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How to Reduce Your Debt

According to an announcement from the National Audit Office, over 8 million people in the UK are currently struggling to pay their debts or meet their monthly household costs. Most homes are spending a substantial amount more than they are actually earning, with an extraordinary 8.1% more spending on credit cards within a year. It is crucial that people start to recognise the difference between essential and non-essential expenditure and borrowing in order to make significant changes towards lowering their total amount of debt. 

It is essential to realise that not all debt is the outcome of poor management; the amount of people requesting debt advice has increased in the past few years. TUC, general secretary, Francis O’Grady stated that: 

‘Years of austerity and wage stagnation has pushed millions of families deep into the red.’ 

Meaning that economic policies have increased taxes and decreased funding towards social services and a lack of wage growth. Following this, education costs are incredibly high; the average graduate from a three-year degree carries a whopping £50,000 worth of debt around with them. This does not even account for the exorbitant interest rates that go along with it. 

Diminishing credit card debt 

It is no secret that many families rely on credit cards to get by. It may seem impossible, but there are ways to reduce total debt. There are a variety of applications out there that offer users the opportunity to categorise and cut down on their spending, for example, Money Dashboard or Emma. They help reduce credit card debt by obtaining a repayment plan specifically targeting high-interest spending and comparing interest rates. Most banks offer refined programmes that identify fraudulent purchasing patterns; however, the purchase amount is often not large enough to alert the cardholder. Therefore, users must keep a close eye on establishing transactions made by fraudulent means. 

Debt management plans

Debt management plans can help guide people back onto the right track. They enable monthly payments to be made to the provider who communicates with creditors to negotiate supportive stipulations. A debt management plan is useful for those who have non-priority debts such as personal loans. Additional options include debt relief order suitable for those with low incomes, individual voluntary arrangements which often give several years in which the debt must be paid and bankruptcy which allows people relief from all debts. 

Those tackling finance problems should first try and cut down on unnecessary spending; however, if that does not solve any issues, financial planning may be mandatory in aiding those coping month to month.

All of the above solutions can be beneficial but should first be discussed with a financial advisor to ensure you are the right candidate for the plan picked out for you. 

6 Ways To Grow Your Business In 2021

Establishing and enforcing a strategy to grow a small business can be a difficult task; however, with some careful planning and a lot of research, a business plan can be a great way to create a better picture of what you would like to achieve and how you’ll achieve it.

In order to develop a small business while competing against the bigger players, you need to be able to think smarter and act quicker. This blog will provide a few tips to get you started! 

Get to know your consumers

By personalising your services and encouraging customers to leave feedback, you are more likely to gain their trust and obtain repeat custom. Furthermore, taking the time to understand your consumer’s needs and developing products that match those needs are bound to score you some big brownie points!

Give back

Giving back to your community boosts your company’s image. The more you help your community, the more likely they are to return the favour. 

Social media

Posting on social media platforms helps to connect with customers, showcase your products and show off the faces behind your brand. Moreover, it allows the provision of insight through social listening. This means you can keep track of what customers are saying about your business, observe customer behaviours and identify keywords and trends that will attract your target market. 

Offer fantastic customer service

Going the extra mile wherever possible is key to exceptional customer service. Your consumers will remember the service you provided and will, therefore be more likely to engage in repeat purchases. 

Remember: if your customers decide they are delighted with the level of service you provided, they are more likely to pass on the message through social media or even just word of mouth!

Host events

Presenting your own events can be a fantastic way to get to know your customers better and build relationships with current and future buyers. It is also a fantastic opportunity to show off what your company has to offer. Although hosting an event may seem like a lot of hard work and a time-consuming task, it’ll help you to stand out from your competitors and develop a deeper connection with your current customers. 

Measure and refine your approach as you go

Monitoring the whereabouts of your customers (in a digital sense) helps to measure whether or not your marketing activity has been successful. Make use of the abundance of tools available to track your digital activity (such as Google Analytics) and be sure to evaluate and update your marketing methods by focusing on what’s working and ditching what’s not.

If you are already the owner of a successful business and need any assistance with your accounting needs, don’t hesitate to contact me! I’ll gladly do my best to help.

A Brief History Of Louth

If you are not acquainted nor familiar with Louth, this blog post will give you an insight into the town and its history. Louth is a large market as well as an industrial town situated in East Lindsey, Lincolnshire. It is located very rurally in the East of Lincolnshire and contains attractions such as St James’ Church, Hubbard’s Hills, the market, many independent retailers, as well as the last remaining cattle market in Lincolnshire.

Louth started off as a Saxon village. Its name originated from the Saxon word meaning ‘loud’ due to the loud gushing of the river. A monastery was built in Louth in the late 7th century. In the 9th century, the Danes took over Lincolnshire and subsequently destroyed Louth’s monastery. However, they gave Louth many of its street names.

In the 10th and 11th centuries, Louth became a small market town. Peasants from surrounding villages would use the market to buy and sell goods. Eventually, in the Middle Ages Louth had a population of around 1,500.

A Cistercian Abbey was built in 1139 at Louth Park. The parish church of St James was also an integral part of life for the people who lived there.

Henry VIII closed down Louth’s Abbey in 1536. The King sent a man to list valuables in the parish church which outraged the people of Louth. The man agreed to go and find out what the King intended to do with the valuables before proceeding.

This event sparked anger and men from Louth started a rebellion, marching towards Lincoln but were blocked by royal troops. As a result, the uprising broke down, and ringleaders were executed.

Louth prospered in the 16th and 17th centuries and its population grew, despite plague outbreaks. One outbreak in particular killed 700 people in Louth in 1631, which was a large chunk of the overall population.

A school was built in Louth in the 13th century, but the Grammar School was not established until 1551. The 18th century saw Louth grow even more and develop a carpet-making industry. A canal was eventually opened in 1770 to make trade easier of goods.

1801 saw a population of 4,250. This doubled 50 years later. 1825 saw a parliament act that cleaned the streets and a year later, the streets were gaslit, despite many Louth residents living in slums.

A dispensary was formed in 1803 for poor people to get free medicine and in 1873 Louth’s hospital was built. 1848 saw the railway reaching Louth which improved business from the canal method previously.

In the 1920s and 30s, the first council houses were established, and electricity lit up the town.

A War Memorial was established in 1922 in memory of those who fell in WW1. In WW2 15 people in Louth died from German bombings.

The population continued to grow in Louth from the 1920s onwards with around 17,000 people inhabiting the town now.

Please read my blog about some of the top reasons to want to live and work in Louth.

Accountants Face Exceptional Challenges For The End Of 2020 And Beyond

With the COVID-19 pandemic causing more uncertainty and disruption, this has led to an increase in challenges in auditing financial statements for accountants. Not only this, but extra difficulties have come to light with regards to Brexit and the transition period finishing on 31st December 2020. Not only this, but climate change has become another important topic of 2020 as well as COVID-19 and Brexit.

These three key issues are predicted to alter areas of financial statements. This is because investors will want to gain information that will clearly explain how directors of businesses have responded to their implications. Transparency will be vital for this to occur.

Directors will also be obliged to review every area of every financial statement, which will be subject to judgement and estimation uncertainty. Furthermore, forecasting will also play a vital part in conducting impairment as well as concern reviews. The uncertainty of all this could require help from other sources.

Soon auditors will have to demonstrate levels of professional scepticism. This increased uncertainty amongst financial professionals will mean that they will need to take an approach that involves seeking good-quality corroborative evidence as well as evidence derived from different sources.

Those preparing annual reports are urged to commence the planning early due to the challenges in the upcoming reporting season. There must be a focus on transparency and engagement across organisations to gather information with auditors. It is also important to think about the reporting deadlines and making their scope as flexible as possible because of the extraordinary challenges that will be occurring for auditors and preparers. These challenges will not only be affecting their professional lives, but COVID-19, Brexit and the climate crisis will affect the personal lives of auditors too.

The key lessons that we can learn in preparation for this are to be as organised and flexible as possible to meet these deadlines. Preparing for the worst financial scenarios due to the three key challenges will also be important in ensuring no more challenges will arise from the ones already established.

The Institute of Chartered Accountants in England and Wales (ICAEW) provides lots of relevant resources and will be able to develop these resources to the changes which are occurring at the end of 2020. They offer technical support with regards to the COVID-19 situation with information for auditors and preparers free of charge.

Take a look at my blog here to see how some UK accountants are voicing their concerns about their environmental worries.

Top Reasons to Live And Work in Louth

Louth is a stunning town situated in the East of Lincolnshire. Here are the top reasons why you should live and work here.

The Location 

Louth’s stunning location is second to none. It is situated in the heart of the Lincolnshire Wolds. The Lincolnshire Wolds is renowned for being an Area of Outstanding Natural Beauty. Its calming hills and deep valleys are striking against the coastal landscape of marshes and dunes.

Being East Lincolnshire, it is very near the coast so perfect for those summer beach days or winter walks next to the sea. The Wolds is sparsely populated, so pollution is at a minimum. Therefore, expect to see the sky and stars at night in all their glory! 

Without a doubt, Louth is the perfect location to work from home!

Louth Market

Louth is a traditional town and with that comes a quaint market which trades on Wednesdays, Fridays and Saturdays. Although with the pandemic, these days might vary or be cancelled so best to do your research if you wish to venture to the Louth Market. Once it is up and running, you can see what the market has to offer, from delicious food to pretty crafts; the market has it all!

The Beautiful Parks

There are some beautiful parks to visit, walk-in, have picnics in and socially distance in too! These are Hubbard’s Hills and West Gate Fields. Hubbard’s Hill was established in the early 1900s. It is beautiful in the summer where children can paddle in the river and families are seen catching crawfish with nets.

Westgate Fields has lawns surrounded by lime trees, oaks and ashes and has a beautiful view of St James’ Church poking over the tops of the trees. There are four leaf sculptures to visit, these are carved from oak and are owned by Louth Art Trail.

The Attractions (when they open!)

The attractions are limitless in Louth! There is much to see and do in this lovely town. All of which to be frequented when the lockdown is lifted once again! Louth has its own Golf Club, taking advantage of the hilly terrain and acres of grass.

Louth Museum opened in 1910 and was modernised in the early 2000s by the Heritage Lottery Fund’s money. It contains the largest collection of Victorian woodcarver Thomas Wallis paraphernalia in the country as well as other historical artefacts.

St James’ Church is a sight for sore eyes and worth a visit for its history and photogenic-nature. It was a gathering point for the Lincolnshire Rising in 1536. This was organised by Catholics to protest the Monasteries dissolution. There is a cafe and souvenir shop too.

When theatres re-open, Louth Riverhead Theatre is THE place to visit! It is owned and run by a small number of volunteers. There are touring productions, musicians, tribute bands, musicals, poetry recitals, evenings with television personalities and comedians who perform there.

Lincolnshire Wolds Railway is another great attraction of Louth. It runs for 1.5 miles between two stations, Ludborough and North Thoresby.

Playhouse Cinema is the only cinema for 15 miles and contains three screens. It was a former chapel and became a movie theatre in the 1920s. It shows the latest releases, classic films, independent ones as well as live recordings from the Royal Ballet and Royal Shakespeare Company.

If you need any help with the accounting of your business in Louth, don’t hesitate to get in contact with me.

Remote Working Continues For Accountants Seven Months Into The Pandemic

The shared experience of working in the office vanished when the COVID-19 pandemic hit the UK. The feeling of company and teamwork in a space disappeared along with this and challenges soon arose for businesses trying to keep things running smoothly and remotely.

Some businesses coped better than others. Ones which were more used to removing sensitive financial data from the office were better equipped at working remotely. These organisations have been laying the groundwork for years of being able to balance the books from the comfort of their homes, so the pandemic was a good opportunity to put this into practice.

These businesses had worked to gain a continuous accounting process. This automates routine accounting tasks that require complicated calculations such as depreciation and amortisation. Therefore, these processes become continuous because of how automated they are. This automates the generation of financial statements, transfers with eliminations and reconciliation tools including AP sub-ledgers and the general ledger. Technology is an efficient way to process transactions for accountants and counteracts the complexities that come with working remotely.

The goal is for these automated processes to happen continuously. The pandemic has focussed on a need for automatic technologies and has also highlighted the importance of the cloud in doing so. The cloud allows sensitive financial information to be stored securely. This could involve data privacy as well as internal permissions when accountants are outside of the office.

Cloud-based technologies are updated regularly in line with the newest standards and regulations which often change. The cloud is kept modern and running smoothly. This maintains compliance for organisations.

With automated systems, there is increased accuracy. There is no need to rekey information from system to system manually. This reduces the chance of human data entry errors, so saves time that can be dedicated to other internal operations within the businesses. It also increases the quality of work-life for employees when functions are automated and left to the end of the month. The most tedious work has become more automated.

In conclusion, although remote working continues for accountants seven months into the pandemic, there have been advantages that have come with it. These advantages mentioned above have sped up the work of accountants by saving them time and removing more tedious aspects to complete. Accuracy has increased and the overall move to automation couldn’t have come at a better time for accountants.

If you need any help with your accounting needs, get in contact today.

UK Accountants Voice Their Environmental Worries About Businesses’ Approach To A “Sustainable Recovery”

The Global survey of accountants this year has unearthed accountants’ disappointment of businesses environmental as well as social strategies. These accountants and financial experts support the move to a “sustainable recovery” but fear that businesses are only escalating negative environmental/social impacts.

The survey was part of a report by the Association of Chartered Certified Accountants (ACCA). It was titled “Mainstreaming Impact: scaling a sustainable recovery“.

In its research, it asked 829 accountants and finance experts around the world about the environmental progress and performance among the organisations they work for.

It was recorded that 90% of those questioned were not happy with the current environmental and social sustainability efforts carried out by their organisation. The accountants said that they want to see their organisations increase all their efforts to become more sustainable, and in doing so, create positive societal change post-pandemic.

One in 20 of the accountants and financial professionals surveyed said that finance teams did have an essential role in contributing to a “more socially inclusive and environmentally sustainable future”.

75% of respondents mentioned that the business they currently work for needs to target the social inequalities which still exist to this day. This could be through wealth, race, sexuality, sexual orientation, religion and gender.

However, an additional 10% to this said that businesses need to make more efforts in curbing the environmental damage, a forefront topic of 2020 behind the global pandemic.

A worrying statistic showed that only 54% of respondents believed that they had the training and skills that were vital to combat the environmental and social change in the business they are employed by.

Many of those surveyed highlighted the barriers businesses face to environmental and social improvements. For example, the cost implications, a narrow focus on returns and a lack of senior management.

Helen Brand, chief executive of ACCA stressed that accountants have “a huge role” to play in environmental performance improvements. She added that this was “because it’s through professional education that accountants can support the transition to a net-zero carbon world.”

Head of sustainability at ACCA, Jimmy Greer said that “Professional accountants and finance teams are central actors, with the skills, knowledge and ambition to do more” and that businesses “need to make board level governance commitment to additional and intentional social and environmental positive impact creation.”

Greer finished by saying that businesses “must allocate resources within finance teams and across organisations to build decision-making capabilities related to environmental and social impact.”

If you need any help with your accounting needs, get in contact with us today.

Five Changes Accountants Are Making To Their Way Of Working

The COVID-19 pandemic has shaped the way accountants are re-inventing themselves. More specifically, it has led to the acceleration in the way that accountants are altering their way of working. Here are the main five changes that accountants are making to their style of working this year in response to the pandemic.

Saving it all to the cloud

With the pandemic changing accountants’ way of working to the work-from-home method, it has been more critical than ever to save, share and locate vital documents all in one place. Using shared digital resources has made accounting more accessible than ever before.

The cloud has been vital for scanning applications where all hard copy forms can be loaded onto a screen, making transactions much faster as well as suppressing the risk of transmission of the virus on paper sheets sent via post.

This not only saves time but money as well and brings with it the ability to operate documents anywhere at any time. Furthermore, any worries of a data disaster or losing vital hard copies becomes obsolete as the cloud continuously backs itself up. Accountants needn’t be concerned with losing anything as the cloud has been proven to hold data forever firmly.

Develop data analysis skills

Accountants are expected nowadays to produce data analysis that will allow their clients to make strong financial decisions. Information is vital and detailed analysis is more critical than ever. 

Analysing information will allow businesses, as well as individuals, to see if they are spending too much money or whether they have too many or too little employees working for them. As a result, brushing up on data analysis skills will enable accountants to become more productive and efficient, as well as more helpful to their clients.

Improving their social media presence and usage

Accountants used to rely on their services based on recommendations and word of mouth. This was their free and easy advertising method. However, now we are living in the age of social media, which is the new word of mouth, especially during the pandemic where many of us are staying at home a lot more and not socialising face to face with our peers.

When a business is looking for an accountant service, they will look online. Reviews and recommendations on social media platforms are what they will use to gauge what sort of accountancy firm you are. Implementing a healthy social media plan can get you that business and recommendations. Imagine all the other accountancy firms in your city having Twitter, LinkedIn and Facebook and your firm having none of those. You will not be recognised or stand out at all. You will lose out on important business. As a result, accountants are embracing social media and strengthening their social media and online presence to cover all bases.

Outsources for specific needs

Many accountants are outsourcing accountants from specific departments that can take care of a business’s specific financial requirements as opposed to general accountants who do not have full knowledge of some particular financial subjects. This is to cover all bases and make clients more trusting and feel more valued when dealing with accountants who have been tailored to their client’s specific needs. This also means that services are consistent as well as scalable with experienced and qualified accountants. Furthermore, other businesses can focus on other aspects such as the core of their business and leave the accounting to more experienced professionals.

Mobile accountants

Everything is now done electronically, with paper invoices long gone and digital receipts the new norm. Mobile accountants have access to software which now allows them to work remotely from their home. This gives them more time to service more customers and in more depth.  

Accountant’s Guide to Managing Your Business Finances

Financial management can take many years to master. Managing your money is difficult but so vital to grow and develop your business. Nowadays, we are blessed with the ability to hire accountants to help manage our business finances for lower costs than you may think. However, you cannot be purely reliant on accountants alone as you are accountable for managing your finances. Here is your guide to equipping yourself with the essentials to manage your finances…

Understand the basics of finances

All business owners must have the basic skills of managing finances in order to have a successful business. There is terminology which is vital to know like the breakeven point, net profit, cash flow, expenses and gross revenue. These will be terms used on a daily basis so make sure you understand them all.

Furthermore, you must also understand business accounting documents such as revenue forecast, cash flow statement, income statement and balance sheet. If you aren’t familiar with these terms and documents, google them and research what they all mean and do. It will be invaluable knowledge for your business. 

Keep track of your cash flow

Cash flow is the money that goes in and out of your business and is easy to lose track of so ensure you are organised and know where it is at all times. The inflow of your business is from selling your goods whereas your outflow is the money your business spends on stock, payroll as well as marketing too. Try to always keep your outflow lower than your inflow, even though this could prove difficult. Just bear it in mind at all times and never lose track of your business goals.

Ensure your business and personal finances are kept separate

If you are a small business owner, it may seem easy and simple to have all your finances in one account. This is not recommended as it makes your business disorganised and can lead to tax issues as your business grows larger in the future. The first thing you should do when setting up your business is having two separate bank accounts for your personal life and company.

Spread out your tax payments

Paying your tax in a lump sum isn’t always the wisest of moves as large amounts of money leaving your cash flow can seriously affect it. Instead of this, try and opt for tax as a monthly expense. This will help you with budgeting.

Have a business cash reserve

Have a business bank account that can be used as a cash reserve. Top it up as often as you can and make it easy to withdraw money when needed for your business. This will take the pressure off when you have any additional bills to pay for your business.

If you need assistance with your business accounting, contact me today!

Benefits of Making Tax Digital

The Government’s programme to make tax digital is a bold one. HMRC has set its aim to become one of the most advanced digital tax administrations on the globe. But what do we mean by making tax digital and most importantly, what are the benefits of this new scheme? This article will guide you through the pros of making tax digital and why it’s a win-win situation for all parties involved in the programme.

What is making tax digital?

The definition of making tax digital is the programme to which HMRC aim to change from paper-based systems as well as forms for the administration of tax to more digital variants. Making tax digital is already prevalent for VAT in the UK. This was established in April 2019 for businesses that are over the VAT threshold of £85,000. As of March 2020, there were over 1.4 million businesses who have joined the digital VAT service. It will eventually be rolled out for self-employment tax, company tax and income tax too.

Making tax digital also aims to make tax files simpler for businesses as online software will be able to automatically prepare tax returns as well as sending them to HMRC directly.

The Benefits

There are numerous benefits to making tax digital. For example, businesses will become more productive; saving them hours each week of business administration. Additionally, there will be less paperwork and reduced stress filing all the tax returns. Accuracy will be enhanced, and fewer errors will be made when submitting these tax returns. Tax liabilities will be more visible, staff can do other business activities with the time saved, and it will be quick and easy to view all tax data on phones and tablets. Not only this, but it’s a greener method, with zero paper so a reduction in deforestation will occur.

The future of making tax digital

So, what can we expect soon by making tax digital? Well, by 2021, it is predicted that HMRC will enforce digital tax methods for corporation tax as well as income tax. It is expected that this will happen in the first tax year for income tax 2021/2022. However, all this may potentially be delayed because of the COVID-19 pandemic. The pandemic has led to delays in numerous projects across sections and has led to the prioritising of specific financial resources. 

Speak to Herridge Accountants now about making your tax digital.