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What is bookkeeping and why is it important?

I touched on this recently when writing the What’s the difference between bookkeeper and accountant? blog but will go into a little more detail now. Whether you need an accountant for filing purposes at the end of the year or not, having a well-prepared set of books will make your life easier and could save you money! Presenting your accountant with a well looked after, accurate set of books will make their life a lot easier than being presented a box of invoices and receipts and make your bill a lot lower too! 

Even if you get your bookkeeper to do your end of year self-assessment and reporting on your business, or even do it yourself, a good set of books is still an essential requirement, as they’ll make it so anyone looking can easily find the information they need! It’s not just useful for self-assessments, your books are a wealth of information about your business just waiting to give you an insight from a different angle.

Reports can be viewed easily to allow you to analyse the financial side of your business easier. I’ve mentioned before the case where one of my clients had us setup some reports to get e-mailed monthly to them, analysing a particular client who they did a lot of work for. The reports showed them that although they spent a lot of time working for this client, the profit didn’t justify that amount of time. This caused a restructuring of how they worked with this client, freeing them up to do more work with more profitable customers. 

So many people see their books as something they do simply to meet the legal requirements of them, so they’ve figures to submit in their tax return. However, they can show you so much more, it’s often people either don’t know how to get something from them, don’t have time to or just don’t want to spend their time doing their books, causing resentment towards them. My husband was a great example of this (before I met him, I should add!). He used to lose every Christmas to doing his books, as he was “too busy” to do this during the year doing the work that he could invoice. This timeframe meant they were done just in time for self-assessment, no time to analyse them in any form, they were just there for that one legal requirement. He’s no longer self-employed so I can’t help him, but he has said he wonders if he’d done things differently if he’d had time to actually look at how his business was performing, other than looking at how much money was in the bank! 

Existing customer or not, please feel free to have a chat with us about how we can help you get the most out of your books! 

So what is the difference between a bookkeeper and an accountant?

A question that we often get asked by people is what is the difference between us and an accountant? While there’s a lot of information out there on the web about this, we thought we’d do a little blog to try and help too! 

Bookkeeping is essentially the recording of all the financial transactions within the business. Accounting is the interpreting, analysing, reporting and summarising of the financial data. So, without the bookkeeping step, the accounting cannot happen. While you’d think from this that bookkeepers will therefore handle the recording part while the accountants analyse, it’s not always that clear cut! The roles often overlap, with bookkeepers analysing and reporting on the data they’ve entered, both for client analysis and also as part of checking their work. Accountants can also create and modify data as part of their analysing, such as moving items from one account to another to help with tax liabilities. 

Some accounting firms will offer a full service, where they perform both functions, however they’re often done by separate departments so it would still be a bookkeeper performing the bookkeeping role, the accountant doing the accounting and this situation is where you’d find less crossover in the roles, sticking to their defined areas. 

Having a separate bookkeeper can be an advantage for many reasons. Either employing a bookkeeper or using an external one such as ourselves can be more cost effective than using an accountant alone. Giving your accountant a looked after and nurtured set of books makes their work easier, plus if they do have any questions, they can speak to someone in technical terms and get the answers they need easier. The bookkeeper can also generate reports using the transactions, handling some of the accounting process again in a more cost-effective way, plus knowing your business well will allow them to know what you need to know.

Bookkeeping and accounting can appear to some people as the same thing, as their both working with financial data. Some people, especially the self-employed, don’t even need an accountant, a bookkeeper can take care of all their requirements. We pride ourselves that we advise our customers honestly when we feel it would be beneficial to them to have an accountant work directly with them alongside ourselves, rather than trying to hide it! We work with a number of accountants who we can get help and advice from as required on your behalf when required, so starting with a bookkeeper is often a good starting place! They certainly wouldn’t end up costing you more than just going with an accountant!

If that’s still left you with questions, why not get in touch with your questions and we’ll do our best to help you. 

QuickBooks Advanced Training

Yet another day in London last week, this time accompanied by my husband, to attend training for Advanced Online Certification of QuickBooks. Held at their training centre near Tower Hill, it was a good refresher of some skills that we don’t use day to day, we learnt a few tips and tricks and proved we’re actually quite good at what we do!

As with QuickBooks connect, lovely food and drink and a lovely training centre to spend a day in, while the classroom is quite intense to ensure you get through everything in a day, the centre is very relaxing and regular coffee breaks help keep you awake! The day ends with a timed exam, lasting a maximum of an hour, thankfully with your result at the end so no waiting to see if you passed! We did both pass, so expect to see our new Certified ProAdvisor, Advanced Online badge on our website soon!

QuickBooks Connect

Last week QuickBooks hosted their annual QuickBooks Connect event, held in London at Old Billingsgate Market, an event for Bookkeepers and Accountants. Starting Monday afternoon allowed me a couple of hours in the office before jumping on the train to head to the city. An interesting afternoon speech aimed at accountants all about Making Tax Digital, followed by a brief drinks reception before retiring to my hotel to enjoy an evening of childfree silence! 

The main day featured a mixture of keynote speakers and breakout sessions, with a wide variety of subjects, thankfully I’d studied the agenda before leaving so I’d got my day all planned. One of the highlights was Dr Brian Cox, although not directly linked to bookkeeping and accountancy was a highly motivating speech, giving me lots to think about. Other highlights including the delicious food on offer throughout the day and getting lots of swag from the various exhibitors around!

One of the only disappointments of the day was how an accountant managed to alienate any bookkeepers within the audience of his speech within the first five minutes, seemingly forgetting that a good set of books can make an accountant’s job so much easier and rubbishing the work we do! Think someone may have not thought about their audience somehow! 

A highly valuable day overall, seeing lots of new innovative software solutions coming up from QuickBooks and their partners. Looking forward to next year’s event already!

Making Tax Digital – What you need to do

There’s been a lot of shouting about Making Tax Digital (MTD) kicking off on 1stApril, with HMRC trying to ensure everyone who needs to know, knows. Equally though, we’ve heard stories of people who are still using journal books saying “it doesn’t apply to us as we’ve not had a letter”. So maybe you’re one of the people that is unsure or doesn’t think it applies to them? 

Put simply, if you are a VAT registered business with a taxable turnover above the VAT threshold, you are required to use the MTD service from 1stApril 2019. There are a few small exceptions that can be found here but for the most part people must be using software to keep their records in a digital form and file their VAT returns using software. Importantly, copying and pasting information from one location to another features in the list of things that are NOT compliant when it comes to the final figures (so you can copy and paste during normal operations but you can’t copy and paste the figures to be submitted around, they have to transfer electronically). 

There’s a lot of information out there, not always in the clearest form, so if you need any help or advise please feel free to contact us, we’re here to help! 

Wow, what a year!

2018 was the first full year of trading for PBS. Although we formed in November 2017, April 2018 saw it become my sole source of income, having left my part time job. We’ve grown from strength to strength, expanding our client base and increasing the work we do for existing clients. A lot of our referral work has been word of mouth so if you’ve recommend us, thank you! 

Looking forward to 2019, we’ve more training planned to be able to offer an enhanced service and to ensure we keep up to date with all changes that will affect you and ourselves! We’ve also got the launch of Making Tax Digital, which we’ve spoken more about in a separate blog. We hope to keep expanding our client base and look forward to working with all of our clients, new and existing!

Going Limited

So it’s the 1stJan 2019 and not only is it the start of the New Year but it’s also the start of Practical Bookkeeping Services Ltd

I made the decision a few months ago after talking through with a client about whether they should make the transition from sole trader to being limited company, when I suddenly realised afterwards that everything I’d discussed with them was applicable to me! 

After crunching some numbers (obviously!) I made the decision to go for it.. So here we are, PBS Ltd is officially go! 

We’ve got gold!

Not an Olympic gold, but it’s still a gold that we’re proud of! PBS are now Gold Tier QuickBooks Pro Advisors! There were some requirements to get this, one of which was related to the number of clients so we couldn’t have done it without you! And it means we have a got a lovely little symbol we can display on our website and marketing assets! 

Our sights are firmly set on achieving Platinum level and are already planning training to assist us in getting there. So if you’ve any questions about QuickBooks, please get in touch 

Training

So, first let’s go back in time. 3 or 4 years ago I was preparing management accounts for the company I was employed by, a part of my job I really loved. Then they told me they wanted me to bring them into a managers meeting to discuss them with everyone.. Now I was out of my comfort zone! 

It may have been the setting rather than what I was doing but I never felt comfortable in those meetings – major case of imposter syndrome even though I knew my job inside and out. I often came away feeling, well, it’s hard to describe but my confidence hit rock bottom. 

Fast forward to now and I’ve found a new love for networking, increasing my confidence to a new high! 

At a recent networking session, I was asked if I provided training by a lady who handled her own bookkeeping. She wanted to hand over a better set of books to her accountant at year end, partly to reduce the accountants work load (and therefore their fee!) but also to make it more worthwhile (see this blog). I said yes as I knew I could do it but admit to feeling very nervous at the thought of those confidence knocking meetings.

I’m pleased to say that that nervous feeling soon disappeared, I left the clients office feeling fulfilled and like I’d done a great job – the feedback from the client told me they did too! 

This is one of the reasons I’ve decided to offer training to the services offered by PBS. Rather than trying to make people fit some pre-determined course I set up and roll out, I create a bespoke session to meet specific requirements. 

Now, I know this sounds expensive, but it’s really not. Although I would create the course for you specifically (which sounds time consuming) as it’s based on bookkeeping (which I do every day!) and on software it’s very easy for me to put together a plan for training.

I feel having some bullet pointed headings and notes to guide, rather than dictate, where the course goes helps ensure it covers what you’re after but remaining flexible to deal with things as they come up during the day. 

We also encourage learning at your office, using the computer/laptop/tablet you always use. Despite best intentions things will display slightly different on different computers, you might have a slightly out of date or even newer software version, there’s so many things that can be different! 

So to wrap up this blog it’s probably worth saying how I charge for training! I charge for it in half day blocks (check my website for my up to date pricing) 

Experience has taught me half day is usually enough for anyone (we all zone out at some point!) but feel free to contact me with specific requirements and I’ll advise how long you will need, further training can always be booked if you end up wanting/needing more.

So, get in touch and see how we can help you with your training. Training sessions offered in QuickBooks, Xero and Sage

QuickBooks is great but I did miss Sage!

I recently got asked to provide some training for a client who was already using Sage 50 but wanted a little bit of help as they felt things should be easier. 

Having used Sage for most of my bookkeeping life, I was more than happy to do this but with most of my clients running QuickBooks I realised I hadn’t used it for a fair few months (except a couple of clients using Sage One but that’s a very different Sage!). 

The training was great, not only did the client get everything they wanted from it but it also reminded me how much I loved my old friend Sage! Don’t get me wrong, I love QuickBooks and think it’s just what suits most of my clients but there was something nostalgic about using Sage again!