Creativity is intelligence having fun – Albert Einstein
Are your accounts up to date and current or is creative accounting in place? The statement above may be true when dealing with theories and inventions, the creative media, technology and so forth… However, it is not the case when it comes to accounting. There are rules and guidelines to be followed and we need to keep up to date with any changes that may be imposed by HMRC and other government legislations. Creative Accounting can be seen by many as a “dodgy accountant” or exploiting loopholes that will catch them out in the long run.
If you’re not sure, contact Maze Accountants on 020 8643 9633.
Are Your Accounts Up To Date?
We do as much as we can to keep ourselves well informed of any changes or developments within the accounting framework. However, we also need to “push” (or gently nudge) our clients to make sure that the accounting information that we require is provided within a timely manner.
There are also benefits for you and your business by keeping accounts up to date, such as:
- If your accounts are up to date you have a better grip on your cash flow.
- Proper accounting enables you to see where you are making money in your business. This will maximise the business potential and in turn increase your profits.
- Keep your tax liabilities to a minimum. You may find that you cannot claim certain expenses if you don’t have the supporting receipts, so don’t give the taxman reason to charge you more than necessary. In addition, knowing your profit will help guide you to whether you should receive dividends or a salary.
- It is easier to deal with your accounts at the time the transactions take place. This makes life simpler as opposed to sorting through a pile of receipts and invoices at the end of the month.
- Business success is more easily measured by keeping your accounts up to date.
- Obviously for those that are VAT registered, you will need to keep proper and up to date accounts. You must register for VAT if your taxable turnover for the previous 12 months is greater than £83,000. However, if your business is approaching the scope of VAT, it may be wiser to register for VAT before the threshold is met. This will affect your profitability and cashflow, so needs to be considered in advance.