Association Between Cloud Based Accounting Method And Traditional

Question: Discuss About the Association between Cloud Based Accounting Method and Traditional Accounting Method? Answer: Introduction Accounting Information System is the process of collecting, processing and storing of financial data of the business organizations in order to provide assistance in the process of decision-making (Romney Steinbart, 2012). For this purpose, the information accounting system gathers different types of important financial data and processes them so that effective decision can be made. The total system of information accounting system is run with the help of computer systems. One of the major advantages of information accounting system is that it helps to develop different kinds of measures to provide assistance in the decisions making process. Hence, it can be said that information accounting system has significance importance in the accounting and financial process of the business organizations (Hall, 2012). Explanation of Traditional Accounting Method As per the traditional way, the process of accounting methods is considered as ginning away all the expenditures of the organizations that refers to the overhead of the manufacturing companies (Carmona, Ezzamel Gutirrez, 2016). Apart from this, the traditional manner of meticulous accounting apportions that it is in nature and it can be aligned with the overheads of manufacturing plants. In addition, it can be said that the quality of the information relied upon the encompassing aspects that are related with direct labor hour and manufacturing production plants. Moreover, it can be assumed that the quality of the financial information that relied upon some of the major aspects includes the statistics of cargoes. Explanation of Cloud Based Accounting Method The accounting techniques in the cloud based computing is signified as the way of dealing with the financial and accounting information of the business organizations and the total process of cloud computing process is done with the help of computers and internet (Binyamin et al., 2012). Apart from this, it can be said that the process of cloud computing does not include any kind of fitting software within the system of cloud computing. This process is considered as one of the most efficient process of information accounting system in the business organizations. One of the major factors is that the companies that have adopted the cloud computing system in accounting can offer different kinds of isolated roles and services of the business (Alali Yeh, 2012). Association between Cloud Based Accounting Method and Traditional Accounting Method As per the above discussion, several types of correspondence can be seen between the two accounting techniques that are cloud based accounting method and the traditional accounting method. These similarities include both the various accounting techniques and certain major resemblances. On the other hand, certain variations can also be seen between these two accounting systems. They are discussed below: Cloud Based Accounting Technique Traditional Manner Accounting Method With the help of cloud-based accounting system, the upfront expenses and operation cost of the businesses have decreased (Domeika, 2015). With the help of traditional accounting system, the upfront expenses and operation cost of the businesses have increased. The main purpose of cloud-based accounting is to assist in the process of methodology execution in a rapid way. In case of the traditional accounting method, the process of executing the methodology take much time than cloud based computing. In the process of cloud based computing, the promotions and updates are available in a prompt manner. The process of traditional accounting does not provide promotion and updates. The cloud-based methodology of accounting provides accessibility, usability and mobility (Prasad Green, 2015). The process of traditional accounting method does not provide accessibility, usability and mobility in the process of accounting. The technique of integration effortlessly follows the services that are associated with the cloud. The technique of traditional accounting method considers as an amalgamation practice that does not effortlessly follow the exacting technique. In the process of cloud-based accounting, there are some major issues regarding safety of the system along with some recital risks. The process of traditional accounting system, it is totally exempt from recital risks along with the safety risks. The major two types of risks that are associated with the cloud-based computing are the compliance risks and strategy risks (Helo et al., 2014). In the case of traditional accounting system, the major risks are associated with deficiency risks that may be strategic risks or compliance risks. Drawbacks of Accounting Method Implementation in Cloud Manner At the time of accessing the cloud-based computing system, the accountants have to confront with certain types of inconveniences. They are discussed under: Some of the major restraints in the cloud based accounting techniques can be seen in the processes of incorporation, customization, and functionality and in the policy of hybrid consumption of the accounting system (Behl Behl, 2012). In the process of cloud-based accounting, one of the major concerns is the SLA concerns that are service-level agreement (Ahmed Hossain, 2014). Several types of risks are associated with the process of cloud-based accounting. For the presence of these types of risks, another major concern is the performance of the companies. These types of risks are associated with the aspects of data, information and security of the system. Apart from this, other two kinds of risks are risk of compliance and the risk of strategy (Fernandes et al., 2014). The daily expenditures of operating costs and fixed costs of the implementation of the various accounting methods are treated as additional costs in the process of cloud computing method (Ryan, 2013). Conclusion and Recommendations From the above discussion about the process of cloud-based accounting and the traditional method of accounting, it can be observed that both the accounting systems have some major advantages along with some disadvantages. For this reason, the business organizations need to employ the suitable accounting method based on the type of the industry and the size of the company. It is recommended that the business organizations with large number of business operations need to adopt the strategies of cloud based accounting system over the traditional accounting method. The main reason is that the process of cloud-based computing will help to organize the large amount of financial information from the large and diverse business operations. In addition, the adoption of cloud-based computing will assist in mitigating various kinds of accounting risks of the business organizations. References Ahmed, M., Hossain, M. A. (2014). Cloud computing and security issues in the cloud.International Journal of Network Security Its Applications,6(1), 25. Alali, F. A., Yeh, C. L. (2012). Cloud computing: Overview and risk analysis.Journal of Information Systems,26(2), 13-33. Behl, A., Behl, K. (2012, October). 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