Accountancy & Management Services

To contact us and ask for our services click here

 

Pre Preparing accounts both to record historic information, and upon which to base future projections and planning, and the implementation of robust systems of recording transactions are the bread and butter of any accountancy practice.

A good accountant will help a client to design systems of recording that are efficient, appropriate to the business, and cost effective and that will enable the business to extract accurate information for all purposes, including taxation, management and future planning.

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The sections below contain links to some of the specific services that Peter Brown & Co is able to offer.

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts preparation & fees for the work

 How to interpret accounts

Management accounts & Information

Bookkeeping and systems advice

 Advice on record keeping

How long should records be retained

When should records be written up

 The engagement letter

Detect and prevent false accounting and fraud

Our record and book keeping service

Accounting for your income 

Record and bookkeeping notes for particular trades

What are proper accounting records

The Charity accounts SORP 

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Accounts preparation           

 To contact us and ask for our services click here

 To contact us and ask for our services click here

 

 

The preparation of formal accounts to measure past performance is the core work of any accountancy practice. To be of any value in managing a business and in making future taxation plans; historical results should be produced in final accounts form as soon as possible after an accounting period end.

 

The value of historical accounting information to a business person diminishes very quickly as time passes, so we are geared up to producing accounts for clients as quickly as possible. We use all technological means available to speed up the process of accounts production, so that our clients can receive their accounts in a readily understandable format as early as practical.

 

The fees for preparing accounts are always based on the time spent, and the skills required will determine the level of staff required, and hence the hourly rate to be charged.

 

It follows that fees will be related to the quality of the accounting records, the number of transactions and the complexity of the work required.

 

We will advise a client whenever we become aware of improvements to the system of record keeping, so that fees can be controlled. See ‘Bookkeeping Advice’.

 

The number of transactions involved and the complexity of the work will depend very much on the nature of a client’s business, and therefore are largely not subject to as much control as the system of record keeping. This is why fees will differ for different types of trades, and trades having different legal structures, such as sole traders and limited companies.

 

With a new client, we will usually be able to assess the likely fee level, based on our understanding of similar trades, after we have reviewed the actual system of record keeping adopted. We are therefore usually willing to give a fee estimate to a new client, and even agree to cap a fee at a particular agreed level in the first year. In subsequent years, we would discuss the actual time spent and the actual fee that should have been charged with the client, so that the client can the fully understand the future fee levels and the factors that govern them.

 

For more detailed notes on fees, see theFees Webpage’

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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The engagement letter           

 To contact us and ask for our services click here

 

 

 It is both recommended good professional practice and a requirement of the law relating to the provision of services to set out in writing a clear explanation of the services we offer. This is known in professional parlance as an ‘engagement letter’.

 

So that any prospective client can understand the full details of the basis upon which we undertake professional work, we have placed a sample of our standard engagement letters on this web site. The actual engagement letters that will be used will include up to date legal and professional requirements that may not be included in the sample letters

 

To view them, simply click here for our engagement letters.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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Bookkeeping and systems advice           

 To contact us and ask for our services click here

 

 

With any new client we will always review the systems of recording and bookkeeping that is employed in the entity. It is often worth investing a little time and effort at the beginning in order to ensure that future accountancy fees are as low as possible.

 

The requirements will vary from business to business, both to meet the day to day needs of the business and to meet the requirements of any regulators or tax authorities. The complexity of the system of record keeping will depend very much on the size of the business, and we will always seek to keep the demands of paperwork to the absolute minimum. Very often, with a small business, it is sensible for us to try and accommodate the system that the proprietor or director understands and is used to rather than to try to impose what we consider to be the ideal system.

 

For some businesses, there are technological solutions to systems, such as EPOS systems in the retail trade, or computerised stock systems, and we can advise on whether these are appropriate and cost effective.

 

We will always work closely with the owners to try and improve the quality of record keeping, and we see it as an important part of the accounts production process to have feedback to clients suggesting ways in which improvements can be made. In the long run, this will mean that accountancy fees can be kept to the lowest level possible.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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Accounting for your income           

 

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Unless good systems are in place, it is very easy to under or overstate the level of your income. This is particularly so if the business has cash sales.

 

The consequences of inadequate record keeping are that HM Revenue & Customs may impose severe penalties if they are not satisfied with the quality of the records. It also means that the proprietor of the business cannot take informed business decisions, because there may be uncertainty over the levels of trading income.

 

We will always assist a client in correctly documenting and recording his income, and we will institute accounting controls when we prepare accounts to confirm the validity of the income levels. We will always advise a client if improvements can be made.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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When should records be written up?           

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A distinction should always be made between the prime records of a business, such as the invoices, till receipts, supplier’s invoices, cheque book stubs and so on, and the secondary records, such as invoice day books, cash books and other books of account.

 

When we advise a client on the appropriate system of record keeping, we will always help him or her distinguish between the prime records, which must be written up at the time an event occurs or as soon as possible thereafter, and the secondary records, which can be written up after the event if the prime records are of sufficient quality.

 

Not only does it make good business sense to write up the prime records at the time, but the tax authorities will be unimpressed if there is delay in writing them up.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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Our record keeping and bookkeeping service           

 To contact us and ask for our services click here

 

 

We cannot assist with the preparation of prime records. That is the function of the business owner. The prime records must be of a high quality and relevant to the business needs. We can advise on what prime records should be kept and how they should be kept, but the onus is on the proprietor to maintain those records.

 

However, when it comes to secondary records, not only can we assist in maintaining such records, but there are many advantages in us doing so. Firstly, the records will be kept in a structured, orderly way, and will meet the requirements of the tax authorities. Secondly, if any problems are encountered because of difficulties with the prime records, these can be tackled much earlier than would be the case if we simply collected the records at the end of each accounting year.  Thirdly, the task of preparing accounts could be much simplified, so reducing accountancy fees, and reducing the time it takes to prepare accounts after the accounting year end.

 

We offer a fast, efficient, computerised bookkeeping service, either at the client’s premises or at our premises, on a very cost effective basis.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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What are proper accounting records?           

 

 

The Companies Act requires limited companies to keep proper accounting records. The Insolvency Act and the Statute of Frauds requires individual and partnerships to keep proper accounting records. There is also a criminal offence of false accounting if records are very badly maintained.

 

What are proper records?  It all depends on the kind of business. As explained elsewhere on this website we would always advise our clients as to the nature of records a business of their type would be expected to keep. In the context of limited companies there are very specific guidelines as to what constitutes proper records, and these guidelines can be usefully used for none limited companies.

 

To be proper records, the records must be up to date, containing prime records created at the time of the event, kept in an orderly and structured way, secure from damage or theft, properly backed up if computer records, and sufficient in the context of the size and scope of the business to fully explain its transactions. They should not rely on verbal explanations from the person who created them. They should stand alone as independent documentation of the transactions.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

 

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Record and bookkeeping notes for particular trades

 

 

 

Every type of trade has quite different requirements for record keeping. Every type of trade has particular types of problems, and particular areas that the tax authorities look particularly closely at.

 

So, for example, with taxi drivers, the cost of fuel in relation to takings and miles travelled is important. For fish and chip shops, the gross profit margin is important. For pubs the amount of ullage should be strictly controlled.

 

For this reason, we have developed specific notes for particular trades, covering the types of records that should be maintained and the particular areas where attention should be given.

 

These notes are available free to clients of our practice, but any non client may request a copy at a fixed fee of £10 including VAT.

 

To order a copy use the order form on the Advice on Line Web page, and instead of entering a question, enter a request for the particular bookkeeping notes required (quoting the reference number from below), and the fee, whether NIL or £10. You can ignore the section of the order form that refers to the normal fixed fee of £20.

 

The areas covered are:

 

·        Newsagents                                                   ref  BN001

·        Taxi and private hire operators                          ref  BN002

·        Fish and Chip Shops                                        ref  BN003

·        Retail trades                                                  ref  BN004

·        Public houses and restaurants                           ref  BN005

·        Hoteliers                                                       ref  BN006

·        Computer consultants                                      ref  BN007

·        Workers through agencies                                ref  BN008

·        Financial advisors and insurance consultants        ref  BN009

·        Estate agents                                                ref  BN010

·        Solicitors                                                       ref  BN011

·        Manufacturers                                                ref  BN012

·        Wholesalers                                                   ref  BN013

·        Importers and exporters                                   ref  BN014

·        Builders and workers in the construction industry  ref  BN015

·        Service industries                                           ref  BN016

·        Other trades and professions                            Available upon specific request

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

 

 

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Management accounts and management information

 

 

Accounts are not only prepared for the tax man.  Regular monthly or quarterly accounts, comparing actual performance against pre planned budgets can be a useful tool in planning and controlling a business and helping it to achieve its objectives.

 

What matters when preparing management accounts is timeliness. Management accounts should be prepared as soon after a period end as possible in order that the maximum benefit can be obtained, and so that decisions can be based on the up to date position.

 

Management accounts will not only include accounting information, but also detailed analytical data, and statistical data so that the causes of events can be explained.

 

Our firm can assist enterprises with setting up and maintaining management accounting systems so that performance can be adequately monitored and controlled.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

 

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How to interpret your accounts

 

 

The accounts produced by an accountant can be a very useful pointer to many aspects of a business. They can highlight the areas of strength and of weakness. They can be pointers as to the dangers of possible future insolvency. They can show how assets might be better utilised, and how the business might be better funded.

 

However, it is sometimes not easy to interpret a set of accounts, and to know where to look for particular clues. Sometimes it is very easy to misinterpret a set of accounts.

 

When we prepare the first set of accounts for a client, we will always explain what the figures actually mean. Then in future years we will update that interpretation with reports highlighting the significant figures and ratios, to help our client make informed and wise decisions.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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The accounting SORP for charities

 

 

Our firm has many clients who are registered charities. We have a specialism in this area, and supply charity accounting software to many other firms of Chartered and Certified Accountants, and offer a consultancy service to other firms.

 

This means we are very familiar with the workings of the Charity SORP (The Statement of Recommended Practice for Accounting and Reporting by Charities). The SORP is issued by the Charity Commissioners, under the auspices of the Accounting Standards Board, and lays down the basis upon which charities should account for the funds under their control and report the results of their activities.

 

Because of the way the practice is organised, having offices in converted stables in a rural location, we have much lower overheads than many firms, and we are able to offer a very professional service to charities at a substantially reduced fee compared to the fees that might be chargeable by other firms.

 

We can advise and assist charities in obtaining grant aid, help them to institute accounting systems to monitor and control their activities, and produce accounts in the format required by the Charity Commissioners.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

 

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How long should accounting records be retained?

 

 

 

 

This is a very confusing subject, as there are different regulations for different purposes.

 

·        Vat regulations require retention of all VAT related records for three years after the last entry

 

·        Income tax regulations require retention of all tax related records under a complicated formula which effectively means approximately seven years after the end of the tax year to which the records relate

 

·        Company legislation requires retention of accounting records for three years after the end of the accounting year (or six years in the case of a public limited company).

 

·        Charity law requires the retention of records for six years after an accounting period.

 

·        Prudence says that all records should be kept for civil legal purposes for six years, or twelve years for records relating to land, as legal actions can commence during these periods.

 

·        There are also a number of other regulations relating to record retention.

 

Although specific advice should be taken in individual circumstances, as a general rule, we would recommend that all records, whether they be paper or electronic records, be retained for at least seven years after the completion of the period to which the records relate, or longer if the records relate to land transactions.

 

This requirement would include keeping the means (eg computer software and hardware) that would enable electronic records to be read.

 

Records should be kept in a dry, secure location, well indexed or referenced with labels, and sensible precautions should be kept against theft, fire and other events. Care should be taken to ensure that insurance policies cover the cost that might arise from the loss of records, and the cost of reinstating the records if possible. 

 

We offer a storage facility for clients of the practice to store their books and records for an annual fee of £25 per year.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 

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The detection and prevention of fraud           

 

 

 

 

The effect of fraud and false accounting can be devastating on its victims. It can cause businesses to fail, and employees to lose their jobs. It can affect even the smallest of businesses. It only needs a very small amount to be lost on a regular basis, and the impact on profitability can be enormous. It can happen in any environment, and the perpetrators can often be the very people who are most trusted in the business.

 

Fraud can be very simple or very sophisticated, and prevention is the best measure. Accounting systems of control should be well designed, and systems of record keeping should be properly developed and maintained. Our firm can assist in this, as explained elsewhere on this website.

 

When fraud does occur, or is suspected, then we can bring our auditing and forensic skills to bear to detect the fraudster.

 

Clients of the practice can obtain further information by entering the ‘Client ‘ Zone’ and searching the index

 

 See also our forensic page

 

 

 

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Peter Brown & Co is a trading name of Undershot Ltd, registered in England , no 4114468. Director :-  P.Brown FCCA, FCIE,DchA,BSc.The registered office is Acomb Grange, Grange Lane, York, YO23 3QZ.

Last modified 11/11/10