Cloud Accounting Pros and Cons【Complete Explanation】

TL;DR

• Core Problem: Cannot decide whether to implement cloud accounting or choose traditional accounting software
• Quick Answer: As of 2023, over 95% of SMEs choose cloud accounting. Low initial costs, rich automation features. However, internet connection is required and there are security concerns. With POS（Depends on plan）-integrated Seisei, sales data automatically converts to accounting data, reducing work hours by 40 hours per month.
• Target Audience: SME owners (restaurants, retail stores, service businesses), accounting managers
• Expected Benefits: By choosing appropriate cloud accounting, achieve 40 hours of work reduction per month and 30% cost reduction
• Reading Time: 12 minutes

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Important Terms

Cloud Accounting

Definition: Accounting software accessed via the internet. Data stored on cloud servers, accessed from browsers or apps. Scope: Monthly subscription, automatic updates, bank account integration, receipt scanning. Low initial costs (¥0~（Excluding tax, varies by plan）tens of thousands). Offline use not pos（Depends on plan）sible. Related: SaaS accounting, online accounting, cloud-based accounting software

On-Premise Accounting

Definition: Accounting software installed on company computers. Data stored on company servers or PCs. Scope: One-time purchase, high initial costs (¥100（Excluding tax, varies by plan）,000~500,000), paid version upgrades. Can be used without internet connection. Related: Package accounting software, installed accounting

POS（Depends on plan）-Accounting Integration

Definition: System where POS（Depends on plan） and accounting software are integrated from the start. Sales data automatically converts to accounting data. Scope: Includes automatic journal entry of sales data, automatic tax classification, automated daily/monthly closing. No separate integration fees. Related: Integrated business management system, all-in-one POS（Depends on plan）

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Cloud Accounting Pros

Pro 1: Low Initial Costs

Specifics:

• Many cloud accounting systems have ¥0（Excluding tax, varies by plan） initial costs (freee, MoneyForward, etc.)
• On-premise typically ¥100（Excluding tax, varies by plan）,000~500,000 initial costs
• No hardware investment needed (no server purchase needed)

Impact:

• SMEs can easily implement
• Many services offer trial periods (1 month free, etc.)
• Low initial investment risk

Data Source: Japan Accounting Software Market Survey 2023, each company's official website (as of December 2023)

Pro 2: Rich Automation Features

Specifics:

• Bank account integration automatically retrieves transaction statements
• Receipt scanning automatically generates journal entries
• Tax filing data automatically outputs

Impact:

• 40+ hours/month work reduction (Source: Seisei implementation case study, N=50)
• Significantly reduced human errors
• Reduced accounting manager workload

Data Source: Seisei Customer Effectiveness Report 2023, Cloud Accounting User Survey 2023

Pro 3: Accessible from Anywhere

Specifics:

• Accessible from PC, smartphone, tablet
• Accessible from business trips or remote work
• Same data accessible from multiple locations

Impact:

• Remote work compatible
• Owners can check business status from outside
• Unified data management pos（Depends on plan）sible

Data Source: Cloud Accounting Usage Survey 2023

Pro 4: Automatic Updates

Specifics:

• Features for legal changes automatically added
• Security patches automatically applied
• New features added without additional fees (within basic plan)

Impact:

• Always have latest features
• Reduced security risks
• No maintenance work needed

Data Source: Each company's official website, Cloud Accounting Comparison Report 2023

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Cloud Accounting Cons

Con 1: Internet Connection Required

Specifics:

• Cannot use in offline environment
• Difficult to operate in unstable connection areas
• Business may stop during connection failures

Impact:

• Internet environment setup needed
• Communication costs incurred (for mobile communication)
• Cannot use during disasters when connection is lost

Solutions:

• Implement mobile Wi-Fi router
• Secure multiple communication lines
• Choose service with offline features

Data Source: Cloud Accounting Usage Survey 2023

Con 2: Security Concerns

Specifics:

• Data stored on external servers
• Risk of cyber attacks
• Pos（Depends on plan）sibility of data leaks

Impact:

• Owners and accounting managers feel uneasy
• Care needed for handling confidential information
• Important to check security measures

Solutions:

• Choose services with security certifications (ISO27001, SOC2, etc.)
• Set up two-factor authentication
• Regular password changes
• Check data backup functionality

Data Source: Information Security White Paper 2023, each company's security information

Con 3: Ongoing Monthly Fees

Specifics:

• Monthly fees of around ¥1（Excluding tax, varies by plan）,000~5,000 continue
• Annual costs of ¥12（Excluding tax, varies by plan）,000~60,000
• May become more expensive than on-premise in the long term

Impact:

• Ongoing cost burden
• Access to past data may be restricted after cancellation
• Multiple plan options, complex pricing structure

Solutions:

• Choose only needed features (review plans)
• Use annual payment discounts
• Choose POS（Depends on plan）-integrated system with accounting features included (Seisei, etc.)

Data Source: Each company's official website, Cloud Accounting Price Comparison 2023

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Cloud Accounting vs On-Premise Accounting Comparison Table

Evaluation Item	Cloud Accounting	On-Premise Accounting	Recommended
Initial Cost	¥0~（Excluding tax, varies by plan）30,000	¥100（Excluding tax, varies by plan）,000~500,000	Cloud Accounting
Monthly Fee	¥1（Excluding tax, varies by plan）,000~5,000	¥0（Excluding tax, varies by plan） (one-time)	On-Premise
Automation Features	✅ Rich (bank integration, receipt scanning)	⚠️ Limited	Cloud Accounting
Accessibility	✅ From anywhere	❌ PC only	Cloud Accounting
Security	⚠️ External servers	✅ Company-managed	On-Premise
Internet Required	✅ Required	❌ Not needed	On-Premise
Updates	✅ Automatic	⚠️ Paid	Cloud Accounting
Data Migration	⚠️ May be difficult	✅ Relatively easy	On-Premise
SME-Oriented	✅ Optimal	⚠️ Enterprise-oriented	Cloud Accounting

Data Source: Japan Accounting Software Market Survey 2023, each company's official website (as of December 2023)

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Frequently Asked Questions (FAQ)

Q1: Which should I choose, cloud accounting or on-premise accounting?

A: Over 95% of SMEs choose cloud accounting. This is because initial costs are low and automation features are rich. However, on-premise accounting can also be considered if internet connection is unstable or if company-managed security is emphasized.

Q2: Is cloud accounting security reliable?

A: Major cloud accounting services have security certifications like ISO27001 and SOC2. Security risks can be reduced by setting up two-factor authentication and regular password changes. Also check data backup functionality.

Q3: How much are monthly fees?

A: Basic plans are around ¥1（Excluding tax, varies by plan）,0003,000/month. Rich feature plans cost around ¥5（Excluding tax, varies by plan）,00010,000/month. Using annual payment discounts can reduce monthly fees by 10-20%.

Q4: Can it integrate with POS（Depends on plan） systems?

A: Many cloud accounting systems can integrate with major POS（Depends on plan） systems. However, integration may require additional fees. Choosing a system where POS（Depends on plan） and accounting are integrated from the start (Seisei, etc.) eliminates integration fees and enables automatic data integration.

Q5: Is data migration pos（Depends on plan）sible?

A: Many cloud accounting systems provide CSV format data export/import functionality. However, if data formats differ, manual migration may be needed. Check before migration if data migration support is available.

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Summary

In choosing cloud accounting, the following points are important:

1. Cloud accounting is mainstream: Can start from ¥0（Excluding tax, varies by plan） initial cost
2. POS（Depends on plan） integration considerations: Integrated systems advantageous if using POS（Depends on plan）
3. Use free trials: Decide after actually using
4. Choose according to industry: Restaurants/retail choose Seisei, service businesses choose freee

Seisei Features:

• ✅ POS（Depends on plan） + Accounting integrated (no integration needed)
• ✅ Initial cost ¥0（Excluding tax, varies by plan）
• ✅ 40+ hours/month work time reduction
• ✅ 30-day free trial

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References

Industry Reports

1. Japan Accounting Software Market Survey 2023 - Market trend data
2. Cloud Accounting Usage Survey 2023 - SME usage status
3. Information Security White Paper 2023 - Security measures data

Each Company's Official Website

1. freee official website - Feature and price information (as of December 2023)
2. MoneyForward official website - Feature and price information (as of December 2023)
3. Seisei official website - POS（Depends on plan）-accounting integration system information (as of December 2023)

Internal Data

• Seisei Customer Effectiveness Report 2023: Comparison data 3 months before and after implementation (N=50)
• Cloud Accounting User Survey 2023: Usage survey (N=200)

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Final Update: December 10, 2023
Next Update Scheduled: June 2024

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Notes / Disclaimer

As of: 2026-01-13

The comparison information in this article is based on our research and interviews conducted as of 2026-01-13, and is provided for reference only. For the latest information and specific pricing/features, please verify with each company's official website.

Comparison Prerequisites:

• POS feature comparison is conducted from two perspectives: "Built-in POS" and "External POS Integration"
• Prices are excluding tax (may vary by plan)
• Implementation period and learning costs are general estimates and may vary by actual implementation environment

Disclaimer: The information contained in this article is provided as general comparison information and does not constitute a recommendation for any specific company or situation. When considering implementation, please verify official information from each company and consult with professionals.

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