It used to be that almost all accounting software was some kind of “product” that was downloaded. It used to be this was done through a hard disk.

 

Now, it’s a lot more common to download software programs directly over the Internet. Some software providers will do both.

 

Over the last several years, a new kind of software delivery system has gained a huge amount of traction and market penetration: Cloud computing. There are a lot of different names for this type of delivery system, as it applies to accounting software features. You might hear it referred to as cloud software or cloud-based applications. You might hear it referred to as Software as a Service (SaaS).

 

For most business owners, there are two basic things you need to know about this new kind of software system:

 

1) The technical difference is that the accounting software and databases are maintained through offsite servers, and

 

2) These cloud-based software services typically charge monthly subscription fees, rather than a one-time cost for downloading the software product.

 

For the next generation of accounting professionals, there’s also interest in cloud-computing software that operates as what’s known as Platform as a Service (PaaS).

 

PaaS is similar to other cloud computing systems, but instead of fully-formed software solutions, the platform allows accounting software developers to customize the system with their own tailored application programs.

 

With the right combination of platform software and tech-savvy accountant, huge accounting demands can be met with at an accounting cost that would have been unthinkable a generation ago.