Published on the 23/04/2014 | Written by Newsdesk
A warning bell has been sounded for businesses which allow their accountants or bookkeepers to take out subscriptions to cloud accounting services on their behalf…
Reports in the Fairfax newspapers over the Easter weekend about an Australian business which has not had control over its cloud based financial information following a dispute with the company’s accountant have heightened awareness of the need for organisations to think carefully about the location of, and their access to, cloud based data.
Oscar de Vries, the owner of Portland Marketing International which manufactures shaving products, had appointed a new accountant to work with his business, and instead of taking out his own subscription to Xero’s software as a service relied on the accountant’s subscription.
Following a dispute with the accountant de Vries is concerned at the lack of control he has over his company data.
“Whatever the dispute is, your data should not be used as a tool to make you pay exorbitant fees,” de Vries told iStart. “I would say to anyone thinking about using Xero – you have to have the subscription in your own name.”
David Smith, managing director of accounting consultancy Smithink 2020, said that it made sense for small and medium businesses to take out their own cloud computing subscription in order to ensure that they had maximum flexibility and control over their data.
He added that organisations should also ensure they properly understood the terms of engagement with their accountant or bookkeeper. Whatever the nature of that engagement however Smith said accountants should not be holding businesses to ransom.
Xero, which has successfully courted accounting firms, encouraging them to sign up their clients to use the cloud based software, is the very public meat in the sandwich in this particular case. However the warnings about maintaining control of data hold true for any cloud deployment.
Xero Australia managing director Chris Ridd declined to comment on the situation involving Portland Marketing’s data, but told iStart the dispute was not about the cloud platform itself, rather the professional services which had been provided to Mr de Vries’ company.
He claimed that disputes of this nature were very rare among Xero’s 100,000 customers, but acknowledged that Xero was “strict in terms of whom owns the subscription.”
