I’ve taken over the family business and our accounting needs modernising – how do I achieve this?
Taking the helm of the family business is an exciting time and an opportunity for you to put your stamp on its operations and future direction.
However, you may find that some of its processes are outdated – particularly if your predecessor held their position for a long time and didn’t put much store in process optimisation.
Modernising your accountancy processes can offer a number of benefits, including:
- Better cost-effectiveness
- More accurate record-keeping and data protection
- Easier compliance and submissions to HM Revenue & Customs (HMRC)
- Scalability for growth
We know that approaching this can be a challenge, and that modernising your accountancy is best achieved steadily and strategically – here’s how.
Assessing your needs
Your first step towards a modern, agile and adaptable accounting system is to assess where you’re currently at, what you need and what you want to achieve.
For example, if you currently store financial information locally on spreadsheets, there are a number of factors you need to consider, including:
- Is this the most cost-effective solution?
- Does this align with other software the business uses?
- Can I manage this on a larger scale if the business grows?
- Can I access all relevant information when needed?
- Is this the most efficient and time-saving way of working?
On the face of it, a spreadsheet may cost less than a cloud-based accounting solution – but it’s unlikely to win out as the solution to any of these other concerns.
This is where you need to assess all your business’ competing needs against one another and identify what you need your accounting set-up to achieve and what functionality it needs to have.
Building your app stack
Cloud-based accounting software can provide a tailored solution to an outdated financial system and meet a range of commercial needs.
Your accountant can advise you on the best apps and functions to meet your requirements, including how they work together and streamline your processes, such as:
- Payroll
- Invoicing and payments
- Accounting and bookkeeping
- Job and task management
- Document and record storage
- Compliance
This adoption of technology is widespread across businesses of all sectors, so it’s a vital consideration if you plan to fully modernise your business’ accounting processes – particularly when it comes to changing legislation.
Compliance requirements
The requirements for businesses to store and submit their financial information digitally are growing. You’ll need to understand exactly what your obligations are and what they are likely to be in the near future in order to optimise your accounting system.
Making Tax Digital (MTD) for VAT is a major example.
All VAT-registered businesses must submit financial information and a quarterly VAT return digitally, using MTD-compatible software or a bridging software product. Financial records must also be kept digitally.
Many businesses that rely on spreadsheets and manual data processing have adopted bridging software without thinking about wider process optimisation through compatible cloud-based solutions.
It’s important that your accounting system actively supports your compliance requirements, rather than hindering them or requiring you to dedicate more time and money to these obligations than is necessary.
It should also align with your long-term goals for the business, capable of scaling with growth and bringing all financial processes into one area.
We can advise you on the right accountancy software and processes for your business to make your transition into leadership as smooth as possible and help you to plant it firmly in the technological age.
Contact our team for further guidance.
