By Gary Pettit
Arguably one of the biggest burdens of business ownership is the maintenance of company records. This is certainly more prevalent in small (usually) family-owned businesses where every so often the owner has to sit down and bring his or her books and records up to date.
Worryingly, I have noticed a trend where I am asked for urgent assistance only to find that the information I need is not available because the books and records aren’t written up. In some cases the delay caused by collating the necessary details has resulted in a company requiring the protection of going onto administration, rather than using a stand-alone rescue package.
It is quite natural for people to shy away from doing something they find stressful or boring, however should you be the one to look for an excuse to do something else and put off the book-keeping, here are a few reasons to encourage you to think again:
Although point one is not to be sneezed at, business owners ought to be particularly aware of point three. A pilot scheme was tested in 2011 by HMRC where they attended small and medium-sized businesses in order to check the “adequacy” of their business records. In a test comprising 800 visits HMRC found that 44% of those attended had issues with their accounting records, with a further 12% being classed as seriously inadequate.
The message is loud and clear; ensure your books and records are up to date and compliant. Personally, I would recommend you engage a book-keeper who will work closely with your accountant. This has several benefits, including that working together normally results in the preparation of annual accounts being more economical and any deficiencies in the accounting records should get flagged at an early stage. Additionally, using a third party is often cheaper and more effective than the owner trying to bumble through the process himself – why waste hundreds of pounds worth of the owner’s time that could be spent generating new sales or producing new goods, when a book-keeper could do the work for a small fraction of the cost? The alternative could be a fine from HMRC or worse, the need to call in an insolvency practitioner!Marshman Price has an enviable record of saving businesses within the county and can recall many success stories – even recently in these difficult economic times. If you are feeling uncomfortable with the financial situation of your business, make an appointment for a free one-hour consultation to discuss, in full confidentiality, what options are available to you. Telephone Alan Price or Neil Marshman on 01933 270 918 or Gary Pettit on 01604 259574 or email firstname.lastname@example.org