Been giving this a lot of thought recently. With the march of cloud accounting and automation etc, seems to me that the traditional split between what is deemed bookkeeping and what is deemed accounting is blurring. Bookkeeping will become more and more a review job, making management accounting (or virtual FD) roles more prevalent - to me quite an attractive offering.
Can't help feeling that new practices are at a competitive advantage in offering such a service against traditional firms with their old style setup and cost base.
Thoughts?
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Well, I'm not sure there is a clear line. I work as an FD in industry, and a typical day can include payroll (only I have access to that) together with preparing strategic financial plans - if it is month end I may jump on to purchase ledger to get the system closed.
In esteemed poster on here (may have been Peter Saxton, can't recall) defined bookkeeping as anything the client can do, and accounting as anything he does - that seems a workable assumption to me.
You may be correct but depending on the size, time availability, natural skill set and desire/care of the client then the work is likely to become:
Re-working of years records
Or at very least a fuller review of entries than would be required if prepared by your own skilled staff
Neither of which personally I think will be more satisfying
Overall I fear far higher risk of errors and tax loss than in the past
Not sure what you mean by "bookkeeping will become more and more a review job". What will it be the review of? Until bookkeeping has been done (i.e. transactions have been recorded in an accounting system) there is nothing to review except source documents is there?
Possibly he or she means a review of all the screw-ups and mis-postings made by the Cloud system? A review of why the bank balance in the TB is £20k different to the balance on the statement? Why the sales in the VAT return report are £40k lower than the sales which have gone through the sales account in the TB?
That sort of thing.
So you mean where the bookkeeping is done from source records automatically by some software without human intervention? Then yes I see why the first human intervention can be described as a "review".
Yes, that's pretty much what I meant, although "authorisation" or "approval" may be more appropriate?
There'll always need to be human intervention - there are too many instances of exceptions to the rule in real life to just put our faith in the machines, despite what LinkedIn 'thought leaders' and their ilk may espouse.
But I do think that the bookkeeping workload will be sufficiently reduced to allow accountants to do it themselves.
I have been in practice for over 15 years, the majority of our clients still expect us to do the book-keeping.
Some clients think they do the book-keeping but often it amounts to only partial completeness and often it is easier to start from scratch.
We use different methods depending on what we get from the client.
MTD has however caused us to review all book-keeping methods which over the course of the next 2 years will become standardised and more efficient for all clients
In the exciting world of the future bookkeeping will be done by magic apps that scan documents and post them to the accounts.
The job of bookkeepers will be to show the documents to the magic box with the magic app and the job of accountants will be to tell everyone when the magic box is finished.
We can all then go home at 2:15 every day, safe in the knowledge the infallible magic box has taken care of everything and all our tax is paid for another day.
I read an article the other day that mentioned that there around 3.8m unrepresented taxpayers.
I've spoken to a few small business owners that have never heard of Making Tax Digital.
Given that MTD is just around the corner, HMRC should be taxpayers very aware of the change.
When the time comes, I expect some taxpayers will decide to go off radar, and others will be in a blind panic and use our services. I think there is great opportunities for accountants - you'll just need to systemise, as the unorganised, and those using dated (if any) technology will get left behind.
I read an article the other day that mentioned that there around 3.8m unrepresented taxpayers.
I've spoken to a few small business owners that have never heard of Making Tax Digital.
Given that MTD is just around the corner, HMRC should be taxpayers very aware of the change.
When the time comes, I expect some taxpayers will decide to go off radar, and others will be in a blind panic and use our services. I think there is great opportunities for accountants - you'll just need to systemise, as the unorganised, and those using dated (if any) technology will get left behind.
Once the AE campaign is finished HMRC can always employ their multi coloured monster to spread the word re MTD. Frankly I preferred Hector but I guess he is now too last century.
An alternative is maybe a Dalek with a camera mounted on its head and a laser mounted at waist level;the camera snaps the invoices the laser exterminates the accountants who will be seen in the advert fleeing from it.
Interesting. Most of the time even I don't want to do my job, I've certainly never met at accountant that wants to do it.
Interesting. Most of the time even I don't want to do my job, I've certainly never met at accountant that wants to do it.
Remember most accountants do not even want to do their own jobs let alone your job:
Counsellor: Well chartered accountancy is rather exciting isn't it?
Anchovy: Exciting? No it's not. It's dull. Dull. Dull. My God it's dull, it's so desperately dull and tedious and stuffy and boring and des-per-ate-ly DULL.
So far my experiences of Cloud software have been entirely negative. Firstly, it is important to note that such clients have totally entered the "brave new world" where they either do all the inputting themsleves on apps and Bankstream, or partly themselves and partly a book-keeper.
Their charges from me have ended up several hundred pounds plus VAT higher. The contract variations to my fixed prices have been solely on issues like the one above i.e. getting the balance sheet to agree to source records.
Stuff has been going all over the place and it has been too much for the book-keeper, who is a decent one but just unable to cope with the volume and variety of mis-postings.
My sample size is very small. My suspicion, though, is that under the slick and spivvy surface of the Cloud hype lurks a bag of knackers.
S My suspicion, though, is that under the slick and spivvy surface of the Cloud hype lurks a bag of knackers.
Under the, not a lot of people know that heading, I am currently reading the book "Agincourt: The King, the Campaign, the Battle" by Julia Barker. In it she mentions that some of the minstrels had two small drums suspended on a belt at their waist which were called nakers, which she suggests may be the source of our current use of the term, knackers.
My experience of cloud accounting has been the complete reverse of mr.mischief's but then, in the majority of cases, I've been the one that has suggested and initiated the move and I can imagine that a long-standing business already keeping naff deskbound books is not guaranteed to do much better migrating to the cloud.
In coming into contact with loads of bookkeepers and accountants, through my work with Clearbooks, one of the biggest changes I've noted has been the blurring of the line between accountants and bookkeepers.
Accountants, who traditionally left it to clients to keep naff books, to correct them in the TB months after the year end, are now getting far more involved in tidying up and reviewing the books in real time and bookkeepers, who are now allowing clients to get more involved in the basic bookwork, are now training themselves to take on tax and final accounts work.
Where my experience also differs from others on here is that many business people are perfectly capable of keeping a reasonable set of books. To back up mrme89's comment, in a survey of CB's users, more than 30% did not use an accountant or bookkeeper and, from the ones I've come into contact with, they have not made a significant mess of them, certainly nothing HMRC would worry about.
Given that, in my experience, this was not the case 10 years ago, this must have something to do with the cloud systems being designed primarily for business people rather than accounting people.
