I am looking to start my own book keeping business part-time. I currently work full time as a Finance Assistant and have worked in various roles since I was 18 (27 now). In my roles over the years I have covered purchase ledger, sales ledger, credit control, management accounts, VAT returns, Intrastats etc. I also have the AAT Level 3 qualification (achieved in 2006).
I would like some advice on if I am suitably qualified to start out on my own or if I should look at doing another course (ICB maybe)?
Whilst I have a lot of experience and knowledge, I expect that the transition from employment to starting out on my own is not that straightforward and would appreciate any advice from anyone who trod a similar path.
I am currently only in the initial thought stage so still have a lot of market research to do and planning but it would be great to have some feedback.
It is really hard to go straight from a full time job to self-employed full time - finding enough clients when you first start out self-employed to work full time is nearly impossible. Personally I think the best way is to stay employed part-time until you have enough work to do it on your own full time.
I did the ICB exams instead of the AAT as the ICB is more for self-employed bookkeepers. Through the ICB you can also get your practice licence and professional indemnity insurance etc.
The ICB exams are much cheaper than AAT and if you have already done AAT 3 then you'll probably fly through them.
Do you have any experience in filing Self-Assessment Tax Returns? I don't know about other bookkeepers but tax returns is at least 50% of my work (and the bookkeeping that goes with it) the ICB have an exam (and maybe a course with a training provider) for a Diploma in Self-Assessment which is worth doing if you are looking to file tax returns.
Getting the work can take a long time, I did it along side my full time job for years until I decided to just go on my own and do it. Once you have a few clients they tell everyone about you and get most of your work from recommendations. I think the big difference for me was getting a website, my work load has tripled since having a website and it wasn't that expensive to do, I wrote it all myself and a web designer I knew built and designed it for me. I think I pay less than £100 a year for domain, hosting and email package.
Flyers to all the businesses around where I live has also brought in a quite a few clients - that's all the regular work.
I hope this helps Rachel
Just wanted to add something - I've started the AAT 3 now (and need to do level 4 afterwards) as I am finding everything learnt from the ICB exams isn't covering everything I feel like I need to know. You pick most things up as you are going along and can find out a lot from this forum and the HMRC website but sometimes it gets a bit scary when your not 100% sure of the correct way to do things. The AAT goes into much more detail than ICB.
-- Edited by rachel_mclean on Tuesday 17th of March 2015 08:34:33 PM
From your comments I think I would definitely benefit from completing the ICB qualification which I may do alongside trying to get some work in the mean time. The plan was always to do this part-time to begin with as I could not afford to leave my job. I don't have experience completing self assessment tax returns which is something I will look into as well.
Do you think it would be best to complete all these before starting to look for work or try and find work alongside?
I am quite lucky in that I have a graphic designer and web designer in the family so I will have help with my branding/website.
It sounds like you have enough experience related to bookkeeping, to just start offering your services (staying away from accounts and tax for now). Indeed, you sound as though you have covered topics, many haven't. I say this, assuming you are not registered with anyone that would require you to get a licence? And of course you would need to adhere to any MLRO regs etc.
However, have you thought about asking your employer to put you through your final year of AAT? Personally, with the great start you have had, I would seriously be thinking about sticking employment out a few more years, getting that final stage qualification, in a setting where you can get the experience.. pushing to be an AAT MIP one day, perhaps?
I do have a lot of experience working within large accounts teams but the kind of client I would be looking for would be much smaller business' and start-ups. This was why my thought process led me to ICB which is more tailored to this type of work.
If I was to start offering my services would I need to provide accounting software for clients, or could I just keep records in excel? It would be useful to know what clients expect being new to this.
Unfortunately my employer is not able to fund my final stage of AAT however I could do this myself and it is something I will look into as it would make sense to complete the qualification having done up to level 3 albeit 7 years ago. At the moment I would just like to start part-time as I need the security of a full-time salary etc but want something to satisfy my entrepreneurial side!
I would recommend continuing with the AAT and getting that qualification rather than transferring to ICB. You have got through one stage and just push on to that final element. That way when you are marketing to clients you can say that you are appropriately qualified.
One thing that was mentioned in the budget yesterday was the penalties for professionals advising people on their tax affairs. Although this predominantly related to the riskier schemes I think it could be a step towards ensuring only suitably qualified people can do professional work. This has started with the HMRC register. Being qualified means you will have the backing of a governing body to support you.
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Phil Hendy, The Accountancy Mentor
Are you thinking of setting up your own practice or have you set up and need some help?
If so a mentor may be the way forward - feel free to get in touch and see how I can assist you.
I would also agree in that 'finish what you started' vein. You can easily get a couple of cheap books from Amazon to refresh yourself on the level 3 stuff before you start the next stage if you are feeling a bit rusty.
On the which software to use - you can use excel, but clients all have different needs - some already have software that you would need to use, others allow you to steer them to whatever is suitable. Every client is different. I use sage but Ive also had to upskill on Quick Books and given the expense of sage am now looking at alternatives (although finding the time to do this is proving somewhat difficult with the demands of clients)
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
I would agree with the previous comments about completing your AAT exams first.
I would recommend the Osborne text books for refreshing your existing knowledge.
In respect of completing your qualification, I have read on the AAT forum that you can buy the necessary text books for the exams you need to do, work through them, and then sit the exam at a local training provider such as BPP. You would have to buy the books and pay for the exam only (I think it was about £60 per exam). I mention this as a cheaper alternative to doing a fully tutored course which you may find more affordable. Search the AAT forum for further clarification.
Thank you all for your replies it is much appreciated.
I understand the AAT qualification has changed a lot since I completed my Level 3 (2006). In fact I have just checked out some of the books for Level 3 and none of them look familiar at all! I understand the structure has changed a lot as well so am I able to still take the Level 4? I'm going to take your advice Cheshire and try and pick up some books on the cheap to refresh my knowledge and understanding.
I have just completed the skillscheck on the AAT website and it is actually recommending I start at Level 2...you can imagine I am quite surprised at this! I guess I have become so used to using computerised accounts packages which eliminate most of the double entry for you.
Try doing the BPP AAT units 1-4 workbook (costs pennies from Amazon resellers). It will all come flooding back.
For a good reference book to get you up to speed try the Osborne book Business Accounts for bookkeeping and accountancy students by David Cox. It helps you back up to speed and its a great go to reference later on.
Pretty sure that you only get one go at the skillscheck which is a bit of a bum in your scenario where you just wanted to try it to see where you were before deciding whether to do it properly.
It gets a little heated as there are posters including myself with some quite entrenched positions in there but there's also a lot of info in there to get your teeth into.
Have fun and talk soon,
Shaun.
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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.
If you do find yourself on your way to completing AAT, have you thought about moving to an accountancy practice position? That would be invaluable experience in smaller bookkeeping, accounts and maybe even tax... that would get you through your AAT experience requirements when you apply for full membership (and MIP), and probably give you a lot of confidence? The world is your oyster hun.. make it work for you! :)
