In September 2016 I presented the keynote presentation in Manchester at the Practice Evolution Conference entitled “Accountants are the new bookkeepers” which was prompted by the introduction of the Making Tax Digital agenda.
It was apparent to me at the outset that MTD was predicated on bookkeeping which HMRC have decided should be digital which they perceive will cut down significantly on errors and mistakes whilst at the same time giving the taxpayer a better “journey”. I did say HMRC had decided.
Many Accountants had built their practices on annual compliance work and had avoided offering bookkeeping simply because it was time consuming and not particularly profitable. Relationships were forged with bookkeepers and work was passed backwards and forwards quite happily.
However, MTD meant that to retain the client we had to take back control of the bookkeeping and be responsible for the quarterly filing which was filling many with dread at the prospect of data entry of invoices cheque payments etc.
But the world had changed and the march of the cloud based products with many and varied app driven enhancements meant that the world of bookkeeping was no longer a case of ploughing through cheque books with illegible handwriting and trying desperately to match receipts to a sales ledger account.
Automation had started even back then and meant that bookkeeping was no longer labour intensive and meant that Accountants could become more proactive and treat the smallest of clients to timely and targeted help and advice.
Now in 2018 the march of MTD may have been postponed slightly but the move to more automation in the world of bookkeeping and accountancy is like a juggernaut going down a hill with no breaks and this is a good thing.
Now any size practice can make bookkeeping profitable which will make the MTD issues easier to handle, mean we can make tax saving decisions easier as we will be working with up to date information and we can help our clients with business enhancing observations again because we are up to date.
I said in 2016 we should embrace bookkeeping and nothing in the intervening period has made me change my mind.
By Tony Margaritelli (ICPA Chairman)
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