Why would I need a bookkeeper? I already have an accountant.

14 September 2021

So many business people do their own bookkeeping – or what they believe is bookkeeping – and then at the year end hand over files of paperwork, analysis books, spreadsheets or, if they’re using it, give the accountant access to their online software.

Accountants take the data, analyse it, compare figures to prior periods, produce reconciliations and prepare the accounts and tax returns. This in itself requires extensive knowledge of tax and accounting regulations so it’s by no means dismissive of what they do, it certainly isn’t ‘only’.

So why would I need a bookkeeper then?

The biggest problem that we see time and time again is ASSUMING THE OTHER PARTY IS DOING SOMETHING.

The business owner is under the impression that the accountant will scrutinise their bookkeeping and let them know when they’ve done things wrong. They believe that the accountant will check all their VAT is correct and they’ve used the right rates correctly, check the payroll was run properly and in the construction industry check they’ve deducted CIS correctly and used the Reverse Charge scheme correctly.

The accountant, unless instructed otherwise, will assume that the business owner has accounted for all of the business expenses and claimed VAT correctly. As long as what was on the VAT Return is matched with what was paid to HMRC they probably won’t look any further. When reviewing the payroll they’ll expect what’s been paid to employees and HMRC to match the payroll reports. They won’t check tax codes are correct, employee benefits added correctly, pension schemes set up.

When people assume something it very often puts them at risk.

A client of ours queried an invoice from a new supplier and asked me to confirm what they believed was correct. Together we contacted their supplier to query it. The supplier agreed they were wrong and duly corrected the invoice but was amazed that their accountant had never told them about how the VAT scheme affected them and had never queried anything in the past. The supplier was grateful to be told so they could correct it.

So who’s at fault here? Well both parties need to take some ownership. The accountant could have made a simple check and asked the client some questions to make sure they were aware of their obligations but the business owner should have been aware too, especially when it comes to taxes. HMRC wouldn’t accept ‘my accountant didn’t tell me that’ as an excuse for errors.

A bookkeeper can be like an insurance policy. We can protect you against risks like these by making sure all your day to day transactions are accurate and we make sure we’re up to date with the various taxes and changes so we can let you know if and when they affect you. Through the ICB (bookkeepers.org) AAT (aat.org) we get frequent training and webinars on all areas of accounting and tax.

A bookkeeper isn’t just someone who posts invoices in to a system and checks the bank, we’re so much more than that and our remit doesn’t start and end at bookkeeping. We look after everything from company start ups, monthly management accounts, cashflow forecasts, VAT, Payroll, CIS, Annual Accounts and Tax Returns for self employed and limited companies.

So now maybe you could ask yourself why do I need an accountant? You may find that you get far more from a bookkeeper.

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