Helping your accountant and benefiting your business
Keeping good records within your business can provide you with the useful information you need to develop and flourish. But have you ever considered how this would also help your accountant?
Good preparation of records can ensure your accountant is able to provide you with their best service and in a timely and more cost-efficient manner.
Here are a few ideas, some of which may sound simple – but what a difference they can make!
- Spreadsheets – Much of the information you provide your accountant is entered into spreadsheets so that it can be analysed. Have a go at keeping the records on a spreadsheet yourself – it’s surprising how much information you will be able to extract to benefit your business. Then you can email a copy of the spreadsheet over to your accountant as and when required.
- Totalling and balancing – However you chose to record your business transactions make sure you are obtaining from them the information you need. If you total up, balance and tick-off transactions that have taken place, you can easily spot those that haven’t. This can also help you find any mistakes and therefore correct them more swiftly. It’s much more difficult for your accountant to trace back a mistake that happened several months ago, and ultimately they would have to contact you for clarification and use up your valuable time.
- Bank Statements – Not all transactions on your bank statements are self-explanatory. Have a quick scan through statements as your receive them, or even as you collate them for your accountant. If it’s not easy to understand what a transaction relates to, simply write a word or two next to it to explain. Lengthy phone calls to identify bank transactions can easily be avoided.
- Stubs – Write clearly on cheque and deposit book stubs. The accountant will need to refer to these to clarify money leaving and entering your bank account. It’s often a guessing game if the writing is illegible. But worse than this is a blank cheque or deposit slip!
- Payment of invoices – Indicating the payment method (Cash/card/bank transfer) on invoices can help your accountant match up bank transactions with the right paperwork and ensure money is allocated properly. This works both ways – sales and purchase invoices can be marked with details of amounts received/paid and dates of settlement.
- Submissions – If you submit your own VAT, P35’s, CIS returns etc ensure you provide a copy to your accountant – it helps that all records correlate.
- Fixed assets – make a copy of invoices for any new assets purchased and also provide information for those disposed of. Don’t forget to pass on documents relating to the exchange of or new company cars and lease agreement if not purchased outright.
- Use a folder – loose records thrown into a carrier bag require a lot of organising before any accounting can take place. You understand your paperwork and records better than anyone and can organise them into categories much more efficiently.
These are just a few ideas that could help you improve your business bookkeeping, something that is particularly important now HMRC can inspect your business records at any time and penalise you up to £3,000 if your records are not adequate!
You may find that in cases where this helps to reduce the time your accountant spends working on your accounts it could lead to…dare I mention it…a reduction in fees! Alternatively, it could free up some valuable time for your advisor to spend some quality time on your affairs looking at ways to improve profitability, save tax, etc.
It all will depend on you and the time and effort you can put into this important administrative task.