years.
Interestingly, more than half (53%) of SME owners / managers would consider looking for a new
accountant if their current accountant was reluctant to investigate and embrace a Cloud-based
accounting software.
This is higher amongst SME owners / managers aged 18 to 34 (72%; cf. those aged 35 to 49 56%, 50+
38%).
Those operating medium businesses (20 to 199 employees) are more likely to consider looking for a
new accountant if their current accountant was reluctant (76%; cf. those operating a small (less than
20 employees) business 46%).

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Cloud computing - a matter of survival for the accounting industry?

7.0 For accountants, what are the most important features of cloud-based
software?

For 7 in 10 (70%) accountants, security is an important feature when making a decision on a

platform for a cloud-based software with more than a third (34%) saying it is the most important
feature.
Accountants aged 50+ are more likely to consider security an important feature (79%; cf. those aged
18 to 34 61%, 35 to 49 76%).
Accountants aged 18 to 34 are more likely to consider flexibility an important feature (52%; cf. those
aged 35 to 49 47%, 50+ 41%).
Only 1 in 10 (10%) accountants consider price to be the most important feature.

What are the important features of cloud-based software

(%)

Security

70%

Functionality

65%

Price

57%

Flexibility

48%

Quality of content

31%

Frequency of updates

20%

Scalability

19%

None / don't know

7%

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Cloud computing - a matter of survival for the accounting industry?

8.0 Security is a key priority when considering making the transition to a

cloud-based system

For SME owners / managers, the most important security factor when considering making the
transition to Cloud computing is the high level of online security of their data (including firewalls,
anti-virus protection, spam filters, etc.) (64%).
This is also the most important security factor for accountants (69%).

Most important security factors considered when making the transition to cloud computing

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Cloud computing - a matter of survival for the accounting industry?

9.0

Methodology

The small and medium enterprise (SME) study was conducted among 1,018 business owners or
business decision makers of organisations with 200 employees or less.
The accountant study was conducted among 212 accountants or principals of accounting firms
servicing small and medium enterprises.
Fieldwork commenced on Friday, 8 March and was completed on Thursday, 21 March, 2013. Both
studies were conducted online amongst members of a permission-based panel.
After interviewing, SME data was weighted to the latest business count estimates sourced from the
Australian Bureau of Statistics.

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