We are going to briefly differentiate between three main services offered through cloud computing, as discussed by Dion Hinchcliffe here.
Storage – computer data no longer has to be stored on site. Instead, they can be backed up at another location supervised and run by a third-party.
Applications – computer applications can be stored and accessed online. This would allow better control over application usage, in addition to giving easier and increased access to users.
Computing – the ultimate in cloud computing, with the entire computing process from data storage, application storage, to memory usage offered through a third party through the internet. There are several advantages of cloud computing for the accountancy profession. As Mircea Goia noted in this entry, it allows the capacity for application growth (scalability), superior work capacity (performance), and minimal failures (reliability) as the needs of the firm evolve. Moreover, Sai Jandhyala noted here several advantages of cloud computing and we discuss below their real life application for a small to mid-size accounting firm:
- Improved accessibility and flexibility: This includes but is not limited to the client’s workplace, travel destination, and home. The flexibility to work from home is an enticing perk for many potential employees. Employees could even access needed applications via cellular devices.
- Increased productivity due to decreased latency and multi-tenancy: Latency is decreased due to increased accessibility (people can work wherever and whenever). Multi-tenancy is a core feature of cloud computing as people can work together online and collaborate regardless of location. This is imperative as teams of accountants working on the same client routinely need to communicate.
- Increased security:
- Computer-specific malware or malfunction – if a specific computer is attacked by malware or crashes; sensitive documents are safe since they are not stored on the computer but rather off-site, work can be resumed on another computer.
- Heightened security – dedicated providers of the service would concentrate efforts in safeguarding their plentiful clients’ sensitive data. The centralization of the application (economies of scale) through cloud computing would significantly reduce the monetary impact of such measures on a sole client, by segregating them across several existent users.
- Centralized location of confidential documents – with regards to client information, sensitive data will no longer be left on often unsupervised laptops and desktops, but would instead be stored offsite at a third party location, guarded through superior technology.
- Better infrastructure at a lower cost (hardware/software):
- Reduced capital expenditure – the firm does not have to invest in software and hardware services, as it will be handled by third-party providers. Similarly, the firm will not have to worry about obsolescence or upgrades either; so the firm can focus on its core business. The firm would merely pay a subscription fee and/or payments based upon usage.
- Scalability – during the busy/off seasons for individual departments – i.e. tax and audit – the firm can allocate computing resources from one department to another or increase or decrease its total resource usage.
- Increased performance – specialized hardware/software that individual firms cannot afford will be provided by third party providers who are able to achieve economies of scale.
- Boost support for accounting clients by offering real-time support with the use of online applications such as HumanClick or BoldChat. These can also be utilized for communication amongst employees.
Dewey Wright Itoff & Howe 
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