I recall in my youth accumulating thousands of vinyl records. The addition of a wife and family meant space became a premium. Eventually, I “bowed to pressure” and got rid of the bulk of my collection. Thankfully though, I can now access my entire collection digitally through cloud streaming sites like Napster or Spotify.
Over the years as an accountant, I have seen some bookkeepers who view their accounting records like I used to view vinyl, looking at rows of filing cabinets containing files of invoices, bank statements and reports with nostalgia – a life’s work.
Lack of space forced me to get rid of my vinyl collection but other pressures will soon force businesses to go digital. For example, HMRC’s Making Tax Digital for Business (“MTDfB”) programme, although recently delayed for some, will eventually force businesses to implement digital record keeping and online quarterly reporting to HMRC. VAT registered businesses however with a turnover exceeding the VAT threshold (currently £85,000) will be obliged to maintain digital records and provide quarterly updates to HMRC from April 2019, with the smallest businesses being able to choose when to move onto a digital system.
Those resistant to change might see the delay in introducing MTDfB for some businesses as a good thing but shouldn’t we all be thinking about the benefits of digitising our businesses anyway?
Like Napster or Spotify, the benefits of digitising your bookkeeping via cloud based bookkeeping software for example are enormous: access to paperless information in real time from anywhere allowing better decision making and collaboration with your business advisors, automated processing of bank transactions and invoices freeing up hours of time per week, easier invoicing allowing you to get paid quicker, being able to sleep at night knowing your financial data is always secure and backed up automatically, maintenance free upgrades and no capital outlays for software are just a few of the benefits of introducing a cloud bookkeeping system. Not only will a cloud based bookkeeping system provide all these benefits but it will also allow you to meet your MTDfB obligations to HMRC when they eventually fall due.
We’ve already seen how payroll data reporting has gone digital with Payroll RTI reporting but what about digitising your timesheet and expenses data, digitising sales through Electronic Point of Sale systems which not only capture sales but also automatically update your bookkeeping software and send automated receipts to customers.
What else could you be digitising in your business? Digital is the future. As a one-time vinyl junkie I never thought I’d hear myself say that!
For more information contact Steve Mitchell, Partner (firstname.lastname@example.org) or your usual AAB Contact.