Almost half of small and midsized businesses that use accounting software use a cloud-based platform today, a survey has found, whereas a decade ago desktop versions dominated.

The study also found that almost one in five SMBs do not use accounting software at all.

Of the companies that do use accounting software, desktop versions are still the most popular by a slight margin. Forty-three percent use QuickBooks Desktop, 5 percent use Microsoft Dynamics Desktop, and 3 percent use Sage Desktop products. However, in the post-cloud era, the scales are tipping towards online accounting software products. The most used cloud-based solution is QuickBooks Online (28 percent), followed by Freshbooks, NetSuite and Xero (all around 2 percent), and Sage Online at 0.5 percent.

The survey included 5,000 SMB respondents, more than half of which make less than $500,000 in annual revenue, and was conducted by Viewpost, a provider of invoicing, payments, and cash management solutions.

“We’ve also found that many companies that do use accounting software don’t even use it regularly,” Viewpost CEO Maxi Eliscu told Accounting Today. “They’ll use Xero or QuickBooks and still do things with spreadsheets. Then an accountant comes in once a month to prepares their financials and get them in order. The problem is real.”

Eliscu said that small companies don’t put enough emphasis on understanding cash flow, and having cash on hand is one of the biggest pain points for SMBs. He sees integrating invoicing and payments solutions with accounting software as one way to address this problem. Thirty-one percent of respondents said such an integration would improve their cash management decisions, but only 13 percent said that their company sees this as a priority.

One fifth of responding companies have already integrated invoicing and payments solutions, but more than half said they had no concrete plans to do so.

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