Are you ready for cloud-based accounting software?

Cloud-based accounting software is becoming more popular and increasingly forms the backbone of a firm’s back-office.

Sage, one of the key software providers in the industry, has seen a huge leap in subscriptions to its cloud offering.

The company said revenues rose five per cent in 2014 off the back of a surge in cloud sales. Subscriptions for its Sage One cloud-based system rose to 86,000 in 2014, more than double the 35,000 the year before.

“The move to subscription is attractive for Sage and our customers as it builds greater and more predictable revenue streams for the future,” the company said in its earnings release. “By balancing subscription adoption across new and existing customers, we are managing the potential near-term impact on revenue of the transition to subscription.”

It comes as the firm launches a specialist platform for accountants of small businesses that delivers an end-to-end cloud-based solution. Designed for accountants in the UK, it allows businesses to easily file accounts with HM Revenue and Customs and Companies House at the same time. This is just one example of how cloud-hosted accounting software is shaking up the industry.

But are companies on board with the cloud train yet? Perhaps not entirely. A survey of 264 accountants in the US carried out by the firm found that just ten per cent of respondents make use of the cloud or online services to collaborate or share information with their clients. When the number one problem cited by respondents was collecting all necessary documents on time, the benefits of cloud solutions seem obvious.

And the US data chimes with wider trends. A global study of small businesses by New Zealand-based accounting software provider Xero showed uptake at around 11 per cent. Australia was ahead of the curve at 14 per cent.

But things are shaping up to change in 2015. Four in ten businesses polled by Xero are looking to convert to cloud applications in the next year and the firm’s New Zealand managing director, Victoria Crone, believes we are at a “tipping point” for cloud-based systems.