A question regularly asked from new business owners and sole traders just starting out is whether they need an accountancy package and if so which one? The best advice we can give you if you are starting out on your own is to keep good records. Make sure you keep all your receipts and if you are not financially savvy ask for help from someone who is. This is where Volarti can help you.
If you keep good records then you have already stepped up the ladder, and those receipts and records can be used to create your tax return, company return, or management reports.
Another useful tip which will help keep your business finances much easier to track is keep your personal and business transactions separate. If you can start up a new bank account especially for your business then do this. It will help to keep the business separate from your day to day household expenses. It will make your life much easier in the long run.
Make sure you get your invoicing right from the start, as even if you have the best business idea in the world, if you don’t produce accurate and effective invoices it will be very hard to get paid . Certain information must appear on an invoice. If you need help with this please contact us for further information.
Spreadsheet or Accounts Package
Many people just starting out don’t think they are big enough to warrant the purchase of an accounts package and start out using excel spreadsheets to record their business finances. Our view is that you are never too small to start using an entry level package.
In our experience using a spreadsheet is fraught with potential problems. There is no real way of checking easily for errors, omissions and duplication on a spreadsheet, and in our experience even trying to check that everything from your bank statement has been accounted for can take hours with even the best designed sheets.
We look after businesses supplying them with bookkeeping services as well as an accounts package and have seen from clients invoices raised in word with incorrect VAT calculations, missing invoice numbers or duplicated numbers, and no system for keeping track of who has paid and who still owes you money. Even the entry level packages offer this kind of control as standard depending on the package you choose. We can supply you with a package and keep it on track for you and your business, as well as freeing up your time for the more pressing jobs, like running a business!
Choosing the Right Package
You need to think carefully about which is the right package for you. Many have a free trial option so you can ‘try before you buy’, or you can ask for a demonstration of the different packages too.
Cloud or Desktop
The latest craze is cloud accounting, with packages like Xero and Sage One becoming very popular. Do you have a good reliable internet connection? Do you need to be able to view your accounts when you are out of the office on multiple machines? Do you need your accountant or bookkeeper to have access to your live accounts in order to support you in your business? Cloud really just means your data is stored on a third party machine and you access your software via a browser window. Data is encrypted and password for security, but would recommend caution in logging onto your financial data on ‘public’ machines.
The alternative are desktop programmes. You install the software on a machine or server and then access it from within your private network. Rather than logging in remotely to your software using a browser you are able to install the software on a machine away from your main office or network and access live data remotely.
I would only recommend relying on cloud based solutions if you have reliable internet services, think about how it would impact your business if you lost connection to your accounts data for a large part of the day.
You need to think about what you need from the package.
Do you need to complete VAT returns?
Do you need to manage stock?
Do you need to produce invoices or manage projects?
Signing up for a free trial is a good way to see what works for your business.
If you need any help with your business, get in touch: