Save content
Have you found this content useful? Use the button above to save it to your profile.
Footprints in the sand

Effortless bookkeeping: Does size matter?

19th Jan 2017
Save content
Have you found this content useful? Use the button above to save it to your profile.

It’s one of the oft-quoted rules of client service: answer the phone within three rings. Many businesses impose this policy. If you leave the phone ringing until the tenth ring, what does that say about your company or your capacity to deal with the request?

Firms competing in Receipt Bank’s Effortless Bookkeeping Challenge transposed this scenario to their bookkeeping procedures. “Everyone responded to the Effortless Bookkeeping Challenge as you could imagine, said Receipt Bank’s UK country manager Nelson Da Silva. “It didn’t matter if they were big or small. Everyone in the challenge was there to win.”  

In doing so, competing firms were figuratively able to answer the phone within three rings. “If you’ve got capacity, you can do that.” Da Silva said. “If you haven't, the phone is going to ring ten times.”

Earlier this year, the Receipt Bank Effortless Bookkeeping Challenge pitted firms against one another to drive practice efficiency. The competition encouraged firms to master their bookkeeping method.

One metric firms were benchmarked against, for example, was auto publishing, which is when invoices are published straight to their cloud software of choice without intervention from the accountant or bookkeeper.

By mastering a metric like this, firms could prevent items from getting old in their inbox - and as a result of this, use the time to strengthen their client relationship. Other metrics benchmarked included mobile app download, inbox age, and client delay.    

Using these elements ultimately revealed that, regardless of the size of firm, real time accounting is no longer just a pipedream.

That said, the size of firms did reveal some interesting insights into how different sized UK firms approach efficient bookkeeping methods and mobile tech. For example, smaller firms, those firms defined as having less than 30 active Receipt Bank clients, got off the mark quicker than their larger counterparts.

Small firms

Small firms saw a greater overall percentage of items auto published, peaking at 33% of published items. The rush of smaller firm’s adopting this tech was seen in having over 84% of all items submitted by their clients via mobile app or email.

Da Silva theorised that this could be because there’s less chain of command or hierarchy within smaller firms. This enables small firms to be more agile.

Another reason for this could be because small firms are more likely to be new firms.

“The newer firms tend to do things more quickly as they adopt new technology from the word go,” said Da Silva. “The newer, smaller firms don’t have to go through that re-education process, unlike a lot of bigger firms.”

So while the smaller firms who have embraced new tech can attract clients more at ease with this technology, the bigger firms may struggle with legacy clients that like doing things the way they've always done it.

However, with that in mind, as Da Silva explains, “Bigger firms are doing exceptionally well in terms of having to go through this transformation.”

Larger firms

Larger firms, though, were quick to make headway with the challenge. Larger firms saw a 13% increase in their average partner user login, showing the firms quickly encouraged regular logging in in order to reduce a build up of work – which is especially pertinent for these larger firms who have more users.   

From analysing the findings, it can be assumed, too, that Larger firms also deployed more resources to reducing the average age of an item in their inbox, dropping from an average of 13 days to nine days (a 40% reduction) over the challenge.

To adopt this mobile app technology, though, is crucial for small firms; especially since they may have fewer resources. Regular submission via electronic methods like email or apps, for example, helped smaller firms implement a processing system, and this, in turn, helped reduce paper storage.

And just as effective, smaller firms rolled out more mobile apps to their clients during a mobile app bonus round, which caused client delay to drop two thirds.  Da Silva said implementing processes like these opened “firms up for value added services and improving that client experience”.

Does size matter?

But in the end client numbers didn’t matter. All firms are looking to provide the best possible service to their clients, be it through tech or resources. What these results show is that, given the right tools, UK firms can accomplish great gains in productivity and efficiency, and provide a world class service.

For example, both small and large firms reduced client delay down to two days:small firms, on average, knocked their client delay from six days to two days. For larger firms the reduction was a bigger, dropping from nine days to two days.

For Da Silva, the challenge demonstrates what is actually possible today. “Anything you can do to increase capacity adds value to the experience, which adds value to the business.” 

Just like answering that ringing phone.

Considering the size of your firm, have you found that mastering a particular metric has helped boost your bookkeeping efficiency?


Replies (7)

Please login or register to join the discussion.

By chatman
21st Jan 2017 12:33

You'd have to be mad to allow Receipt Bank to post to your ledger automatically; their error rate is too high.

Thanks (5)
Replying to chatman:
By AgileAccountancy
24th Jan 2017 11:14

I have considered RB, I am assuming you talk from experience. How do you think they operate?

Do you think information sent in goes through an attempted auto-post AI/algorithm, then if it fails it is passed to a human?

Or do you think they have an army of humans allocating and making judgment calls? And so there is a variable level of competence?

Thanks (0)
Replying to AgileAccountancy:
By chatman
24th Jan 2017 11:53

AgileAccountancy wrote:

I have considered RB, I am assuming you talk from experience. How do you think they operate?

Do you think information sent in goes through an attempted auto-post AI/algorithm, then if it fails it is passed to a human?

Or do you think they have an army of humans allocating and making judgment calls? And so there is a variable level of competence?

I understand from Receipt Bank that it is semi-automated. Some machine recognition and categorisation and some manual processing in India. I don't know if there is a variable level of competence but there is definitely inconsistency in how the same type of expense from the same supplier should be categorised.

I also understand from RB (and this is confirmed by my experience) that they will book anything labelled on a receipt/invoice as "Sales Tax", "IVA", "TVA" etc as if it were UK VAT.

Thanks (0)
Paul Layte
By Paul Layte FCA
24th Jan 2017 10:57

I don't think you can say that without going into a bit more finer detail.

Whilst I would agree 100% auto publish straight to approved is not something you would do selecting certain suppliers with consistent invoice styles and submissions where previous accuracy has been 100% for say last 3 months or so is suitable for selection for auto publish especially where you have setup supplier rules and also the CoA in Xero appropriately.

It is not a binary thing to have all or nothing auto published but each client and their suppliers can be review. If you can get to a third auto across the overall client base your doing pretty well in my book. Every little helps.

Thanks (0)
David Ross
By davidross
24th Jan 2017 11:52

Could Richard please re-write this article in Plain English?

Thanks (0)
By Ian McTernan CTA
24th Jan 2017 12:39

I'm not even sure what was being measured- what's a 'client delay'?

None of these automatic recognition software programs are worth it at the moment unless your affairs are so simple you probably don't need software at all, or you use the same 5 suppliers (all UK based) and 5 customers every year.

The issue that arises quickly is as you can't have 100% confidence that it is correct, you as the accountant then spend longer checking the entries than it would have taken you to put them in in the first place.

Then you have to explain that to the client who was expected little to no fees from you as he thought he had done everything themselves.

Expecting a client to scan a receipt then spend minutes making sure they have it in the right category or even the right VAT amounts where some items are vatable and some aren't is just waiting to be burnt. They will glance, be 'guided' by the software recommendation, and click.

I'm having this very issue with a client now involving around 6000 transactions...

Thanks (0)
Replying to Ian McTernan CTA:
Man of Kent
By Kent accountant
31st Jan 2017 14:55

Don't agree.

Receipt Bank used correctly (which requires a minimal amount of client education/training/support) is a huge advance.

Using RB with Xero I'm actively looking for bookkeeping work now as it does become (more) profitable.

A client with 6000 transactions - I'd suggest they need a bookkeeper

Thanks (0)