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Cloud accounting 
is the provision of accountancy software through the cloud. Users login into 
the accountancy software to process financial transactions and produce management reports in 
the same way as if the software was installed on their own machine. 
A cloud service can be private or public. A 
public cloud
sells services to anyone on the Internet. (such as 
Amazon Web Services and Dropbox.) A 
private cloud
is a proprietary network or a data centre that 
supplies hosted services to a limited number of people. When a service provider uses public cloud 
resources to create their private cloud, the result is called a 
virtual private cloud
. Private or public, the 
goal of cloud computing is to provide easy, scalable access to computing resources and IT services. 
In the UK, Sage, Quickbooks and Xero (as well as others) provide 
cloud accounting services
. The main 
benefits of a cloud accounting system over a traditional system installed on individual machines include: 

System data and the software itself is automatically refreshed and kept up-to-date. 

Information in the system is available to multiple user simultaneously and globally, providing the 
users have internet access and a login. 

Duplication and other system errors and inconsistencies are eliminated because only one set of 
data is kept and is synchronised to all users.

Data is stored in one offsite location and users simply access the information when required. 
There is no need to transmit the data between users over the internet or by USB stick, increasing 
data security. 

Multiple users mean key people can access financial and customer details should they need to. 

It reduces the cost and complexity of keeping backups of the data because this is performed by 
the cloud service provider. 

It reduces the cost and time involved in upgrading the software. 

It improves support and customer service because the service provider can access the user’s 
information to help resolve issues. 
PER performance objective PO4 requires you to contribute to the effective governance of an 
organisation and raise awareness of risk. The material covered in this chapter will help you achieve 
this. 
BPP Tutor Toolkit Copy

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CHAPTER 9
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CONTROL, SECURITY AND AUDIT