Just looking for some feedback as I am considering training to become a bookkeeper.
I have a degree in Accountancy & Economics (1990) and a post-graduate diploma in HR Management (1992). I then had a successful career covering roles in business analysis, project management, internal audit management and risk management, working mainly in financial services including Ernst & Young, spanning around 15 years. I enjoyed the actual 'mechanics' of my job but I found the big company politics tiresome and I had a career change into the health profession. I have a degree in Podiatry (2009) and set up and run my own successful Podiatry practice, from scratch. Much as I enjoy my role, I am aware it is physically demanding and in order to manage this risk I am looking to develop another string to my bow. There is no doubt I miss certain elements of my business career and I really enjoy doing my books and looking after the business-side of my practice. I am thinking I could develop this skill and build a bookkeeping business.
I would so appreciate views from those who are already in the bookkeeping profession. Would this be a wise career move? What qualification should I do? I am 45 and feel I have lots of knowledge and skills I could share in this role - especially as I have set up a business from scratch. I know how hard it is!
Well, it seems as though you've got the right background to get your foot in the door (lol, see what I did there. Podiatry, foot in the door... tut, I'm wasted here).
Your history sounds as though you should be pursuing accountancy rather than bookkeeping but, attempting to answer the question asked... Or at least meander around the subject a bit...
For starters the bookkeeping could be considered complimentary to your business and then grow the bookkeeping side organically from there. (I note that you already do your own bookkeeping, what software do you use?).
Financial accounting has changed quite a lot int he last 25 years but bookkeeping and management accounting remain pretty much the same so a large chunk of this will be like remembering how to ride a bike.
Whether its a good idea depends on whether there is a local market for your services. Some areas such as Staffordshire and the West Midlands seem to be pretty flooded with bookkeepers where area down south and north of the border seem more accomodating to new practices.
Do a bit of investigation as to who your competition will be before parting with too much money.
To get you back into the swing of things try starting out by reading Business Accounts by David Cox. A very good book that I still find myself refering back to occassionally.
You don't need to be qualified to work as a bookkeeper but you may find it advantagous.
For someone coming fresh to this field I would always advise qualification but for someone just revising the subject after a long hiatus it's less black and white.
The other advantage of a professional body is networking opportunities.
There are really three bookkeeping qualifications. The first two are ICB and IAB.
The younger of those two, the ICB was started in the mid 90's by an ex IAB manager. It has grown from nothing to very much dominate the market over the last few years.
The IAB seemed to have been caught sleeping by the ICB and only really this year seems to be starting to fight back.
ICB seems to have a membership who feel that they belong to an organisation that is moving the profession forwards.
IAB seem to regard themselves above the spin shenanigans of acquiring market share. Their meetings are shared with the IFA so very much bookkeepers and accountants rather than just bookkeepers.
The third body is the AAT which some see as bookkeeping and others as accountancy. Whatever the truth of matters its the only one of the three where employment rather than only self employment is a serious option.
However, reading your post you are not interested in employment, only in starting a business.
Both ICB and IAB have plus points for someone starting up their own bookkeeping business and it really comes down to which of the two you feel the best about being a part of.
Unfortunately it's not a question thats got a single definitive answer as there are too many variables involved.
Before investing a lot of money in this read that book and through lots of old posts on this site to ensure that you know what you are going to be getting into. Give serious consideration to the three bodies that I mention to determin which best fits your needs.
Good luck with your new venture,
Kind regards,
Shaun.
p.s. If you do set up a practice remember that you must have MLR cover either directly from HMRC or from your professional body.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Thank you very much for such a comprehensive reply - you have given me lots to think about and research. And you made a joke about feet :)
You mentioned I should maybe pursue accountancy rather than bookkeeping. I would like to remain self-employed and realise there are a lot of accountants out there who are also doing bookkeeping, so difficult to compete with them without having a similar level of qualification. I have my initial degree and lots of industry experience - what qualification would I have to do to become/call myself an accountant? I'm aware I've spent a lot of years studying already so wouldn't be too keen to get into something onerous. But very interested to know what my options would be and would obviously like the best qualification I can get. Could I start with a bookkeeping qualification e.g. with ICB (which incidentally had already caught my eye) to get me going and then build upon this to become an accountant, or is a case of choosing one or the other right from the start?
I am based north of the border and could cover Edinburgh and/or around Perth. And yes, I would be looking to build up the bookkeeping so that I don't have a reliance SOLEly (get it?) on Podiatry. I would see bookkeeping as something I could maybe do leading up to retirement if I am finding the physical rigours of Podiatry too much.
You asked what package I use for my own accounts. Nothing fancy, just excel, been doing everything on a SHOEstring - haha - you'll be sorry you made that joke!
I'm part qualified CIMA. In the previous incarnation of my business I was effectively the management accountant for several companies that were far too small to employ one. I was also a Sage dealer, and sold a few computers. I supplied my clients with Sage, and computers if they needed them, trained their staff to do the book-keeping, and did all the clever stuff, apart from the annual accounts. I was more competent at this job than most qualified accountants were, and cheaper, but it was much better paid than book-keeping. The book-keeping I did was the interesting sorting out carrier bags and shoe boxes stuff, that would probably have flummoxed quite a few book-keepers! It did me at times!
I did this for around 15 years until 10 years ago, and it's not what I'm planning to do now, although it would be rather nice if it worked out that way. Except for selling Sage that's now a ripoff, and selling computers that's now more trouble than it's worth!
Maybe you could find a niche where your skills could be used to help smaller businesses. Book-keeping may be the foot in the door (sorry ) to get started, while you see what opportunities come up. I didn't start my business with a plan to do what I ended up doing!
-- Edited by EPF_Solutions on Sunday 8th of June 2014 07:21:11 PM
Thank you John for sharing your experience. I like the idea of helping small businesses - I know what it's like to be 'doing absolutely everything' when you're building/running a small business - the last thing you have the energy for in your spare time is the accounts! Feeling enthused - thank you :) My accountancy degree and industry experience really didn't arm me with the knowledge of how to start with a carrier bag full of papers and turn them into a nice neat set of accounts. I now have personal practical experience of that!
I'm learning about ethical marketing at the moment. One of the things I'm studying is the idea of an Audience Business. The old way was to invent a product or service then go out looking for customers for it. The new way is to build an audience first, find out what they need, then provide it. The course I'm doing is teaching me how to do this for the social enterprise I'm working on. I've been trying to do it for some years without realising it, and getting it wrong! This isn't the accounts business, but I've got this in mind now I'm restarting it, so am keeping an open mind on where it goes.
Another idea I've picked up is turning a service into a product, that I think fits in with this. The idea is that as you identify services that a number of clients need, you set it up as a system that can be run efficiently and easily repeated. I suppose rather like fixed pricing, but going further than that. I developed some pretty automated systems when I was doing management accounts, that allowed me to charge affordable prices, but earn a high hourly rate for some of my work (although I wasn't smart enough to get back all the time I put into writing the software!).
Someone's telling you porkies John if they're telling you thats a new idea (#1).
Give your tutor a nightmare and tell them to go and Google Ansoff
Focus group based product design has been around for a long (long, long) time.
I think that the only time that "Build it and they will come" philosophy worked well was in the film field of dreams.
The issue with building an audience for a product though has to be finding an audience with the intention of buying the product and how do you get them interested unless there's a product in the first place (I would go on here about chicken and egg but I've now seen on QI that the egg came before the chicken (#2) so thats ruined that one).
The idea of I'm going to build something, I don't know what it is but when it exists you'll really want it so you need to be involved now doesn't seem like an idea thats going to fly in the real world.
Your idea of automating processes on the other hand to reduce cost whilst again not new is a sound idea. I've developed some nifty excel macro's in my time that at the click of a button do work previously taking a couple of people a few days in seconds.
Automating aged debtor reporting actually ended up with one client clearing 65% of their backlog in the first month after implementation.
Unfortunately clients never believe the savings that they are going to be able to make up front so trying to base pricing on that's a non starter.
From the opposit end of things, pricing based on what the client has saved rather than you saying what they will save would be contingent pricing (pricing based on an outcome) which is ethically frowned upon and is banned by some bodies in advertising services and all bodies for audit but thats basically the way that I think that your second suggestion would need to go.
When you say that you are learning about ethical marketing I'm assuming that isn't the same sort of ethics that I talk about in relation to marketing professional services? (As defined in section 250 of the IFAC code of ethics for financial professionals).
Happy to have my perceptions changed and genuinely open to new ideas... Although, the more that I read the more that I think that there are no new ideas, just people standing on the shoulders of true greats such as Porter, Ansoff and Harmon.
That was fun,
talk in a bit,
Shaun.
#1 don't feel alone in that, just read Johnson Scholes and whittingtons book on corporate strategy and tell me that they're not repackaged ideas from the true greats such as Porter.
#2 All birds are descended from dinosaurs (Sorry to disappoint any creationists reading this in the mid west of America).
Therefore dinosaurs existed before Chickens
Dinosaurs laid eggs
therefor eggs came before chickens.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I was doing some of this stuff 25 years ago, so it's not a new idea to me. What I've only come across recently is people explaining how to do it properly!
We've been through some of this before Shaun. You didn't like the look of the 7 Graces of Marketing web site, so decided the whole ethical marketing thing was a bad idea!
But I did like the other website that you posted so that arguement doesn't hold up.
If you were doing this stuff 25 years ago then that in itself says thats its not a new idea and I was only responding to the post made above.
lil ol cynical me has decided that there are no new ideas only old idea's in new packaging.
Doesn't matter if one is selling tree hugging conventions or Kalashnikov's, marketing is marketing and their's no difference between selling one over selling the other.
You have something to sell, you are looking to convince someone to buy it, simples (#1). Everything else is just fluff.
I'm not surprised that its only now that you are finding people able to teach the old ideas as there are many more people now who are first or second generation American taught marketing guru's who regard marketing as an art form.
Basically the idea's have not changed in a generation but the professionalism of their marketing has.
Shaun.
#1 of course it's easier to convince other people to buy anything that you want them to if you purchase the Kalashnikov first.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Don't get left flat footed, there's no point just dipping a toe in, so jump in now, but make sure you 'toe' the line otherwise you'll end up having to foot the bill.
That is possibly some of the best advice I have ever given here!
And in the process stopped me from ending up putting my foot in my mouth over marketing.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Well, at least now we're making steps in the right direction.
I really need to give all these negative vibes the boot don't I.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Getting back to the point, can anyone answer my question about whether I would be better served becoming qualified as an accountant rather than a bookkeeper and what this would entail?
Accountancy qualifications start at AAT although its a bit of a hybrid qualification which may be considered on either the bookkeeping or accountancy sides of the fence.
Maybe the nbest way to consider it would be that MAAT is an accountant and anything lower than that is a bookkeeper.
Getting qualified takes about two years. It can be distance learned but you need a training provider. The common choices for which on here are Premier Traing and Eagle Education.
There are a couple of serious contender accounting qualifications which fall between AAT and the big boys. Many people who practice through them actually qualified through different bodies but found gaining practice certificates near impossible. Those are IFA and AIA (Institute of Financial Accountants and Association of International Accountants).
Then you get onto the serious qualifications.
ACCA (Association of Chartered Certified Accountants) doesn't need a training provider. There's plenty of available study materials including free lectures from Opentuition. Qualification will take around five years and all of your social life. The thing to be careful of with ACCA though is that regulation 8 prevents you from offering services beyond bookkeeping and payroll on a freelance basis unless suitably supervised by a qualified accountant. (And bookkeeping stops at trail balance).
Note that what constitutes being a qualified accountant varies from one body to another but all seem to agree that qualified members of the CFAB bodies plus CIMA are qualified accountants.
Which brings us to CIMA. Similar to ACCA but with a smaller (not to be confused with easier) syllabus and more emphasis on management accounting. The real advantage of CIMA is that there is more flexibility as to what you are allowed to do pre qualification. Again, it can be self taught.
ACA is top of the tree and you will need a training contract in order to qualify... For anyone who'se not in their twenties straight from Uni you can find training contracts under the dictionary definition of unicorn poop.
Note that when I talk about ACA its a term referring to the three chartered institutes (ICAEW, ICAS and ICAI).
There are also tax specialisations such as ATT although I would regard that more as an add on rather than a stand alone qualification.
As for whether you would be better served by being an accountant... Personally I do not think that you would be satisfied with anything less although maybe your chosen route could be via a bookkeeping qualification such as IAB leading possibly to IFA? Or simply go AAT and stick at it eventually practicing as an MAAT MIP.
If you lop my head off I've got ACCA running through me like a stick of blackppol rock but its not a qualification for everyone as shown by the high drop out rates so if your attention is drawn to that one do a lot of research before venturing down that path.
HTH,
Shaun.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
) to get started, while you see what opportunities come up. I didn't start my business with a plan to do what I ended up doing!
