It has become almost impossible to avoid cloud-based software. No longer a vague notion about being “on the cloud”, Wolters Kluwer’s June 2025 Future Ready Accountant Report found that while only 47% of UK accountants are using cloud-based software, 97% of accountants “mostly” or “totally” trust the cloud. Bridging this gap is a worthwhile goal, with the Wolters Kluwer report finding that 74% of cloud-based firms are reporting growth, compared with 65% of traditional firms.

But it can be challenging to determine how to get started with cloud computing, so ICAEW has published a software adoption checklists. Here are four key questions to help accountancy firms make the move.

1. How can firms take a strategic approach to implementing cloud software? 

Instead of a haphazard ad hoc approach, cloud software is an investment, so firms should first determine their priorities and use cases.

A business and technology strategy should clearly articulate software selection principles, addressing cloud-first (prioritising cloud software) versus on-premises (keeping IT infrastructure in-house), off-the-shelf versus bespoke products, all-in-one solutions versus specialist tools, perpetual or subscription licensing models, and determining a company stance on open-source solutions.

Next, define the crucial software capabilities, such as user/client experience, reporting, data accessibility, integrations, security and automation/use of AI. Critically evaluate if the vendor's products align with the firm’s priorities and needs. Finally, assess the main software dependencies and governance, consider the impact of changing providers, and confirm internal capabilities for implementation and data migration.

2. Are legal and contractual requirements being met?

There are legal and regulatory implications when purchasing software – it is a more considered business purchase than stationery, for example.

Regulatory and legal requirements include the ability to provide historic data for audits, especially for HMRC. Review pricing elements, covering trial and notice periods, contract duration, automatic renewals and price increase risks. Terms should be transparent and unambiguous.

Evaluate service level agreements, defining included services, such as IT support and reporting functions, and any fees for extra services or access. Define termination rights, including notice periods, read-only access post-cessation, and the ability to set up a software escrow agreement for data recovery. Confirm the contractual liability limits and purchase adequate insurance coverage for financial losses.

If your organisation engages in M&A activity, there are also contractual considerations when it comes to the software you’re using. Contractual flexibility is critical if you want to integrate the two organisations smoothly.

If software contracts are too rigid, you may find different teams using different software for a period of time, instead of working on the same system; or you will end up writing off the costs of one of the software contracts.

Consequently, when taking on a software contract, it’s important to consider how you may get out of it if circumstances change.

3. What are the data migration and security considerations?

Accountancy firms handle sensitive data every day, so data migration must be undertaken with care and the information protected when the software is in use.

Data needs to be provided in an actionable, usable format, such as CSV, API or SQL, not just through the vendor’s software. Verify that exported data is comprehensive for all legal and regulatory needs and allows bulk processing. Clarify data ownership and accessibility terms, defining the roles of data controllers and data processors, as per GDPR requirements. The cloud platform should support compliance, including subject access requests and the right to erasure.

Test the ease of migration between platforms, ideally with simulated exercises, and check for available tools to aid this process. Understand limitations on data volumes and storage costs, as well as the jurisdiction where data is stored.

4. What are the software risks associated with cloud migration and use?

Any new software investment comes with risks. When undergoing a cloud migration, assess the historical availability and performance of the software and recompense for outages. Implement measures to restrict and monitor access. Here, useful features include multi-factor authentication, Single Sign-On and IP blocking. Robust security controls, such as encryption, restricted admin access and audit logs are important too. Verify vendor security certifications, for example, ISO 27001 certification for information security management systems.

A business continuity/disaster recovery plan is essential. It should align with the software and define the vendor's support. Evaluate backup options, such as frequency, retention, data coverage, continuity versus rollback, associated costs and the technical feasibility of separately hosted backups. Finally, firms should test restoration capabilities and perform disaster recovery/cyber attack simulations, so they can be confident that if the worst happens, sensitive data will remain protected.