Once you realise that you need CRM software or better accounting software, you then have to decipher how to choose the right software for your needs. Fortunately, that process is a lot more straightforward than you might think.

Establish What’s Not Working

Many business owners and managers start looking at their software options when something in their line of work isn’t working. You may feel like your remote team isn’t working hard enough, or your finances are all over the place. Write down the problems you’re having so you can prioritise the systems that could streamline your daily operations. Sometimes, it can help to do this at the time of the issue so that you don’t forget. For example, time tracking software could get your remote team back on track, and bookkeeping software could shine a light on your financial problems.

Research and Compare

In an ideal world, the first piece of software you come across would be perfect for your business. That’s rarely the case, which is why using specialist companies can help you research and compare. You can gather information on each software type within a single category and compare the features of each. When all the data is laid out for you, it can be a lot easier to make an informed choice. The alternative would be to spend a fortune on software and only realising later that it’s not quite what you had in mind.

Rate the Features

When comparing one software type to the next, there’s a lot to consider. Think about the features you must have, those you may be able to do without, and some that would be nice to have but aren’t essential. It can also be worth finding out if a particular software type is customisable to suit your unique operations. Some software providers are more than happy to create plug-ins and extra features if it means it’s more compatible with your daily needs.

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Read Reviews

When your stress levels are high enough, wasting money on software that’s not fit for purpose could send you over the edge. This is why reading reviews can assist in choosing the right programs for your needs.

You’ve already looked at the pros and cons, but genuine customer feedback can be a deciding factor. Look for information relating to customisation, flexibility, price, customer support, and features. Around 91% of people read online reviews before purchasing a product, so there is certainly peace of mind to be gained by finding out what real purchasers think.

If you want your business to run like a well-oiled machine, new software can be the answer. However, the type of software you need remains to be seen. By researching and comparing options before rating the features and reading reviews, you may stand a better chance of finding that winning program that makes daily operations much more manageable.

Outsourcing Finance Services: Everything You Need to Know 

The popularity of financial outsourcing is growing every day, as it enables medium-sized businesses and large companies to improve their financial functions cost-effectively. In this article, we will cover the following points:

1. What is Outsourcing & Accounting Outsourcing?
2. Risks Related to Outsourcing Finance Operations
3. Reasons Why Organisations Should Outsource Finance and Accounting
4. Outsourcing Finance: Find a Reliable Vendor 

What is Outsourcing & Accounting Outsourcing?

First, you need to know that outsourcing is a company's refusal to independently perform a number of non-critical business functions or parts of business processes and transfer them to a third-party contractor who professionally specialises in the provision of such finance and accounting services.

Consequently, financial outsourcing is the transfer of the functions of accounting and tax accounting and reporting to specialised organisations.

Company's Operations to Outsource

Of course, financial and accounting outsourcing is not all. Companies can outsource the following functions:

• human resource management;
• facilities management;
• supply chain management;
• customer support, etc.

For example, if you are looking for software development outsourcing, it would be a good idea to look into the web development services of a company that develops custom software from a distance.

Finance Services for Outsourcing

If you want to outsource crypto or financial tasks, this does not mean at all that you need to give the intermediary all the available financial information.

Outsourcing can be used for the following assignments:

1. Bookkeeping and Back-Office Support 
2. Controller Services
3. Financial Planning and Analysis (FP&A) 

3 Types of Outsourcing

Now you already roughly understand what functions in the company you can outsource. Now is the time to choose the type of outsourcing.

There are three different types of outsourcing:

1. Local Outsourcing
2. Nearshore Outsourcing
3. Offshore Outsourcing

So you will need to deal with each type separately and decide which one suits best.

Risks Related to Outsourcing Finance Operations

Any modern innovation, like accounting outsourcing or day trading crypto, has its own risks. They should not scare and stop you, you just need to take them into account and think over in advance what you will do in case of an unfortunate situation.

Possible Hidden Costs

Due to the fact that you, shall we say, start working with new people, there is a possibility of misunderstanding, which can lead to the fact that in one task there will be more details, the implementation of which you did not initially take into account, and this will increase your expenses.

Therefore, try to immediately discuss everything in detail and draw up a specific plan of tasks.

Less Control

When you delegate tasks to someone who is not on your team, it will be difficult for you to control the process. You will no longer be able to ask daily how the process is going.

Therefore, it is very important to initially establish a high level of trust so that you do not constantly feel that the person will do something wrong.

Distance, no Local Presence

We have already talked about this above. When you transfer some functions to outsourcers, you will be ready for the fact that you will receive answers to questions, let's say, with a delay.

To make it easier to communicate, you can set a specific schedule so that the outsourcer knows exactly when you will contact him.

Reasons Why Organisations Should Outsource Finance and Accounting

Of course, the reasons why it is very profitable for companies to outsource certain functions clearly outweigh the above risks. Let's take a closer look at all the benefits.

1. Cost-efficiency 

According to statistics, the use of outsourcing for a number of functions of company employees reduces costs by 30-45%. This is because there are employees who receive a lot, but for some reason their performance may decrease, which harms the result.

2. Focus on Strategic Tasks 

When you outsource a percentage of your work, it automatically creates more time and energy that can be spent on important tasks for the company. Everything is simple here - the less your employees are employed, the better they will perform important work.

3. Access to Specialised Talents

Outsourcing finance and accounting, since it is not tied to a specific territory, gives you access to all the people in the world who are looking for outsourcing accounting work. Thus, you have increased opportunities to find a talented and experienced person in their field.

4. Hiring Costs Elimination

When you hire a new employee, very often they need to be taught, trained, sent to some courses, and so on. With outsourcing finance, all these costs disappear, since you hire a professional in your business who just needs to be given a task.

5. Advanced Technologies and Systems

This is one of the biggest benefits, as outsourcing companies usually use cutting edge technologies that help increase work speed and avoid mistakes as much as possible.

6. Enhanced Business Operations & Accuracy

Again, outsourcing is convenient in terms of the quality of work. Your regular employees, who do the same tasks every day, do everything automatically and do not try to change or improve something. By outsourcing finance tasks, you can get not only fresh solutions, but also, possibly, change something in your company.

Outsourcing Finance: Find a Reliable Vendor 

We have already talked about what benefits a properly chosen outsourcing company can bring to you. The main thing remains - to choose this company.

Therefore, now we will talk about how to choose the right outsourcing company.

1. Search for Proven, Streamlined Processes 

Experienced outsourcers always have an established process and structure. You need to look for those who will not only promise a good result, but also clearly show how they will achieve this result.

Also, keep in mind that the team you hire must ensure risk control and data security.

2. Check Team's Experience

It is clear that you are not going to hire a person from the street, but it will not be superfluous to check the experience of the team, what projects they worked on, and ask for recommendations, and so on.

3. Evaluate Methods and Metrics for Success Measuring

Ideally, your prospective provider should have methods that will provide assessment and improvement of the company's financial condition, as well as show errors.

In Conclusion: Is Outsourcing Financial Services Right For Your Company?

Finance and accounting outsourcing services will help you not only decrease the tasks of your employees, but also reduce costs, improve results, improve some activities in the company, and so on.

The main thing remains to find an experienced provider who will meet all the necessary conditions.

A high-quality and well-thought-out process will bring great benefits to your company!

Steve Cox, Chief Evangelist at IRIS Software Group, explains how tech can be a lifeline for accountants looking to support businesses through the coming months.

Today’s accountants face a litany of challenges, not least navigating through the COVID-19 crisis and increasingly murky Brexit waters - all while keeping up-to-date with the requisite compliance and legislation changes. Though we now have a much clearer idea of what to expect, unlike in the first months of the pandemic, it’s an understatement to say that a huge degree of uncertainty hangs over businesses - and life in general.

The sudden shift to remote working caused chaos among businesses. Some were not prepared for the immediate digital transition, with many struggling to continue business as usual looking to their accountants to guide them through the uncertainty. Accountancy firms have reacted well to this increase in client demands, and while much advice has been given about compliance, the opportunity to change and become better advisors has been cathartic for the industry. But this begs a new challenge.

Reactive advisory was a necessity when we went into lockdown - no one was prepared for a global pandemic - yet accountants were quick to react to the necessary changes, getting their firms running in the cloud with hosting in the early parts of lockdown. But as we head into the next normal, firms need to be proactive. They need to utilise technology and act on the lessons learnt from the pandemic; delivering the strategic, digital-first advisory service businesses now need.

The changing role of technology in accounting

While no silver bullet, technology has, and will continue to play, a central and evolving role in helping accountants support businesses through these uncertain times and throughout the next normal.

Lockdown proved to be difficult for maintaining human interaction between accountants and their clients - something that’s critical in developing a trusting relationship. But harnessing technology meant accountants could carry on as usual, offering first-class digitally powered advisory - approaching problems or opportunities with digital solutions, using tools such as video conferencing. This meant they could continue building relationships with both new and existing clients.

Technology has, and will continue to play, a central and evolving role in helping accountants support businesses through these uncertain times and throughout the next normal.

COVID-19 has unveiled the accountants who have chosen to embrace new, innovative methods of interacting. Those who are proactively utilising digital assets, and interacting in new ways, are noticing that they are interacting far more with their clients than prior to lockdown - calls would have been over the phone rather than video, and meetings may have been cancelled due to lack of convenience.

What’s more, technology has helped accountants understand ‘the perfect marriage’ between human interaction and valuable data. Using data, accountants can compare client history, by accessing real-time information online. This in turn creates a wealth of business understanding, delivering both short and long-term value to all their clients. But, as the role of technology evolves in the accounting world, so too is mandated financial and administrative processes.

Making Tax Digital (MTD) is part of the government’s plans to make it easier for individuals and businesses to manage their records digitally and subsequently their taxes. While at first glance a minefield for many, MTD is a prime example of how harnessing technology can help accountants and their clients automate compliance. That said, compliance is also the traditional safe zone. With the extension of VAT-registered businesses, mandated to keep VAT records in digital form from April 2022, it is far easier to rely on traditional assurance and compliance services, than to invest in a digital-first advisory.

A digital-first advisory

Our world is transforming into digital-first - businesses have been taken online, with many processes automated to manage the new working style. Further, MTD is a clear example of the UK government now jumping on the digital-first bandwagon.

The government’s plans for an economic recovery - the Bounce Back Loan Scheme (BBLS), the Furlough scheme, Kickstart for young people and even the Eat Out to Help out - caused a stir for how businesses manage their funds. And while all designed to speed up our economic recovery, someone has to pay for the billions of pounds spent so far - the Eat Out to Help Out scheme for example has driven UK inflation to a five-year low.

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To pay for this added sum, the UK will most likely see a new tax legislation come into play, so that we can eventually pay off the debt the government has lumped on our economy - with higher rate players paying more. However, with this increase of tax burden, processes need to be streamlined. And this is where MTD steps in.

MTD helps businesses and accountants manage finances efficiently - which right now is vital for survival. Businesses can pay their taxes online - saving time and improving overall business productivity. In turn, businesses now need to work with their accountants and look at their wider business strategy so that it resonates with the new digital compliance. This includes addressing business needs, as well as how they work, employee capacity and all financial outgoings - all of which can be successfully managed through a digital-first advisory approach.

Addressing human business needs

Accountants improve the lives of their clients by addressing human business needs. They are the engines behind their clients’ businesses, and by using technology, can remove cumbersome and time-consuming financial management. However, while accountants have been quick at reacting to addressing these needs, they now need to be proactive and act as a business’s tour guide as we enter the next normal.

The pandemic has created a snapshot of what businesses now need, especially those who relied on old, mandated accounting solutions. Using technology to catch real-time data, accountants can paint a picture of exactly what their clients want and need now and for the future. As experts in their field and the latest legislation changes, accountants are best placed to advise clients on how to navigate these increasingly complex times.

However, every superhero needs a sidekick, and as we enter the next normal, technology will firmly cement itself at accountants’ side. Through automating everyday tasks and processes, accountants will be able to proactively unlock powerful insights into their clients’ businesses; enabling them to move from bean-counter to hero consultant, help clients remain compliant and drive business growth.

Not only will it make you more efficient once life returns to normal, but it will also help to save you money which can be used to reinvest in staff and other areas of your business. These are some of the reasons why COVID-19 is the perfect opportunity to reorganise your finances and the ways in which you can do so. 

Work with specialist accountants

When dealing with finances, specialists can offer targeted advice that offers greater results. But particularly during these uncertain times, gaining professional advice and guidance is key, so now is a great time to work with accountants or financial specialists who really understand the nuances of your industry. 

“Once you have your plan in place, you need to make sure that it is financially viable, to make sure that you are realising a profit,” says OS Accounting, a chartered accountancy firm that specialises in working with SMEs. “Any banking or financing house will expect to see realistic and well-considered financial budgets and forecasts and translating an idea into facts and figures needs experience."

Make it easier for customers to pay

No sale is complete without your customers paying you for your service or product. But with an increased need for contactless payments in light of the pandemic, it’s vital that businesses adopt and embrace cash-free payment options. 

From PayPal to Amazon Pay and Apple Pay, there are various options to choose from that will make it easier for your customers to pay you to keep your business taking an income. 

With an increased need for contactless payments in light of the pandemic, it’s vital that businesses adopt and embrace cash-free payment options. 

Go digital

It’s much easier to keep track of all of your financial documents if the business is digitised. While lockdown forces us all to adopt more downtime, there’s time to make the switch to a more digital way of working. 

Not only does it make accessing these documents easier when working remotely, but it also provides a safer form of storage as leaving hard copies in filing cabinets makes it easy for data to be stolen. There are many online tools and software options that will help you digitise your business, particularly where finances are concerned. However, make sure that all of your documents are backed up with a cloud-based service so that you can be sure they are secure. 

Do the things you’ve been putting off

Now is the time to make use of more time and do the things you’ve intended to do for months but haven’t had the time. Use the lockdown to take stock of how your business is operating and make the necessary changes – this might include separating personal and business finances more efficiently by opening a separate bank account or tracking and auditing your expenses.

Whatever financial tasks that have been sitting on your to-do list for a while can now be ticked off to make the best use of your downtime. 

Have regular finance meetings

COVID-19 offers a chance for a fresh start in numerous ways, but particularly where processes and systems are concerned, so get into new habits that will help streamline your business processes for the future. One way to do this is to hold regular weekly finance meetings so you can regularly keep track of income, outgoings and expenses. 

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Money is tight for some SMEs and may be fluctuating more than usual during the pandemic, so it’s a great time to gain an understanding of where your money is going. By having this knowledge, you’ll be able to avoid the liabilities that can bring many businesses down in order to keep it running productively and profitably. 

Final thoughts

Businesses across a host of industries have found themselves in unchartered territory since the COVID-19 pandemic began, but it has hit SMEs harder in many cases. By making use of this time to reorganise the financial aspects of your business, you can hit the ground running once life returns to normal and ensure that your business continues to turn a profit throughout.

When you are in control of your money, you have more power and flexibility to craft the lifestyle you want. You have an excess of money coming in and a handle on the money going out, so you don’t feel stressed or pressured by your finances, even when a surprise emergency expenditure occurs. Being in control of your money is a critical element of being in control of your life — but for some reason, you just can’t manage to do it.

Believe it or not, it probably isn’t a mystery why you still aren’t in control of your finances. Consider the following list of reasons why many people fail to manage their money, and think about making some changes to the way you live to keep your earning, spending and saving in check.

You Are Neglecting Your Debt

You will never be in control of your money if you don’t first gain control of your debt. Debts can accrue slowly, over time through things like credit cards, and debt can appear suddenly and massively in the form of a car or home purchase or student loans. Equally easy to accrue is business debt, which will impact many more people than yourself if allowed to grow unchecked. If you are suffering from a serious amount of debt, either personally or in your business, ignoring it will only make your financial situation worse. A much better strategy is understanding what your debt is, where it is and how you can systematically gain control of it to benefit your finances overall.

There are all sorts of tips and tricks for dealing with debt in a constructive way. At the very least, you need to be making your minimum monthly payments, but you might consider the snowball method or the avalanche method to rid yourself of debt faster. Debt isn’t inherently a bad thing, but you need to have a handle on it if you want greater control over your money.

If you are suffering from a serious amount of debt, either personally or in your business, ignoring it will only make your financial situation worse.

You Are Spending Frivolously

One reason your debt might be out of control is that you can’t manage your spending properly. Even if you start with a great fortune, you can lose it rapidly with excessive spending on things that don’t add to your wealth or the betterment of your business. Typically, frivolous spending isn’t merely buying yourself a coffee every morning; it is buying a coffee, buying lunch out, buying dinner out, buying new clothes, buying home décor and buying other things you really don’t need. In short, improper spending is a habit that you need to work to break.

Again, there are several strategies for overcoming this bad habit. Perhaps the best is employing money management software, which helps you track your spending and apply it to a carefully created budget. It is much easier to control your money when can see exactly where it is going and when you can see that the changes to your spending are having a positive effect on your finances overall.

You Aren’t Increasing Your Income

There are two ways to build your wealth: stop sending money and increase your income. If you have your spending under control, but you are still struggling financially, it might be that you don’t have enough income to manage your current lifestyle. In general, having more money makes it easier to manage your money because you don’t need to worry as much about covering necessities like food, rent/mortgage and utilities. The absence of financial stress allows you more freedom to experiment with money management strategies, which can be fulfilling and fruitful.

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At present, increasing your income might be a difficult prospect — but that doesn’t mean you shouldn’t try. If you are currently employed, you might ask your employer for a raise; a 10 or 20 percent raise every year or so will help your salary remain competitive in the market and meet the demands of inflation. You might also consider obtaining a side hustle, either a second job during your typical off hours or else a way to turn a hobby into a money-making endeavor. However, it’s important to remember that your life shouldn’t only consist of work; you need time for yourself to avoid burning out and losing all income.

Everyone wants to have impeccable personal finance skills, but the truth is that not everyone has the discipline to build them. It takes time to develop the knowledge and habits necessary for excellent money management, and if you are intent on gaining control of your finances, you should start paying attention to your debt, reducing your spending and increasing your income today.

Little do they realise that a lot can be done to encourage clients to pay faster, in some cases even before the due date. Being diligent and following the invoicing tips mentioned in this post, businesses can get paid faster and maintain smooth cash flow. 

1. Send Timely Invoices

For businesses that don’t have formalised accounting departments, sending invoices in a timely manner might be a tough concept to grasp. But the fact of the matter is, the quicker you send your invoice the quicker it’s going to get paid. 

Ideally, you should be invoicing your clients as soon as the products/services have been delivered. Here are the reasons why you should do this:

• Setting expectations: You want to project a professional image of your business and sending invoices immediately shows you take money matters very seriously. This will build expectations with clients accordingly, and they’ll be inclined to pay you faster.
• Value of products/services: Another reason why you want to send invoices immediately is that the value of your services/products is still fresh in the client’s mind. 

Most business owners delay sending invoices because it’s usually a cumbersome process. But with a specialised invoicing software, it really isn't. Once you have the software set up to generate the kind of invoice you want, it’s only a matter of putting in data and pressing a couple of buttons, and you’ll have a professional invoice ready. 

2. Set Clear Due Dates

Don’t leave it up to the client to decide the due date of your invoice! Having clearly mentioned due dates for invoice payment will communicate that you want the cash by a certain time.

There’s some technical terminology for this. For example, writing “net 30” means that the invoice must be paid 30 days from the invoice date.

Novice business owners don’t even need to use this terminology. They can simply write “Payment due on DD/MM/YYYY” for absolute clarity. With this the client won’t have the excuse of not understanding the terminology as well.

It’s also recommended to write full month names to avoid ambiguity, such as “February 3, 2020”.

Don’t leave it up to the client to decide the due date of your invoice!

3. Avoid Extended Due Dates for Payments

It’s good to be flexible when it comes to payments. You don’t want to give your clients a two-day window to make payments. But you don’t want to give them too much time as well. 

Do not give your clients the freedom to pay late, as they’ll naturally gravitate towards this option. A balance must be struck here, with a payment term that’s short but relaxed enough that the client doesn’t feel flustered by it. 

4. Impose Late Payment Penalties

This may sound a bit harsh to some business owners, who often have cordial relations with their clients. But hey, this is the lifeline of your business we’re talking about.

Imposing some kind of penalty on late payments can be a great motivator for clients to pay on time. For example, you could add a certain amount of interest on the payment if it’s paid after the due date. 

In fact, having these terms means that the client will often make the payment much before the due date, out of caution. 

Don’t forget to communicate these late payment terms to your clients beforehand. 

You don’t want to appear brash about late payment penalties, so here’s the correct way to do it:

• Clearly include a section on late payment in your invoice.
• Communicate and agree on the late payment fees with your clients in advance (beginning of project).

Having a clearly stated policy on penalising lateness means that clients are far more likely to send payments early.

5. Incentivise Fast Payments

The goal of effective and efficient invoicing is to optimize the cash flow of a business. To get payments as fast as possible, you may want to incentivise clients who choose to pay you on time. 

For example, you could offer a small discount to clients who pay ahead of the due date. You could also offer them a gift card of some sort - you get the idea.

6. Break Down Larger Invoices

You may be working with businesses that just don’t like to pay large invoices, for a multitude of reasons. 

In this case, you can try breaking down invoices into several instalments. Instead of sending them an invoice for a large sum of money after 60 days, send them invoices after every 15 days, with smaller amounts. 

This will work well for both you and your client because:

• You’ll get regular cash inflow.
• The client will find it easy to process smaller invoices.

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7. Send Friendly Reminders

Have you heard how email follow ups can dramatically improve the reply rates of email campaigns? The same goes for invoicing as well. Your client may have received the invoice but simply forgot to pay it. 

This is why sending friendly reminders as the due date approaches is a good idea. You don’t have to demand that the client pay in these reminders, but rather make them aware of the fact that the due date is fast approaching. 

Some business owners even use these email reminders to open opportunities regarding upselling products or services to the client. Be creative!

8. Treat Your Customers Well

This is the most basic tip we can give, but also something that’s important. Delivering quality products or services to your clients is a great motivator for them to pay you on time.

According to Ken Charman, CEO of uFlexReward, this appears to show that the private sector, despite their concerns about how the reforms played out in the public sector, are ready to embrace the new measures when engaging limited company contractors.

Kate Cottrell, one of the UK’s foremost IR35 experts has slammed these organisations for their blanket approach stating: “It is a real shame that these organisations have not waited a little while longer when we should have the final legislation and updated guidance from HMRC on a host of issues…” but their decision to comply ahead of the deadline, clearly demonstrates the mounting regulatory pressure on organisations today.

For companies like Barclays and Lloyds with potentially lots of contractors, complying with the new IR35 rules will be a huge amount of work.   However, it also provides an opportunity to assess whether the current systems they have in place enable them to accurately report on their human capital assets, including the contractor workforce.

Accounting for Total Labour Costs

It is becoming increasingly important that organisations understand and report on their human capital assets in a transparent way to existing and prospective employees, shareholders, regulators and other interested parties. Yet, to date, external contractors, consultants and  contingent workers are usually excluded from the employee payroll and the organisation’s total labour cost remains unknown.

When an organisation wants to analyse its business, it needs to see the whole labour cost, not just what the payroll systems can show up. In omitting the total data pertinent to contingent workers, organisations fail to understand labour productivity and end up with a skewed analysis that only takes into account employees. Deloitte found last year that only 42% of organisations were primarily made up of salaried employees.

With the IR35 forcing the costs of limited company contractors to be accounted for within the employee payroll, we’re some way along the road in organisations understanding the value of its human capital. This is despite there being no guidance yet on who will pay the tax, NI and the levy.

With the IR35 forcing the costs of limited company contractors to be accounted for within the employee payroll, we’re some way along the road in organisations understanding the value of its human capital.

For right now though, there is no universally accepted way to track the management of human capital. The economy has grown in ways that leave the current rules behind. For several decades an organisations’ market value has been far higher than the value of their tangible assets (for example land, buildings, fixtures and fittings), leading for calls for labour assets (i.e. human capital) to be included on balance sheets to give a more accurate impression of organisation value.

Reporting on Labour

Whilst companies must report detailed information about their capital investments, they have almost no reporting requirements related to human capital. This is a problem for two reasons.

The lines between contingent workers and employees are becoming increasingly blurred. This cannot be more clearly illustrated than with the recent troubles of Uber in the UK, whose drivers – traditionally thought to be self-employed – were, in fact employees of the company. Uber now has statutory obligations to give drivers holiday and sick pay (and thus, they are entitled to a minimum wage and paid leave). Prior to this, these were costs that were not broken down and could be a way of hiding a very bad gender pay gap, underrepresented minorities and more - regulators are catching up with that.

Additionally, not having to report on human capital discourages effective investment in workers - which can have an impact on your bottom line. Research shows organisations with specific employee experience programs and strategies report up to three times higher profit growth. Part of this growth is due to lower operating margins stemming from employees being more innovative in how they work, but lower employee turnover also contributes measurable savings.

Although the private sector may be lagging in preparation for the IR35 changes that take effect in little over 150 days’ time, they could bring about a seismic change in how organisations start to report on their human capital costs to the wider market.

These two fields of study fall under the economy category. By choosing a major in each, you’ll get the chance to study many interesting things from blackchain to the real estate industry economics. But, how do you make the choice that best fits your skill set?

Difference Between Accounting and Finance

Before you make your choice, you should differentiate between the two fields of study. Some of the accounting and finance topics from topics mill can help you better explore the fields once you know the difference.

Accounting is narrower than finance. It involves the financial statements’ preparation process. Basically, it explores where money come from, where they’re spent, as well as focuses on making cash flow plans and budgets.

Finance is broader. It doesn’t focus on making statements, but on evaluating the existing statements. The task you’ll have in this field is to understand the financial situation and make important financial decisions, such as where the money should be invested or how they should be spent.

Accounting vs Finance: Choosing Between the Two

In order to choose the right major, accounting or finance, you need to pick what you want to be studying and what you’d be good at.

If you choose to study accounting, you should know that this field is broken into three main categories: tax accounting, auditing, and public accounting. On the other hand, finance is divided into: financial planning and traditional finance.

If you choose to study accounting, you should know that this field is broken into three main categories: tax accounting, auditing, and public accounting. On the other hand, finance is divided into: financial planning and traditional finance.

This decision is a grand one, so naturally, you are spending a lot of time trying to figure things out. It’s wise if you use the best essay writing service in Great Britain to reduce some of the workload while you’re exploring the fields, maybe even volunteer in a company to see what you’re more interested in.

Now, let’s dig deeper into the specialization paths that these fields offer you.

Specializations for a Major in Accounting

Public accounting involves keeping and preparing financial statements and records. It’s the perfect job for those who are detailed and persistent in doing everything perfect, as well as the ones that don’t mind the idea of constantly having to create detailed and accurate statements.

Tax planning involves preparing tax returns, providing tax consulting services, as well as doing tax planning. That being said, such a job requires a lot of learning even after you graduate, since regulations change very often. It’s perfect for those who enjoy research and have highly developed research skills.

Auditing involves evaluation of financial records. Your job in this career will be to check if records are accurate. Most of the time, you’ll be auditing other people’s work, which makes this the perfect task for those who are detail-oriented and enjoy the opportunity to investigate and dig in.

Specializations for a Major in Finance

Traditional finance requires deep knowledge of both economics and finance. If you can’t decide between the two, this is the perfect combo of both fields. It requires knowledge of global markets and an understanding of investments. The perfect person for this job is one with leadership skills, ready to take over the most important and difficult decisions. These are usually the highest paid people in the company, since the entire company or big teams rely on their input and their expertise.

Financial advisor/ planning include helping people by checking their financial statements, income, taxes, insurance, and investments. It requires a great deal of financial planning and knowledge of many fields, as well as great communication skills.

How to Finalize Your Decision

Now that you know what each field expects of you, it should be easier to finalize your decision. As I said, you can get the best picture of how each career path works by shadowing someone who does this, or volunteering in companies that work in the field of finance and accounting.

Also, you definitely want to consider your personality. As you can see, every career path requires a specific personality from the person who does it. Therefore, do your research thoroughly and pick the one that fits you best.

In the world of finance and accounting, things are similar. But, this doesn’t mean that you can change your mind constantly and easily switch from one career to the next one. Both fields require a lot of constant work, practice, and knowledge.

Moreover, for most of the careers in this field, you’ll have to get a degree, certification, or a title that allows you to do that job. It takes some time and a hefty investment to get the education you need to thrive in this field. So, take your job of choosing a major seriously since you’ll probably have to stick with it.

Yes, it is possible to change careers, but it will require an even bigger financial investment and will waste a lot of your time.

Join the World of Finance or Accounting Today!

These two career choices are of high influence and importance in the world. They’ve always been in high demand and this isn’t about to change any time soon. So, whatever you choose, make sure that you study a lot – it will definitely pay off for you!

Author’s Bio

Bobbie Sanchez is a financial advisor. He works privately as a contractor who helps small businesses and business people in keeping their finances organized, spending them wisely, and tracking their money. In his written work, you can read very useful advice in terms of your investments.

Here Ian Smith, GM and Finance Director at Invu puts to rest five of the most common myths about this business critical function. 

Myth 1 – Accounts payable doesn’t need investment

Reality – While it is understandable that most businesses will prioritise investment in front office functions, funding back office operations should not be ignored. Business requires accounts payable to deliver customer satisfaction. Failure to invest can result in the function being off the pace and unable to support the business.

Myth 2 – Accounts payable can fund your business

Reality – Funding your business by delaying payments to suppliers can damage your brand and normally ends with a fall. We’ve seen this multiple times in the past year, where the only cash generation was from delayed payments to suppliers who eventually could not take anymore. The late payment of suppliers by large companies has been subject to regulatory overview with the introduction of Reporting on Payment Practices and Performance.

Initial reporting figures show that on average 31% of invoices are not being paid on time.

Myth 3 – The accounts payable department knows everything going on in the business – even if you don’t tell them

Reality – The consequences of keeping the accounts payable department in the dark, by failing to provide the information required to resolve issues, can be harmful both to supplier relationships and management accounts due to delayed processing of transactions. Accounts payable and those responsible for the approval of invoices require transactional visibility and an audit trail to ensure effective processing.

Myth 4 – Accounts payable is the department of “no”

Reality – The perception of accounts payable as a department staffed by variations of the Little Britain character Carol Beer – “computer says no” – mis-states the role, which is to support budget holders in the delivery of outcomes and maintain a positive relationship with suppliers.

Myth 5 – Accounts payable just happens and requires no skill

Reality – There’s an expectation that accounts payable will be seen and not heard, be error free, and always on time. When this is not the case there is often an assignment of blame rather than an appreciation that this is an exception to the normal success rate.

The brave new world of accounts payable requires systems that automate data entry, provide approval workflows and requires skilled staff who can deal with exceptions, helping provide efficiency, visibility, and control over the payables process.

Nonetheless, last month high street retailer Sports Direct pleaded with the Big Four to take over their auditing process, which it said a smaller firm would not be able to handle. Sky News reported that the Shirebrook company, the firm heading up Sports Direct’s insolvency, approached Deloitte, EY, PwC and KPMG to ask them to take on one of the toughest jobs in the profession. But is it actually true that any of these Big Four firms would do a better and more thorough job than a smaller firm?

Challenges faced by Big Four

Following the demise of Carillion and BHS, the Competition and Markets Authority (CMA) recently entertained the possibility of the Big Four being split up, forcing them to work with smaller rivals. However, it instead recommended that government officials hold the Big Four accountable when it comes to the close relationship between their auditing divisions and more lucrative consulting services, in order to avoid a conflict of interest. It also stated that it is open to revisiting the prospect of a breakup in five years if the performance of these firms does not improve.

Splitting up the Big Four would certainly change the dynamic completely, and allow smaller firms to show their worth when it comes to larger Sports Direct level ordeals, but it would also create a much more competitive playing field for smaller firms, leaving large organisations without a go-to solution.

Another challenge the Big Four currently face is the rise in new technologies, especially on the back of digitisation and increased regulation. According to a survey from the Chartered Institute of Internal Auditors (IIA), just under 60% of auditing firms believed these factors to be significant problems ahead in 2019.

According to Christian Wolfe, a regular reporter on the Big Four firms, machine learning, artificial intelligence and blockchain accounting solutions are fair game for all smaller firms, and the way it currently works is that “if you want public financial statements that investors trust, you must use a Big Four accounting firm.” However, he points out that once you’ve eliminated the margin for human error, recording and verifying transactions will be equally as trustworthy regardless of which firm you approach for the job.

That sounds a lot like a level playing field when it comes to accounting and auditing performance.

Spread of audit work

This leads me to discuss why in fact it is not an actual level playing field in the auditing profession. Simply put, the spread of work when it comes to the larger Carillion or BHS situations is too much for a smaller company to handle. In this regard, Sports Direct are correct. The Big Four, individually, never mind put together, have the manpower and resources, on a global level, to confront the largest tasks.

The spread of work when it comes to the larger Carillion or BHS situations is too much for a smaller company to handle.

Economia reports that the amount of FTSE 100 clients on retainer between the Big Four has never been closer. In 2005, EY held the least, at 19 FTSE 100 clients, while PwC held the most at 41 FTSE 100 clients. In Q3 2019 the numbers are much closer. EY now holds the least at 22 FTSE clients, while PwC still holds the most at 27 FTSE clients. Clearly, the spread between the Big Four has become more even over the past 15 years, however 100% of FTSE 100 companies are now on the books of a Big Four auditing firm. In September, Steve Smith, research manager at Adviser Rankings Ltd told Bloomberg that “the Big Four have cornered the FTSE 100 market.” And he’s not wrong.

This is not yet the case with FTSE 250, but it’s not far off. According to the figures from Adviser Rankings, the Big Four currently control 95% of the FTSE 250 market in terms of number of clients, and 96% in terms of market capitalisation. The parity between the Big Four and all other auditing firms, based on the number of the UK’s largest companies that contract them, is worrying. The other two firms that control a small share of the auditing of FTSE 250 companies are BDO LLP and Grant Thornton LLP.

These numbers are the real figures on client retention, and should essentially serve as proof that the Big Four are in fact still the best, otherwise, surely the FTSE 100 or 250 would seek auditing services elsewhere?

How much they are paid

As the Big Four are by default considered the best, they of course also cost the most, and partners in these firms are earning figures you can only write on paper. Recent reports indicate Deloitte Partners are due their biggest payday in a decade; the average pay for 699 of Deloitte’s equity partners is $882,000 in 2019, moving up an average of $50,000 from last year.

In addition, Deloitte’s combined member firm revenue has risen a chunky 9.4% to $46.2 billion (£37.4 billion) since last year, and in 2018 this number had already grown 11.3% on the previous year. The growth is volatile, but it is significant growth for the company’s bottom line.

Based on the above, you would figure Deloitte, the largest of the Big Four, is charging its worth in gold, but are the companies that are paying these huge firms getting a fair deal in return?

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Quality Ranking

In terms of quality standards, the Big Four auditing firms are assessed and regulated, often by each other, which in a market of fierce competition between them, is a fair and appropriate method of benchmarking standards. There aren’t rankings available per se, but each of the Big Four has its own strengths and weaknesses; EY, for example, is more Europe centred and therefore by default performs better for European based firms.

On the topic of performance quality, Gennaro Senatore, former Transaction Services AM at KPMG, said on a Quora forum: “…with IFRS and Generally Accepted Audit Standards I can tell you the differences are getting less and less noticeable.” He mentions PwC having an edge, or “at least perceived.” While he says that in terms of advisory, in Europe PwC has the most successful treasury practice, EY is stronger on internal audit and Risk Services, and Deloitte in implementation and IT projects. He concludes that KPMG is very good all-round and has a very strong tax practice. However, the performing results will be different for each client, for each auditing firm, so these opinions are after all highly subjective.

More recently, the UK Financial Reporting Council issued a serious warning about the quality of audits of financial statements in the UK. The watchdog stated that the Big Four have YoY failed to meet the benchmark 90% target of large company audits requiring no more than limited improvements. In 2019, of all auditing firms, 75% of audits reached that level of quality. The consequence was £32 million ($39.5 million) in fines (see above for Deloitte’s bottom line and then think about how this could possibly disincentivize poor performance).

Sir Winfried Bischoff, the outgoing chairman of the FRC, said in the watchdog’s report: “We are not seeing more immediate improvements from the [audit] firms and there is undesirable inconsistency across the market.”

The Big Four have YoY failed to meet the benchmark 90% target of large company audits requiring no more than limited improvements. In 2019, of all auditing firms, 75% of audits reached that level of quality.

Clients Dissatisfied

Despite not improving their performance, the Big Four are set to maintain the top tier stranglehold in the auditing sector, which is strange because a study by Source Global Research found that although over two-thirds (68%) of audit clients still rank a Big Four firm as their go-to external auditor, over half (58%) do not name their current auditor as their first choice.

In the US, there are reports of the Big Four bungling 31% of their most recent audits, as analysed by the Public Company Accounting Oversight Board (PCAOB). The data shows that in 2019, Deloitte bungled 20% of audits examined, PwC bungled 23.6%, EY bungled 27.3%, and KPMG bungled 50%. For what is expected of the Big Four, falling short of near-perfect is a bad image, so missing the mark on 31% of audits could be considered poor performance for the top firms; firms which are paid and are growing as if they were truly the best of the best.

(Source: www.pogo.org/investigation/2019/09/botched-audits-big-four-accounting-firms-fail-many-inspections/)

According to The Independent, Stephen Haddrill, the FRC’s chief executive, said: “At a time when the future of the audit sector is under the microscope, the latest audit quality results are not acceptable.

“Audit firms must identify the causes of their audit shortcomings and take rapid and appropriate action to improve quality. Our latest results suggest that they have failed to achieve this in recent years.”

So are the audits that were surveyed by both the UK and US watchdogs actually botched or bungled, or are the firms simply not as good as everyone thinks they are? Are the Big Four really still the best?

Based on what we’ve looked at, it is apparent that action should be taken, and further regulation implemented, while large companies should start considering the auditing and accounting services of smaller consultancy firms and perhaps then the status quo on the Big Four will change. What are your thoughts?

Cash flow, the money a business has in the tank to function, can make or break businesses. The latest MarketInvoice Business Insights explored the attitudes of UK SME owners on managing cash flow.

What is cash flow?

Put simply, cash flow is the money your business has readily available to use for day-to-day operations. Put less simply, it is whether your current assets are enough to cover current liabilities. Cash flow is also sometimes referred to as operating liquidity, working capital and current ratio.

Over half (52%) of business owners said they relied on making ad-hoc paper notes, using spreadsheets or relying on text messages from their bank to understand their cash flow position. Meanwhile, 18% reported using online accounting software to do so. Overall, 70% are taking it upon themselves to manage this. Only 30% were using an accountant to manage cash flow information.

Cash flow is clearly something front-of-mind for SMEs with almost half (45%) of business owners checking their cash flow position on a daily or weekly basis to ensure they have the means to continue the smooth running of their business.

Anil Stocker, CEO at MarketInvoice, commented: “Every business needs to know their cash flow position but the disproportionate manual focus on this can distract entrepreneurs from focussing on their business and driving growth. Managing cash flow needn’t be such a taxing affair with the plethora of online tools available today.”

Cash flow constraints mean that 87% of businesses are prevented from taking on more orders. Yet, two-thirds (67%) of business owners aren’t seeking any advice about cash flow. Of the businesses that ask for help, the majority (14%) are turning to their business bank manager. Furthermore, in shoring up cash flow, almost half (48%) of business owners reported increasing their bank overdraft facilities and one in six (16%) used invoice finance to tackle cash flow constraints.

Anil Stocker added: “It’s imperative that business owners get advice to manage their cash flow. We can’t allow UK economic growth to be stunted because of cash flow constraints. Businesses waiting on long payment terms can use invoice finance to help bridge the gap by getting an advance on their invoices and propel their businesses forward.”

After all, hackers are rife on the internet and if you’re not careful then you may find yourself an unsuspecting target. If you want to help yourself then there are a few things that you can do to guarantee your own online security.

Test your Passwords

It doesn’t matter how strong or even clever you think your password is because hackers can use the finest technology to get the edge. One way for you to know for sure if you think your password is strong enough would be for you to use a password analysis site. Sometimes this will give you an estimated time they think it would take for a hacker to guess your password. They even give you hints to improve it too.

Financial Accounts

Hackers tend to target real-money websites more than anything. This can include payment sites or even casinos. If you want to help yourself here then it is so important that you assess the site first, before you go depositing anything. If you want to sign up to an online casino, then check to make sure that the site is reputable, and that it has HTTPS as this will help to protect your data. NetBet casino games are a prime example of this, so you can always rest assured knowing that your data is safe on there. When signing up to a payment provider, check to see how well-used they are, how long they have been in business or even to see if they have any additional security measures that you can implement.

Use a Password Manager

Remembering all of your passwords can be an absolute nightmare. Writing them down is a huge security risk because if you were to be burgled then they would have access to just about anything. Using a password software can be great, as they are super secure and they give you the chance to remember just about anything you need. You will need to set a single master password to get into your account, so it’s suggested that you incorporate letters, numbers and even symbols where possible.

Sensitive Accounts

If you have an online account with any sensitive information, then you may want to double-up with an additional layer of security. This is especially the case if you bank online. Sure, this can make signing in way more frustrating but it’s well worth it if something were to happen. You also need to make sure that the most important accounts have an alternative email address too so that you can gain access to your account should you ever be locked out. This can be a real life-saver and it can also alert you if someone ever does try and hack your account. This can give you an extra level of security and you’d be surprised at how convenient it is for you to do this.

So, keeping your online data safe involves:

• Using a password manager
• Protecting your sensitive accounts
• Changing your passwords regularly
• And always choosing sites with HTTPS over HTTP