Further to John Hemming’s posting I also think it might be easier to address some practical points that were raised as many of them seemed to get lost in the gargantuan post and perhaps a summary is useful (if you can take anymore!)
The following of course is after all only my opinion and from my own experience, others will disagree!
1. We have to prepare accounts 4 times a year now instead of 1
No you don’t. I understand you have your professional pride and we would all like to be super useful to clients and provide them a nice set of accounts but the chances are they do not want that.
You can use the cash basis for small businesses remember, and in my view unless there is compelling reason to do so or the client’s business is such that the values are easy to find I will not even be thinking about debtors, creditors, prepayments, accruals etc for the Quarterly updates.
2. Banks feeds will solve all the problems
No they will not, neither will the software automatically do all the work, Bank Feeds are an excellent tool but they are just one tool in the hands of a human. But there is no doubt that feeds and rules can save a lot of time.
3. What about cash?
Just like you do now, you will have to find a way to capture it. For example one of our clients fills in a shared excel file that they fill in each night with the days takings, those that have a large amount of cash purchases will use receipt capture.
4. All the work needs to be done in one month or 5 weeks
No it doesn’t, the clock starts ticking 1st April, get your systems in place so that you can start the book-keeping right away.
If the client themselves are doing the book-keeping (bad idea) you need to be clear about timescales.
5. The software is too expensive
You need to look beyond Xero, there are very good packages out there ranging from free to £5 a month. Keep an eye open for deals and grab them while you can.
6. Its going to be quadruple the work
It just isn’t. I cannot tell you how much more work (or less work for that matter) it will be because every client and practice is different. But I can tell you from experience that in some cases it is less work, I know some people didn’t want to hear that, but I am only telling you what I know from doing it.
Of course there is the initial setup so that needs to be taken into account
7. How can we possibly get the clients to give what we need 4 times a year
It does need an honest discussion with the client so that each side knows the expectations, whether you agree with MTD or not you are making sure that they comply - our approach was 1. talk to the client, 2. Put the systems in place and 3. Setup an automatic reminder system (in our case AM)