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Tag: bookkeeping

  • Getting Value for Money on Storage Space with Accountancy SaaS 

     

    An accountancy firm without clients is like an empty suitcase – just dead weight. 

    First you need to cost in the transportation cost – how much your logistics provider will charge to migrate data and integrate it across relevant platforms.  

    Then there is a value-add charge encapsulating your weighted load. If you’re carrying excess baggage, redundant or missing data – what will be the cost and how can it be redistributed? 

    The workload at an accountancy practice can be divided among relevant stakeholders, with clients connected via an online system with priority tasks, and those clients who pay for more of your itemised services, assigned in a workflow allocation process which takes full account of upcoming deadlines based on the business’s reporting date.  

    Managing Accruals and Prepayments 

    Accruals must be fully addressed in a timely manner, that they are registered within the accounting period they relate to, and so that deferred income is carried over once payments have been processed in the cash book and bank account. 

    Another core component of bookkeeping practice is prepayments – classed as an asset when the business has prepaid the expense; and a liability where the prepaid income has been received but cannot be recorded in the ledger as such until such payment is timetabled based on its relevance to the current reporting period; that the payment can be reversed from an outstanding liability, and logged in the normal way at the commencement of the next reporting period. 

    Returning to our suitcase analogy, items are weighted based on the cost, in the context of turn on an asset. Are you getting value for money from your service providers on items assessed in terms of the cost of processing them? If you switch provider, can you guarantee a more cost-effective result? 

    Weighted Packet Margins May Surprise 

    Prior expectations of profitability are another example of excess baggage. While profitability ratios can be used to inform stakeholders of the efficiency with which a client business deploys its capital and accumulated credit owed to major debt holders, and the net vs gross profit ratios can indicate how a business is able to manage the costing on its current liabilities, – or expenses – financial reporting always logs the result at a time lag relative to the Statement of Financial Position (SFP) and the Profit and Loss Account (PLA). 

    And for this reason it is vital to keep updated accounts which are regularly refreshed, to ensure a snapshot of the business’s profitability, assets balance sheet and expenses management (itemised as fractions of net sales revenue), can be taken which reflects the payables and receivables control accounts in that forward orders, and credit purchases, are factored into the sales conversion pipeline. 

    Human Capital 

    Employees are a vital part of the business’s intangible capital assets. Skilled workers can mean the difference between returning and non-returning customers. So whatever the percentage increase in sales revenue attributable to marketing campaigns at cost, maintaining your brand identity and integrity requires re-investment, in relevant skills training and offering a sufficient reward – whether in the form of a commission, a bonus, or simply a competitive salary. 

    Matching pensions contributions, whether from salary sacrifice schemes or fixed-percentage contributions rate, is an important component of being able to invest in employee retention and ensure employee loyalty to the organisation, where they may  be transposed “sideways” to other internal roles, predicated on expertise and continuing relevance of their accumulated skills set, to the retainer organisation. 

    How to Meet Your Payroll Obligations 

    I am comfortable processing payroll and handling HMRC liabilities based on income bands and National Insurance categorisation. The new secondary threshold, over which a 15% NI contribution is mandated (up from 13.8%), of £5000 rather than £9,100, is especially onerous for managing the workforce in hospitality and can eat into marginal profits. Thereafter the Secondary Threshold will be increased in line with the Consumer Prices Index (CPI). 

    It is important to factor in that the Employment Allowance has been increased from £5000 to £10,500 to help eligible businesses offset costs. And additionally that the previous restriction that prevented businesses with a Secondary Class 1 NICs liability of over £100,000 p.a. from claiming the allowance has been removed. 

    I am also qualified to manage expenses with reference to VAT, particularly on charge-backs from capital expenditure on non-current assets. VAT owed from sales is straightforward to calculate, and liabilities can be matched relative to cash received back from HMRC on applicable purchases. 

  • Capium Accounting Software – user review 

    I have found this software to be very useful in managing workflow and stacking tasks in order of priority. It gives you a comprehensive oversight of upcoming deadlines and enables you to automate tasks with email and document templates, letting you get client sign-off on for example capital expenditure on assets, regular filings such as the trial balance process and with multiple user accounts for clients, onboarding is simplified for greater efficiency. 

    Clients are sorted into different “baskets” by the nature of the service offering. These include Trust Tax Return, Work & Testing, Partnership Tax Return, Company Tax Return, Company Accounts, and Confirmation Statement. These services are all billable with a workflow management stream allowing reminders to be set and tasks assigned to staff members, or shared with clients, for collaboration, using checkboxes for the nature of the service offering to the client. 

    You can set deadlines from a specific date, and the system will flag the task as overdue if this is not met. You can also sort by priority, from low to normal to high priority; and to set the frequency of a recurring task. In the “My admin” menu, you can access a client list to look at individual accounts and ensure a holistic approach to client relationship management.  

    Client access can be restricted if you do not make a policy of sharing all bookkeeping records, although for documents which require client sign-off or content input such as the directors’ statement, there is an esign facility as part of the package. The software integrates with the client bank account, letting you see updates in real time. It uses a Trust Layer or API to link to bank accounts and access bank feeds of all transactions, with input data reported using an automated service. 

    You can drag and drop placeholders, add tags for easy reference, and upload sales invoices. The non-current assets register helpfully automates depreciation calculations where you specify either a straight-line or a carrying balance approach. 

    In the context of VAT submissions, you have different VAT settings and you can bridge the account to link to other accounting systems such as Xero, QuickBooks and Sage where you can view VAT details prior to submitting, after checking the appropriate settings have been applied to the client. Payroll is another service offering, with a flexible pipeline allowing you to process subcontractors and freelance workers in line with regulatory requirements. 

    Finally, tailored reports let you collate and manage accruals for approval whilst preparing the trial balance, which you would file with Companies’ House after client sign-off. The mode of input can be comprised of several funnels: bookkeeping, Quickbooks, CSV, Xero, manual and free agent. 

    In the process of client onboarding, regulatory requirements on KYC and AML compliance are handled by experienced third-party provider Verify, which provides a checklist of billable services with a small service fee per item, plus VAT. So an AML check costs the practice £4, a credit check costs £2, an international ID check is £2, and the same fee for a company check. The biometric check however costs £8.50 due to the added complexity of verifying biometric ID. Support tickets are enabled and a support line to address outstanding issues which obstruct the onboarding process.