Here at AccountingWEB, we try our best to be the profession’s advanced guard, do the legwork and to report back on what we hear and see.
That’s why we went out and spoke to a variety of businesses about their accountants and their accounting needs.
The point isn’t to pontificate or to tell you what to do. You are all professionals; you can draw your own conclusions. But we hope that you will find what these four diverse businesses say useful, both as an insight into your current and future clients.
Let us know what you think!
* * *
Richard da Costa from Floating Harbour:
Situated in one of the most scenic parts of Bristol, Floating Harbour is based – as their name hints – on a ship. The vessel, christened the MB Tempura, is ensconced on the river Avon right in the city centre.
Floating Harbour is, as da Costa terms it, a creative hub. The company does filming, equipment hire and website design. The firm is in flux, undertaking extensive renovations to the boat to create a studio and meeting room.
AccountingWEB went to chat to da Costa about his water faring production business and what he wants from his accountant during this critical phase of growth.
* * *
Alan Armitage from WearEponymous:
WearEponymous is an online fashion retailer based in Glasgow that stocks garments from independent designers. The items are mostly from the UK. “Although we are looking at different designers, different countries as well,” says Armitage. “We’ll cast our net out further as the years go along.”
The company is in a high growth phase at the moment. Armitage is hoping to bring WearEponymous into the corporeal realm by opening a store. “The stock will be a carefully curated collection of independent designers under our brand name, kind of like Debenhams or House of Fraser – but just on a much smaller scale and for independent designers.”
The company is in an exciting phase, and according to Armitage, he relies extremely heavily on his accountant. “We work very, very closely together. I’m on the phone to them if I’ve got any issues in the week,” he says. “It’s more like business strategy they do, it’s not just accounting. They’ve helped us a lot with various things like VAT, things that we need an answer on that aren’t always straightforward when you speak to HMRC.”
Armitage doesn’t delegate all the work to his accountant, however. He has used QuickBooks for four months now and uses it in conjunction with Receipt Bank, a set-up he is happy with. “One of the issues with accounts is once you’ve got an accountant, it’s too easy run around and say ‘I’m going to let the accountant do it’”, says Armitage. “We used another accountant in my first year running the company, and we kind of lost control of our finances and I really wanted to bring it back under our control. I control all of that, so I know exactly where my business stands at any point financially.”
WearEponymous’s accountants have access to QuickBooks, and Armitage says he works with them to ensure accuracy. He also enjoys the reactivity of this style of working. “If they spot any problems, they can tell us straight away.
“I wouldn’t want to go back to the old way.”
* * *
Olga Crosse from Crosse HR:
Crosse HR is an HR consultancy that works with small businesses. Its founder is Olga Crosse, an Irish national who has made the UK her home for 22 years. “My business is HR. I deal a lot with small businesses, start-ups and people who are changing,” says Crosse. “Most of my work, a bit different from just running my own small business, is dealing with other small businesses.”
The business’s strap line is “shrewd HR solutions, not HR departments”. Crosse helps small businesses who can’t afford a permanent HR staff, set up their processes. But she also classes herself as a generalist, often offering advice outside of her remit. “I get a request almost once a week going, ‘oh God, we’ve got no accountant!’”, she says. “A lot of small businesses set up, but forget they need these things. It’s kind of reactive.”
Crosse vividly describes the elementary mistakes she made in the past. “Back in the day, I genuinely thought everything that went into my bank account was mine,” she says. “And then there would be this mad panic when VAT would have to be paid. And that was a large learning curve for me.”
As for her own accountant, Crosse defines the relationship as “parent-child”. “He’s the parent, I’m the child,” she explains. According to Crosse, her strong relationship with her accountant – she refers to him as “my guy” – has been vital.
It wasn’t always so. “I used to avoid my guy like the plague. Whenever I got into trouble, I used to not call him like an absolute eejit,” she says. “I didn’t want to be told off. Since I’ve started behaving more responsibly in the past two-three years, I pick up the phone whenever I need him and I actually enjoy doing it.”
She describes her accountant as “shrewd” and “cautious”, all things she likes. Crosse is also heavily dependent on him as she doesn’t utilise client technology. “My accountant prepares all of my end of year accounts and does all of my day-to-day stuff,” says Crosse. “There are some things like cash flow I like to do myself as a form of control, though. I find it cultivates good discipline.”
* * *
James Hadley from Loading Deck
Loading Deck is an IT consultancy run by James Hadley, a doctoral researcher in computer science at Lancaster University. Loading Deck was incorporated two years ago, but Hadley has been working with hosting technology for a decade.
“The firm doesn’t actually sell the servers,” explains Hadley. “But we provide technical support to mainly small businesses with their hosting environment, where the hosting service has been insufficiently helpful.”
One of the core concentrations of Hadley’s doctoral research is cloud computing, so unsurprisingly he uses a cloud system. In Hadley’s case it’s Xero. Along with Xero, Hadley’s accountants are a local firm.
“The relationship is good. They’re pretty much open to supporting anything in terms of software, they don’t have a particular preference,” says Hadley. “At the start they made it clear that most of their customers use Sage products and that most of their practice was based on using Sage at some level, but it wasn’t for us.”
Hadley shopped around and looked at numerous products. “Our accountant was very helpful throughout this, even at a stage where we were looking at creating our own software to do most of the bookkeeping, our accountant was giving his input into what we need to include in that,” says Hadley.
He has settled on Xero now, and is happy with it. “The accountant is helping us with the bits we can’t do ourselves but allowing us to do as much as we can ourselves to help keep costs down,” he explains. “It’s about keeping costs down, rather than wanting to do it myself.”
Despite Hadley’s DIY ethos, he says it doesn’t mean he no longer needs an accountant. Rather, the type of need has changed. “One does need professional advice. Forums like the UK Business Forums can provide general advice but there does come a point where you need specific advice. That’s where accountants come in,” he says. “And when it comes to preparing end of year accounts, I don’t think Xero actually prepares end of year accounts, I think some packages can – but there’s a danger of relying on the system too much.”
And for a young tech company, tax is also a big consideration. For that, Hadley needs a human touch. “Xero doesn’t really make a specific effort to be tax efficient and our accountant has helped us a lot with that.”
* * *