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Accountants’ cloud security fears ‘overblown’

The majority of accountants are still unnecessarily concerned about the security risks of storing client data in the cloud, according to new data from one accounting technology consultant.

News James Mitchell 02 October 2014
— 1 minute read

In the lead-up to the Accountants’ Technology Showcase Australia event in Melbourne this month, Smithink’s founding director David Smith revealed some of the findings from a survey of 300 industry professionals.

When asked how concerned they are about data security in cloud hosting, 12 per cent of respondents were not concerned at all, 21 per cent were slightly concerned, 29 per cent moderately concerned and 37 per cent said they were very concerned about cloud security.

“If you take ‘moderately concerned’ and ‘very concerned’ together, you’ve got 66 per cent,” Mr Smith said.

“So there is still quite a concern out there,” he said.

The use of cloud computing among accountants is steadily gaining momentum, with several software providers advocating the service.

However, according to Mr Smith, while 20 per cent of accountants are now using the cloud, the rest remain concerned about security, fears which he believes are largely overblown.

“The first thing you’ve got to say to the client is: how secure is your PC?” Mr Smith said.

“Someone could walk into your office tomorrow and pick up your PC or your server and walk out with it and you’ve lost your data that way,” he said.

“As a general principle I would trust the security of most of these cloud providers, as long as they are strong, legitimate companies, much more than I would a server sitting in somebody’s office.

“My view is that it is overblown a bit.”

Cloud providers such as Xero, Google and MYOB understand that their business will be severely hurt in the event of a major security breach, Mr Smith said.

“The investment of time, money, resources and technology that those guys put into building strong, robust systems is extraordinary,” he said.

Mr Smith was previously chief executive of Class Super, an SMSF platform that used cloud storage.

From his time at Class, Mr Smith said he has seen first-hand how much investment is made into ensuring the security of cloud computing systems.

“These companies employ other companies that specialise in trying to hack their systems to make sure their security is as tight as it can possibly be,” he said.

“My personal view is that these legitimate, major brand cloud providers have much securer systems than any individual company could dream of having.”

Commenting on the results of his survey, which show that the majority of accountants are worried about cloud security, Mr Smith said the industry’s fears are essentially an education problem.

“In reality, when you look at the number of people playing in the cloud space with applications, the number of security breaches is minimal,” he said.

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Accountants’ cloud security fears ‘overblown’
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