Small business/professionals clients (Other than Corporates) generally have the starting point of asking whether they have to prepare the accounts and have?
If your turnover is above a specified limit, you have to maintain at least some specific books/records as per Income Tax Act. Further the accounts can provide not only the profit/loss from your business/profession but also many other measures of success, efficiency and/or inefficiency or warning signs of trouble ahead.
It has been seen that for an average small business, financial paperwork and records can take up as much as 20% of available work time. For most businesses that time could be far more productively spent on customer facing matters, product or service development or marketing.
The question is, can your business afford a bookkeeper? Additionally, is it better to have a bookkeeper and an accountant, is it necessary and are the roles separate and different?
In many cases, it makes sense to use accountants for bookkeeping as well as oversight and preparation of the formal accounts and reports. We understand the demands on small businesses and consequently have a solution to suit all budgets and types of business.
The benefits include efficiency as work is not duplicated or doesn’t need to be double checked and our bookkeeping or support ultimately feeds into the statutory accounts process with the assurance that everything is monitored and checked by our fully qualified Accountants.
For those clients who prefer to do their bookkeeping in-house, we dovetail with your bookkeeper to add additional bookkeeping and accounting services to help enhance financial reporting and planning.
Bookkeeping is an essential prerequisite for preparing management accounts, a vital tool for businesses, which we strongly recommend should be prepared on a monthly or quarterly basis. Monitoring your business progress and performance against your budget as well as improving your ability to chase trade debtors and keep track of suppliers’ invoices all start with good and complete bookkeeping.
Ensuring that information, is up-to-date, is a very good habit to have for your business as is analysing the information and spotting trends or issues early, either positive or negative. For example, if your cash flow analysis shows that your customers are starting to pay more slowly, this could be an indicator and warning that they are struggling and that you need to tighten credit or perhaps that your industry or the economy generally are facing a difficult period ahead.
Year End Operation:
By tackling the accounts process shortly after the financial year end and working through the tax calculation in the same time frame, this allows you to budget for and build the payment into your cash flow model.
Once the accounts are complete, our Accounts team will begin work on a “Business Insight” report which aims to deliver actionable commercial guidance designed to improve profitability and growth.
Reviewing these analysis provides our clients with the chance to identify and exploit competitive advantages and to set targets and objectives for the coming year.