Cloud accounting is seen to lead to considerable increase in productivity because it helps accountants in small and medium business to provide quality financial reporting to their customers and arrangements on their money related issues and furthermore help accountants to exploit budgetary counsel and settle on better and fast choices, in this manner improving in general money related execution. In this work the effect of cloud accounting on financial reporting qualities of SMEs was evaluated. This work discovered that there is need for SMEs to adopt cloud accounting technology. This will increase their financial reporting quality and financial performance. The study recommends that the management should render their support on the adoption and smooth running of the cloud computing by providing the necessary resources needed and also for computer technologist to solve the security issues that comes with cloud accounting technology. The study hereby concludes that cloud accounting has a positive effect on financial reporting qualities of SMEs.