Act now – whilst there’s no leaves on the trees…
We’ve all done it, sat in conferences, listening to inspiring keynotes, making notes about things you know will change how you work, how happy and motivated your workforce will be, how much money you’ll make etc etc. Back at the…
Blog31st Jan 2019
We’ve all done it, sat in conferences, listening to inspiring keynotes, making notes about things you know will change how you work, how happy and motivated your workforce will be, how much money you’ll make etc etc. Back at the office you tackle the email backlog – and all those thoughts, ideas, inspirations get displaced by the day to day, the mundane. In the last two weeks I’ve attended an event dubbed ‘Coachella for accountants’, another one which most certainly wasn’t, and an engaging food and drink event where the memorable line ‘Nothing tastes like a Scottish tomato’ was delivered. Plenty to take away from those events! But actually despite the very obvious differences there were common themes.
I have worked in the accountancy profession for years, in roles ranging from trainee and newly-qualified with a big four firm, self-employed management accountant, software consultant, through to my current role specialising in cloud accounting. I’ve worked with 100s of different businesses but it seems to me that each one ultimately faces the same challenges; they might have different objectives – not for profit, lifestyle, become a world leader – but they are all built around operational and financial processes. Those processes should enable those objectives to be achieved, but so often businesses are hindered by those very systems which should be working for them.
Time and time again I see businesses, particularly owner-managed businesses, and especially start-ups, who have been so engrossed in the business – the operational processes – that the financial side becomes something to be done later, when the VAT needs doing or the bank shouts loudly for the dreaded MI. How many businesses have started with a great idea only to founder or, worse still, fail because of cash flow problems which they didn’t see coming – or saw but couldn’t avoid.
But it’s not just the small business –multi-million pound turnover global organisations with highly complex operational processes can still have financial processes which are a mystery to anyone other than the finance team, and are almost certain to include dependency on spreadsheets somewhere, most likely for reporting (or expense claims, we all love excel expense claims!).
The common theme which unites businesses from tech start-ups to energy giants is the need for reliable information, whether financial or operational. Without that you are operating in the dark, unable to make informed decisions. Without that you are operating in the dark, unable to make informed decisions.
Over the last 10 years the world has changed, with the increase in cloud-based technology impacting on our personal and business lives. Cloud accounting software has enabled businesses to break free from expensive software license agreements, and move to subscription based software. This obviously assists with cashflow but more importantly it delivers a product which is technologically advanced, yet flexible to needs, and intuitive to the 21st century user who is accustomed to being constantly connected through multiple devices – tablet, ipad, phone, pc, mac.
And as businesses adopt new technology so too will HMRC. By now every VAT-registered business should be aware of the changes coming next April, when VAT Returns will have to be submitted through so-called ‘functionally compatible software’. Making Tax Digital (MTD) for VAT will be followed by MTD for other taxes, and businesses need to be ready for this. Those businesses who have adopted the new cloud technology have nothing to fear – they will always have the most up to date version of the software without paying for expensive upgrades. But those businesses with complex ERP systems, or expensive bespoke systems which have not been updated cannot be so sure.
So why the heading ‘No leaves on the trees’? Well, the good thing about winter is it enables you to see clearly because there are no leaves on the trees. Take the opportunity and use technology to strip away what’s blocking your view and see what your business needs to make it fit for the 21st century.
For more information please contact Lynsey Taylor (email@example.com) or your usual AAB contact.
To find out more about Lynsey and the Audit and Accounting team, click here.