Ways to improve year end processes


Business and accounting paperwork
Continuous improvement is the key to success.

As with every New Year, January marks a particularly busy month for two sets of professionals; personal trainers and accountants. Gyms are at their busiest at the beginning of each year, packed with people wishing to stick to their New Year’s resolution to lose weight. Accountants, on the other hand, are spending many hours in the office trying to tie up year end.  As much as any financial controller tries to prepare, year end always ends up being a battle of time versus a multitude of tasks.

We live in the digital age where the importance of big data has become more noticeable than ever. Companies have come to rely on business intelligence to clean through vast data lakes in order to drive business strategy and increase profits. However, this increase in data volume impacts all departments, many of which still rely largely on manual processes. None of these are as critical to success as the financial control function. Heads of Finance will no doubt appreciate that their teams are recipients of data outputs from a variety of sources, which are then consolidated for financial and management reporting purposes; often relying on hours of dedicated data mining and formatting by overqualified accountants.

This juxtaposition between the use of highly automated business intelligence to create strategy and revenue versus the manual, laborious approach taken by the back office could not be more striking in 2018. Often, the real casualties in this scenario are data integrity and financial intelligence. For most companies, the effort required to complete key accounting and finance tasks takes away time that could be used to ensure the integrity of the data and deliver continuous management information that adds value, such as liquidity and budget forecasting.

Gaining financial control means getting ahead of the many period end processes and gaining efficiencies in the routine tasks, such as intercompany or expense management, in order to produce reports that add value to your business.

Without a doubt, gaining control requires automation. It would be easy to suggest that this could mean the end of the trusty old spreadsheet. For many this is not true, and a frightening thought.  But consider this; as data volumes grow, the limitations of spreadsheets becomes all too apparent. For many finance professionals, spreadsheets are the primary tool of choice for ad-hoc scenarios. It goes without saying that most financial controllers are highly adept at using systems such as Excel, Numbers or Lotus 123. But all too often manual processes are initially used as stop gaps which, in time, become strategic and part of the problem. This is particularly true when it comes to reporting. Unfortunately, the reliance on manual processes can, and does, lead to error.

It would be easy to dismiss the importance of spreadsheets. The simple fact is that spreadsheets are irreplaceable and will continue to be a part of every day life in finance. The trick is to limit their importance in any process and seek automation wherever possible.

Financial Control is at its busiest at the beginning of each month. The number of tasks performed during the first 3-10 days (depending on the firm’s policies) of the month to close off the previous month’s books is typically a challenge leading to countless late nights. Adopting a more streamlined, automated approach as outlined above significantly reduces time pressures and leads to a cleaner, more efficient month end close.

If you need any help with your month end accounts send us an email info@stanleycarter.co.uk or check our www.stanleycarter.co.uk

Managing your finances ready for the New Year!

As the ribbon is cut on 2018, there’s usually a slight pause in business owners calendars which can be used to look back at what your company’s accomplished and how it might be get better.

finances, Self assessment, HMRC, Tax, New year
Getting on top of the finances


Managing a small business is a complex endeavour that only passionate people can dare to undertake. A small business owner has to wear many hats, especially in managing sales, customers, workers, partners, and personal life at the same time. Keeping the finances of a small business running efficiently is one task that business owners cannot afford to outsource or delegate completely because finances is the lifeblood of the business.

However, managing the finances of a small business is fundamentally complex because there are so many balls that you must juggle at the same time. Nonetheless, the right tools can help you manage your business finances more efficiently without ignoring other important parts of the business.

Anyone who needs to complete a Self Assessment has the potential to shave hundreds of pounds off their tax bill by getting savvy on which expenses are eligible for relief with HMRC. 

Keeping proper accounts is an important part of managing a small business, but the accounts of a small business can become confusing pretty fast if you don’t have a background in finances. In fact, many small business owners need help knowing where their personal finances end and where their business finances begin.

Once you moved up from being a sole proprietorship to become a small business owner, you’ll start having to manage other people other than yourself alone. However, many small business owners who don’t have a background in HR tend to see payroll management as a time consuming process.

Expenses are an important part of running a small business; you’ll have a number of core operational expenses and an even higher number of non-core but important expenses. You’ll spend money on petrol, meals  coffee with potential clients, and sending holiday gifts. Those seemingly minor expenses can pile up and leave a big hole in your finances.

If you need help organising your finances this new year or to prepare your self assessment send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk


HMRC penalties to corporate Directors

The number of personal penalties levied by HM Revenue and Customs (HMRC) against corporate senior accounting officers (SAOs) remained high last year.  The figures showed that HMRC was taking an aggressive approach to enforcement. HMRC office

Given the scale and complexity of the money flows in large businesses, simple errors in the finance department can result in mis-reporting and subsequent fines. Finance directors need to understand all the requirements set out by HMRC. The policies, procedures and systems in place to ensure tax compliance need to be carefully monitored to avoid the potential for mistakes,”

There are two types of personal penalty that can be issued under the regime: firstly, for failing to take steps to ensure the accounting arrangements are adequate; and secondly, for failing to provide an annual certificate either confirming the arrangement are adequate or disclosing details of the deficiencies. Accounting arrangements are considered ‘adequate’ if they enable all relevant tax liabilities to be calculated accurately in all material respects.  Businesses can also be fined under the regime for failing to provide the name of their SAO to HMRC.

The total number of penalties issued under the SAO regime last year was actually lower than the number issued in each of the previous years.

If you have any queries about your tax or HMRC penalties send us an email on info@stanleycarter.co.uk or check our website for further information www.stanleycarter.co.uk

Changes to the UK Corporate Governance Code

The UK Financial Reporting Council (FRC) has confirmed it will launch a consultation on changes to the UK Corporate Governance Code.

Among the proposals, the watchdog said, would be the need for companies to link corporate governance to purpose, engagement with wider stakeholders, and consider how they benefit wider society.

The FRC added that it would sound out views on the future development of the UK Stewardship Code, including the extent to which the interests of wider stakeholders and broader social impacts,  including environmental, social and governance factors  were integrated into engagement and monitoring by investors.

The development comes after the FRC faced criticism from corporate-governance campaigners over claims that it had failed to enforce the requirements of section 172 of the Companies Act 2006.

Section 172 says company directors must not only run a successful business but must also take account of a wide number of stakeholders such as employees, its suppliers, the wider environment, and even the wider reputation of the company.

The FRC has revealed plans to conduct a series of targeted thematic reviews of company financial reports during 2019.

The audit watchdog said the reviews, which will supplement its routine oversight of financial reporting, will focus on four key areas. In its sights are smaller listed and AIM companies, revenue recognition, lease and financial instruments accounting.

The FRC said it planned to contact 40 small companies before their financial year-end and select two areas of disclosure from their upcoming reports and accounts for review.

The areas that the FRC will select for review,  will be drawn from five areas that have been flagged up in recent thematic reviews or in Financial Reporting Lab reports.

The IASB has recently introduced major new standards covering revenue, leases and financial instruments.

Disclosures about the effects of Brexit are also on the FRC’s hit list.

If you have any queries about how these changes will affect your business please send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

UK Government Budget

UK Chancellor of the Exchequer Philip Hammond unveiled his Budget statement on November 22, under the new arrangement for the main annual tax changes to be announced in the autumn for the following year. Some predicted tax increases did not materialise, which will be welcomed by the wider business community.


Capital allowances

The temporary schemes for 100% first year allowances (FYAs) for purchases of zero emission goods vehicles, and for gas refueling equipment, which were due to end for expenditure incurred after March 31 2018, will now be extended for a further three years.

With immediate effect, there are some minor changes to the list of energy-saving technologies eligible for 100% first year allowances (FYAs). Lessors are not eligible to claim FYAs, but the use of hire purchase type facilities will allow customers to claim them.

The temporary scheme of first year tax credits (FYTCs) for environmentally beneficial capital expenditure, involving projects within a designated list of energy and water technologies, which were due to expire in April 2018, will now be extended for a further five years. FYTCs can be claimed by companies in a tax loss position, at two thirds of the corporation tax rate. The use of leasing facilities becomes a relatively less attractive option for potential lessees who could claim FYTCs while purchasing assets outright.

Vehicle taxes

Various income tax and vehicle excise duty (VED) changes are designed to promote environmental objectives. The diesel supplement for the income tax benefit in kind (BIK) charge for diesel cars not certified to the RDE2 standard will rise from 3% to 4% with effect from April 6 2018.

The first year rate of vehicle excise duty (VED) for new diesel non-RDE cars will be increased by one band from April 2018. Other VED rates will rise in line with the retail price index from next April.

Electricity provided by employers for the workplace charging of employees’ electric and hybrid cars will be exempted from BIK charges with effect from April 2018.
However, there will be no changes in motor fuel duty rates next year.

Some tax increases

There are some significant tax increases. In the taxation of capital gains by companies, indexation relief for inflation is to end in respect of changes in the retail price index after the end of this year. This will match the capital gains tax (CGT) rules for individuals, where indexation relief was removed in 2008. The ultimate impact of this change will obviously depend on future inflation rates.

A new move against cross-border corporation tax avoidance will target the use of favourable tax jurisdictions to hold intellectual property rights such as core product brands. The Chancellor proposes a new withholding-type tax at the income tax basic rate on royalty payments to associated entities based in low tax jurisdictions, by international groups trading in the UK. The change will take effect from April 2019, and a consultation paper on the details is to be issued at the beginning of next month.

Other steps against tax avoidance and evasion include:

  • a move against VAT evasion in online sales, making the marketplaces jointly liable with suppliers for unpaid VAT, from the enactment of the next Finance Bill;
  • a further strengthening of legislation in the 2016 Finance Act designed to tackle “disguised remuneration” of employees or quasi-employees for income tax purposes;

Other significant changes

For micro-businesses, the Chancellor announced that the VAT registration threshold will remain at annual turnover of £85,000 at least until April 2020. It remains under review for the longer term, and the UK threshold is low by comparison with other EU countries.

The rate of the tax credit for research and development expenditure is to be increased from 11% to 12% from January 1 2018.

Economic background

The Chancellor acknowledged that the UK’s recent economic performance has not been as good as previously expected, due to a generally stagnant trend in productivity. The latest official forecast is that the UK economy will grow by around 1.5% in each of years up to 2022, compared with earlier forecasts of 2% annual growth.

However, he still predicts a continuing gradual improvement in the budgetary position, having avoided major new tax increases or expenditure cuts in this Budget. Annual public borrowing, which rose to nearly 10% of gross domestic product (GDP) in the aftermath of the financial crash in 2008, is projected to fall steadily from 2.4% of GDP in the current financial year to 1.1% by 2022/23. Overall national debt is projected to peak at 86.5% of GDP this year (having more than doubled since 2008), then falling to 79.1% by 2022/23.

If you have any concerns about the last budget and how it will affect you or your business please send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

The risks of fraud in your business

Fraud is a real and growing problem for organisations and companies of all sizes. For SMEs, it can be catastrophic. According to the Annual Fraud Indicator 2016, the cost of fraud to the UK economy is £193bn a year and of course that is just the fraud we know about.

The danger of fraud if left undiscovered is that the perpetrator becomes emboldened in your company and it can repeat the behaviour. We have known situations where detection has taken five years or more by which time small amounts of expense fiddling have increased to large thefts with a real impact on the bottom line. Often it is a company’s auditor who spots irregularities but sometimes it can be an employee whistleblower or a change of manager who highlights a reason for suspicion. The only lesson for business managers is to be ever vigilant.

If you suspect fraud is taking place in your organisation and require expert advice please email us on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk


Cloud good or bad for Accountants?

In 2017, accountancy practices face many challenges that span the regulatory, economic, political and technology spheres. In particular, digital transformation has brought about rapid change, with accountancy practices needing to consider how to thrive in the digital age, and how to evolve their businesses to maintain pace with the digital revolution in the UK and beyond.

The majority of UK businesses are now leveraging technology to achieve business success. The adoption of cloud technology has almost doubled in the past seven years, according to a study by the Cloud Industry Forum (CIF), with 88% of businesses now using cloud services. In addition, as revealed by the CIF in March 2017, 67% of companies expect to increase their adoption of cloud services by March 2018.

So, why should accountancy practices prepare to move to the cloud, and what steps should they take to get there?

What to gain from the cloud

Digital transformation has had a significant impact on the accountancy industry. As technology enables “traditional” accounting bookkeeping services to be automated, accountants have been presented with an opportunity to transition to an advisory role, adding value to clients.

So, what are the benefits of moving your practice to the cloud?

 Improved efficiency

With the cloud comes efficiency. Technology allows accountants to automate repetitive tasks, saving time spent on paperwork. And the cloud also eliminates the need for spreadsheets as well as reducing the risk of manual errors, improving accuracy of data.

Increased accessibility

Data in the cloud can be shared with clients, colleagues, or anybody who needs access, at any point. It also provides accountants with the freedom to work remotely – all you need is an internet connection.

Improved decision-making

Accountants can leverage real-time information to help make informed decisions and provide strategic advice to clients. Whereas accountancy practices without cloud capabilities must often delay decision-making until end of year historical data is available, accountants on the cloud can make the right decisions quickly.

Streamlined systems

A paperless working environment is a key advantage for practices overrun by paper records. Cloud technology also offers a reliable storage system, with quick and efficient access to client and business data, all stored safely and securely with no danger of missing or lost files.

Before moving your clients to the cloud, become a true advocate of the technology by first moving your practice’s accounts to a cloud accounting system. This will enable you to use the system to interpret your own data first and adjust to the system before turning to client data. Become accustomed to the differences between your existing accounting set-up and the new services that the cloud technology offers, fully understanding the benefits that you can leverage to fulfil your clients’ advisory needs.

Finally, it’s important to identify the right clients to move to the cloud first. Young, tech-savvy and small companies are the ideal candidates. By beginning with business that don’t have stock control, custom requirements and a large number of transactions will make the transition smoother for your practice.

For further information about your accountancy needs send us an email on info@stanleycarter.co.uk or check our website www.stanleycarter.co.uk

SME Bank accounts

Banks are looking for new revenue streams. Providing excellent service to SME customers is an opportunity often overlooked by banks. There are an estimated 4.7 million SMEs in the UK – accounting for 99.9% of private sector business. Can you afford to ignore this market?

Business customers don’t have time to fill out a time-consuming and complicated application and then wait days — or even weeks — to open a new bank account, or to repeatedly enter the same information into separate applications to obtain multiple products. If the process isn’t quick and easy from any device, customers simply decide to take their business to a bank that offers a more convenient and customer-friendly experience.

To date, banks have been unwilling to tailor their services to meet the specific needs of SMEs. By failing small business owners, banks are ignoring the opportunities of the lucrative business banking market. Large banks likely have upside available today for existing SME customers, adding a cross sell capability — to apply for additional credit, for example — would bring banks a significant upside.

The good news is anyone can adopt the best practices , proven by the success of top banks, to create a customer-focused acquisition and onboarding experience.

If you need help to open a business bank account email us your details to info@stanleycarter.co.uk or check our website for further details on www.stanleycarter.co.uk

Top accountancy companies post significant growth

The top 15 tax companies and top 15 audit companies have been released this week, based on data submitted by firms for the Top 50+50 Accountancy Firms 2017.

In both tables, PwC leads the way with total UK tax fee income of £822m and audit and accounting fee income of £1.24bn.

The remaining Big Four firms replicate the same positions occupied in the Top 50+50 table with Deloitte in second, and EY and KPMG in third and fourth respectively.

Deloitte recorded audit and accounting fee income of £824m and tax fee income of £654m. EY took £581m from tax services and £619m from audit and accounting, and KPMG registered £498m in audit and accounting and £479m in the tax table.

Elsewhere in the tables, BDO occupied fifth position in both tax and audit ahead of Grant Thornton. The firm, which placed sixth in the main Top 50+50 rankings, had a total tax fee income of £126.8m, with Grant Thornton slightly behind on £104.4m. In audit, BDO edged ahead of RSM by £10.4m with total audit and accounting income of £170.4m. Grant Thornton took seventh with £148.4m.

Saffery Champness has ranked at number 13 in tax, but slipped out of the top 15 in audit and accounting. UHY Hacker Young entered the audit table with fee income of £30.13m, ahead of MHA MacIntyre Hudson and Smith & Williamson.

PKF UKI posted strong growth of 24% in tax services this year, holding ninth position in the table. The firm also holds ninth in the audit table with growth of 16% and fee income of £71.26m.

Other firms showing strong growth this year are Moore Stephens, with a 27.9% increase in tax fee income compared to 2016, and Haines Watts and MacIntyre Hudson with 18.6% and 20.8% tax growth respectively.

The only firm to post negative growth across the two tables was KPMG, with a decline of 3% in audit compared to 2016 figures.