If you have your own accountancy firm, you’ll be more confident than most when it comes to managing business finances. However, that doesn’t mean that you’re infallible. Even the most experienced accountant can fall short, especially when relying on information from clients.
Safeguard the success of your company by exploring the common mistakes that accountancy firms make and what you can do to avoid them.
Even though you’ll know how important it is to keep accurate financial records, it’s all too easy to let things slip through the net. A prime example of this is mismanaging invoices. This might include sending them late or not at all, as well as creating thin documents that lack detail.
All invoices should include a breakdown of the work completed and how many hours you’re billing for, as well as a clear due date for the payment. The invoice should be sent to the client as soon as the work is completed for fast financial settlement. Late fees also encourage prompt payment.
Don’t forget to track payments for your receivables to avoid invoicing twice. This will also ensure that you can maintain accurate financial reporting.
Not seeking support
Clients will look to you as the authority on all things finance but that doesn’t mean you need to know everything. Tackling complex challenges without seeking support can lead to errors being made which could be damaging to your client’s company and your reputation.
You could consider investing in professional indemnity insurance for accountants as some such policies provide access to advice for you and your clients on difficult subjects like tax. They can also offer protection in the event of an unintentional breach of your duty of care.
Outsourcing certain tasks is also an option. For example, you could use a specialist company to check that your clients are doing what’s necessary when it comes to financial compliance.
Missing key deadlines
There are lots of key deadlines to keep track of when it comes to accounting, most relating to the tax year (6th April – 5th April). It’s important to keep up with these deadlines as your client would have to pay a penalty for the late filing of Company Tax Returns and other legal documents.
Meeting these deadlines can be a challenge. For one thing, you’re likely to receive a lot of requests all at once just before the new fiscal year – and you’re dependent on your clients for the information you need to complete their documentation.
To help you stay ahead of the game, you could invest in special software that does the hard work for you. Computer programs can process hours of admin in minutes, collating information and sending out automated reminders to help clients stay on top of deadlines.