After 30+ years in industry and commerce including full CEO responsibility for P&L am now starting on my own freelancing/consultancy.
Understand figures, but am not a finance person - have always had experts around me!
Unlikely to bill more than £50-60k pa at first. Working as sole trader from home-office. No overheads - premises, heat/light etc and no staff.
Given that I shall need an accountant at year-end to make sure I get my figures right for the Revenue (and claim my maximum tax allowances), what system would readers recommend for computerised book-keeping? Which will be easy for me to operate and balance during the year, and gives the professional all the info s/he needs at year end in form required?
Both Sage and Quickbooks seem to come well recommended, but what do readers think?
Ian
Ian Campbell
Replies (20)
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AccPac Simply Accounting and VAT Cash Accounting
I also need a financial record keeping package for my own consultancy business. I've worked with clients to select AccPac before, and having looked at the feature list of several of the options suggested here, I'm drawn to SimplyAccounting. VAT's my biggest headache just now. I ues the cash accounting approach and wonder if anyone knows how well Simply Accounting copes with this.
Mike
as a topic expert on Accountingweb mainly on The Law Society Acc
I am a Topic Expert on Accountingweb, mainly in connection with the Solicitors Account Rules of The Law Society, but I am also a Virus Consultant, and computer Consultant as well as an Accountancy Troubleshooter.
I have tried many systems over the years, both for my own use, and whilst working for clients. The larger systems have many advantages and disadvantages. The best rule of thumb is to find a system which is adaptable and simple, and has regular updates.
For the past two years, I have used, and would recommend "TRANSACT" and "VT Accounts" by VT Software. They can be contacted at "[email protected]"
They are reasonably priced and the software interacts with EXCEL to produce Tax Returns etc.
You can then choose an Accountant to advise you for your tax advantages and reduce your costs for professional advice.
If you proceed along this route, you may contact me for advice to "[email protected]"
KISS
Getting to this question a little belatedly, it's reassuring to see that my colleagues here are not only prepared to recommend sticking to manual systems(or at least using a word processor for invoices and a spreadsheet to make sure that things add up, and to work out 17.5%) but that they even suggest that an accountant isn't strictly necessary.
Despite actually being an accountant, I must admit that I had not originally realised the extent of the small business exemption, not only from the annual preparation of anything but the simplest of balance sheets which would not tax anybody remotely numerate, but also from any audit at all.
If you haven't actually ascertained how little work is actually involved in the annual accounts, I'd be pleased to offer enlightenment, absolutely free, since it involves a single sparse A4 page! Email me at [email protected] for an entirely non-commercial response.
Gareth (using an accountant for simple book-keeping is like just driving a Porsche in first gear - possible, but why bother) Lewis
www.pserendipity.co.uk - Delivering Professional Services solutions (but not when it isn't really necessary!)
Accounting Software
Ian,
I know you've already had a bewildering amount of advice. Don't go with a shoe box. How are you going to invoice your clients, a word document? then go off and enter in a ledger. Waste of time. You reckon you may earn £60k what's £100 on a package? I strongly recommend Quickbooks, it's simple, forgiving and has everything you'll need. Take care in setting it up correctly and it'll practically do your accounts for you. If your happy on the internet, you can plug the numbers straight into the Revenue's online form. You don't need an Accountant for your accounts, but you may need one for tax planning.
I'll even help, gratis, you buy the software. Provide me with your business details (name adress tel etc) and I'll set your datafile up in less than half an hour, email it back to you and provide free telephone/email support for a month.
Chris
[email protected]
Which suits you best?
One thing (in amongst all the others) you should consider is your own inclination. As a small business specialist accountant I refuse to be trapped into making recommendations until I have met and talked to the clients. It is vital to ascertain how the client wants to keep their books. Some are nervous of or even hate computers, some love them. I would not recommend a computerised package to the former, but would to the latter. If you are inclined towards a computerised package because you are computer literate and enjoy working with them, then get Quickbooks and set it up properly with the help of a Quickbooks adviser (accountant or QB specialist). Forget about costs - if you are generating 50k - 60k income in year 1, spend £500 on the package and good installation training and advice. It's an investment that will make administering your working life a lot easier.
Nigel K Wayne FCA - AIMS Accountants for Business
Moneysoft Money Manager+Office Manager Database
Hi Ian,
Busy query this one! I use Moneysoft Money Manager - not to be confused with Microsoft Money. It does everything you will need even as an inexperienced finance guy. An addon but fully integerated, if you wish it to be is Office manager which can handle clients, billing and post the sales invoices automatically to Sales Ledger. All for about £150. Check out their website. www.moneysoft.co.uk and see for yourself.
Trouble with Sage is the ongoing annual support costs and Quicken is always an anglicised American product in my view.
With Money Manager evything is on one screen and uses a one line entry including VAT extraction. Vat Returns are then a doddle.
Practical advice for a practical problem
Ian, I am a chartered accountant and I get asked this question a lot - and my answer is use a simple spreadsheet if you want to cut costs and use Quick Books if you want the benefits of a computerised package. QB is so easy to use - and your accountant should be able to correct any mistakes you make without too much hassle. You should be able to buy an entry level version of QB for under £100 and a couple of hours of playing around with the package will get you up and running. Good luck with your new business.
Manual is best
Hi Ian - good luck with the business.
As accountants (and former tax inspectors) with many clients such as you we can safely recommend- as have others - a simple record book. It will save you time leaving time free to get out there and make money.
Some accountants make money selling you software packages - others charge by the hour and so the more complicated your bookkeeping the better for them.
The Revenue is more than happy - in fact probably happier - with paper-based books as computers can disguise so much. Buy one book - at the back list business lodgements and at the front list business expenses - analysed into headings.
Keep the computer for things which will make you money.
So many options...
As a software reseller of a variety of packages, I would agree with the past few posts in one respect - you have to have an underlying grasp of double entry bookkeeping to get the most out of any software.
We work extensively with QuickBooks, which I would highly recommend. I can recount endless tales of clients who have not invested in setting it up properly which has led to a total mess at year end (and beyond if their accountants don't help their clients adjust the opening trial balance at the beginning of the year). Usually I come in to sort them out and it is more costly to back track through a mish mash history than to get it right from the start.
A computerised system (if you set it up correctly) will take the drudgery out of putting together sales invoices, remembering who to pay and when to pay, and telling the VAT man how much you owe him. Also it can allow you to very quickly pull out figures that will help you manage your business more efficiently. A computerised system is only a tool - it is how you use it that makes the difference.
As for products, yes QuickBooks is good, but if you are a sole trader then Microsoft Money or Quicken (QuickBooks' baby brother) will also provide a good range of funtionality - including VAT tracking. You may also want to look at ACCPAC's Simply Accounting (http://www.simplyaccounting.com/uk), as it is one of the market leaders in Canada and they are giving it away here to try and break into the UK. It has the full range of functionality of QuickBooks, though some of its terminology hasn't been UKised (i.e. it is still a little bit too North American).
Good luck with it all
Damian J. Bourke
Berrystone Associates Limited
http://www.berrystone.com
Put QuickBooks to the test
Ian
QuickBooks comes with a 60 day unconditional "full refund if you don't like it" warranty, so you can test it out to see how YOU like it. Whether or not you get on with it is the most important point.
It is designed from the ground up to be used by people who don't know anything about double entry book-keeping and don't want to know either. All the double entry book-keeping is done in the background whilst the user enters data via user friendly screens.
Have a look at the QuickBooks website at www.quickbooks.co.uk and, whilst there, try out the online demo. For your situation as you have described in the question, the lower priced regular version ought to cover your needs and more. You can also go along to a larger Barclays Bank branch and have a look at the accounts side of ClearlyBusiness (owned by Barclays and Freeserve) as that is QuickBooks.
Concentrate on recovery of time......
Ian,
From your description, your 'business' is all about charging your time out and controlling your travel and small office expenses.
My comments would be:
1 Your expected turnover is around the VAT registration limit, so I'd investigate registration. If you do register, it impacts how much recording you need to do
2 Expense claims (especially mileage rates and miles) need to be controlled and up-to-date - both in terms of potential VAT recovery and applicability
3 Whatver package you go for, I'd go for one that has a time and billing element that links to a debtors ledger - after all that is what you do
4 You say you are a sole trader. Do you mean you are not an employee of a limited company (ie having a salary). Depending on that status would alter any general advice on what to keep
5 You'd probably waste enough of your own time 'preparing' accounts that a decent small accountant with 'shoe box' skills would deal with easily and with less 'opportunity cost'. The important items are billing and VAT returns. If you have one expense claim and create one sales invoice a week - thats 104 documents. Even if you double that it's not an onerous task to create a set of accounts for the taxman
Regards
Daniel Clark
Ryba Macaulay Ltd
[email protected]
Why a computer at all?
Having been a self employed consultant for part of my working life, both in IT and as a chartered accountant, I found a Guildhall analysed cash book to be just the ticket. With the level of turnover and few expenses, a computerised system is going to be more trouble than it is worth, IMHO.
ACCOUNTS SOFTWARE
HAVE A LOOK AT VT TRANSACTION BUT BE AWARE OF SOME LIMITATIONS IF YOU INTEND TO ADOPT CASH ACCOUNTING FOR VAT AND YOU RECEIVE PART PAYMENTS AGAINST INVOICES OR RECEIVE PAYMENTS IN ADVANCE OF INVOICING - BY IT'S OWN ADMISSION IT DOES NOT COPE PARTICULARY WELL WITH THESE SITUATIONS AT THE PRESENT.
VISIT THE WEBSITE AT VT.SOFTWARE.CO.UK WHERE YOU WILL SEE USER RECOMMENDATIONS.
WILF