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FREE Accounting Top Tips

This page is a free resources page which I hope you will find helpful. New tips will be added regularly, so please visit again to check on my latest accounting tips.



Tip 1: Accurate Tax Calculation

The tax man has new powers to fine people/businesses that try to reduce their tax incorrectly. The fines could be as high as 100% of the error. This will not affect most of you because you prepare your accounts properly. The areas that I could see where a number of businesses could get caught out are :-

  1. Including personal costs as business
  2. Getting stock valuations wildly wrong
  3. Not keeping proper books of account

I will try to catch any errors before the tax returns are submitted, but I recommend that you to make every effort to make sure that you do not put through and items that are personal.


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Tip 2 : Prepare a Budget

This is a list of 12 benefits which can be achieved by preparing a budget:

  1. Makes the business owner take time to review the business and plan for the future
  2. Enables Management to evaluate different options for marketing, purchasing and processes
  3. Costs are reviewed and may highlight areas for savings
  4. Gives owners comfort that required earnings are likely to be achieved. If not, it helps highlighting actions to be taken
  5. Helps set targets and bonus or incentive awards
  6. Helps set Key Performance Indicators
  7. Improves Cash availability
  8. Resource Planning:
    • Stock
    • Employees
    • Fixed Assets
  9. Enables better working with suppliers (partnerships)
  10. Helps you to talk to financiers before problems occurgiving time to choose the best finance available
  11. Enables you to see the improvement/deterioration of the business
  12. Improve interest costs/income

These are 5 very good benefits that can be achieved if you compare your actual results to your budget regularly (monthly or quarterly):

  1. Comparing sales to budget enables you to plan action that needs to be taken because sales are higher or lower than expected
  2. The longer it takes to realise that you are being hit by unnecessary costs, the higher these costs become
  3. It enables you to get comfort that the budget is being achieved
  4. It enables you and your Employees to give yourselves a pat on the back when the budget is achieved (motivation)
  5. When the business delegates to its management, it is essential that the business owner keeps management focused on the Key Performance Indicators

Achieving these can be very helpful to you and/or your business. The more time and effort that is put into the process, the more you will achieve.

Contact Nigel Barber if you want to discuss further how these benefits can be achieved.


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ACCOUNTING TOP TIPS

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