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I need an accountant for my business!
Often business owners wait too long before they realise that they need help from an accountant.
Key reasons are:
- They don’t understand the difference between a book keeper and an accountant
- They think an accountant will just be an extra cost – the reality is that most accountants will save the business many times their cost
- They think they accountants are just bean counters
But if you choose a qualified and experienced accountant they can bring huge benefits….
- Management tools to improve profitability
- Cost Controls
- Tax Savings
- Identifying Cash Flow needs and funding solutions
- Growth Strategies
- Business Planning
- Budgeting
- Business Structures
- Business Accounting and Reporting Systems
- Maximise Credit Scores to win more business
So don’t wait too long, getting an accountant should be a priority for all businesses!
steve@bicknells.net
65% of SME’s rejected for a loan want to try alternatives… would you
A government consultation ended last week into whether legislation should force banks to refer rejected loans to alternative sources of finance.
At present the largest four banks account for over 80% of UK SMEs’ main banking relationships. Many SMEs only approach the largest banks when seeking finance. Although a large number of these applications are rejected – in the case of first time SME borrowers the rejection rate is around 50% – a proportion of these are viable and are rejected simply because they don’t meet the risk profiles of the largest banks. There are often challenger banks and alternative finance providers with different business models that may be willing to lend to these SMEs.
Although the largest banks will sometimes refer these SMEs on, in many cases challenger banks and other providers of finance are unable to offer finance as they are not aware of their existence and the SMEs are not aware of the existence of these alternative sources of finance.
SME’s most trusted advisors are Accountants, according to Accountancy Age a fifth of SME’s are more open with their accountant than their bank manager and half believe that their Accountant is the most valuable source of business advice and just under half turn to their Accountant first for advise.
So why aren’t banks working more closely with accountants? I think its because its hard to work with individual accountants and build multiple relationships, its much easier to work with groups of accountants on a national basis such as www.business-accountant.com
Would you ask your accountant if you were looking for finance?
steve@bicknells.net
Why do I need a Forensic Accountant?
Forensic accountants are called upon to help in many situations:
- Shareholder and partnership disputes
- Divorce Cases – assessing assets and liabilities
- Professional Negligence claims
- Personal Injury Claims
- Insurance Claims – Business interruption and loss of profit
- Fraud Investigations
- Criminal Investigations
Often Solicitors will appoint Forensic Accountants and obtain quotes from several accountants before making a recommendation to their client.
CIMA Accountants are well suited to Forensic Accounting because of their business experience and analytical skills.
Divorce is a growth area for Forensic Accounting as its common for both parties to value assets and liabilities in different ways, to resolve this in some cases accountants will be jointly appointed by both parties.
The process is normally as follows:
- The Solicitor issues instructions to the Accountant
- The Accountant reads the brief, investigates the information supplied and searches for undisclosed information (for example Land Registry, Companies House, Internet etc)
- The Accountant requests further information via the solicitor
- Appropriate calculations are carried out
- A report is prepared which can be presented to the Court
steve@bicknells.net
Are you your worst enemy?
I have been spending time mentoring fellow accountants in practise who have moved from the world of industry to working for themselves as accountants to SMEs.
As with many business owners one of their key problems is a lack of confidence, not in their abilities as accountants, but in determining the value they bring to their clients. This leads to them taking on work which is below their qualifications and experience, because it is easier to ‘sell’ lower level work if you don’t understand the value to clients of more challenging projects.
It is then very easy to get onto the tread mill of having to take on lots of low value clients/projects just to pay the bills. Because all their time is taken up servicing clients, rather than developing their business, they don’t have time to go after higher value work. This then means they find it very difficult to break out of the rut they have dug for themselves.
Another problem is that, even if they are trying to go after higher level projects, they are not clear enough on what their ‘perfect’ client looks like. To the ‘perfect’ client the work professionals can do for them is of real value. They want the service and are prepared to pay an appropriate fee for it.
Other clients may have been told they need the service but it has less value to them because they do not get why it is important to them. These clients will view a professional’s fees as a cost and are much more likely to want the service at a cut down fee. In this situation the management accountant (in this scenario) may still be in the position of doing a large number of hours for a relatively low rate and have the same problem as detailed above.
They have become their own worst enemy!
The key to understanding the value you can bring to customers is to talk to them! I know this sounds obvious but we are often put off from talking to our clients because we are afraid they will tell us something we don’t want to hear. However, it is more likely they will tell us something we DO want to hear!
If you don’t have any ‘perfect’ clients you will still have introducers and other business professionals with whom you can talk to chrystalise your value proposition.
Although this blog has focused largely on accountants the same problems can be found with other professional service providers and the solutions are the same:
– Have confidence in yourself and your abilities
– Understand the value your clients realise from what you do and charge accordingly
– Concentrate on projects in which you have particular expertise
– Identify your perfect clients and market to them
Become your best friend and give yourself the best chance of running the business you deserve
Fiona 🙂
Get HMRC to pay you
HMRC will pay you interest
It is not that well-known that HMRC will pay you interest on tax paid early. The interest rate is only 0.5% though, so it isn’t going to change your life.
In the case of Corporation Tax, any payment is due 9 months and a day after your year-end. If you have a business bank account that pays no interest and the cash to pay your tax early you can pay your tax as soon as you have filed your return. After the 9 months is up HMRC will send you the interest calculated.
What spare cash?
See my earlier post on paying your debts first. In the situation where you have cash in the bank that you aren’t putting to good use and no outstanding debts paying your tax liability early will yield a small benefit.
Get your tax return done early
It is difficult to plan your cash flow if you don’t know how much tax you are due to pay. Even if you don’t want to pay your tax early, it is helpful to know how much cash you will need to set aside. The later you leave it to file your tax return the more pressure you can end up putting on your cash flow. More importantly the later you leave it, the more pressure you put on your accountant. Most accountants increase their fees as tax deadlines approach – or to put it another way you are likely to get a discount for starting early!
Don’t be late!
It won’t surprise anyone that HMRC will charge interest on late payments. The interest rate isn’t the measly 0.5% mentioned above but is currently 3%. As Bank of England rate increases – expect this to increase too!
For support and advice on preparing your annual accounts and filing your tax returns contact Alterledger or visit the website alterledger.com.
Do you need a part time FD?
Many SME’s wait too long before employing their first FD.
SME’s that would most benefit from an FD are those looking to invest or spend large sums of capital on assets, expand into new markets, perform mergers and acquisitions, exit from the business or prepare for a stock market flotation.
There are two part time options open to SME’s – recruiting a part time FD or Outsourcing.
When choosing a part time FD its important to look carefully at their experience and track record as the objective is to build a long term relationship.
Having the right FD will release management time to focus on other business issues.
Smarta have a checklist to help you when deciding whether or not to recruit an FD
- Determine the point at which your company is, and assess the state of your finances
- Decide on what the next step for your company is: where do you want it to be? Are you going forward for further investment? How do you want your business to grow? You need to be able to communicate this to your FD
- Determine the ways an FD’s professional input could improve how your business is run, and factor this into the job description
- Ensure the person you take on is experienced, knowledgeable and a good cultural fit
- If you cannot afford to take on a full-time FD, consider taking on a flexible or part-time FD – and make sure they are committed
You could speak to one of our team members if you need help https://business-accountant.com/the-team/
steve@bicknells.net
Frost Group and Business Accountant Offer MVL Service
Frost Group are extremely pleased to be working with CIMA members in practice through their Business Accountant service and sharing with CIMA MiPs our knowledge and experience of Members Voluntary Liquidations.
Jeremy Frost, Insolvency Practitioner and Managing Director of the Frost Group commented:
“Recent developments in the tax regime have caused an increase in the requirement to use Members Liquidations when considering legitimate tax mitigation measures. We believe that CIMA members in practice are better placed than most accountants to recognise and deliver the benefits that will accrue to their clients from this procedure. It makes perfect sense to train them in the process and we are delighted to be able to assist”.
Frost Group are corporate recovery experts, licensed insolvency practitioners and business advisors, and are now in our tenth year of trading. Our continued aim remains to develop partnerships with CIMA members in practice who can benefit from ongoing support and a modern, pragmatic and commercial approach. To learn more about Frost Group, visit our website at http://www.frostbr.co.uk.
Contact Jeremy Frost at the Frost Group on 0845 260 0101. We look forward to working with you.
Auto Enrolment do you need help?
New research*, from workplace pensions provider NOW: Pensions reveals that four in ten (44%) small and medium sized companies haven’t given any thought to how they’ll go about finding a pension scheme to comply with the new auto enrolment legislation. But, a significant proportion, (14%) intend to get help from their accountant.
Of the 450 small and medium sized firms surveyed 5% are going to consult an IFA, 4% are going to search the market and do the research themselves. Only 2% have already made a decision and secured a scheme.
Over a fifth (22%) intend to use their existing pension provider for auto enrolment. This comes despite growing concern that some providers will not support smaller employers’ auto enrolment needs.
Despite a large proportion of SMEs admitting they are yet to think about their pension scheme, over half (57%) of firms surveyed think that their choice of pension provider is either important (33%) or very important (24%). Only 8% think it is unimportant.
Four in ten (40%) believe offering a good quality pension scheme will help with employee retention and nearly a third (32%) think it will help to improve the attractiveness of their company to potential employees.
Morten Nilsson, CEO of NOW: Pensions continues: “As auto enrolment gathers pace, accountants will play a key role in guiding small and medium sized companies through the complexities of the legislation. For those accountants that manage payroll, auto enrolment is unavoidable so getting to grips with it sooner rather than later is a must.”
Stephen Milne Chair of the CIMA Members in Practice Panel said: “With over 10,000 employers auto enrolling each month, support for SMEs is inevitably in short supply. Accountants are ideally placed to provide much needed help with the process from scheme selection to assessment and implementation.”
Through Business Accountant, a service provided by CIMA Members in Practice, companies facing auto enrolment can book a local CIMA Member in Practice by calling: 023 8064 3763.
*Research undertaken by BDRC Continental, an award-winning insight agency. Questions were put to 450 UK SMEs (up to and including 250 employees) via BDRC Continental’s monthly Business Opinion Omnibus. Telephone-based interviews with a nationally representative sample of senior financial decision makers across the UK, weighted by size, region and sector. Fieldwork dates 3rd to 13th March 2014
**Research conducted online with 264 advisers by Defaqto between 25th November and 5th December 2013.
Top 5 reasons why Mums are starting businesses
Research by Direct Line shows that 65% of Mums with children under the age of 10 are considering starting their own business, why?
1. Allow me to spend more time with my children 20%
2. Cost of child care if I worked away from home 16%
3. Flexibility of being my own boss 14%
4. Lifelong ambition to start my own business 12%
5. Don’t/didn’t like my current job 1%
Reasons according to Financial Reporter
New figures suggested that full-time annual childcare costs for two children are now at £11,702, with almost half (49 per cent) of mothers surveyed believing they would be better off financially to start a business from home and save on childcare fees.
Here are 20 business you could start:
- Get a lodger – Under rent-a-room a taxpayer can be exempt from Income Tax on profits from furnished accommodation in their only or main home if the gross receipts they get (that is, before expenses) are £4,250 or less
- Ironing and Laundry Services – Always popular and you can start with friends and family
- E Bay Trading – as E Bay say… The first task is to sort through those bulging drawers and messy cupboards, finding stuff to flog. Get a big eBay box to stash your wares in, and systematically clear out wardrobes, DVD and CD piles, the loft and garage. Use the easy 12-month rule of thumb to help you decide what to offload: Haven’t used it for a year? Flog it.
- Blogging – Blogging has taken off and many businesses are looking for people to write blogs for them
- Candle Making – You can sell the candles on line and its easy to buy the wax and things you need to make the candles
- Car Boot Sale – As with E Bay but without going on line
- Cake Making – Make sure everything is labelled correctly and you comply with Health & Safety issues
- Data Entry – The internet makes it easy to enter data from where ever you are
- Social Media – Similar to blogging, businesses need help to manage Twitter, Facebook and Linked In
- Website Design – If you have the expertise, go for it
- Sales Parties – Cosmetics to Ann Summers, there is a long list of opportunities
- Sewing and Clothes Alterations – Perfect before and after Christmas
- Jewellery – Making and selling jewellery is always popular and great for Christmas presents
- Car Repairs – Assuming you have the skills needed and comply with legal requirements
- Pet Care – Walking dogs or grooming is popular
- Virtual Assistant – Also personal organiser or personal shopper
- Wedding Planner – You could start by creating a blog about your expertise
- Direct Sales – For example http://www.direct-sales-opportunities.com/uk.htm
- Computer Repair – Great provided you have the skills
- Marketing – Telesales to leaflet design and freelance writing
If you’re thinking of starting a busines please ask us for help https://business-accountant.com/contact-us/
steve@bicknells.net
Not all accounting is the same
Management accounting combines accounting, finance and management with the leading edge techniques needed to drive successful businesses.
In addition to strong accounting fundamentals, CIMA teaches strategic business and management skills:
- Analysis – understanding the story behind the numbers and using it to make business decisions
- Strategy – using the insight from analysis to help formulate business strategy to create wealth and shareholder value.
- Risk – applying analytical skills to look at end-to-end business processes to identify and manage risk.
- Planning – using accounting techniques to plan and budget.
- Communication – knowing what information management needs and explaining the numbers to non-financial managers.
You can trust CIMA members
CIMA members and students are required to comply with the CIMA code of ethics and to adopt the fundamental principles to their working lives. CIMA members are at the heart of business as its conscience, adding judgment, independence and objectivity to their professional qualification.
Every year, CIMA audits its members to ensure they uphold these ethics and will take action if members have been less than true to them.
Business Accountant 