an accountant's perspective

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The Basics of Bookkeeping and Accounting

The new tax year is well underway so now is a good time to check your approach to your record keeping and make sure you are making the right decisions for you and your business. It is not always easy to know what those decisions are and sometimes your self-belief will dip a little. Don’t let the natural peaks and trough of business pull your dramatically in either direction – learn to keep a even path and keep tethering yourself back to it.

For that to be possible you need a sound financial core at the heart of your business. That does not mean you have to make masses of profit or cannot survive those fairly inevitable tough times, but it does mean that you need up-to-date financial records to draw conclusions from. The more information you have about your cashflow and how your business operates the more chance you have of predicting moments of affluence and hardship and put in place preventative measures or request extra support to capitalise on them.

Ultimately, business comes down to bookkeeping and accounting – the numbers have to add up! These are familiar terms that we may understand and often try to avoid at all cost. The moment you gain a little of enthusiasm towards them and open a book, or scan a website to learn more, you retract in horror at what it can involve. And yet, if you have a methodical system, maintain some legible records then you can survive that initial terrifying moment of realisation. Bookkeeping and Accounting all boils down to detailing your business income and expenditure.

Simple bookkeeping

For the most simple set of accounts you need:

  • a cash book to record money entering and leaving the business
  • a sales ledger, which details money received and owed
  • a purchase ledger, which logs outgoings
  • a wages book, which details salary payments and National

Insurance contributions

These books will most likely exist within a spreadsheet in some computer software these days so you will be able to see everything on a single screen.

It is also a good idea to start as you mean to go on. So get a box file and divide it into months so you can keep cash purchase receipts. Then get a couple of files and store unpaid purchases in one and paid purchases in the other.

For cash, cheque and card payments, till rolls are an ideal means of updating your sales ledger. If your company will be issuing invoices then sales paid and sales unpaid need to be separated into files electronically or with another couple of ring files manually.

You need to keep just about every piece of paperwork that you receive, no spam though, that can be shredded. Keep bank and card statements, fill out paying-in books and cheque book stubs meticulously, maintain payroll records (if you employ people) and VAT records (if you’re registered). For help in any of these areas go to the PAYE or VAT sections.

Electronic bookkeeping systems

The software for basic accounting may not be as expensive as you think. A budget of £100-£180 would get you basic accounting software and you can choose one that comes with free support. The most popular software for electronic records (spreadsheets) is Microsoft Excel.

There are also dedicated accounting packages which are easy to use. See the Mother website (www.managewithmother.com/about/cashbook) for the bookkeeping software that ABC backs. It is a great tool and we can recommend it because we have several clients that are very happy with it.

Software is ideal because any errors can be corrected quickly; you can get financial reports with the click of a button. Any money you owe or is owed will be brought to your attention. You can also see sales patterns and costs, which helps with forecasting and budgeting for your business.

If you cannot afford a full-time bookkeeper then you will have to do much of it yourself. As your business expands the role of a bookkeeper can be combined with other duties, such as office or HR manager. A part-time bookkeeper may be more viable for small to medium businesses.

It is possible to do it yourself and then get an accountant to take care of the complex bits that quite frankly would give you sleepless nights and a nasty tension headache. A small business will be faced with the chore of doing the books after hours, or at weekends. Once your business expands then the quality of the accountant you choose could have a great impact on your company.

The best advice when choosing an accountant is to follow your gut feeling, see how up front they are about their fees and test their knowledge before signing up with them. Don’t go for the one up the road before getting a feel for whether they are right for your business.

Hopefully, you have the knowledge you need to build an effective accounting and bookkeeping core at the heart of your business now. If done right you will never regret the extra effort and organisation you put into it from the start. Stress in these areas tends to come when records have been neglected and a years worth of transactions are only known to have taken place because of the bank deposits made. Do it the smart way and get on top of the basics early – you won’t regret it!


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IR35 Personal Service Companies: The Facts

HMRC are using their powers to crack down on those who break IR35 rules. The problem we are seeing with many clients is that those rules can be incredibly complex to unravel. So here is your walk-through of the legislation in place, who it applies to and what HMRC are trying to crack down on.

What is it?

HMRC have special IR35 rules which are designed to prevent the avoidance of tax and national insurance contributions through the use of personal service companies and partnerships.

Note, individuals can still operate through either their own personal companies or a partnership, but IR35 seeks to remove any possible tax advantages from doing so.

Removal of tax advantages

The tax advantages mainly arise by extracting the net taxable profits of the company by way of dividend. This avoids any national insurance contributions which would have been due if that profit had been extracted by way of a salary or bonus.

The intention of the IR35 rules is to tax most of the income of the company as if it were salary of the person doing the work.

To whom does it apply?

The rules apply if; had the individual sold their services directly rather than through a company or partnership they would have been classed by HMRC as employed rather than self-employed.

  1. An individual operating through a personal service company, but with only one customer for whom they work full time is likely to be caught by the rules. On the other hand an individual providing similar services to many customers is far less likely to be affected.

Planning consequences

The main points to consider if you are caught by the IR35 rules are

  • The income of your company will be charged to income tax and national insurance at personal tax rates rather than company tax rates
  • Consequently there may be little difference to your net income whether you operate as a company or as an individual
  • If you have a choice in the matter would you want to continue to operate through a limited company
  • If the client requires you to continue as a limited company can you negotiate with the client for an increase in fees to cover the extra tax and national insurance due

Employment V self-employment

One of the major issues under the rules is to establish whether particular relationships or contracts are caught by the IR35 legislation. This is because the dividing line between employment and self-employment has always been a fine one.

All of the factors will be considered, but overall it is the intention and reality of the relationship that matters.

The following factors are relevant to the decision. HMRC will consider the following to decide whether a contract is caught under the IR35 rules

  • Mutuality of obligation

The customer will offer work and the worker accept it as an on-going understanding

  • Control

The customer has control over tasks undertaken and hours worked

  • Equipment

The customer provides all of the necessary equipment

  • Substitution

The individual can do the job or send a substitute

  • Financial Risk

The company bears the financial risk

  • Basis of payment

The company is paid a fixed sum for a particular job

  • Benefits

The individual is entitled to sick pay, holiday pay, expenses etc.

  • Intention

The customer and the worker have agreed there is no intention of an employment relationship

  • Personal factors

The individual works for a number of different customers and the company obtains new work in a business-like way

Exceptions to the rules

If a company has employees who have 5% or less of the shares in their employer company the rules do not apply to the income that those employees generate for the company.

Note, in establishing whether the 5% test is met any shares held by family members or associates must be included.

How the rules operate

The company operates Pay as You Earn (PAYE) and national insurance on actual payments of salary to the individual during the year in the normal way.

If on 5th April the individual salary from the salary included benefits in kind amounts to less than the company income from all of the contracts to which IR35 applies the difference net of allowable expenses is deemed to have been paid to the individual as salary on 5th April and PAYE & NIC’s are due to HMRC by 19th April.

This is a potentially complex area and we will be pleased to review any contracts you may have with customers to ascertain whether they are IR35 friendly. Please note that there is no such thing as an IR35 compliant contract.

For advice on this just email: shell@abc-accounting-services.co.uk or call 01427 613613 and ask to talk to Shell or Ian.


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Why you might need to change accountants

February is a great month to review your accountants and decide whether they have your best interests at heart. You have just gone through the self-assessment process so you can ask yourself some basic questions:

  • did you understand everything they explained to you
  • was the invoice what you expected/were told to expect
  • did you find them approachable
  • did they respond to communications quickly/efficiently
  • do you get the feeling they are making every decision based on what is best for you and your business

If you answered yes to most of them then you probably have an accountant you ought to hold on to. There are plenty of good quality accountants out there so if you answered no to more of the above  it may be time to spread your wings and see who else would make a better fit for you and your business. There are plenty of reasons people fear change when it comes to accounting. Let’s take a look at those reasons and try and demystify what essentially is a required service in an industry that is highly competitive. It’s up to accountancy practices to woo and wow you – not the other way around!

Reason 1: You have had the same accountants forever

This is usually a quick response that involves three main parts to it. What they are really telling you is that they are local and convenient, they are happy with the service because they have no comparison, and they trust their accountants to be doing what is best. These are all great reasons and loyalty is a fine quality provided you are getting the best service available. Like you would do with car insurance and heating bills it makes sense to shop around sometimes and make sure you are not simply remaining blinkered. We have seen clients trust accountants that have been woefully neglecting their responsibilities and left them in a real state. We have also seen clients content with ridiculous accounting fees for simply tasks. Loyalty is to be commended provided it is not costing you too much. Look around and make sure what you are content with is worthy of being content over.

Reason 2: Changing accountants is a massive upheaval

It often feels like that for many but in reality it is extremely simple. Once you have visited your new accountants and signed up with them they will contact your old accountants on your behalf and request all the information they need. It should be a seamless process and fluid transition from one accountants to another. They are obliged by law to co-operate so even if you leave on bad terms there is only a short amount of time they have to be awkward in before they are forced to comply. If you had a good bond with them and are worried about the emotional attachment then write to them, or go and talk to them to explain your reasons for leaving. This gives them the opportunity to lure you back and prevents bad feeling from developing.

Reason 3: Accountants are all the same

This is a massive misconception and ABC Accounting Services alone smash it into smithereens but we are also aware of plenty of other accountancy firms that do the same! Accountancy practices are just as varied as the people that work in them. They can be formal and professional, professional and approachable, approachable and friendly, quirky and friendly, a little crazy, forward thinking and fun! When you go for a free consultation with an accountancy firm you should get a sense of their character and their company ethos then. If you don’t then try another. You should be able to find an accountancy practice that shares your objectives and connects with you and your business. So do your research, go and talk to a few and see who makes sense as a natural extension to your business.

Reason 4: Accountants are there to liaise with HMRC and that’s it

If that is all your accountant does then you are missing out on a valuable chunk of the services they offer. They are there to support you, give you up-to-date financial advice, help shape your business the way you want it and assist you in planning for the future. A good accountant will listen to you and give you guidance. A great accountant will listen to you, help you fight when times are hard, discuss risks and challenges that lie ahead and be there for you exactly when you need them. There is something very flexible, immediate and responsive about great accounting that you will not get from a practice that just goes through the yearly motions. If you are not sure what type of accountant you have ask them if you can discuss your KPIs (Key performance indicators). They should walk you through the following:

  • how far ‘off’ are you from your forecast cash position? What’s the main reason for it?
  • any discrepancies need to be researched and understood so you can take necessary action to bring the figures back into line.
  • how well you are able to meet your short-term financial obligations – a key figure for almost all businesses in the current climate is their liquidity
  • how much gross profit you are making on average, per sale?
  • if you deal with consumers, say in a mail-order business, you’ll want to know how many complaints you have each day, and the broad reasons for them, so you can spot any trends and make plans to deal with them.

These figures can all be monitored and spending time with your accountant should shed light on aspects of your business you may overlook from time to time with your manic schedule what it is.

Reason 5: You don’t need a relationship with your accountant

There are clients that happily email in their data or use a digital filing system like DropBox so contact is slim on the ground. This is still no excuse for a poor or nonexistent relationship. The rapport you have with an accountant is a valuable connection. They understand business in a way that your family and friends are unlikely to. They witness hundreds, if not thousands, of clients go through the same issues, stresses and challenges as you do. In terms of advice, guidance and support there is no better ally that your accountant. You should be able to pick up the phone to them and hear a reassuring voice or drop in for coffee and receive a motivational pep talk when you need it. That is what great accounting is all about. Great accounting is not about the numbers it is about the people that create them!

Is it time to change?

We have given you five good reasons to take a long hard look at what your accountant does for you and weigh up whether it is enough. Don’t move for moving sake or base a decision purely on cost because sometimes you get what you pay for. But, if a move makes sense for you then do not hesitate because your accountancy practice should be an extension of your business and if they are not working with you then you are missing out on valuable momentum.

If you would like a free consultation to find out more about the services we provide then contact Shell via email: shell@abc-accounting-services.co.uk or ask for her by phone: 01427 613613.


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Smashing the accountant stereotype to pieces

From the very beginning accountants have had a hard deal with stereotypes and literary attacks. They have been painted as crooks, thieves, liars, greedy money hoarders, boring stiff collard nerds, and humour less droids. Ouch!

But, don’t take my word for it, have a look at how they have been captured in text and slated in recorded opinions through the centuries. From philosopher through to writer and actor everyone has a strong opinion about accountants.

The first example comes by way of the bible:

Jesus entered the temple area [of Jerusalem] and drove out all who

were buying and selling there. He overturned the tables of the

money changers [the accountants of their day] and the benches of

those selling doves. ”It is written, ” he said to them, “‘My house will

be called a house of prayer, ‘ but you are making it a ‘den of

robbers.’ (Matthew 21: 12-13)

It is also interesting to find that tax collectors have had an equally bad press:

While Jesus was having dinner at Levi’s house [the home of a tax

collector], many tax collectors and “sinners” were eating with him

and his disciples, for there were many who followed him. When the

teachers of the law who were Pharisees saw him eating with the

“sinners” and tax collectors, they asked his disciples: “Why does he

eat with tax collectors and “sinners?” (Mark 2: 15-16)

Elbert Hubbard, the American writer, publisher, artist and philosopher is credited with this quote:

‘The typical accountant is a man, past middle age, spare, wrinkled, intelligent, cold, passive, non-committal, with eyes like a cod-fish; polite in contact but at the same time unresponsive, calm and damnably composed as a concrete post or a plaster of Paris cast; a petrification with a heart of feldspar and without charm of the friendly germ, minus bowels, passion or sense of humour. Happily they never reproduce and all of them finally go to Hell’ Attributed to Elbert Hubbard – sourced here

The psychologist Abraham Maslow once characterised accountants as obsessive, exacting, and uncreative. He saw them as only concerned only with order and control.

Let’s have a look at one literary depiction among many from modern times. The accountant in Joseph Conrad’s ‘Heart of Darkness’ is a fine example of literature mocking a stereotype:

‘I met a white man, in such an unexpected elegance of get-up that in the first moment I took him for a sort of vision. I saw a high starched collar, white cuffs, a light alpaca jacket, snowy trousers, a clean necktie, and varnished boots. No hat. Hair parted, brushed, oiled, under a green-lined parasol held in a big white hand. He was amazing, and had a penholder behind his ear.’ (1.42)

Marlow is stunned by the man’s appearance. He is constantly immersed in his books upholding extreme due diligence. Conrad portrays the accountant and the company he represents and embodies as impenetrable – machine like. He is the slick shinny example of the ideal and perhaps how we like to view accountants. The backdrop of black native African workers make him look quite ridiculous.

So, it might be time the vicious stereotypes were laid to rest. These reasons are a good starting point in the case of the accountant verses the stereotype:

  • there are plenty of women in accounting these days including 10 in the ABC Accounting Services offices
  • Accountants are responsible for tax refunds – HMRC are highly unlikely to initiate those of their own accord
  • There are much less stressful ways to make money – accountants earn their wage. More than eight out of ten suffer from stress related problems
  • Accountants have embraced social media and technological advancements which have put serious distance between them and their tweed, abacus image
  • Accountants have personality and like to laugh just as much as the next person

Beware of the director sign on doorshell doing a crazy pose belinda holding chainsaw

Hopefully, that is the end of that debate once and for all. It is time to start writing nice things about accountants’ people!

Never Give Up


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50 Top Business and Accounting Tips

We are celebrating our ten year anniversary here at ABC Accounting Services. That means we have ten years worth of accounting and business experience to share with the world. Not just that, it also means that we have seen thousands of businesses both fail and succeed in their sectors.

The culmination of this knowledge is a list of 50 top tips for keeping your business afloat based around what we have seen businesses benefit from and what we know is sound accounting advice. They wont all be Earth shattering insights, because a lot of business involves common sense, but there will be some nuggets of wisdom in there. We have also thrown in a few light suggestions to keep you amused along the way.

So enjoy and hopefully we will continue to entertain and educate our followers for another 10 years – cheers!

1. Good bookkeeping from day one not only makes perfect sense but it will also avoid a lot of long nights and accompanying stress further down the line. Get a system in order from the start and then you will always be on top of your paperwork.

2. Talk through big issues with someone else in business. If you run a business on your own another perspective can be crucial when making big decisions. You will not always agree with someone else’s insight but it does make you consider another viewpoint to that of your own.

3. Always make time for clients when they need it, even if it is not convenient for you. The same applies to customer service for commerce companies. It has to be above and beyond what the client and customer expects if you are to build real trust and respect with your target audience.

4. Leading on from point 3, the most valuable form of marketing today is still the same as it has always been – word of mouth. People talk and the only question you need to consider is whether they will be saying good or bad things about you and your business.

5. Don’t run out of tea, coffee, sugar, or milk. Firstly, because it is really bad for morale and secondly because you will look a right dummy if you can’t offer visiting clients a drink!

6. The traditional advice is to keep personal and business completely separate. ABC has more of a family style bond where the boss is the boss but still a colleague, source of support, and when needed, a friend. Do what works for your business but be careful to keep a clear line so that everyone knows where they stand when tough decisions need to be made.

7. Ignore social media at your peril. Facebook, Twitter, YouTube and LinkedIn are the big four. Instagram and Pinterest are the big movers. It is free marketing that will raise your profile so make sure you know your social media and get your business on there pronto.

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8. Making mistakes and learning from them is the most valuable skill that you will learn. No mistake is irreversible unless you do not face it head on and put it right.

9. Keep all receipts from fuel, office supplies, overheads, work clothes, equipment, and hospitality/social functions so your accountant can claim full expenses entitlement against your tax bill .

10. Keep morale high by empowering staff, training them to be the best that they can be, and actively encouraging light relief and social events when the team need them.

11. Write all the important dates on a wall calendar where you cannot miss them: Year End, VAT Return, PAYE, Business Insurance Renewal, Website Hosting Renewal, Employee Birthdays…you get the idea.

12. Buy tons of pens because they have a habit of going missing!

13. Pass on your expertise – make sure people know what you know because it is great for your business, it means that one day you can reduce your hours and share your unrelenting responsibility with others who have followed in your footsteps. It also keep the company ethos strong and in line with what you set out to accomplish.

14. Expand your network so you are connecting with new people over social media and face-to-face on a weekly basis. If you can add one person to your network of contacts each week imagine where you will be in a year and then in five years.

15. Have plan A, plan B, and plan C ready at all times because the first attempt isn’t always the best attempt.

16. Keep reminding yourself why you started your business and ask yourself if it still matches your original objectives and ambitions.

17. Stick post-its on your computer but make sure they are for the most urgent task you have to do at that moment in time. It will help you prioritise critical issues and then once they have been dealt with you can throw the post-it away.

18. Your website is potentially your most valuable asset so make sure it reflects you and your business. Fill it with strong content, make sure it is optimised for searchability, loads fast because visitors have short concentration spans, and is attractive/original.

19. Automated posts, phone systems and digital communication cannot replace the human touch. Make sure your clients/customers know there is a person behind their service and someone who cares, can relate to them, at the end of a phone.

20. National Minimum Wage (NMW) often goes up on the 1st October, it is illegal not to pay employees NMW so keep updated on changes.

Alien minimum wage 2

 

21. Give yourself the credit you deserve and acknowledge your success because you should feel proud of your achievements. Otherwise all you will ever feel is stress and responsibility and that is no fun.

22. Following on from point 21, celebrate successes because you are bound to beat yourself up over mistakes – the Universe likes balance.

23. Try not to say no too often, yes opens more doors that lead to more opportunities. Say no and you never know what could have been.

24. Learn to delegate, as much as you want to do everything yourself, you cannot maintain that level of commitment and workload forever.

25. Schedule in personal time. Block out days to spend with the family, trips away, and holidays. If you block out days in your calendar you will respect their importance and make them psychologically harder to put off or rearrange.

26. Connect with local businesses so your can exchange services/products, agree discounts, work on referral arrangements and have a friendly face at networking events to seek out.

27. Only take out a loan if you absolutely have to and make sure you get solid forecasts done to check and check again the feasibility of your business plan.

28. Have a mix of men and women in the office if you can ethically because the opposite sexes tend to have different qualities/strengths. They are not set in stone but generally speaking men and women can often provide different values to the team that compliment each other.

29. Have a dress code and stick to it. It doesn’t have to be suits and skirts, you may prefer a more causal approach. Many technology companies have a casual Friday to boost morale and give everyone a ‘ahhhhhhh’ day. If a policy is in place it is easier to address unsuitable attire issues.

30. Pay it forward by helping the next wave of entrepreneurs or by employing apprentices. Contributing to the future of business in both of these capacities can be financially rewarding in the long-run but it is for the personal satisfaction that most do it.

31. Keep your business account and your personal accounts separate. It makes bookkeeping far easier so if you are doing it yourself it will not take as long. If someone else is doing it that means it wont cost you as much. Sure, you can pay your business account back but will you always remember and keep the appropriate records. So much easier to keep them separate.

32. Call an expert when you are not sure of something. Many experts in pensions, insurance, banking, accounting, the legal sector, and the marketing sector to some extent are happy to offer free advice and may even provide a free consultation. Sometimes you need outside help so make sure you know when to access it.

33. Spend a lot of time interviewing people. Invite them in for trial days and make sure they fit in and you can imagine them being part of your company. Smarts count for a lot but you should also go by your gut – do they feel right? It’s your business so your feelings count.

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34. Keep a close eye on in-comings and get a system in place early on that includes chasing outstanding invoices. Too many people sit waiting for the money to appear or forget about half of the invoices they have sent out. That’s your money!

35. Always remember to let your customers know where to go with calls to action. Never let them navigate around your site aimlessly, read your blog, or scan your flyer, without giving them their next destination – a strong pull or hook to something that will tell them more, offering them something better.

36. First impressions are made in seconds – are you giving a good one? Is your team giving a good one?

37. Prepare and practice your introduction for networking events so it comes across smooth and polished and says everything you intended to say.

37. Set expectations that you can exceed. The ultimate goal may take you some time to reach so put in short and medium term goals that give you a motivational push when you need it and a moment of joy and victory when you achieve them.

38. Be passionate and communicate to people with feeling. There is no shame in being excited, energetic and enthusiastic about your business. Too many people fear public reaction to a little confidence and pride but if you are happy then don’t suffocate that. The majority of your audience will actually find that refreshing and endearing.

39. Follow up on leads straight after events. For one thing it is easier because you can remember who you have talked to and are more likely to recall a detail that adds a personal touch to the email/phone call. And they also like immediate contact because it lets them know they were remembered and you are also fresh in their mind.

40. Singing around the office shouldn’t be done on a regular basis but a bit of music and self expression is great for morale and can be highly amusing. Just a thought!

41. Respect everyone that you meet and be courteous to the horrid people you immediately dislike. Why? Because you never know when you might need them or who they may know/be connected to.

42. Only sell what you would buy yourself. Only offer a service that you would be happy with yourself. It is a simple mantra but if everyone did it then we wouldn’t have call centers in countries overseas containing employees that customers just cannot understand. We wouldn’t be able to buy poor quality clothes that only last three washes or vehicles that break down around the corner from the garage!

43.  Manage your email by creating sub-folders so that you can filter emails into dedicated areas for each client/staff member/subscription/service provider. You can also have an ‘important’ folder to make prioritising your emails far simpler. Then just make sure you stay on top of them.

44. Rich Tea do make great dunkers but they taste a lot like cardboard. Hobnobs, chocolate digestives, custard creams and ginger biscuits are preferable. Offering clients a cuppa or a coffee is essential, offering them a biscuit is just plain nice (also good dunkers)!

45. Appreciate and encourage staff to motivate them. Pulling them up on mistakes is sometimes necessary but if you smile and provide a solution and incentive to revise and refine that solution then you can turn a negative into a positive. Never leave a conversation on a negative unless the mistake was business or life threatening.

46. Step out of your comfort zone because that is usually where opportunities await you. Everyone would be successful if it didn’t take a few brave steps into the unknown. Be prepared to try new things, trust new ideas and embrace change.

47. Negotiate energetically on price and never take the first quote without a little bartering. You never know what you might save and it isn’t cheeky or rude it is just business.

48. Measure everything and use that data to drive decisions so you always have solid facts to reinforce the direction your business is taking. It will also make you analyse decisions with logic rather than feeling.

49. Budget for tax. Budget for VAT. You will have to pay them both whether you ignore them right up to the deadline or not so it makes sense to set money aside and be ready for them.

50. Do not give up. Most people who are self-employed go through tough patches where they are penniless, disheartened, and beginning to doubt their future. The ones that survive grit their teeth and push on hard. They drag themselves into tomorrow and manage one day at a time until they start smiling again. Not giving up is the core skill embedded in most business owners.

abc35

As with any advice this is just what ABC Accounting Services Director and team would advise based on their experiences. Everyone is different and you have to learn to navigate your own path and learn from your own experiences. If Ginger Nuts are not your thing then buy in Bourbons. Follow your gut but more importantly follow the figures and continually measure your success against key performance indicators (KPIs).

The very best of luck and if you want to discuss your ambitions or issues with someone then we offer a half hour free consultation so just give us a call: 01427 613613.

 

 

 

myths


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Dispelling the Myths of Accountancy

The myths of accounting like the myths of any industry have travelled far and wide. The whole point of these blogs is to get to the bottom of what people want from the accounting industry – what we can offer to make your relationships with accountants smoother. There are some government bodies who are extremely efficient at worrying people into making impulsive decisions and paying tax bills instantly without a seconds hesitation.

It is far better for our clients, and for any business owner, to know the facts and understand exactly what is happening with the information they provide. Accountancy is not a dark art and truthfully there is no magic wand. There are incompetent accountants that can make the rest of us look like magicians but once we have answered your questions and dispelled some myths you should be able to spot a dodgy accountant a mile off!

We have put together a short video of the first five myths we objected to. We will be producing a monthly blog on myths to run beside the monthly questions and answers piece (coming up next week folks!). So, by the end of the year you will be polished experts on the topic of accountancy and all that it involves. Enjoy the video and get in touch if you have a myth you wish dispelled or confirmed, or questions you need the answer to – we are always reachable.


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Is your Accounting ready for Christmas?

If you are a retailer then you know exactly what I am talking about. September is in many ways the last month before the seasonal storm begins and that is for retailers and accountants alike.

Accountants are hoping to get as many tax returns done as possible before the Christmas break and the January mania that follows it. Retailer are preparing for heavy footfall, massive online traffic and hoping their stock levels have been gauged perfectly. Autumn long nights represent the perfect opportunity for you to get your books ready for the seasonal peaks.

There are many challenges placed on businesses and polished accounting records could be the difference between succeeding and failing when the shopping frenzy begins. Now is the time to give your business a much needed winter service.

CASHFLOW

cashflow

 

Cash flow management has to be meticulous. From careful bookkeeping accurate cash flow forecasts can be made. Seasonal businesses can anticipate when heavier inflows will come in and make sure that outflows are scheduled to occur at the same times. It is also a good opportunity in many cases to create a reserve for the off-season ebbs in cash flow.

INVENTORY

The challenge of managing inventory will also rely on accounting transparency. The yearly cash flow forecasts will take into account the stock bought and shifted in the last seasonal periods but they cannot predict fluctuations. Detailed sales and inventory plans need making before the season begins and are often done months in advance to ensure timely delivery. You have bought the stock, anticipated the seasonal shopping habits – have you brought your bookkeeping up to date.

It is September, another month and you will be in the thick of it give or take a few days/weeks. Your business will be stronger next year when inventories are being created if you do not have to project back information and make everything balance after the fact. Do it now while it is fresh in your mind and you are not worn out from the Christmas rush.  

WORKERS

seasonal worker

The last thing has very little to do with accounting but is essential for retail businesses at exactly this time of year. Seasonal workers usually get taken on in September or October. There are increasing commercial pressures which can lead to corners being cut. Make sure you spend the right amount of time interviewing and training staff that will fit in with your team’s ethos and work ethic.

Seasonal workers represent your business alongside permanent workers. Christmas represents a huge opportunity and it is potentially the only time a customer visits a store. Your customer service needs to be at its best so those newest to the team need the right incentives, training and motivation to deliver just that. Spend time training seasonal workers to the right standard otherwise the cost to the business could irreparable.

 

It is time to get the Christmas stock out but before you do make sure your accounting is top notch. Your will impress your accountants when you take your books in at the beginning of January and you will impress yourself to boot! Good business is built upon good accounting – there is just no way around it and yes we are bias but you know it makes sense.

Put the long nights to good use – crack open a bottle of wine or pour out a can of Fosters and catch up with your record keeping so you do not have a mountain to climb in three months’ time. Do it at the end of the month until the end of the year and you will be laughing come January. Best of luck – great bookkeeping is what we accountants dream about!