‘I don’t need a bookkeeper – the software will do it all for me….’
Seen those fancy TV ads for Quickbooks and Xero – all you have to do is buy this software and all your accounts are done for you, right? Wrong!
We are spending a great deal of time helping new clients who have bought software and think it’ll all be easy and got themselves into a mess! Why are the adverts misleading?
Software is a great tool to use to compile your accounts – although some very basic tasks can be learnt, there is still a lot of accounting knowledge needed. The software works on a double entry bookkeeping system – so how do you manage this, if you’re not trained in double entry bookkeeping?
Here are some examples of what we OFTEN find:
VAT paid, unnecessarily – saved a client £1,300 recently paying VAT on furlough income
VAT reclaimed, incorrectly – ignorance is no excuse if you get a tax inspection
Payroll journals all over the place, making a nonsense of the profit and loss
Meaningless profit and loss with expenses included which shouldn’t be there eg loans, tax payments, fixed assets, supplier invoices categorised as sales
Bank accounts and credit cards not reconciled with missing or duplicated transactions, because the bank feed dropped out
Supplier and customers ledgers with many old errors in them
If your numbers aren’t up-to-date and accurate, you cannot get a grip on:
Who owes you money?
Who do you owe money to?
Can you take dividends?
How much tax are you likely to owe this year?
Apart from not being able to manage your business effectively, because you haven’t got a grip on the numbers, it will cost you more to sort out the mess you’ve made, than it would have done to get it done properly in the first place.
A good bookkeeper is worth their weight in gold – ask any of our clients!