UK accountancy firms cautious on fully embracing cloud IT shift

A new survey conducted by Cloud2Me has highlighted the current state of IT management within UK accountancy firms, revealing significant variations in approach and readiness for digital transformation in 2025.

The survey, which engaged hundreds of accountancy professionals, indicates that more than a third of participating firms are operating hybrid IT environments, combining modern cloud-based tools with traditional on-premise servers.

This blend of legacy and cloud technology demonstrates that, while the industry as a whole is moving towards digital solutions, there remains a degree of reluctance to fully embrace the cloud. Firms appear to be opting for incremental change rather than wholesale transformation, potentially as a way to mitigate perceived risks or due to uncertainty about the implications of total migration.

The persistence of on-premise solutions is further evidenced by the finding that just over one in five accountancy practices continue to maintain a physical server onsite. The continued reliance on old infrastructure comes despite the increasing sophistication of cybersecurity threats and the widespread adoption of remote and hybrid work models.

Having in-house hardware presents questions around business resilience, continuity, and the adequacy of data protection strategies. With physical servers, firms face risks related not only to data security but also to hardware failure, theft, and disaster recovery capabilities.

The research also found that generalist IT support remains predominant among accountancy firms. Fifty-eight percent of respondents rely on local IT providers delivering broad, non-specialist services. The report suggests that while these companies may offer convenience, they do not always possess the sector-specific knowledge required to optimally support accountancy systems or enable firms to maintain compliance with financial regulations.

This reliance on generalist providers points to an opportunity for accountancy practices to reassess their IT partnerships, potentially seeking support from specialists who understand the nuances of accountancy technology and can offer more targeted, proactive solutions.

Adoption of Hosted Desktop solutions, which offer a secure and centralised environment for accessing applications and data from anywhere, has yet to become widespread. The survey found that only 7% of firms use Hosted Desktop services from providers specialising in the accountancy sector. As these solutions can improve performance for core software, streamline updates, and bolster data protection, their limited uptake suggests firms may either lack awareness of their benefits or are uncertain how to embark on such a transition.

The survey also drew attention to the concentration of IT responsibility within many accountancy practices. Nearly a third of firms place all IT decision-making authority with a single partner or director. Such an arrangement poses operational risks—such as potential knowledge loss or decision-making bottlenecks should that individual become unavailable or leave the business. Distributing responsibility or involving external IT experts could reduce these risks and help establish more robust, future-ready processes.

When asked about barriers to cloud adoption, 22% of firms cited high migration costs as a key concern. Helen Brooks, Head of Commercial at Cloud2Me, commented: "There's a perception that switching to the cloud is expensive, but in reality, it's often far more affordable than staying stuck with outdated tech."

A further 14% of respondents indicated that finding the time and resources to consider migration was a significant challenge. Reflecting on this, Helen Brooks added: "Sometimes, it's not about the tech but more about the time. Firms are stretched, and making big changes can feel overwhelming. That's why it's so important to work with a provider who can guide you through it."

Additionally, 27% chose 'Other' as their reason for delay, implying broader uncertainty or lack of confidence in how to initiate major technological change.

The full findings reveal a sector that is progressing towards modern IT infrastructures, but still faces substantial hurdles, from concerns of cost and capacity to a lack of specialist support and challenges related to business continuity planning. The report identifies significant potential for improvement in areas such as security and operational efficiency, suggesting that firms have room to modernise their infrastructure.