QuickBooks Connect 2018: chilling out at the London Printworks
It wasn't so much a baptism of fire as an introduction by ice. My first trade exhibition. And what a way to start... with the offering from accounting software giants Intuit, QuickBooks Connect at the London Printworks.
With the UK in the grip of a cold snap, and most of the south of England under a blanket (to be honest, quite a thin one) of snow, the first challenge was to get to east London from Vladivostok on Sea (aka Brighton). The next, having arrived at the several-aircraft-hangar-sized venue, was to decide whether to keep one's coat on or not. On was the answer.
As a former UK national newspaper journalist, I loved the location. It's where they used to print the Evening Standard, the Metro and the Daily Mail (not so much). The problem was you need a big building to print newspapers in. And big buildings are hard to keep warm!
With the green and white strobe lighting, it was a bit like entering a vast Berlin techno club (apparently). But there were no bouncers... just was a very warm welcome from the QuickBooks team, inspiring speeches from the keynotes and absorbing workshops from leading figures in the accounting field. Plus plenty of steaming hot coffee.
History lesson at QuickBooks Connect
Former MI6 officer Julian Fisher had a selection of chilling anecdotes from the world of secret agents, spies and the dark arts of persuasion. While Jo Tomlinson delivered words of wisdom geared specifically for accountants.
"We're looking for clients who want more than an end of year history lesson," said Jo.
Another highlight for me was catching up with Rich Preece, Intuit VP and leader of accountant segment. We had a short but illuminating chat about technology, artificial intelligence and what the future holds for accountants in particular and the industry in general.
Rich is a very smart guy who flagged up the reality of data as "the new currency". The ability to provide accountants and small businesses with the information to make better and more profitable decisions was key, he told me. He added that what the future held, given the present rate of development in accounting software, was "unimaginable."
Rich said that data aggregation, combined with artificial intelligence, would change the industry landscape beyond recognition. Quite.
Beef brisket burrito
After a break for a beef brisket burrito, it was off for a couple of afternoon workshops. QuickBooks sales expert Louise Kenny used her soft Dublin brogue to demystify five steps to digitalisation.
It's the route that accountants must take in order to reach the "holy grail" of becoming an advisory service and it goes via digital design strategy, segmentation and client awareness, efficiencies and capability building.
Particularly interesting was her presentation slide on the proportion of time accountants felt they spent doing different aspects of the job. Bookkeeping still came in very high and advising very low.
My last port of call for the day was a Making Tax Digital panel discussion led by Quickbooks' Nick Williams and featuring Rebecca Benneyworth, Ian Fletcher and HMRC's Clare Sheehan. It was a lively discussion full of wit and wisdom.
My favourite quote of the day came from Rebecca and concerned the urgency with which accountancy professionals should approach MTD. "It's too late to be early. But it's a good time to be on time."
Next up, Accountex Summit North followed by Accountex in May.... I can't wait!
Best of app add-ons boost client connections
Written by Daniel Richards, of My Firms App: Accounting has repeatedly demonstrated its capacity to adopt and adapt to changes in business practices, statutory regulations and technology. The flexibility and technical proficiency this demands is part of the professional DNA.
However, in the digital age, the speed of change can make keeping pace difficult, even for the most well-resourced and tech-savvy firm. The ways in which accountants and their clients connect, collaborate, and communicate are being reshaped and these strategies are in need of a reset for the evolving digital age.
Today, more than ever, a proven solution is needed to connect accountants and their clients and bring together individual components such as apps, logins and portals into a centralised place that’s easily recognisable in the firm’s brand.
The move to digital technology has become a mobile-first experience with over 900 billion hours spent on apps last year, and the number of smartphone users expected to reach 48.26 million in the UK this year. Because apps are being used for all kinds of business activity, their sheer number on smartphones and tablets is giving rise to a new problem: information bloat.
It is not unusual to see in the region of between forty and fifty individual Apps on a home screen and as these App stacks and App Add-on communities grow, the role of an App integrator – the accountant – is set to become increasingly critical.
Own the digital relationship with your clients
Across the globe, accounting firms have been giving away control of their client base to software companies and as a result, the emotional bonds between business owners and software houses are intensifying.
A key question to ask is, ‘Who owns the client digital relationship?’ Accountants need to protect their position as the most trusted adviser and rather than giving away control of the data associated with Cloud bookkeeping and accounting software, they should adopt a strategy that puts them right at the centre of that client relationship.
A simple and straightforward way to add value and to make interaction easier is have a firm branded app. Giving a powerful single app to a client for free that acts as a single contact point for all things financial sends out a very strong message that the accountant is embracing change and wants to interact with in the way most businesses prefer – on their smartphones.
The app creates a connection between the firm and the client at all times with their own tax data and key financial dates stored within and with access to useful tools such as GPS mileage tracking and receipt management. All online portal and accounts software logins can be held in it too, creating a single interface the client needs.
We believe that putting the accountants’ interests first and building a powerful differentiator strengthens unique client engagement and provides the strategic framework needed to gain control of this new app world.
New role as an App integrator
The potential for the accountant to take on the new role of App integrator by bringing everything into one single environment – the firm’s own App – will simplify the client’s life and add more value. With a pro-active digital strategy, the firm can choose which Apps to make part of their clients’ Add-on community and as a result, strengthen the relationship.
Getting an App is just the start of the journey. Once it is built, a mobile App needs to drive engagement and constantly evolve. There is a compelling opportunity for all firms, large and small, to now turn digital technology to their advantage, and take on a new and crucial role as App integrators.
Daniel is head of Sales, MyFirmsApp, in Pod 8 at Accountex Summit North
Financial risk reporting strategy starts at the top
During the 1990s and 2000s, a series of financial reporting scandals catapulted the issue of ethics in accounting into every headline around the world.
Troubles at Enron and Tyco shook the confidence of investors everywhere when published annual reports and accounts, as well as other publicly available information, were found to contain misleading information about how affairs were being managed.
While it may be difficult to assign a ROI to reducing financial reporting risk, there can be little doubt that bad practice in the past has had a significant negative impact on shareholder value.
The above scandals can be considered proof of the failure of the corporate governance models and the risk of accounting standards not requiring relevant disclosure.
Many years later, regulations have tightened globally imposing new mechanisms of governance and increasing transparency through the issue of new and revised accounting standards that require more relevant disclosure.
Reduce financial reporting risk
To reduce financial reporting risk, organisations should start from the top, with the CFO taking ownership of the effort and assembling a cross-functional team of accounting, information technology, human resources, and operational resources to work together and understand where every department stands with respect to financial reporting risk.
These individuals should collaborate to design, plan, implement, execute and monitor risk managing activities and programs. Inherent and specific risk areas for their organisation should be assessed and identified with the goal of developing a future state based on the assessment. Like any other business process, it should be undertaken systematically with clear goals and objectives.
Ideagen has helped many companies worldwide over the past 25 years with their goals in reducing risk. With the group's automated financial disclosure tool, Pentana Disclose, companies such as PwC, EY and Grant Thornton have been able to safeguard their companies’ reputation, mitigate risk, increase efficiency and assure customers and regulatory bodies that they are up to date and compliant with relevant accounting standards.
Pentana Disclose provides accountancy firms, audit firms and finance professionals the confidence that they are working in line with up to date changes to companies legislation and UK accounting standards, including FRS 102 (or ‘new UK GAAP’) and relevant Statements of Recommended Practice (SORPS).
Ideagen will be at Accountex Summit North, Pod 21.
Financial risk reporting strategy starts at the top
Written by Jennifer Greig of Ideagen: During the 1990s and 2000s, a series of financial reporting scandals catapulted the issue of ethics in accounting into every headline around the world.
Troubles at Enron and Tyco shook the confidence of investors everywhere when published annual reports and accounts, as well as other publicly available information, were found to contain misleading information about how affairs were being managed.
While it may be difficult to assign a ROI to reducing financial reporting risk, there can be little doubt that bad practice in the past has had a significant negative impact on shareholder value.
The above scandals can be considered proof of the failure of the corporate governance models and the risk of accounting standards not requiring relevant disclosure.
Many years later, regulations have tightened globally imposing new mechanisms of governance and increasing transparency through the issue of new and revised accounting standards that require more relevant disclosure.
Reduce financial reporting risk
To reduce financial reporting risk, organisations should start from the top, with the CFO taking ownership of the effort and assembling a cross-functional team of accounting, information technology, human resources, and operational resources to work together and understand where every department stands with respect to financial reporting risk.
These individuals should collaborate to design, plan, implement, execute and monitor risk managing activities and programs. Inherent and specific risk areas for their organisation should be assessed and identified with the goal of developing a future state based on the assessment. Like any other business process, it should be undertaken systematically with clear goals and objectives.
Ideagen has helped many companies worldwide over the past 25 years with their goals in reducing risk. With the group's automated financial disclosure tool, Pentana Disclose, companies such as PwC, EY and Grant Thornton have been able to safeguard their companies’ reputation, mitigate risk, increase efficiency and assure customers and regulatory bodies that they are up to date and compliant with relevant accounting standards.
Pentana Disclose provides accountancy firms, audit firms and finance professionals the confidence that they are working in line with up to date changes to companies legislation and UK accounting standards, including FRS 102 (or ‘new UK GAAP’) and relevant Statements of Recommended Practice (SORPS).
Ideagen will be at Accountex Summit North, Pod 21.
R&D Online: The UK’s First Whitelabel R&D Tax Claim Portal
Easy R&D would like to announce the launch of their new R&D tax portal, R&D Online. R&D Online is an intuitive digital platform that makes it easy for accountants to offer R&D tax relief services to clients.
The platform simplifies the claims process, meaning accountancy firms no longer need to have a specialist in-house to complete R&D claims. Finally small to medium accountancy firms can compete with larger firms who can afford to hire R&D specialists.
Easy R&D have been providing this specialist area of tax for over five years, partnering with accountants across the UK, enabling them to provide these services to their clients. But Easy R&D could see there was a gap in the market – so many accountants wanted to offer the service directly.
R&D tax claims are often complex and highly technical, so it is very difficult for a general practitioner to make claims on behalf of clients. But easy R&D has developed a platform which allows accountants to make successful claims without outsourcing any of the work.
R&D Online is an intuitive platform that walks the account through the complex claims process, step-by-step. The portal is designed to be very simple to use, but, should the accountant run into any difficulties or have questions about the best way to proceed, R&D Online is supported by a team of R&D specialists who are just a phone call away. It’s a self-guided system underpinned by a robust support team – exactly what accountants need to put together successful claims in-house.
Andrew Howarth, R&D Online CEO, said: "I am a great advocate of light-touch technology that delivers quick and easy benefits. R&D Online is a product of that philosophy: a simple solution to a major challenge for accountants across the UK. With the launch of R&D Online, every accountant in the UK will be able to provide R&D Tax relief to their clientele, resulting in sizeable benefits for everyone involved."
Jones, Hunt and Keelings, Chartered Certified Accountants and Chartered Tax Advisors noted how Easy R&D provides added value to its clients. Alf Del Basso, Partner at Jones Hunt and Keelings, said, “It’s allowed us to offer R&D tax relief to clients, and as there aren’t many firms in the local area that can do that, it really sets us apart”.
Dom Maurello, Partner, noted that “R&D tax relief is complex, it’s really not for the general practitioner, but each claim we’ve made has been successful… I most definitely recommend using R&D Online”. Both agree that the integration of R&D online allows them to provide that highly specialised level of service in the most streamlined way possible.
R&D online launches on 1 March 2018. If you have any further questions, please email Andrew Howarth on [email protected]
Stand 58 at Accountex Summit North.
Web: www.rndonline.co.uk
Tel: 020 3858 5548
Make sure clients have a peak perception of your accountancy firm
Before we visit the lessons of high-altitude mountaineering, let’s start by stating the blindingly obvious: Your client’s willingness to stay loyal to your accountancy firm, to continue paying you, to refer you and to buy more from you is determined by the perceived value they get from you and your firm.
This may be obvious. But value is a relative term. Value is determined by comparison with other purchases, or with possible purchases.
Comparisons with what exactly?
- Compare the value of annual accounts presented 6 months or more after the year end with… the value of quarterly reports a week or two after the quarter end.
- Compare an annual bookkeeping tidy-up of a desktop accounts file, involving lots of time-consuming, hassle-heavy queries, journals and searches for missing receipts and invoices with… weekly bookkeeping updates and minimum interruption before quarterly financial reports a few days after the quarter-end.
One service stands out, head and shoulders above the other. If the price for the two services is similar, the perceived value for the well-timed quarterly reporting will be much higher than for the ancient history of your annual accounts service.
Even if quarterly reporting is more expensive than annual reporting (and it should be), it could well be seen as being of higher value by most of your clients.
Quarterly reporting is an opportunity to earn more because you’re delivering more value.
But what is the definition of value?
At a recent QuickBooks conference in San Jose, California, Ron Baker (The Value Pricing guru and founder of Verasage) made a profound observation: “Value is not a number, it’s a feeling”
The stronger your client feels about the work you do with them, the greater the value they experience – as long as the feelings are positive of course!
So, what do you do to give your business-owner clients a more emotionally-packed experience because of the work you do together?
Quarterly reporting is an option
Quarterly reporting is one option for you and your firm and with Making Tax Digital just around the corner it’s an opportunity that’s coming like a train and one to grasp now.
Ignore, avoid or simply ‘wait-and-see’ what happens is not a good option. It’s not a good option if your competition is on the case. The Cairngorms prove that
“cannot
be bothered” is not an option!!!
Accountants can’t risk a “I can’t be bothered with MTD and quarterly reporting” approach – it could kill their firm.
Earlier in February I did a winter mountaineering course, three days with a professional high-altitude guide. I need to brush up on my ice axe, crampon and rope skills before I climb Mount Elbrus (Russia) in August – it’s 18,500 feet, 6 times the height of Snowdon in North Wales!
Our experienced mountain guide gave us some sage advice:
“At such altitude it’s too risky to think ‘you can’t be bothered’.”
You can’t be bothered to put on your high-altitude gloves,; Can’t be bothered to have a pee; Can’t be bothered to take off a layer so you don’t overheat, all usually result in a very dangerous, possibly life or limb threatening situation. Approach the unavoidable shift to MTD and quarterly reporting with a “can’t be bothered” approach and you risk the life and limb of your firm. For the accountancy profession MTD is not something to ignore but one to welcome.
Time to step up to higher-value
You and your firm need to make a decision about the level of (perceived) value you want to deliver to your clients. Your business owners’ expectations about quarterly reporting, monthly reporting, weekly reporting and even daily reporting is changing. Over the next 12-24 months your business owner clients are going to get more demanding. The UK government’s Making Tax Digital (MTD) initiative is making quarterly reporting non-negotiable.
What an opportunity you and your firm have!
But even without MTD, almost all your business clients have a mobile phone and a computer. Your clients already are, or will be, making more of the readily available cloud accounting products and apps. So, you either choose to be at the forefront of the adoption of cloud accounting and quarterly reporting, or behind it.And if you want to maintain or grow your fees, profits and capital value you’ll want to be at the forefront of this change. Providing well-timed data processing and quarterly reporting will be the bare minimum your clients will need and expect from you.
Clients resist higher prices
Chances are you’ll be doing more work and will need to charge higher fees. Chances are your clients will resist higher prices. So, it pays to share higher-value options for clients to compare with your new, but necessary, quarterly reporting service.
Have you yet thought seriously about improving the perceived value your clients experience?
Paul Shrimpling is presenting at Accountex on the research findings of his soon-to-be-published book – The Business Growth Accountant. You’ll hear in Paul’s presentation what other firms are doing to improve their value offering, and how you can do the same. Paul will talk about two small firms with 16 and 26 clients and average fees of £26000 and £35000. Clearly at this level of fee the clients perceive very high value. Check out Paul’s presentation and why not pre-order a copy of Paul’s book here www.paulshrimpling.com
Are you ready for GDPR?
Written by Sybil Weir of FreeAgent: GDPR is a welcome new regulation for individuals, increasing their right to privacy in line with advances in technology. But, for many businesses, the May 25 deadline has been cause for concern - not least due to the lack of concrete recommendations. And with potential fines set at dizzying new heights, spring’s starting to feel like it’s approaching fast!
Like all businesses, FreeAgent has been working to get to grips with what the new compliance landscape will look like and how it will affect our business. And we’re not keeping what we’ve discovered to ourselves!
Practical application of GDPR
Join this webinar to get a view on the practical application of GDPR out in the wild, including:
● What we know (and don’t know) about GDPR so far.
● Looking after client data and complying with transparency and deletion requirements.
● Communicating with clients under GDPR.
● Keeping personnel records compliant.
Countdown to compliance: applying GDPR in the real world
Thursday, March 8, 11am(GMT)
Register here
FreeAgent will in Pod 18 at Accountex Summit North.
Q&A: Damon Anderson, Xero (2018)
Next up in our speaker Q&A series is Xero’s Director of Partners Damon Anderson. A leader in fintech with over 15 years’ experience delivering digital marketing and payments technology, he'll be sharing his insights into the challenges facing the industry and why accountants must get on board the digital revolution to survive. Read more
What tax reliefs remain for landlords?
Gradually reliefs and allowances relating to renting are being eroded away and with the Property Tax Campaign in its fifth year, it is obvious that HMRC believes that there is still more tax to be raised.
However, one relief that it would be difficult to withdraw entirely is the right to claim expenses incurred on the running of the property.
Renting is deemed to be a ‘business’ for income tax purposes and as such similar expenses incurred in the running of other businesses are allowable. Repairs, car running costs relating to the business use, council tax, management expenses, legal fees are all allowable.
The 'Replacement Furniture Relief' is a relief that had to be fought for by landlords and their representative associations as HMRC was intent on abolishing both the 'renewals allowance' as well as the 'wear and tear' allowance thatpermitted landlords of furnished residential properties to deduct 10 per cent of net rent from their profits to cover ‘wear and tear’ on their properties whether or not any furnishings, fixtures and fittings or repairs had taken place.
The 'Replacement' relief can be claimed by landlords of all residential lets (except furnished holiday lets) whether fully or partly furnished, as a deduction for the costs of replacing capital items such furniture, furnishings, appliances and kitchenware provided by the landlord for use by the tenant.
Note that this applies to replacement only, not the initial cost.
Another relief that is sure to remain, although restrictions have already been imposed, is the principal private residence relief (PPR). The PPR rules typically exempt the capital gain on the sale of a main residence.
The relief is clearly targeted at owner-occupiers, but landlords can take advantage (providing the property has been the individual’s only or main residence at some time) by claiming the last 18 months ownership (9 months following the autumn 2018 budget and 36 months for those moving into care homes) as occupation regardless of whether the landlord has been resident during those last months.
It is good tax planning for anyone purchasing a second property to elect for one of those properties to be the PPR and hence secure the 9 months tax relief. So long as the initial election is made, then it can then be varied (‘flipped’) as many times as desired by submitting a further election.
There is no prescribed form or wording for the election, but it must be made within two years of the change in ‘combination of residences’. Should the two-year time limit be missed, there needs to be a ‘trigger’ event in order to reset the election date.
The private rented sector has become a very different place over the past few years and although steps can be taken that may reduce the impact of the various restrictive changes that have taken place, research shows that the rules have affected the smaller landlords who have between three and five properties (89% of the sector) rather than the professional landlords who have emerged relatively unscathed.
Inside track on HMRC tax-gap strategy
Reducing the 'tax gap' is at the heart of HMRC's digital strategy . The "tax gap" is the difference between the amount of tax that should be paid and what is actually paid.
According to HMRC's Official Statistics Release of June 2018 the 'tax gap' is about £55bn, which is 5.7 per cent of the total tax take, equivalent to half of the annual defence budget. Approximately 10 per cent of this is lost as a result of tax evasion.
Although HMRC says that any taxpayer could be the subject of an inquiry, the reality is that they are either based on computer-generated risk-based selections or as a result of information received from sources.
Sophisticated computer systems
HMRC has one of the most sophisticated computer systems in the world, with its analytics team winning the award for the Best Big Data Project at the 2017 UK IT Industry Awards for its 'Connect' project.
Connect looks at data using a mathematical technique known as 'social network analysis', which ploughs through disparate, previously unrelated information to detect otherwise invisible networks of relationships.
Other digital technology used includes web-trawling software as well as social media search tools.
However, there is still a place in HMRC's investigation world for good, old-fashioned, investigatory skills – it is not unknown for undercover investigators to have lunch in a restaurant suspected of hiding small value cash transactions.
Rogue operators
Most holiday or short terms lets and parking spaces to rent are all invariably advertised on the internet.
Landlord licensing schemes are popping up all over the country as local authorities attempt to crack down on rogue operators.
HMRC have use of these council databases and would welcome licensing for all landlords to make their search for landlords who do not declare that much easier.
Tip-offs are still a vital source of information and tend to generate the biggest returns.
Tax fraud hotline
HMRC has a hotline enabling the public to report evasion and tax fraud direct to which 40,695 calls were made in 2017/18.
As an incentive to expose, HMRC offers rewards to those who provide information about suspected tax evasion and confirm that last year £343,500 was paid. In addition, every three months HMRC publishes a 'name and shame' list of taxpayers who evade more than £25,000 in tax.
With far more information available than ever before HMRC is able to target investigations on a more efficient and cost-effective basis. But the department is not being complacent - it is intent on extending its data gathering powers.
A recent consultation on HMRC’s civil information powers proposed that HMRC should be able to seek information from third parties without the agreement of the taxpayer or a tax tribunal, with no right of appeal.
The change proposed is essentially to bring HMRC’s powers in line with those of tax authorities in the rest of the G20 group of countries and although the number of taxpayers affected by these proposals will be relatively small the fact the taxpayer will not be consulted is a worrying point.