Guide to virtual teams and remote working ... in numbers
Here's a nice little visual and blog from our friends at Sage...
In 2017, more than 4.3 million people worked remotely in the UK. The latest data from the Office for National Statistics (ONS) shows that three quarters of these people were experienced professionals who work in the highest skilled areas of the economy.
Research carried out by the TUC, has found that in the last decade the number of workers who say they usually work from home has increased by a fifth. This growing trend is partially in response to companies trying to recruit top talent by offering a better work-life balance.
On a global scale, the World Economic Forum’s most recent forecast of employment trends called flexible working, such as virtual teams, “one of the biggest drivers of transformation”.
Tech companies such as Zapier, Basecamp, Github and Microsoft are pioneering different approaches to virtual teams. Employers such as the Civil Service, Vodafone, Transport for London and Unilever are regularly praised by workers for their flexible work culture. While charities such as Unicef have tapped into the potential offered by spreading teams across time zones.
Remote working is not just for multinationals. Small businesses can also embrace the virtual team, with productivity and access to the best talent being the biggest benefits. Research shows that employees working remotely are highly productive, motivated and committed to their employers.
Much like the rise of home delivery from supermarkets has disrupted how we purchase food, remote working has the ability to change the way we approach the traditional office structure. The massive benefit from this is a huge reduction in commuting and the impact this could have on pollution.
“The benefits are immense: a better lifestyle, with positive benefits for recruitment and retention; a reduced carbon footprint; enhanced accommodation of diversity; better mental and physical health; improved productivity; more effective use of property.” – Bruce Mann, former Cabinet Office finance director, Civil Service
How to build defences against late payments
The difficulty of managing cash flow and getting paid on time is a harsh reality for many firms in the construction industry.
In a sector responsible for 6 per cent of UK GDP, these cash flow gaps can hit the economy hard.
Nowhere is this more evident than with the fallout from the collapse of Carillion, which has caused cash flow gaps to reverberate around the economy since the beginning of the year.
The problem is serious enough that the government recently appointed a Small Business Commissioner whose remit solely consists of remedying this issue.
So a solution to cash flow gaps in the construction industry would boost the economy.
We argue that this could come in the form of cloud accounting technology, which creates a unique opportunity for construction companies to improve efficiency and to better manage collection of payments, alongside access to finance to cover cash flow gaps.
Long supply chain
But first, why are late payments so common in the industry?
Late payments are a particular problem in construction due to the sector having such a long supply chain, consisting of specialists and subcontractors.
This means that it can take time for subcontractors to get paid due to payment needing to pass through a number of different parties to reach them. It is estimated that Carillion owed £1bn to up to 30,000 businesses at the time of its collapse.
Mark Telford, director of Telfords Chartered Accountants, a firm that specialises in the construction industry, says: “If a client doesn’t pay his subcontractors on time each week they will often walk off site and look for work elsewhere. It can then be very difficult to get that labour back, which in turn affects the ability to deliver client work on time.”
He said that subcontractors waiting for payment are reluctant to take legal action due to fear of losing business.
How do business owners navigate this environment? Colin Kent, owner of Pembrokeshire based CK Roofing Contractors Ltd, issues all of his invoices on 30-day terms and frequently suffers from late payers. “I always send a reminder out straight away when invoices are late. However, some clients aren’t on the ball and often delay payment by a few weeks. This has knock-on effects for cash flow in the business.”
Speeding up payments
In the meantime, there may be opportunities closer to home to solve these problems. The development of cloud accounting software such as Xero and QuickBooks, alongside an ecosystem of add-on partners, makes it relatively easy for construction companies to access up-to-date information on their finances, as well as giving them tools to facilitate faster payment and issue invoices.
“We encourage our clients to get their clients to pay by direct debit. GoCardless and iZettle have revolutionised the way in which small businesses can improve their cash flow,” says Mark Telford.
The benefit of using these tools is to be able to issue invoices and collect payment on the go, while on a job as opposed to retrospective billing.
As well as improving cash flow these tools can significantly reduce the time spent on credit control.
Easy access to finance
A number of debt finance providers now also integrate directly with cloud accounting software, which makes it fast and hassle-free for construction companies to access finance to cover late payments.
Revolving credit facilities, such as iwoca, are similar to overdrafts in that they allow business owners to just pay fees on what is borrowed.
Robert Bailey of Swallow Hill Homes, a company that converts historic buildings into residential properties, uses iwoca to draw down on what he needs to pay on a daily basis. He lists its key benefit as the “money arriving straight away” into his bank account. This then allows him to log onto his business banking and have adequate funds to set up payments for his suppliers.
Cloud accounting software
Construction companies shouldn’t wait for changes to public policy to reduce late payments. Instead, they should be encouraged to take advantage of advances in cloud accounting software to manage their day-to-day finances and reduce the time they spend on chasing invoices. When the next Carillion collapses, we can all be better prepared.
This article originally appeared on the ICPA website.
How to approach the Employee Ownership Trust
There is a new way of owning a business in town – the Employee Ownership Trust (EOT). Since its introduction in 2014 this is becoming an increasingly popular method of succession planning.
Having sold a majority stake of my business, Ovation Finance Ltd, to an EOT, I have seen its advantages – and challenges – first hand.
In short, the company sets up the EOT, which buys the shares. This creates a deferred consideration, which is repaid from the future profits of the business. The beneficiaries of the trust are the employees of the business.
Any profit above the annual payment of the consideration – and all the profit once the consideration is fully repaid – therefore goes to the employees. The owner gets out at a market value, and the employees get in without having to come up with the cash.
Capital gains tax
Among many advantages of this route, owners that sell their shares to an EOT (at minimum a controlling interest) will not pay capital gains tax on the proceeds. It is tempting, therefore, to spread the news to business owners focusing on this tax efficient element of disposal.
It is, however, a temptation that must be resisted.
Life in an EOT business is not like life in one that is privately owned. The transition to a business that is owned by an EOT must focus on company culture issues: collaborative decision making; employee engagement; developing the business purpose.
Employees and clients
The driver for using an EOT for succession planning must be to build a business that will last, and not just to save tax. This itself might stem from wanting to leave a legacy, and/or perhaps the desire to look after employees and clients.
But possibly the strongest reason to focus on creating a business with a long term future is the fact that it is the future profits that will be used to pay the owner their value of their shares!
Interest in the EOT as a method of succession is increasing massively. It is vital that accountants help spread this message with a focus on building long term businesses, and not just focus on tax breaks.
Accountants, clients... and the stress factor
At Accountex back in May I was asked about accountants and stress levels. I pointed out that stress in the workplace for accountants in practice is nothing new. It is not a recent development, it is just that now more publicity is quite rightly being given over to the subject.
I have been in practice for more than 30 years and have experienced stressful times. Some Januarys have been worse than others, and P35 filing time was always a tad stressful (thank goodness that one has gone).
But how will the MTD agenda stack up going forward?
I always found that analysing the problem was the best way of reducing stress levels.
And, in fact, doing that brings back the joy of being in practice and helping so many clients fulfil their business dreams.
Rise in stress levels
I found that, inevitably, a rise in stress levels not just in myself but also among staff was often caused by uncommunicative clients. The ones who who never responded to emails or letters in a timely manner, never provided the necessary information requested in one go, or who were tying up myself or the staff with seemingly endless questions.
A stress-free working life would be wonderful but you can reduce stress levels if you take control of your practice.
And just one way of doing that is by making sure that the clients you have are the clients you want to have and are the clients that, more importantly, want you and your staff to act for them.
Best service
A client is entitled to the best service you and your team can offer. But if you are unhappy you don’t have to act for them. You can resign and pass them on to another accountant who they may treat differently (or not).
Stress seldom ends without some form of resolution or determination to make it end.
And sometimes it’s as simple as sacking a couple of clients...
This article originally appeared on the ICPA website.
TaxCalc takes on new product director
TaxCalc has hired a new product director to spearhead a major expansion initiative.
Pauline Smith will lead the group's Making Tax Digital strategy, augmenting its product suite and developing solutions to bolster its practice management offering.
A veteran of 17 years in product development at IRIS, Pauline her last two years at there leading the technical product team.
“I’ve worn many hats in my previous job, so can bring a wide variety of disciplines, skills and perspectives into my new role. TaxCalc has been the one to watch for several years now.
Commercial flair
"As a company I’ve always admired their commercial flair and commitment to getting it right for their customers. In our business it’s very rare that you see a company that relentlessly pursues excellence while maintaining price points that are within the reach of accountancy practices, large and small.
I’m incredibly excited to join the team and look forward to doing great things here.”
With 8,000 practice customers and rising, TaxCalc has seen good growth over recent years. September saw the launch of its practice-focused GDPR Centre and eSign Centre, with its MTD-ready VAT Filer product due for release in mid-October.
Stellar talent
CEO Tracy Ebdon-Poole says: “Pauline is a stellar talent that any company in our sector would love to have.
"We’ve eyed one another across the fence for some time now and I speak for the whole company in saying how absolutely delighted we are that Pauline has joined the TaxCalc family.
"This is a big role and Pauline has wasted no time in bringing a fresh pair of eyes to our ambitious plans. 2019 is going to be one hell of a year with Making Tax Digital and we are determined to deliver the very best solutions to make the transition an easy and profitable one for our customers.
"With Pauline at the helm of our MTD strategy, we’ve already started implementing change and envisioning new product development. You’ll be hearing a lot more about our plans in due course.”
MTD VAT pilot takes a huge stride
It's happening! Half a million UK businesses can now sign up to the HMRC's making tax digital for VAT pilot.
Another 100,000 will be able to join by the end of the month.
That's ahead of next April when about a million businesses registered for VAT with a taxable turnover above £85,000 will need to keep their VAT records digitally and file their returns using MTD-compatible software.
This significant step for the whole MTD programme was announced online yesterday.
Join the pilot as soon as you can
HMRC advises: "Eligible businesses and agents shouldn’t leave preparations to the last minute and are encouraged to join the pilot as soon as they can."
More and more businesses use digital tools every day to help them operate – tax shouldn’t be different. This is a major step towards bringing VAT into the 21st century.
Theresa Middleton (pictured), director for Making Tax Digital for Business, adds: "Millions of people are already banking, paying bills and interacting with their suppliers and customers online. Using digital tools to help businesses manage their business income and expenses and get their tax right builds on this momentum and will also help them get more control over their finances."
Background information
HMRC’s ambition is to become one of the most digitally advanced tax administrations in the world and Making Tax Digital is making fundamental changes to the way the tax system works – transforming tax administration so that it is:
- more effective
- more efficient
- easier for taxpayers to get their tax right
HMRC has updated its guidance and produced a series of videos to help people make the leap into digital, including how to create an agent services account. Loads of info HERE.
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5 tried and tested ways to stay sane while your practice grows
They don’t teach this to you at business school! So, what am I talking about? When your firm is going through rapid growth, you – the firm owner – are on a roller coaster of emotions. As the quote goes, be careful about what you wish for! Of course, one of the best ways to cope with this roller coaster is to accept that it is going to happen, and pay careful attention to your own self-care during stress periods.
1. Plan the impact on your resources
Having a well-stocked pipeline that easily converts is a great feeling, this can place huge strains on the operation of your practice if not anticipated for. Over-trading is NOT a nice problem to have as some people may tell you. Over-trading can be as dangerous to your firm’s success as under-trading.
The answer is to critically look at your planned growth and ask yourself these questions:
- Do we have enough capable hands in the firm to service this growth?
- At what points in the year do we have capacity issues?
- When do we need to hire in extra resource to meet our planned growth?
- Can we cover the peak periods with freelance resource?
2. Work out how to ensure you have enough cash
There is nothing quite like the feeling of having to pay your monthly wage bill when you’ve brought in your first full time experienced hire.
As we like to call it in the Accountants Millionaires’ Club, it’s squeaky bum time. And, it’s not just the payroll cost either. After all, for each new person into the business there is always a recruitment, equipment, payroll and time cost attached.
In an ideal world you would always have the cash reserves to invest in a new team member. Unfortunately, real life is not always as well planned as that. There is always a balance between the available capacity in the practice and whether you can afford to take on the commitment of a larger payroll.
A few of my clients have found that a short-term business loan has given them the headroom to recruit ahead of the anticipated demand for their services. Once again, if you have modelled your firm’s capacity as your firm rapidly grows, you will be able to make a better judgment about whether you can manage without hiring in an extra team member.
3. Outsource or delegate
As you grow rapidly it is not the growth itself that puts the huge strains on a firm, it is often the growth in the workload peaks. Whilst I’m not suggesting that you choose to outsource the client work to an external organisation, there are other ways you can outsource or delegate. For example:
- Can you outsource some of your practice management tasks, eg diary management, to someone internal or external to the firm?
- Do you have to personally do everything on your desk? What can you delegate to another member of the team?
- Will some short-term freelance resource help take the strain out of the peaks?
4. Prioritise your self care
Any period of intense growth, whether planned or not, is physically and mentally draining for any practice owner. I can vouch for this. While you may feel that you need to just “get through this phase” or “have no choice but to keep working at weekends and evenings” or “don’t have the time to take a holiday”, this is not sustainable.
Therefore, plan regular battery recharging time - daily, weekly, monthly and quarterly.
5. Build a supportive tribe around you
Every Monday I spend 30 minutes with my accountability buddy. We each have 15 mins to just talk and get ourselves balanced for the week. And yes, it has made a massive difference to my mental health. I don’t feel alone any more.
Just as my accountability buddy keeps me on the straight and narrow, she also keeps me accountable to my goals and plans. The physical act of checking in is a great mood balancer and de-stressor. Who is doing this for you?
Where is your tribe who allow you to be you and help you get through the tough stuff? This is why we set up the Accountants Millionaires’ Club as a club. We are there to be each other’s tribe and watch their back. Who is doing this for you?
Accountancy toasts winners of customer awards
Leading figures from the accountancy industry toasted the IRIS Customer Awards at a glittering ceremony in London.
The awards were launched as the accountancy software provider enters its 40th year. They celebrated best practice across several areas as accountancy firms evolve beyond compliance services to capitalise on new service opportunities in the digital economy.
Sion Lewis, CEO of IRIS Accountancy Solutions also presented a Special Recognition Award to M J Kane & Co Accountants in honour of the outstanding achievements. These stemmed from practice development to the firms work providing training for Bombardier employees.
Free information
M J Kane & Co was also congratulated on its extensive graduate programme and ‘Information Nights’, which give free information to local businesses in a variety of areas such as pensions, payroll and VAT.
Sion Lewis says, “The quality of the entries demonstrated some pioneering approaches practices are taking to improve client excellence, add depth and volume to practice advisory and create innovative marketing campaigns. Technology is underpinning much of the outstanding service provision, evidenced by their effectiveness and productivity. All our winners have shown that they are among the best in the accountancy industry.”
Michael J Kane FCCA, from MJ Kane and Co, flew in from Antrim, Northern Ireland, for the ceremony and received a shock when the previously unannounced trophy of CEO Special Recognition was revealed. He says, “We had been nominated for one award, but didn’t know anything about this. We’re almost speechless, unbelievably happy. To be recognised for something you enjoy doing is such a bonus. I will probably fly home to Belfast without a plane I feel so happy.”
Data engineering competence
Alastair Barlow FCCA, founding partner of flinder in London, says, “I’m so happy we won best use of tech, it means so much to us. We started this firm 20 months ago, really focusing on technology, real time data and building our data engineering competence, so this is the one we wanted to win. I’m absolutely delighted for the team.”
Simon Cowie, MD of Aberdeen-based Infinity Partnership, celebrated four award victories for his team, including Graduate/Trainee of the Year, Accountant of the Year, Bureau/Outsource Service of the Year and IRIS Firm of the Year Medium.
He says, “It’s been an amazing night and what an accolade for the team. We’ve diversified significantly since the down turn hit Aberdeen three years ago and doing this has led to our continuing growth. Team work is key. We adopted IRIS 18 months ago and it has allowed us to do the growth, that’s for sure.”
The full list of IRIS Customer Awards Winners:
- IRIS Small Firm of the Year - Your Tax Shop Ltd
- IRIS Medium Firm of the Year - Infinity Partnership
- IRIS Large Firm of the Year - MHA Monahans
- Bureau/Outsource Service of the Year - Infinity Partnership
- Client Excellence Firm of the Year - Your Tax Shop Ltd
- Marketing Innovation Firm of the Year - Dunkley’s Chartered Accountants
- Fastest Growing Firm of the Year - Bailey Group Chartered Accountants
- Accountant of the Year - Greg Houston, Infinity Partnership
- Partner of the Year - Ian Phillips, Duncan & Toplis
- Practice Manager of the Year - Sue Jackson, Harrison Beale & Owen
- Advisory Firm of the Year - Wilson Partners Limited
- Best Use of Technology Firm of the Year - flinder
- Graduate/Trainee of the Year - Gail McShane, Infinity Partnership
- IRIS CEO Special Recognition Award - M J Kane & Co Accountants
For further information visit: www.iris.co.uk/iriscustomerawards
BrandWatch: Accounts IQ joins forces with TransferMate
AccountsIQ, supplier of financial management software, has partnered with TransferMate Global Payments, the global B2B payments technology company.
The aim is to offer its customers a new way to access preferential FX rates for payments, saving them time and money with an automated solution within the AccountsIQ system.
AccountsIQ’s clients include Web Summit, Gaelectric, Nuritas and Altratech.
Foreign currency payment
Gary Conroy, TransferMate’s chief product officer, says: “TransferMate is delighted to announce this new partnership with AccountsIQ. With a growing global client base, more AccountsIQ users are demanding simpler, faster and more cost-effective foreign currency payment solutions.
"TransferMate’s integration with AccountsIQ software, streamlines making an FX payment, right inside the Accounts IQ platform. This provides a preferential exchange rate and lower fees than a traditional bank along with huge time savings for accounts teams. A key driver of TransferMate’s growth is deep strategic partnerships with accountancy software providers and we are really excited to be working with Accounts IQ.”
Time and money
Darren Cran, AccountsIQ’s UK MD, adds: “This FX payments solution is far quicker and cheaper than people have been used to. It will make a real difference to senior finance staff’s time. We’re thrilled to be able to give back time and money to our customers with such a simple solution. After using this solution, customers will wonder how they ever did it the old way.”
"AccountsIQ is constantly looking to provide the most complete solutions for customers. This partnership with TransferMate allows us to provide a market leading service and reinforces AccountsIQ’s position as a real innovator in the provision of comprehensive accounting applications.”
AccountsIQ’s pioneering history of integrating with other leading apps means the needs of a wide range of businesses can be met. Working with complementary best-of-breed, sector-specific applications to merge vital data means that organisations get a seamless solution for their finance needs.
Gary Conroy, CPO, TransferMate and Tony Connolly, CEO and founder of AccountsIQ explain the benefits of the partnership in this short video.
For more information on AccountsIQ visit www.AccountsIQ.com
For more information on TransferMate, visit: www.transfermate.com
IRIS aims to simplify the route to MTD
Software group IRIS has delivered an autumn statement of intent that aims to equip every accounting practice with the tools to thrive in the digital future.
The company, which is celebrating 40 years in business, has even thrown down the gauntlet to EY, PwC, KPMG and Deloitte by offering an artificial intelligence audit solution that could threaten the Big Four's market dominance.
But first, back to the future. Back because one of the big making-tax-digital add-ons unveiled at IRIS World this week visits "Planet Spreadsheet".
IRIS VAT Filer bridges the spreadsheet gap
IRIS says: "With just 25 weeks until the MTD deadline of 1 April 2019, accountancy businesses are beginning to complete quarterly filing submissions in the MTD programme but for many, progress has been precarious.
"To help ease the journey we have focused on MTD improvements including the IRIS MTD solution for Income Tax and VAT filing.
The bridging software, IRIS VAT Filer, enables accountancy businesses to use IRIS for MTD VAT filings, allowing for the import of VAT values from either a CSV file or clipboard. They can then be filed with HMRC via its new MTD APIs. VAT Filer is included in IRIS as part of the subscription.
Sion Lewis, CEO of IRIS, says: “We are approaching the dawn of a new digital era for accountants, and we are starting to see progress as we head towards the April 2019 deadline. Our mission over the next few months is to help smooth the transition to digital records as much as possible, while of course, remaining compliant.”
Sion Lewis continues, “The MTD journey is at the forefront of everyone’s minds, but we also look to increase productivity for accountancy professionals as they evolve beyond compliance services to capitalise on growth opportunities in the new digital era."
IRIS has also improved the user experience in Time and Fees; with IRIS Connector now allowing the export of invoices with VAT and Nominal Codes breakdown into a CSV format ready for use in the preferred accounting product.
Artificial intelligence
IRIS's partnership with Canadian AI analytics group MindBridge is all about "democratising audit" and trying to loosen the stranglehold that the Big Four has on the market. It also enables superior data set analysis and will hopefully give smaller companies the accuracy and enhanced credibility to compete with the bigger outfits.
Sion Lewis says: “The MindBridge partnership will accelerate AI adoption in audit among the top 100 firms, but ... why not use it as a platform for advisory services?”
Project Darwin
It sounds slightly sinister but I thinks it's meant to convey evolution rather than survival of the fittest. For IRIS product chief Nick Gregory it's a new era in accounting where an accountant's practice data is centralised in the cloud and can be accessed and updated or amended whenever and wherever.
Project Darwin ties together IRIS OpenSpace (used by 425,000 accountants and clients to work together online), Analytics and IRIS connect through APIs.
IRIS payments
A major headache for accountants is tracking down payments with 70 per cent saying it's one of the biggest burdens in the profession. The software group has launched IRIS Payments, which aims to cut down on this time-consuming pursuit. It's a facility that again links in to IRIS OpenSpace.
Sion explains: “The launch of IRIS Payments complements our vision to simplify the lives of accountants, making them more effective and more productive. Integrating a payment solution into the accountant’s client portal is a natural fit, as it is being used as part of the ongoing relationship.
"This is an opportunity for accountancy professionals to streamline their client experience and create additional efficiencies in the digital process.”