Keeping on top of company finances is a challenging enough task at the best of times but as you approach end of financial year, the stresses and strains are magnified.
It’s something that finance teams throughout the UK will be experiencing as they push to get paperwork completed and accounts signed off.
Question: Why is this time of the year so stressful for finance teams?
The problem is that you have accountants having to oversee all of the usual day-to-day tasks required to manage an organisation’s accounts but on top of that they have a mass of retrospective reporting.
If not handled properly, it creates a spike of work activity that will expose any organisational weaknesses or inefficiencies processes that may work fine throughout the year are liable to start cracking under the strain.
Also you have to factor in the increasing pressure on accountants to work with forensic accuracy when reporting on their company’s performance. With fines and penalties for late and inaccurate documentation, people can’t afford to make mistakes.
When you mix these two elements together, you find yourself with a kind of “perfect storm” of pressure and stress.
Question: How can organisations tackle the problem?
Unfortunately, there’s no quick fix and the most effective approach is always going to be having a long-term strategy. While the focus tends to be on the end of the financial year, what’s more important is really what’s done at the start.
It’s planning ahead and creating a structure, setting out all of the important HMRC deadlines and milestones that need to be hit, with internal deadlines to match. You should have a checklist for the end of financial year which identifies each measure needed to ensure smooth reporting.
You also need to be reviewing the current systems you have in place. Are there manual and paper processes that can be automated to reduce workload Moving to digital processes not only reduces the time a finance team spends on admin, it also provides the data required for the tax authorities.
Question: How important is technology?
It’s absolutely essential for companies to incorporate technology into their financial processes. Without the right digital tools, you simply can’t operate effectively in today’s financial climate.
It’s the difference between spending hours manually collating information and having all of that data instantly available at the click of a button. It gives you the ability to access and manage information in ways that haven?t previously been possible.
And this becomes particularly invaluable as the end of a financial year approaches, allowing your team to quickly and efficiently access expenses data, up-to-date financial statements and details of transactions needed for VAT reconciliation.
When these systems are setup properly, there’s virtually no need for the information generated to be adapted or edited by finance professionals, it provides an organisation with a bespoke set of data for tax and external compliance purposes.
Question: What general advice would you give
To be prepared; to make sure you have the right systems and tools in place and that you’re making best use of the expert knowledge that’s out there. The tax system can be confusing and intimidating but there’s no point struggling along and hoping for the best.
If there’s any kind of confusion when it comes to compiling tax returns, it needs to be addressed. One particular valuable resource that I’d recommend for accountants are the webinars held throughout the year by HMRC.
These allow questions to be asked and advice to be given that’s relevant to your company’s particular setup and structure. It’s the kind of vital information and guidance that can prevent costly mistakes being made.
The other area of support to focus on is with the more technical side of things. If there’s any kind of technical issue, particularly as a deadline approaches, you need to have a software provider that can handle those problems – quickly and efficiently.
Bernard Crumlish is finance manager at webexpenses, which provides businesses with a smarter way to manage and monitor employee expenses.