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Skills you need to develop as an accountant

We take a look at the key skills accountants need to develop to pursue a successful career.

Accountants, skills, accounts
Skills required for accountants

If you are striving for a successful career in accountancy, there are a number of key skills which you should look to develop and build upon throughout your career.

A combination of accredited qualifications and excellent interpersonal and professional skills will enable you to pursue the successful career you are aiming for.

Adaptability

The accounting industry is changing rapidly. The role of the accountant is becoming more of an advisory one as technology automates processes and removes the need for paper. Clients have new expectations, and accountants can now collaborate and work with their customers in real time.

With technology bringing constant change, accountants need to be able to adapt quickly and react to whatever curve ball is thrown at them.

Openness           

Honesty is highly valued in the accounting world. Accountants and the firms they work for pride themselves on adhering to the highest ethical standards and always treating their clients with honesty and integrity.

It is important to be transparent when making decisions, providing advice, and completing tasks. This is true of every workplace relationship, whether with clients, your manager, or when working in a team of colleagues.

Strategic decision-making

Automation of many administrative tasks means accountants have more time to focus on the strategic decision-making side of their role; and clients know this.

Individuals who have strong commercial skills and have invested in their accounting training will be considered highly valuable by clients and firms alike.

Information technology expertise

Accountants should look to be knowledgeable in general IT and accounting software, especially when it is likely your client will know how to use it too.

Cloud accounting is the latest technology break-through in the accounting industry. Working in the cloud means data and software are available anytime and anywhere, so clients can keep their finances up to date across different platforms. Many clients will also be technically savvy about the cloud, but for those who aren’t, the accountant needs to step in and explain it clearly.

Communication

Clients and colleagues can communicate with you at any time they want to from anywhere in the world. Accountants need to be willing to interact with people across all mediums, from phone to video conferencing. It is a good idea to master social media as well as the more traditional email.

While clients may contact you regularly via the phone, most will also value face-to-face meetings. This is also the best way to build a trusting relationship. When it comes to complex financial or technical discussions, accountants must be able to relay information clearly and concisely.

Creative problem-solving

Change is likely to bring about challenges as well as positives. Therefore, firms need accountants who can think outside the box and come up with effective ways to solve new problems.

Initiative, a skill which can be developed in professional, educational, and personal situations, is highly valued by employers. Firms are keen to recruit staff who want to share ideas to continually improve business performance.

Customer service skills

For accountants working in public practice, it is essential to be able to build a strong relationship with current customers, in order to retain them, as well as being able to attract new customers.

In corporate accounting, individuals must meet the needs of the organisation’s other departments and their managers. In both instances, strong customer services skills are invaluable.

Here at Stanley Carter we are a highly skilled and experienced accountancy firm. If you require any help or information please contact us on 0161 2056655 or send us an email info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

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Would the new corporate governance code have saved Carillion?

Carillion, the second largest building contractor in the UK and the lead on a number of key public service contracts, entered into liquidation last week. Various commentators have highlighted poor governance at the company but would the revised UK Corporate Governance Code recently announced by the Financial Reporting Council (FRC) have prevented its collapse?

What caused the collapse?

There are differing views as to what caused Carillion’s problems but many have pointed at internal failings and a poor governance culture. Roger Barker, Head of Corporate Governance at the Institute of Directors said “it is clear that major providers of public services must be governed in a prudent manner”. He suggested that the collapse highlights a lack of effective governance at Carillion and questioned whether the board and shareholders acted appropriately before the collapse.

The Government has acknowledged these worrying signs and has ordered an investigation into the conduct of Carillion’s directors. Executives at the company are said to have tweaked rules in the firm’s bonus scheme to make it harder for those bonuses to be clawed back if the company failed. This sounds like the executives were trying to preserve their own position at the expense of shareholders’ interests. The bonuses have been branded ‘exorbitant’ in the House of Commons.

Further concerns related to the excessive pay of former chief executive Richard Howson who received £1.5 million in 2016. Carillion also agreed to continue paying his remuneration until October this year, handing him a £600,000 salary.

Many believe that the directors of Carillion did not follow responsible internal processes. Recognising the crippling debt, and other significant problems the company was facing, they should have acted in the best interests of the company and looked to minimise the risk of collapse, which eventually became unavoidable.

The revised corporate governance code

Poor corporate governance, particularly excessive executive pay, has been a hot topic for reform in the last 12 months. The FRC has opened a consultation on those proposed revisions after undertaking a ‘comprehensive review’ of the code.

In the consultation document, the FRC highlights the heightened public scrutiny faced by the country’s largest companies and the impact poor internal governance can have on a wide range of stakeholders. So could the proposed changes help to prevent another Carillion failure?

The revised, ‘shorter and sharper’ code aims to encourage high standards by being clearer and more concise. It focuses on the application of principles relating to stakeholders, integrity, corporate culture and diversity.

Excessive pay

A significant change, introduced in an attempt to tackle excessive levels of executive pay, relates to shareholder dissent and the percentage of votes against a resolution. So when more than 20% of shareholders vote against a resolution, the company should: explain the actions it intends to take following the vote; publish an update on the position within six months of the vote; and provide a final summary in the company’s annual report setting out the steps taken as a result of the vote.

To increase transparency, the Investment Association has introduced a public register that lists companies which have experienced high levels of shareholder dissent. The first published list shows that, at their last AGMs, 24 FTSE All-Share companies received significant shareholder votes against their remuneration policies and 43 had 20% or more votes against their remuneration report.

The new code should give shareholders more say in how company executives are remunerated. The excessive pay levels at Carillion may have been tackled earlier had the directors had a greater responsibility to address shareholder concerns.

Employee engagement

The new code will require boards to establish a mechanism by which they can engage with the company’s workforce and gather its views. The collapse of Carillion will have serious repercussions for its 20,000 employees whose jobs are now in limbo. Perhaps if the board had engaged more directly with those employees and been required to listen to their concerns, steps could have been taken to safeguard their position.

Section 172 duty and stakeholder engagement

The Government intends to introduce legislation which would oblige companies to explain how they have complied with the requirements under section 172 Companies Act 2006 to take account of stakeholder interests when making decisions. This is needed to increase transparency and ensure the internal processes adopted by a company promote its success and are for the benefit of its members as a whole, whilst also taking account of wider stakeholder interests.

Carillion’s supply chain is thought to include up to 30,000 small businesses who had already suffered persistent late payments before the firm’s final collapse. The changes to the section 172 duty are intended to highlight that it’s not just the shareholders who are affected by the decisions of a company’s board of directors.

The future of governance

Whilst a range of factors contributed to Carillion’s collapse it is right that poor governance practices are being highlighted as a key contributor. But whether the new corporate governance code would have prevented the collapse is unclear. Ultimately, the new requirements will only bite if shareholders and investors are prepared to step in and hold boards to account.

The new code should help to increase transparency in a number of key areas, helping stakeholders to understand what is going on behind closed doors. Preventative action could then be taken to stabilise any struggling company before it reaches the point of no return as Carillion did earlier this month.

Give us a call on 01612056655 or email us on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

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The deadline is looming. Companies and Business owners have until the end of this month to submit it.

January can be a tricky time for companies and business owners. Even if you’ve kept on top of it all throughout the year, you can still have a time consuming task on your hands.

Tax return, HMRC, tax
Deadline approaching

Companies face a number of challenges at this time of year, particularly as the tax deadline is in tandem with reduced revenue after the Christmas break.

It’s all too easy to forget that small business owners don’t have the luxury of enjoying much downtime over Christmas. The break is often a prime opportunity to catch up on important business admin and to start planning for the year ahead.

It’s worrying that nearly half of small businesses in the UK admit that they have struggled to pay tax bills, according to a report from insurer RSA. But what’s more worrying is that problem with accounting, or simply a lack of awareness about the process or the deadline, mean that as many as a quarter of companies are missing the due date.

Failing to file a self assessment form by 31 January can leave you facing an automatic £100 penalty.

The fines build up after three months, with HMRC starting to charge penalties of £10 per day, and after six months, the penalty amounts to five per cent of the person’s tax or £300, whichever is higher.

Being hit with fines will inevitably put a strain on the cashflow of small businesses, so managing your tax properly is important. We have here some tips to help you manage your taxes:

First, stay organised. You don’t want to be panicking the day before the deadline trying to find bits of paperwork, so it’s a good idea to file everything in an organised fashion throughout the year.

If you haven’t made any progress, there’s still a week until the deadline. Just don’t leave it until the last minute.

Second, keep tabs on all expenses and include all the information required. Make sure you don’t miss any sections out on the form, and include all earnings, including dividend income on any shares you own. You don’t want HMRC to reject your tax return if there are any mistakes, so also allocate time to double-check the form before you submit it.

Third, use tools available to you. The days of doing everything by hand are long gone. Software’s are available to give you a helping hand when managing your accounts, so do a bit of research to figure out which app is best suited to your business. Making use of these tools will make your life a whole lot easier; think of it as an investment.

Finally, if you are really stumped when it comes to your tax return, you can get a professional accountant involved who should be able to take all the stress away.

Yes, this will come at a cost, but you have to consider if that cost outweighs the penalty from HMRC. Seeking advice from an accountant on your finances can be invaluable to your business, particularly later down the line as your company grows.

Fulfilling tax obligations can be one of the biggest barriers to the success of a business, but don’t let it stop your company from having a prosperous future.

For help filling your tax return give us a call on 01612056655 or email us on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

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The challenges of using technology

Technological advancements require accountancy firms to review not only their internal processes relating to workflow and business management, but also their working environment, including employee reward and engagement practices

Techonology, accountants, UK
Is technology helping accountants?

The rise of technology has transformed the accounting industry and the way in which accountants work in recent years, with cloud tools automating processes which previously took up valuable staff time, increasing efficiency in practices throughout the UK.

Yet, technological advancements require accountancy firms to review not only their internal processes relating to workflow and business management, but to also examine their working environment, including employee reward and engagement practices.

Cloud-based technology automates the collection and processing of financial transactions, helping to build better accountant-client relationships. It can capture, read, and store receipts and invoices automatically, removing the need to store paper, type in data, or chase clients. It also vastly decreases the likelihood of error.

These benefits mean that technology provides significant time savings, with firms needing to adapt to the new business climate as a result, eliminating time-based pay and incentive’s productivity to foster happier employees, and therefore happier clients. Ultimately, time is freed up for accountants and bookkeepers to focus on more important activities, and provide their customers with a quick, hassle-free service.

With staff wanting to feel challenged in their role and recognised for the performance they give, firms need to find an effective way of boosting productivity and rewarding employee performance.

Incentivised pay ensures that the amount an individual earns is relative to his or her results, profit, or performance. Short-term schemes, like bonuses and commission, motivate employees to hit or exceed targets while longer schemes, such as profit sharing, help to generate in the employee an interest in the success of the company.

Firms that fail to get on board with these productivity practices will likely find themselves unable to compete with the more tech-savvy businesses, and risk losing their best employees to competitors offering more recognition for individual performance.

If you are looking for new accountants send us an email info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk 

 

 

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Corporate Governance and the pay gap

Executive pay fell last year but top bosses will still have made more money in three days than the typical worker earns in a year, new figures reveal.

UK top companies, Corporate Governance, pay gap
UK top executives pay gap

The mean pay of chief executives in FTSE 100 companies fell by a fifth from £5.4 million to £4.5 million – 120 times more than an average full-time worker, a slight drop on the ratio of 122-1 in the previous year.

The High Pay Centre think tank and the Chartered Institute of Personnel and Development (CIPD) said there had been “modest” restraint by company boards but the pay gap between the top and average workers remained wide.

All listed companies will have to publish the pay ratio between bosses and workers under new corporate governance reforms this year.

While it was encouraging to see a tiny amount of restraint on pay at the top of some FTSE 100 companies last year, there are still grossly excessive and unjustifiable gaps between the top and the rest of the workforce. Publishing pay ratios will force boards to acknowledge these gaps.

The drop in pay in the last year is welcomed but will have largely been driven by the Prime Minister’s proposed crackdown on boardroom excess.

It is crucial that the Government keeps high pay and corporate governance reform high on its agenda, but we also need business, shareholders and remuneration committees to do their part and challenge excessive pay. We need a radical rethink on how and why we reward chief executives, taking into account a much more balanced scorecard of success beyond financial outcomes and looking more broadly at areas like people management.

The current review of the UK Corporate Governance Code provides a great opportunity to broaden the remit of remuneration committees to ensure that there is much more focus on the wider workforce and employee voice when decisions on chief executive pay are being made, to improve fairness and transparency.

We are experienced on corporate governance and if you have any queries send us an email  info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

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What should Accountants expect in 2018

We’re just a matter of days into the New Year and no doubt accountants are already looking ahead at the new challenges and obligations 2018 will bring.

self assessment, tax return, accounts, tax
Preparing self assessment in 2018

Of course, some of the most important deadlines for accountants to meet fall in the first few months of the year, and May 2018 brings a deadline of a different nature – with firms needing to ensure their data is compliant with the new EU-led  General Data Protection Regulation (GDPR).

But what other challenges might accountants be facing this year, and how might they need to prepare to respond to them?

Self-assessment deadline looms large

The first real target to meet for accountants is the annual scramble to ensure clients submit their online tax returns in order to meet the 31 January deadline.

In truth, of course, the majority of accountants will have done the bulk of preparation by now; readying their clients and securing the necessary information for the 2016-17 tax year in the hope of comfortably ensuring submissions are made.

 

However, if you are struggling to extract the last pieces of information from your clients it’s worth sending out one last mail shot as soon as possible, not only to remind them about the deadline but also to ensure they fully realise they are entirely responsible for submitting their returns and thus avoiding triggering the automatic £100 penalty.

You don’t want to be in a position where any client tries to put the blame for any penalty at your door.

HMRC is in the process of reviewing how penalties are applied, with a review suggesting a driving licence-style points system, but for now, the immediate £100 fine remains in place, with further penalties following for clients who continue failing to submit.

New dividend threshold

In terms of new policies coming in place this year, that you may need to direct your clients towards, the first involves the reduction in the tax-free allowance for dividend income.

From the start of the new tax year in April, legislation will come in reducing the band where dividends incur a 0% tax charge from £5,000 to just £2,000. Clearly, this could have an implication for how some clients choose to be remunerated in the future.

Tax relief for finance costs reduced

Also in April, the tax relief available for the finance costs of individual landlords will continue to be hit.

During the current 2017-18 tax year, higher rate tax payers have only been able to claim higher rate tax relief on 75% of the total finance costs deductible from rental income received. The remaining 25% of finance costs incurred only qualify for tax relief at the basic rate. From April 2018, the higher rate relief available will fall to 50%. Ultimately, landlords will only be able to claim basic rate tax relief on finance costs incurred; this process is set to be completed at the start of the 2020-21 tax year.

Making Tax Digital comes ever nearer

Finally, while Making Tax Digital (MTD) will not start to come into force until April 2019, many sole traders, partnerships or limited companies likely to be affected should be advised to consider whether their existing bookkeeping function will meet HMRC’s strict MTD filing requirements. If it doesn’t they will need to invest time and effort into adapting their record keeping to be MTD-compliant. This is not something that can happen overnight. The smooth transition can only be achieved if sufficient time is allowed for planning and evaluation.

While many VAT registered entities are already virtually compliant, for others the process will take a little longer, and it will be prudent to consider software choices a good nine months in advance of any new legislation coming into place. For a number of businesses therefore, the summer of 2018 will be a good opportunity to choose an option that will work best for your needs.

If you need assistance with your self assessment or any other tax matters email us on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk 

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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

 

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How best to deal with your R&D claims

When it comes to claiming R&D tax credits, many business managers assume that their accountant is best-placed to handle the claim while they provide the technical input.

Tax credits, R&D, Research & Development, small business, tax relief
R&D for small businesses

Furthermore, there’s often an automatic assumption by many accountants that if they have the correct technical information, a claim is fairly straightforward.

Admittedly, the fact that any limited company developing new products, technology or processes may be eligible and can claim for up to two accounting years retrospectively, sounds straightforward enough.

But, even when a business owner or director feels he or she can identify R&D projects better than anyone else, scoping them in the context of the R&D tax criteria is not that simple. It requires technical understanding combined with an in-depth knowledge, without which the numbers might not add up.

Therefore, the reality is that presumptions can fall way short of the need for an in-depth understanding of what potential R&D activity may or may not fit within the context of the current legislation.

Take the meaning of R&D in the context of R&D tax relief; an issue that isn’t simple to handle. R&D in this case is not limited to the R&D department, as HMRC defines it as work that achieves a scientific or technological advance when scientific or technological uncertainty exists.

This can include achieving an increase in overall scientific or technological knowledge or capability; significantly improving products, processes, materials or services through scientific or technological development; or using science or technology to duplicate the effect of an existing product or process in a new or appreciably improved way.

For instance, a whole project might not qualify but the element addressing the technological uncertainty does. That can include planning and managerial activities in some instances.

To be sure a claim is justifiable and as beneficial as it can be, an accountant must fully understand the detail of the HMRC guidelines. That’s a 15-part manual and, once you have read through it all, you will need the technical expertise to define, quantify and support a claim.

This is where a specialist partner that lives and breathes R&D and has extensive experience in supporting companies in funding, resourcing and exploiting R&D would make the process more efficient and more profitable for all parties.

With Stanley Carter R&D, clients often find that the objective, expert evaluation and broader experience in supporting technology companies can fundamentally change the way they look at and approach their R&D strategy going forward.

For more information on how we can help you with your R&D claim send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

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Things to consider if you not long wish to use spreadsheet to do your accounts

For many UK contractors and micro-business owners, the process of managing business finances has historically been a solid Excel spreadsheet and a lot of patience.

accounts, spreadsheet, Vat, HMRC, self assessment
Doing accounts using spreadsheet

But with an ever-changing small business landscape and the looming spectre of digital tax on the horizon, more and more people are looking past their spreadsheets and searching out more sophisticated technology to help them with their accounts.

Although technology is becoming increasingly sophisticated, we are not quite at the point where everything can be fully automated and your accounts just take care of themselves. So while software is designed to make the process easier, you still have to do some work too.

When approaching accounting software for the first time, the most important thing is to ensure that the information you are entering into it is correct. This includes everything from inputting accurate bank data (if you’re manually entering transactions rather than using a direct bank feed), and categorising your expenses correctly, right through to simply making sure your company start and year-end dates are correct. By doing this, you will avoid making simple mistakes that could cause you a headache with your finances down the line.

Bookkeeping is not the most exciting task when it comes to running your business, and it’s easy to let it slip down your priority list, especially if you’re facing the prospect of using a new method after years of your reliable spreadsheet. But the less disciplined you are, the more difficult it will become.

Take out a dedicated time each week to do your basic admin (such as inputting expenses, chasing invoices and reconciling bank transactions) and stick to it. By making bookkeeping a regular habit, you will keep on top of your finances more easily while getting better acquainted with your software much faster.

Perhaps the biggest obstacle that puts people off stepping away from spreadsheets and giving accounting software a try is the issue of data security. It’s certainly not a mistake to be concerned about this; data security is absolutely vital and any accounting software provider worth its salt will take it very seriously. These providers should be completely transparent about what they do with your data and how they store it, so take the time to do some research and put your mind at rest.

But if you are looking for new accountant that you can trust and give you impartial advice please send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

 

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Our view on the proposals for a revised Corporate Governance Code

Governance code, banking, UK economy
UK Coprporate Governance Code

The FRC (Financial Reporting Council) proposals are a welcome move to improve corporate governance in the UK. The proposals place a much greater focus on organisational culture and employee voice, meaning that company boards will need to invest more time and thought on strategic workforce issues than ever before. This is a significant step forward in recognising the value of the workforce and the need for its voice to be heard at board level.

The FRC rightly recognises that in order to drive sustainable culture change and build trust in business, boards must focus more on values, behaviours and a wider stakeholder voice beyond that of shareholders, with particular attention to the voice of the workforce. We support the plans to encourage companies to enhance employee voice by either appointing a director from within the workforce, a formal workforce advisory council, or a designated non-executive director with responsibility for representing and understanding the wider workforce. No single approach can suit all firms’ situations so it’s important that there is flexibility for businesses in choosing an option that is most appropriate for them.

The proposal also broadens the role of the remuneration committee to oversee pay and incentives across the wider workforce rather than just focusing on executive pay. This is an important step in encouraging businesses to be more active in capturing and acting on their people data and for boards and the remuneration committee to improve their understanding and oversight of people data. Such a move will require fundamentally changing the role and makeup of the remuneration committee to ensure it has the right levels of expertise and necessary time and support to carry out its expanded remit.

We welcome the FRC’s efforts to evolve the UK’s corporate governance system and these latest proposals reflect many of the recommendations made in various consultations to government, including those directly linked to the UK Corporate Governance Code.

If you have any question on how this proposals may affect your business send us an email on info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk