Agree about not deleting, some of the best discussions have been when matters have gone completely off the original thread.
The are the occasional insults on here, but thankfully we aren't as bad as Aweb Johnny. (Now I'm having to do a double take to make sure I spell Johnny right, lol)
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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
What I find quite interesting about Bank feeds is that it seems to be talked about as a relatively new phenomenon, whereas I know that it's being going on at least since 1994 with some software, as when I worked in Corporate it was one of the selling points of using a specific business related online banking platform (and even without needing to be large enough to combine it with the old proper Bacs and Direct Debit facilities) that it's old fully integrate with the accounting software.
But my client who uses the cloudy stuff is now refusing to use the bank feeds as they 'messed it up' ......she is, by the way, an ex Accountant so is not green behind the gills.
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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
Is the reason for the payments directly from you, as an oppose from the client to the cloud provider so as that you are able to apply a mark up, along with claiming some form of commission? That isn't a loaded question, after all, business is business. Reason why we pay is as Xero partners we get access to the non-VAT and VAT cashbook packages at £5 and £9 per month that the client as a member of the general public doesnt get access too. For a lot of clients this is all they need. We just recharge the client whatever the standard cost of the package is. We do get a discount overall depending on the number of licences but we dont pass that on to anyone as would be difficult to work out how to split and wouldnt be worth the effort.
The clients whom get involved themselves with the cloud - were they as involved / organised before you implemented them to the cloud system? Some were some werent. Although Xero is our preferred cloud package we have clients using other cloud packages. At the end of the day we can work with anything as it is simply a nominal, sales and purchase ledger at the end of the day however you package it.
In regards to point three, when you decided to partner with a cloud provider was there ample training provided for yourself? Videos / conferences? If so, are these at a cost or free? Watched the webinars and did the accredited training. I think there was a charge for the accredited training but think from memory just said to Xero "look I will get you clients so why do you want to charge me to teach me how to use it so they waived it". Kashflow charges for online training webinars but I said had about 70 clients on Xero and we could move a lot onto Kashflow but would need to know how it worked first and wasnt willing to pay for that training. So they passed on the free discount code to use the webinar.
Mark from seeing some of your posts on various other threads it has to be said that your business must be one of the largest, if not the largest on this forum. Your obviously not afraid to embrace change. You seemingly have seen the positive effect to the cloud, of course i'm not saying your success is down to a particular software platform, yet I see a lot of opportunity in the way you have set your business to be in harmony with the cloud. I would hazard a guess at saying the bulk of your fees are earned through tax work?? For those working in tax, the cloud must be a god send? Unlike others on here we are a firm of chartered accountants and are not primarily bookkeepers so most of our fee income comes from year end accounts and tax work. Though saying that had a call from a potential client today looking for 1/2 day bookkeeping support a week. Not really the kind of work I am interested in doing so will probably quote them £600 + VAT per month and if they dont go with it then wont lose any sleep. Key point is you always have to innovate and look to supply clients what they need. On this basis looking to sign up with AVN and use their tools to provide proactive services to clients to help them grow their business. This would earn us serious money, enable cross selling services and lets us sell other things such as advanced tax planning which although we dont actually do the work we earn a fee indirectly which could be anything between £2k - £5k per referral.
One of the main points which caught my eye was - Please do note that bank feeds are not available for all banks.
Not a big issue. We just import bank download monthly if the bank feed isnt possible. Key point is that it saves us typing all the bank transactions into the software. Probably takes a five minutes to import the download rather than 0 minutes if the bank feed is set up compared to say an hour or more if had to manually type in.
I appreciate that the posters here hold two quite diametrically opposed views of the cloud and it's excellent that we are able to hold a constructive discussion here using logical well constructed arguements for and against the cloud.
I have no objection to slippage and off piest sub discussions within the thread but I feel for this subject I cannot allow the thread to be hijacked by someone who appears to have an alternate agenda.
Any posts here that go in a similarly confrontational direction by that poster or any other will be hived off to the alternate thread.
kindest regards,
Shaun.
-- Edited by Shamus on Saturday 20th of February 2016 12:26:06 PM
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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.
It has to be said Mark, you've certainly added the positive side to the software. If your role was as a bookkeeper, in the purest sense of the word, would you still use the software? Mark, could it be said, that for the larger practices as yours clearly is, is the cloud not akin to accountants subbing out work to bookkeepers, yet in turn cutting out the middle man? The cloud then becoming your bookkeeper? Obviously by way of competent clients, leaving just monthly / year end adjustments for yourselves to complete?
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
It has to be said Mark, you've certainly added the positive side to the software. If your role was as a bookkeeper, in the purest sense of the word, would you still use the software? Mark, could it be said, that for the larger practices as yours clearly is, is the cloud not akin to accountants subbing out work to bookkeepers, yet in turn cutting out the middle man? The cloud then becoming your bookkeeper? Obviously by way of competent clients, leaving just monthly / year end adjustments for yourselves to complete?
Couldnt comment re the bookkeeper side as never been a pure bookkeeper. But from an accountant viewpoint cloud software certainly streamlines the bookkeeping function. At the end of the day I dont want to be processing sales invoices, purchase invoices and bank transactions.
You will always need an accountant/bookkeeper to input the transactions into cloud software and reconcile the same as you have always had with for example SAGE. Just that nowadays with bank feeds and add on partners such as receipt bank a lot of the bookkeeping work has now been made redundant.
I personally prefer the desktop software, my bookkeepers understand Sage and I am happy that things are posted correctly. The main benefit of cloud accounting appeared to be the automatic bank reconciliation but I kept thinking it takes very little time to reconcile the bank in Sage and we have control. Nowadays I am seeing that the natural wastage of older clients is not being replaced so quickly with similar more traditional type of bookkeeping clients. Whether we like it or not (and I don't particularly) the likes of Xero are here to stay and we have to move with the times. I think Shaun joked about the kids who feel they can run their business from their mobile, but actually that is very perceptive, albeit they may not think they can run their business this way but they certainly expect their advisors to be able to understand this software and to respond quickly. We have to move with the times if we are to thrive. I outsource virtually all my bookkeeping to a couple of self employed bookkeepers and accountants, typically around 40 to 50 hours plus per week but this has started to diminish. Some is due to more 'contractor' type clients coming on board on FRS for VAT but also because of the cloud. I've had to seek out a cloud bookkeeper now and one interesting thing to note is that my normal payment of £15 per hour doesn't cut it, these guys are charging £20 to £25 take it or leave it. Upshot of this is my main bookkeeper is going to bite the bullet and become proficient on Xero and my apprentice is very keen to learn.
Now is a good time to be entering the profession I think. No need to unlearn the majority of what is just about considered the norm today. New tax changes, the way it will be reported. New FRS's. Cloud software. The sentiment is so true in regards to a mobile now, there is an app for almost everything. Kids who are not particularly into tech are still extremely tech savvy now. Times change, technology doesn't stand still. Having opened the thread, I have gauged opinions from both sides, I think I have the opinion that the cloud is clearly the way forward. Just as desktop software was to paper ledgers. Time will only tell how things will play out. Security issues I'm sure will always be at the forefront of people's mind, along with random increases in price nearer the time of HMRCs digital switch over. Having read Marks replies I believe it fair to be said that a great business model can/could be achieved. Obviously other things considered. I believe to not embrace the cloud could potentially alienate the future majority of would be users. Just my opinion.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
I happen to agree with you Johnny, and will adapt when necessary, eg if someone wanted me to do their bookkeeping on the cloud, I wouldn't turn it away, but it's nice to know I can charge extra for it (Cheers Rob for that insight!)
Rob, why are you potentially being charged more if you contract out cloud bookkeeping, do you think?
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
We've had a debate about cloud software and whilst any software is a good idea to learn how to use I do not see the proposed changes in the same way as Johnny and I do not expect needing to use cloud based solutions as ever being an essential part of anything.
<snip>
Its an interesting debate but I certainly wouldn't give up your desktop version of Sage as that (like VT Transaction+) is going nowhere... Unfortunately Intuit seem to have drank the cloudy coolaid so cannot say the same for them... Sure that they'll be back as their market share dwindles.
I'm not sure you know. In this discussion I did peruse that any software would need to link up to the DTA, and you didn't think it would. I really hoped that to be true, but I saw this on aweb the other day http://www.accountingweb.co.uk/article/digital-accounting-records-be-compulsory/597922 Further info is due after the budget (April more likely) and I'm following this with keen interest.
If it turns out the software must be able to link up to the dta where does that leave VT? I'm guessing they would adapt somehow.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
hoping its not true and the route that is taken is more akin to how we handle VAT but if it is VT was very quick to come up with an industry leading iXBRL solution when that became a necessary part of our work.
When I've fought off my current email issues I may try and make contact with VT to see if I can get a comment from the horses mouth about this.
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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.
I'd like to know, with quarterly reporting - what happens with balancing payments? CGT - how can you plan how much to use from the pool if you've already sent 3 payments? The end of shoe box returns I imagine. You can't deny it will create a higher bill for the client. Not everyone has stable Internet.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
Thanks Shaun, hope you get your email problems sorted soon. I have confidence they will come up with something if that's the way the Govt intends.
This is the stupid thing about it Johnny. All we have at the moment is a mandate from HMRC that people will need to keep digital records with effect from 2018, 19 or 20 dependent on which group you are.
We now know that the Government propose that we have to use software that connects with the digital tax account. And that's it!! We don't know whether it will be submitting figures straight from the accounts without any "year end tidying" and then a final year end with all the correct allocations in place, or whether businesses will be assessed for tax just on the quarterly accounts, with no allowance for adjustments. I suspect that the encouragement will be for businesses to submit their own quarterly accounts, and that cloud software will be pushed as the holy grail, and that a big play will be made of how easy it will be. I also predict that no encouragement will be made to engage a bookkeeper or accountant and people will be fed the idea that a quarterly submission will be all thats needed. I think that adustments at year end will be allowed, but not encouraged.
I think the danger for HMRC will be that whilst people will be enthused to do away with us, thus adding more tax to the coffers (the cynic in me suggest this is the real reason behind all this) the penalties for getting it wrong will be such that people will then come running back to us to correct their mistakes.
For something that starts in about two years I'm pretty gobsmacked at the lack of information from HMRC. When asked questions about it the stock answer seems to be "we don't know yet"
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
At the rate of how HMRC work I'm expecting it to take at least 5 years! Why not start this scheme on a voluntary basis first? Supposedly record keeping on excel and paper will be no longer allowed. I can see what they want to do, I can see how the first 3 payments will work - then there is the 4th, together with, as we say, adjustments. What happens with the excess HMRC workers? More inspectors?
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
If I use receipt bank with xero - client takes a photo of every invoice with a smart phone - uploads to the cloud - do I ever need to see source documents, in the flesh again? If I do, what's the point in the above, if I don't what's the point in a client using me? If everything, ok, mostly everything is automated, then - you see where I'm going?
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
You do not need to see the original documents but you need to file them away for your defence.
Clients should also copy both sides of the invoice, not just the front.
If the client is investigated you need the original documents so ensure that your client destroys nothing.
As for why do clients need you...
A tightrope walker can still walk a tightrope without a safety net... He would just be bloody stupid to try it.
Now add to that equation that the tightrope walker is not trained as a tightrope walker...
They need us. They may just have a crazy two minutes when they believe that they don't.
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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.
Hi Shaun. At the minute, it goes like this - collect paperwork, scan, input, return. So in the future, I assume! I, we, us, are able to download all the photographs the client has taken?? Taking away the need to actually collect paperwork, scan and save in a file? All should be automated? It is then upto the bookkeeper / accountant to locate the correct accounts? Thanks
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
I wonder how many actually take a copy of the back - next to none I would hazard a guess at! I dont scan and return docs to clients - I keep, input, pass to accountant and they keep them or I get them back and pass the whole file on. I am stuck with a few - one which went out of business and I have no idea where the guy did a runner to! The other is my footyman and I have allsorts of bits not even accountancy related. Must have a clear out back to him, although that might mean he dumps them in the bin, so maybe safer with me! Might have to start charging rent!
If you allocate good referencing to the docs as you scan them that integrate with the info you input to the Accounts then finding said docs will be a doddle.
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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
(Cheers Rob for that insight!)
