Getting your firm ready for digital accounts and MTD
Adoption of cloud accounting systems by practitioners grew by 50% last year, according to research by AccountingWEB. As an industry, accounting has gradually gone digital over the past decade and online accounting systems are now increasingly the norm in many larger firms.
The move to the cloud has been driven by a number of benefits such as instant mobile access, real-time data and the ability to deliver financial reporting necessary to become an advisor. The adoption of cloud services is also important to comply with the move to comply with the Making Tax Digital (MTD) initiative.
To help your firm meet the challenge of MTD, we’ve highlighted five key steps for completing your digital transformation in the most effective way.
1. Get your practice systems digital-ready
To start being digital-ready, you will need to have your client’s financial information available as digital data by using the right digital systems at your disposal.
Start using an online accounting platform that enables you to have clients’ information stored in the cloud and available from anywhere, making workflows more efficient and allowing you to pull out the relevant tax figures, supporting documents and financial reporting.
By incorporating automation into your processes, such as optical character recognition (OCR) scanning you will be able to get clients’ information into the digital domain quickly and efficiently.
2. Review your workflow processes
Review your processes to make sure that you are making the most out of SaaS systems and software automation to add maximum value. It’s important that your workflow processes are optimised so that you can make the most out of your digital system.
Review the processes in your firm and try to systemise the process of getting data into your practice platform, pulling this data into digital working papers, and managing the resulting workflow and actionable tasks. With an effective system you can quickly export your clients’ data directly to HMRC’s proposed digital portal.
3. Educate your clients
Many business owners are still unaware of MTD. To solve this, make use of your firm’s communication channels to communicate the changes. For instance, you can use your blog, newsletters, social media and events to get the message out there.
All VAT-registered UK businesses must be digital-ready by 2019, according to the latest guidance from HMRC. So there’s a pressing need to communicate the key benefits of a digital approach to your clients and to keep MTD front of mind with their management teams.
4. Contact your software providers
HMRC's digital portal still doesn’t provide that much information about how the accounting systems will integrate and share data with HMRC's systems. Therefore, it is important to contact your software providers and make sure their API will be ready to connect, and that your firm will have access to templates for exporting and submitting tax data directly to HMRC.
5. Plan for the digital change
MTD is a key change in the accounting sector, and it will take time, effort and money to get right. Start planning now for the digital transformation process so that your firm is prepared when MTD becomes a reality for clients in April 2019.
Find out more about Silverfin, the centralised data hub designed specifically for finance professionals. We help you collate your clients’ data in the digital space, making MTD less of a challenge for your firm.