This article first appeared in the Staffordshire Newsletter as a guest column written by Clive Boult Manager.
The rapid advance of technology, especially in the past decade, is not only changing the way we work, but is also impacting on how businesses of all sizes are managed, leaving them better equipped to cope with the peaks and troughs of today’s commercial world.
One of the areas to experience significant growth is cloud-based accounting, with online packages such as Sage One, QuickBooks and Xero making it easier to get a grip on your finances. Helping to improve accuracy – so there’s less likelihood of incurring tax penalties due to errors or the risk of inaccurate data resulting in poor quality decision-making – the software simplifies file management, enhances security and improves data back-up and retrieval thanks to 24/7 accessibility to the latest information.
Real-time reporting is a bonus and instead of having to install and maintain software on individual desktop computers, you can access data anywhere on any device with an internet connection. You don’t need as much server infrastructure to store data and there’s no need to recruit dedicated IT staff to maintain or update a cloud-based system.
We’ve all heard about Making Tax Digital and this is one area in which cloud accounting will come into its own. The concept has been widely criticised by large sections of the business community, which object to being forced into accounting online and there are concerns about the pace of change and what some consider HMRC’s failure to provide sufficient information to help businesses achieve compliance.
Although the roll out of Making Tax Digital may have been delayed, HMRC is committed to delivering a system that will support businesses and reduce the amount of tax lost through avoidable error. It would therefore be prudent to start making ready for April 2019, when it will be a mandatory requirement for businesses with a turnover above the VAT threshold to use the system to meet their VAT obligations.
At Howards we’ve embraced the technology revolution, creating our own app – free to download from the App Store (Apple) or Play Store (Android) – to help clients manage their finances.
As well as providing access to the latest accounting updates, key dates and calculators, the app helps you to track receipts and expenses in real time providing greater transparency. It also serves as a one-stop shop for cloud accounting, Making Tax Digital tools and the latest tax content.
Changing role of accountants
Technological progress and an increasing willingness to use software for business management is also impacting on the relationship that companies have with their accountants. In future, rather than talking to your accountant about profit and loss, you will more likely be seeking advice on strategic planning. Your accountant will adopt more of a consultancy role, adding value by analysing and interpreting data to support the development of your business.