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Health check up

Are you keeping your clients’ data healthy?


We all know the importance of keeping clients records error-free, especially when it comes to the end of the year – but are you actually doing it? Caroline Harridence reminds us of the benefits.

11th Nov 2019
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We have all seen them and heard them. There are adverts on the television, radio, in newspapers and even the underground encouraging businesses to move to a cloud accounting software package. They all have one thing in common: they make it sound easy, like in no time the business owner will be taking photos of receipts and sending invoices while out and about their day.

Whilst it is often true that the set up is relatively quick, if not undertaken properly then, by the end of the financial year, the business’s accounting records could be full of errors.

This could also mean mistakes in VAT returns, and the work to prepare the year-end accounts is messy and time-consuming – and so expensive for the client.

Through the correct setup and regular health checks, these problems could all be avoided.

Set up service

Set up is key so provide clients with this service. Did you know they wanted to move to a cloud-based system? Ensure you speak to your clients regularly and discuss the accounting packages available.

Also, offer a migration service. Few clients will want to do it themselves once you explain the consequences that could arise. Then provide training on the new software to ensure the client is fully trained from day one.

Why undertake health checks?

Undertaking regular health checks on a client’s accounting system ensures the integrity of the client’s data. This is a really useful service for current client’s undertaking their own bookkeeping and also for new clients as you can quickly check out their data. These checks should be completed a few times a year to identify potential issues early.

Where do I start?

Start by checking that the setup and security features are in place. This includes a review of the users, that any additional security features are implemented and the lock dates are on and locked on the correct date.

Software set up

Next, examine how the software has been set up – if this is not right then the balances will not be correct right from day one which can create issues when preparing the accounts and also potential errors on the VAT returns.

Check the conversion balances to the prior year accounts or closing trial balance if the client migrated mid-year. It is not uncommon to spot the opening balance journal has never been posted and has been forgotten.

Review the chart of accounts and check the classification of the items are correct and also that the VAT rates have been correctly applied. Incorrect VAT rates can have significant implications and could prove costly to a client.

Roll up your sleeves and get stuck into the data

Next, get into the transactions and examine the data. This does not mean going through every individual item. Instead, your checks and reviews will spot anomalies so then you can then dig a little further.

Areas to examine include:

  • bank reconciliations – are they up to date and accurate?
  • review accounts and coding of transactions – are any items misposted?
  • aged payables and receivables – are these correctly dated and up to date?

Also, check if the client is making the most of their accounting system. It is frustrating when you discover they have a package with lots of time-saving and clever features but they are not being used. Good examples are the fixed asset register, bank rules and bank feeds.

What’s next?

Next, report the findings to the client. Ideally meet with them so you can run through the health check and agree who will make the corrections and by when. At the end of the meeting, set a date for the next review.

The health check is a very valuable service for clients as it can prevent errors going undetected and prevent costly mistakes. A quarterly review ensures that the data is kept in check and also means that time is set aside to meet the client, discuss their business and develop the relationship with them further. 


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