Starting an accountancy practice

[wtomkins312]

Hi all,

I am looking for some help and advice on starting an accountancy practice.

I am 26 and have 8 yrs experience running all aspects of accounts and payroll for 2 companies - one IT recruitment and the other construction recruitment. We use quickbooks pro 2008 and sage payroll but i also have some experience with sage line 50. I deal with VAT, PAYE, accounts yr end, bookkeeping and production of management information. I run accounts for both companies (who's combined turnover is £4m approx) on my own. Doing the lower end daily jobs such as filing and data inputting is becoming frustrating but the boss doesn't want to 'waste' money on getting me an accounts assistant!

I have just finished studying with AAT and have completed my last exams which i will get results in feb.

I also have ltd company set up ready to be used for accountancy services and even have 2 clients (who are friends) and i'm registered with HMRC as an agent and have registered with IFA to be able to practice in accounts.

I am lacking experience of working in an accountancy practice environment but feel confident of my knowlegde. I would be grateful if some1 could point me in the right direction to getting inside knowledge or even just a few pointers on starting an accountancy practice. I am interested to know what software is best for tax returns and ltd company accounts for example..anything will be useful.

Thanks
Wayne

[elainec100@cheapaccounting]

Wayne

There are numerous threads on here about this subject - a lot are doing the same as you especially this year.

So have a good search and you wll find some useful info.

Jenni may help more on this but I thought to be able to practice with AAT you had to be a Member in Practice (Jenni - I know that is the wrong wording).

I thought this took a year after the exams to do?

Have you registered for ML?

[Maslins]

Hi Wayne,

Sounds to me like you're going the right way about it. Having your first few clients as friends is probably a good idea. Inevitably your service won't be quite as smooth now as it hopefully will be in a few years time, and mates are likely to be more tolerant of that, especially if you're only charging mates rates!

VT Final Accounts is not something we currently use, but are considering changing to for accounts preps.

Your hardest job will be finding clients, so I'd recommend sticking with the day job for the time being (perhaps you can go down to part time with a more junior person doing the basic stuff...overall saving for your boss if their wages lower than yours). :p

There are of course also lots of red tape bollox to deal with. I'm sure all the doom & gloom accountants will come along to bring up all of those to put you off!

[Wild Goose]

Wayne

Have you registered for ML?

Won't he be covered by his IFA practising certificate? Would the IFA certificate obviate the AAT's practice certificate requirements?

[Jenni384]

Jenni may help more on this but I thought to be able to practice with AAT you had to be a Member in Practice (Jenni - I know that is the wrong wording).

I thought this took a year after the exams to do?


Elaine, right wording :D

Once you've passed your exams, you have to show you have the relevant experience and then you will attain full membership. You clearly have experience so should get MAAT straight away after you pass your exams (good luck!).

If you want to do any work for yourself you have to register as a MiP.
You have to demonstrate competence and experience in the areas for which you wish to be licenced. I forget how long this needs to be - best to ask the MiP team at AAT.

They will register you for MLR; if you wish to trade before you get full membership you will have to register with HMRC though you sound like you're close enough to attaining full membership that you should wait.

Won't he be covered by his IFA practising certificate? Would the IFA certificate obviate the AAT's practice certificate requirements?

Pass. I'm AAT; David is IFA, I would have thought that the IFA practicing cert would be fine (especially before you're MAAT) but I would double check with AAT to be on the safe side.

Whatever you do, you should get PII.

Regards working in practice from industry... it's possible to do it. But it's a steep learning curve and, unless you've at least got a mentor, many will argue it's not fair on your clients. By the sounds of it, though, it's the tax experience you need, not the accounts production - though bags of receipts might be a shock :D

Accounts production - VT without a doubt
Tax Returns - FTax is about a cheap as it gets and does the job. Tax Calc is also reasonably priced and very good.

If you're small and starting out, I wouldn't look at the more expensive offerings like digita, iris, drummohr etc though of course if you have the capital and want an all singing all dancing product straight away that of course is your choice :)

Do, do buy 3rd party tax return software - HMRC's product is awful in comparison.

Oh, and 12Pay or Moneysoft for payroll.

Best of luck

[elainec100@cheapaccounting]

Won't he be covered by his IFA practising certificate? Would the IFA certificate obviate the AAT's practice certificate requirements?


I don't know about the IFA at all - so maybe?

But can be practice under IFA without mucking up his AAT MiP application?

[DFL]

It looks like you have got pretty reasonable experience in dealing with accounting and tax matters. What you may need to also consider is what type of business you want to build.

Do you want to be a one man band or do you want to employ and grow? Do you want to do this until retirement or do you want to grow and sell? What are your profit requirements and how will you meet them?

It is worth considering the above and writing a business plan, as the type of practice you want to build will affect all strategic areas inlcuding marketing, pricing,service offerings and client base.

Having friends as clients already gives you some practical experience (which is better than none) though friends tend to be very easy to work for and not throw up some of the challenges that 5% of Joe Public tend to. Client management is key for a one man band so ask yourself what are your skills like in that area. Can you easily say no to an unreasonable client? Can you negotiate / communicate / inspire loyalty?

The thing to remember is that the technical accounts work is only one small element of building a successful practice - this needs to be of high quality and up to date, but there are many other areas to also concentrate your energy on, none of which can be overlooked in the long term.

Having said that, accounts and tax work can be a highly rewarding, profitable and enjoyable business to start and grow and there is no reason why you should not be able to meet the challenges of doing so.

With regard to your question on software for accounts production and tax returns, have a look at VT and TaxCalc respectively - both excellent products at very reasonable cost.

Good luck!

[Wild Goose]

But can be practice under IFA without mucking up his AAT MiP application?

You'll have to ask (Jenni's) David - he's an IFA.

It'll give you something to talk about on Sunday's flight!:D

[elainec100@cheapaccounting]

You'll have to ask (Jenni's) David - he's an IFA.

It'll give you something to talk about on Sunday's flight!:D

Soooo cheeky :rolleyes:

[Neilh]

Won't he be covered by his IFA practising certificate? Would the IFA certificate obviate the AAT's practice certificate requirements?

Hi

I dont believe the AAT requirements are obivated by the IFA certificate. As I understand it, the AAT require a practising MAAT to hold the AAT MiP status unless thay hold a practising certificate from a CCAB body - check the regs on the AAT website.



Have you registered for ML?

The AAT is a recognised supervisory body under the MLR, but this only applies to full members/MAAT.

Neil

[MBS Accountants]

Agree with NielH. You will still need to be an MiP with the AAT or not be a full member. They only drop this requirement if you hold a practising cert with another CCAB body as Neil suggested.

I would also recommend VT and TaxCalc. Although I have not used them for a few years now.

Again Moneysoft for payroll.

Best of luck. It might also be worth posting on the AAT forums to get some ideas from there as well?

[wtomkins312]

thanks to everyone for all the advice, very much aopporeciated..

[Scott-CopyandDesign]

I hate to be a member of the spelling police here but for your own good make sure you use proper grammar and spelling when communicating with clients. None of this 'some1' and 'yr' talk. This accountancy practice may be the first time you've ever had to speak directly with potential clients, and if they get one whiff of shoddy spelling they could very easily run a mile.

They're going to trust you to handle all their finances, so you have to be 100% professional.

Keep that in mind!