Choosing an Accounts Management System
There are several options when it comes to managing the accounts of your business. You can allow your staff to do it themselves. You can do it yourself; you could buy in an accounting software package or an accounting solution for your business; you could bring in a chartered accountant or simply outsource all of your accounting to an accounting practice. This guide will help you work out which method is most appropriate for your company’s needs.
Although many accounting software packages allow businesses to input their accounting records in their own offices, this requires expertise. Before choosing your accounting management solution, decide who will be responsible for making the accounting entries, the amount and detail required e.g tax, VAT, National Insurance. Can it be done by you, one of your employees or will you need to engage the services of a chartered accountant – this decision will determine the kind of system you need.
When is it possible to enter your accounts records in-house?
Choose to go for inputting your accounting records in-house when you can satisfy all three of the following conditions:
• The individual assigned to do the accounting has the time: they are accurate and precise, they are good with numbers and will be able to take care of all the steps leading up to the entry of records into accounting software.
• The individual has technical accounting skills: they have an in-depth knowledge of entering accounting records. If the accounting is not supervised by a chartered accountant and an Approved Management Centre, this person must be aware of current technical, legal and tax developments. However, because the regulations are constantly changing, there is a danger of overlooking a change in law. For this reason, supervision of your accounting by a chartered accountant is recommended when the business cannot employ a finance director or a person with a degree in management.
• Your account’s work area has the right equipment and support. Ideally a computer, an Internet connection for online tax returns or social security contributions and access to licensed accounting software. Alternatively, they can use a programme available via an Application Service Provider (ASP) over the Internet.
When is it best to outsource your accounting?
You can opt for outsourcing the accounts of your business. This will guard against all risk of errors and oversights that your staff could make. Outsourcing may be for complete or partial input of accounting entries, depending on the size of your business, the volume of transactions handled and the technical skills of the staff responsible for the accounting entries.
• Partial input of accounting entries: someone from your business will be responsible for input of accounting entries and for preparing the current accounts (journals, receivables and payments balances, customer or supplier ledgers). An associate from a firm of chartered accountants will need to supervise the entries and prepare the year-end accounts, which will include the annual ledger with the balance sheet and profit and loss account.
• Complete input of accounting entries: Someone from your business will be responsible for filing the accounts documents. Then, your accountant will be responsible for the input of all the accounting records and for preparing the end of year accounts.
Choosing an Accounts Management System
