Practitioner's Diary: Paper bites back - shredders beware!

Our West Country general practitioner has some practical advice for CGT planners.

* * *
20 December - My second CGT case, and just as bad. Client declared the sale of his previous private residence on his 2006 Tax Return. He lived in it for many years but let it for a few years when he moved into his present home. There was a huge gain on the disposal, but it was all covered by PPR relief, indexation, taper and annual allowances. HMR&C have now queried the CGT calculation and want to examine evidence of the substantial enhancement expenditure (which, I would add, the client calculated himself). Of course some 20 years after the event most of the building receipts are nowhere to be found. As it was his own home for so long he had no idea that he would at some future date be called upon to produce them!

* * *
17 December - There's a bit of a CGT theme emerging this week. I have a tax enquiry running with one of my clients who, among other things, owns a number of houses and elected for the one he was most likely to sell next to be his principal private residence. Of course, it's the house he DIDN'T actually live in most of the time. HMR&C have naturally questioned the validity of the election and want proof that he did indeed live there, which is proving something of a challenge. I believe him when he says he lived there off and on, but I'm not sure he ever paid Council Tax on it and so far he hasn't been able to produce any other household bills.

The lesson is that a PPR election is all very well in theory, and, no, you don't need to live primarily in the elected property to qualify but you must be able to produce evidence of ACTUAL occupation if asked by HMR&C, which may not be until several years after you move out, so make sure you keep the household bills for some considerable time!

* * *
14 December - I was only surfing for some free Excel templates and accidentally bumped into her. Apparently she's been there for ages, I just never knew, and I never dreamed she'd have her own website courtesy of Microsoft itself. Mind you, she seems to have aged a bit. Who is this? - the Crabby Office Lady of course ("solid advice...with an attitude", as her home page so aptly puts it).

I am pleased to add that the encounter was an entirely happy occasion and I picked up a number of handy MS Office tips. This is a site well worth adding to Favourites for future reference. If, like me, you are a Word or Powerpoint amateur there are some very simple practical tips on these pages. Good for lunchtime browsing (and you can count it as unstructured CPD too - not something you could say of the other crabby office females I have known)!

* * *
10 December - With my senior corporate people all out on audit or exam leave I have had the rare opportunity to review and finish off a few jobs. I say 'opportunity' rather than pleasure as we seem to be doing our newer trainees a disservice by not enforcing proper file discipline. I have just seen a pile of jobs with no proper lead schedules, indexing, sign off checklists, cross referencing, etc. Now, I have some sympathy with tight budgets and jobs completed against a deadline (none of these were though). But when jobs are incomplete, poorly documented, and particularly when the salient points stick out like a sore thumb but noone has spotted them yet, then I get a little irritated.

I know many small firms don't use standard accounts file quality control forms such as preparation checklists, etc. I also know that some small firms churn out very poor accounts, often due to a lack of proper quality controls. Preparing lead schedules does at least make the preparer check that the accounts agree with their working papers.

And lead schedules make the preparer list the components of each balance sheet total, so that, for example, a £35,000 cash in hand balance where there has never been a cash balance before might stand out and make the preparer ask a few questions before passing the file for review!

Time may well be tight in January, so I'll be reminding all my team that proper file discipline IS important, even if they don't understand why.

* * *
7 December - There's nothing like a full cooked breakfast to start the day off well - some compensation for being bright eyed and bushy tailed at 6.45am for some intensive networking this morning! Met some interesting people including a couple of businesses that look like potential introducers of new business to us, so I've some follow up to do.

Back in the office I received a call from one of my largest clients inviting me to submit a quote to take over the audits of the rest of his business empire. So now we're in the interesting situation of needing to plan our workflow rather more carefully than usual for next spring (yes, they are inevitably 31 March audits) or we won't have enough people to go round! I fear further recruitment may be on the cards!

* * *
4 December - Have received a surprising number of invitations recently to networking events. Looking back over the additions to the client list in the last few years many of not most of them are related to networking efforts by our team - BNI, chamber of commerce, Business Link, etc. BNI seems to have given up locally, not enough committed interest apparently - to be honest I enjoy BNI breakfasts, but I'm not sorry that I haven't got the opportunity to go to one EVERY week at 6.45am!!

So my plan is to get out on a regular basis to network locally with practice development in mind. Which means that I WON'T be going to meeting of local professionals where the accountants all gather in a corner and moan about recruitment and tax office closures.

Since BNI isn't an option, I may have a look at their clone, 4-Networking (www.4networking.biz) as there are a load of groups in this area. I have also been thinking of joining ecademy (www.ecademy.com) which looks interesting for armchair networking. Mark Lee has a high profile there, and I have spotted quite a few other accountants so maybe there's something in it. And they have some physical events in thuis area, so it's not just virtual networking.

The other strategy is getting regular 1-to-1 meetings with potential introducers in the diary, especially with local bank managers. The trouble is that it's a job to find a "local" bank manager these days. They are either very part-time, or they work in a team out of a regional centre. Still, most of them are suckers for a free lunch, so there should eb some takers!

* * *
Last month our practitioner's diary ranged over topics from CGT and value pricing to pecha kucha and Microsoft Office Accounting - for a recap, visit his November diary.