News & Articles

1. Prepare yourself
The first step is to prepare.

Decide upon a system: What will you use to build your budget - are you already subscribed to a financial accounting software, such as Xero, that’s suited to the purpose? If not, a spreadsheet is likely to be the best solution to get started. 

Set up the chosen system for your budget, allowing space to map out each of the elements outlined in steps 2-5 below, and set an appropriate timeframe that makes sense for your business. This can be monthly, quarterly or annually, or could track all three in one budget plan - either way, keep in mind that for maximum impact, your budget will be reviewed and updated on a monthly basis, comparing your plan with your real life results, and adjusting it as appropriate.

Gather your data: Next, pull together all of the financial statements and reports you’ll need to outline your expected income, expenditure and profit for your chosen timeframe. ​

Take Action: Regardless of how long you’ve been trading, how much information you have available to you about your business finances, or what you know about budgeting - get started! Take action from whatever position you’re currently in, and the clouds of mystery will start to evaporate.


2- Outline your estimated income
Begin to map out your estimated income - how much revenue you expect to receive within the defined timeframe - and from where. The sales information on your Profit and Loss statement, and your sales pipeline is a great place to start. Then consider what other sources of income you may have in the upcoming period that may not yet have been accounted for, and outline them on your budget plan. Total all of your expected income for the period.

If you’re just starting out, why not begin by setting some sales targets that are reflective of your existing business situation, then work out your expected income based on these, alongside the cost of your products and services.


3- Outline your fixed expenditure
Next your fixed expenditure - this is your regular outgoings that will show up on your statement month after month, and are generally the same amount each time. It may include items such as rent and service costs. Your bank statements and accounting reports can help you work out all expenditure for your business, but don’t forget to consider any new contracts you’ve signed, or wish to sign in the upcoming period, that will result in new ongoing fixed costs. All of these will be outlined in this section of your budget. ​


4- Outline your variable expenditure
Variable expenditure is different from fixed - it is the expenditure that varies in amount from month to month, based on your business needs and activity. It may include utility bills, printing costs and office supplies. Total all variable expenditure for the timeframe.  
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5- Outline your one-off expenditure
Outline your one-off expenditure - these are the spends you don’t make very often, and sometimes pop up unexpectedly. They may include repairs or new equipment costs. Total all of your one-off expenditure for the period.


6- Calculate your profitability 
Now that you’ve mapped out all of your expected income and expenditure within your budget plan and have calculated the totals for each area, you can calculate your profitability. To do this simply compare your total income with your total expenditure - this will reveal your profit for the defined time period.


Now that you’ve built your budget plan, you have all the insight you need to start making some highly impactful financial decisions for your business, and keep the rest of your team on track. 

Click here to book a working session with Pyramis Solutions. We can help you build a budget that’s tailored to your business or offer valuable insight into how to make the most out of your current plan. 

Whether you have been in business for some time or are just starting out, I am sure you have wondered about all the various financial roles out there and what would be right for your business.

Finance Professionals are wide ranging and finding the right type of professional for the task at hand is important in getting the best result, so read on for our brief guide into the different roles and services provided:

Book-keeper
At some point you may want a book-keeper in your business, even as a sole trader this support can be valuable. A bookkeeper is a data-entry professional, whose primary role is to make and maintain your accurate business records. The data collated by a bookkeeper is often used by business owners and accountants to make financial decisions and can be provided to your accountant.

Financial Accountant
Unless you love doing your own tax returns, you will want an accountant. The bigger your business gets the more important it is to have someone who really knows what they are doing on the job.
They maintain your financial accountability; and oversee areas like payroll, taxes, and spending. They can also provide reports to management and investigate any financial discrepancies that may arise.

Management Accountant
If you become a LTD company, then you will want a Management accountant. They work for public companies, private businesses, and government agencies and look after the day-to-day accounts. Their duties include recording and crunching numbers, helping to choose and manage company investments, risk management, budgeting, planning, strategising, and decision making. They are normally a key part of a business.

Financial Manager/Controller/Director
Larger companies will have a Financial Manager or Director. They work with the management team to plan, organise, direct and co-ordinate financial information and advise on company financial policy.

Tax Specialist
A Tax Specialist focuses solely on tax planning and compliance. They can advise clients on ways to reduce their tax bills, or prepare and submit tax return forms.

Auditors
An auditor is trained to carry out an audit which is “independent examination of financial information of any business or organisation.”  Larger companies are required to have their accounts audited, however this is not usually required by small companies.

Companies of any size can be investigated by HMRC, for example if a discrepancy arises in your tax affairs. This is not a statutory accounts audit, and your tax specialist or financial accountant can usually help you through this process.

Insolvency Specialist
An Insolvency Specialist is someone who is licensed and authorised to act in relation to an insolvent individual, partnership or company. Most are accountants or insolvency specialists working in firms of accountants. You will only need one of these if your business cannot pay it’s debts ie you have more liabilities than assets on the balance sheet, or if you’re looking to wind up a company. Sometimes it can be useful to consult an insolvency practitioner if your business is encountering difficulties and you want to look at options for recovery.

Mergers & Acquisitions Specialists
Mergers and acquisitions (M&A) is a term that refers to the management, financing, and strategy involved with buying, selling, and merging companies. The M&A Specialist will assist with the deal negotiations and help manage the entire process from a tax perspective.

Banking & Financing 
As we all know, Banking and Finance is the world of money, shares, credit and investments. Financial markets are very important, and understanding the pricing of assets and derivative securities is vital. Financial intermediaries such as banks are key players in these financial markets.
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Investment Specialists
An investment specialist represents the fund manager when speaking to clients, they can explain what is happening in the fund: ie where the manager is investing and why.

So how do you know what support you need for your business?
For most sole traders, you would just need a low maintenance bookkeeper and accountant, someone to keep everything up to date and prepare at end-of-year off your records and file statutory commitments.

If you want a more supportive professional, who is available to discuss, train and explain what you need and occasionally check in with you regarding your numbers then look to work with an accountant who actively supports you through the year.

If your business is expanding and growing, you may need extra support from someone who is more involved in your business. Depending on your comfort level with the finances this might be through your financial accountant, or by using additional management accounting services.  Look for someone who can actively review accounts throughout the year, share information or updates as they arise that may affect you, and share ways to improve your books. The aim is to help you plan the coming years strategy as things change in your business.

Pyramis Solutions - Your Outsourced Financial Department 

At Pyramis Solutions, our services are designed to feel like your internal team, offering the support and practicality of having a book-keeper, management accountant and Financial Director/Controller in your business.  Our aim is to help get the full financial management coverage in one handy service, from getting the numbers in order, having reporting that helps you make decisions with them and then utilising this to plan ahead, future proofing your business as well as you can.

We also bend and flex as the business changes, utilising the right people at the right time to work closely with you, that way you have the whole team available and no further recruitment or training needed when you grow.

To top it off, with our Pyramis Accountancy service, we also can help with the compliance and statutory work, again taking the proactive approach to your accounting, perfect for those that want a closer look throughout the year.

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Your business is growing, you have realised you can no longer do it all, so you get others in to help you out as your team expands.

You can let go of some responsibilities, but how do you stay on top of all the moving parts?

How do you know how things really are in your business and how do you measure the success when you are not in the day-to-day?

​As our team is developing, so are the workflows in each department, with independent functions and projects happening all the time.

This can be a hard shift for a business owner to navigate as they take on balancing delegation with leadership and supporting without micromanaging. Then there is the setting up of workflows and reporting so the leader can truly step back from the ‘doing’.

My chief love is working with my clients and working with my team. I have happily started letting go of some areas of the business, which are taken care of by much more capable hands than mine. But with this step back, I could lose sight of the day-to-day.

So, how does a business owner manage all of that?

Something we are working on at the moment is how we track activity, progress and results at Pyramis Solutions. 

With team members taking on more autonomy and control for their areas of responsibility and to avoid ending up in endless ‘update’ meetings or writing/reading dry reports, I wanted a lightweight system that can track key elements of the business in our very own ‘Dashboard’.

It’s no secret that I love my tech! So I looked at the key software tools available. Many are integrating or utilising a form of ‘dashboard’ where they summarise all the information held into small digestible and often graphical representations. Tools for Accounting, Sales, Marketing & even Productivity are great, but I wanted to see all my business in one place.

Thankfully, I feel quite at home in an Excel Spreadsheet. As long as I can find the data, I can design the processing and presentation I need, so I set out on creating our very own ‘dashboard’.

I started out with what I know, the financials! I will never tire of saying the financials are the sum of the other parts. Whatever strategy, ambition and targets you set in any part of the business, the results show up in the financials. So this was an easy one to define as we already have key indicators to measure against for this.

Working our way through Sales, Marketing, Customer Success and Operations, we are building a full picture of the moving parts for the organisation to see a very summarised snapshot to measure how performance is going.  

One thing that has been extremely interesting is defining what is important. No-one want’s data for data’s sake. We don’t want to be revisiting, tweaking and reprocessing all the time, as a small business, we simply don’t have the resources for that. 
Determining what is important is a great tool to cut out the unnecessary and really focus on the stuff that matters, which again, in a resource restricted business, was a very useful exercise.

It even helped me to evaluate some of our internal processes. We determined that a key area to understanding the mechanics of the business was to have insight through job costing. What I realised is that to get that data without duplication, reprocessing and in a timely manner, we needed to upgrade some processes.

So the act of looking at and defining our results is smoothing out and improving our underlying processes, which can only be a good thing as we grow. I’m not looking to grow a business on shaky foundations.

The dashboard can offer several other benefits too.

First, now the team knows what we are looking to achieve and what the expectations are, they can take on more responsibility for the results and can regularly check in without my interference or evaluation.  

If they are updating the results, I don’t have to, so I can take a clean top level view at the overall picture and decide for the future of the business.

It also acts as an early warning system, if standards are slipping, external factors are affecting results, things are not going in the right direction, we can do something about it early.

And if it is going better than expected, what a way to showcase and thank everyone quickly for their amazing results.

Ultimately, it allows me, the business owner, to step back without losing visibility. 

If you are reading this and know of a piece of kit that is perfect for the job and suits the small business price range, I would love to hear about it!

And if, like us, you think it is time to look at your reporting lines and results across the business, why not consider one of our Working Session to kick start its development? 


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As we move into March, we think it’s a good time to start thinking about your Tax Return.
Yes, we know what you are thinking - didn’t we just do that?
You got your tax return in and probably thought - that’s it for another year, so you can forget about it.

Or…

Maybe it can be less stressful, especially if you left it to the last minute again.
We all love a deadline, most of us work better when we have one but when we leave the work until the very last minute it can be stressful. 

So here are some tips for managing your accounts over the year, making things more manageable for you and your accountant!

1. Set your deadline earlier. Talk to your accountant, ask them what they need from you and set time aside each week or month to do this. Block the time out in your diary for finance time.
2. Make it a habit - use software like Xero, or Quickbooks, to keep your records up to date as you go
3. If you are a Xero user use hubdoc to snap and forward receipts to the software to speed up reconciling income and expenses; for Quickbooks use the Quickbooks receipt capture. Both work on phone apps.
4. Stay in touch with your accountant and update them of any changes through the year.
5. Do a pre end-of-year review - eg get everything up to date as far as you can in March, this makes finishing it off much easier.
6. Focus on the positives of getting your tax return in early. If you’ve made payments on account and your income is lower than last year, then you will reduce your next payment due in July, or possibly get an early refund. This also helps you plan for your next tax payment.
7. Getting your accounts done early can help with getting mortgages and loans approved.
8. File paperwork as you go along to avoid any lost documents / receipts and last-minute panics, (again you can use the software to get it in your system).
9. Lastly, set yourself a business challenge. Know exactly where you are with your numbers and profits each quarter - to do this you’ll need to have your records up to date and you’ll have better business finance information which will help make those decisions throughout the year. 

We offer bespoke working sessions to help you with any area of your business numbers - because when the numbers work, your business works. If you would like to discuss what you need and how we can help you then please book a call today.

Yet again, there are more changes coming for Making tax Digital (MTD).

MTD is becoming mandatory for all businesses from 1st April 2022, even those businesses with a VAT turnover below the registration threshold.

Now I must declare, that I’m not much of ‘Tax’ person, so I won’t be sharing any insights into the wonderful world of what’s coming with MTD, however as a business owner, like many others, I may well be forced to make a choice, so I thought I would share some insights.

The latest changes will include the withdrawal of certain reporting mechanisms for VAT submissions from your accounting software to HMRC (your old system won’t be able to talk to HMRC anymore), which has led to submission changes in your software to cope.

VAT Submissions for MTD are currently mandatory for all businesses that have crossed the VAT Registration threshold and therefore for those businesses, the decision has been made for them; they need to submit via an MTD method.

However, businesses that have voluntarily registered for VAT because they’re below the registration threshold and who haven’t yet signed up for MTD, now face the choice of whether to register early for MTD VAT Submissions or to remain unregistered and to file VAT Returns through the Government Gateway.

That doesn’t seem so bad, right?
However, there are some drawbacks to not embracing MTD.
Firstly, how are the numbers being prepared? 

If you’re not using accountancy software yet, then tracking the entries manually, preparing the finished numbers and then entering them into the gateway leaves a lot of room for arithmetic or human error. This can be costly to notice, find and resolve.

Spreadsheets are super easy to break without noticing, so the likelihood of an error slipping in can be quite high, even for the most diligent person. If you’re busy and up against a deadline (which I’m sure most business owners find themselves in), then the process can be tiresome, stressful and therefore easy to make a mistake.
The level of effort to prepare that information can certainly creep up, especially if there are a couple of inconsistencies, and you suddenly lose a couple of hours trawling around spreadsheets and paperwork.  
It is also quite difficult to proofread your own work, especially when you’ve just spent an hour or two digging around in the details.

Secondly, the inevitable is coming!  

HMRC has some very strong reasons for introducing MTD, one of them being that it is easier to do accounts when the transactions are recent (which is the main argument for moving the self-assessment style reporting to quarterly). And we have to agree with them, trying to remember every transaction for over 12 months is difficult. The quicker a transaction is processed, the better.  

As MTD is not going away. I would advise to future-proof your business. Getting MTD compliant now will save a lot of stress later.

If you are already using a software for your accounting, it is just plain easier and more time effective to connect it up and click a button for submission each month, compared to finding the report, reviewing it and then manually logging into your gateway to enter the same numbers. There is also a slight risk of getting the report periods wrong or transposing the entries as you fill in the form, by using your software that talks to HMRC, that is covered.

If you are not using software, then you may find that you gain more than just MTD filing from moving over to an accounts package.
Some benefits are:

1. Your accounts and source documentation in one secure place. 
2. You can assign tasks to others in your organisation without showing them all your sensitive accounts information.
3. Handy reports and dashboards can help you get an understanding of where your business is in real time.
4. The level of reporting and historical information now available for you to review and look at trends has increased dramatically.
5. Integrations with other tech is becoming a real time saver.

So even if MTD doesn’t feel like a driver, the benefits from moving to an accounts package can change the relationship with your financial information, allowing you to use this information as a tool for making business decisions instead of just considering it as the chore it can be.
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Finally, with the introduction of the historical information, reports and VAT Submissions available at click of a button, you get the chance to prepare and submit filings a lot easier, avoiding the stressful deadlines but more importantly, giving you the opportunity to do some cash flow planning.

MTD for VAT is here now, and MTD for income tax is arriving in April 2023, with corporation tax to follow. Using up-to-date accounting systems will mean you or your accountant can get those numbers together quickly, which then gives you a good 8- 9 months to plan for the payment of any tax.
We believe in the ‘value added’ accounting software brings to a business owner, if you would like to find out more about migration or how to get more from your system, why not book in a Working Session with one of the team?

You can do that here: www.pyramissolutions.co.uk/appointments.html

So it’s coming up to the end of a very long, hard, difficult and/or weird year for many of us.  I’m sure the other ‘planners’ out there had to scrunch up this year’s plans into a ball and get creative to keep business flowing.

To all those that had to make tough decisions this year, I commend you!  And I want to congratulate all those that have managed to pivot, expand, bend and flex this year in order to be even more secure and successful through these times.

Here at Pyramis, we have been so very fortunate to work within an industry that has continued to receive funding, create new grant research projects and provide services that helped during COVID, so we are very happy that we were able to continue to support our clients the best way we could, helping them to manage those numbers.  


As like many at this time of the year, the team are looking forward to a break over the festive period, but before we do, we’ve been looking back over the year and reflecting on our highlights and learnings.


Highlights Of Our Year

With a new website, an expanding team and our sister company Pyramis Accountancy launching, we had plenty to keep us busy through 2020.


But for me, the highlight has been getting to work with our talented team members and to watch the business develop with every contribution made.  Most of my colleagues know that I have had a personal journey this year, but the kindness and support I’ve received, especially during a year when the world is facing such tough times, has been overwhelming. I was reminded that we work in such an incredible community, which is about people, as well as business.


I asked the team what their highlights and learnings were; Stefanie, enjoyed the ‘Photography Day’ we squeezed in right before lockdown.  We are all a little camera shy and this really was a team effort and I agree with her comment that it was the ‘first day that it really felt like Pyramis now had a team of people’.  


Alice joined us just before lockdown and mentioned that her highlight was ‘joining such a lovely team of supportive women in a role where I am continuously learning and growing’.  


I can totally empathise with Vicky who supports us in marketing, where she mentioned a true highlight being getting the website project completed and ‘going live’.


What We Learnt
The team’s thoughts on learnings can be summed up with one word ‘resilience’.

This year really did push the skills and resilience of business owners everywhere. I certainly have been challenged, but my biggest learning, the one that stands out as I write this, is being true and honest to myself.  

My personal challenges required me to reflect on what I do, how I do it and ask myself, ‘am I the best person to do it?’ 

And so, the latter part of 2020 has seen me take a step back, pause and really consider if what I aim to do moving forward is sustainable for me, the team and the business and how I play to my strengths. 

That reflection then also requires action, and this is where the resilience shows up - I had to bend, flex, generate new ideas and pause activities which caused friction for me in order for the business to operate and grow.


Stefanie has also captured this in her learning, she mentioned ‘how well people and businesses adapt despite covid turning absolutely everything on its head. You hear about how resilient and adaptable humans can be, but it feels a bit different when you get to actually see it’.


Alice put it perfectly, ‘with a bit of patience and perseverance you can work through anything’ and whilst we adapted to a new digital work-flow platform, Vicky was surprised to find that ‘I like being in a world with techie women as they force me to learn how to use the likes of Trello and other tech tools’. 


So What’s Next For Pyramis?

We just wanted to take this opportunity to send our season’s greetings, and hope you enjoy a break over the festive period.  

We’ll be looking at the year ahead with excitement and enthusiasm, bringing more ideas to our offerings and services, launching our Pyramis Tech brand and looking at how we can continue to help business owners get closer to their numbers.

Here at Pyramis, we believe that your financial records should be there to help you and your business.  Yes, the priority is to get the records right for the tax man, but ultimately, as your business gets older, matures and grows, the numbers become a certain source of truth about the state of your business.  

So how equipped do you feel to find, analyse and use your reports for your decision-making process?
This month we thought we’d look at some of these reports with you…

The 3 Key Reports
When starting anywhere with your reports, there are three key ones, each of which has very different information in them.

These reports are your Profit & Loss (or Income Statement), your Balance Sheet (or Statement of Financial Position) and your Cash Flow Forecast.  

Now if you have been keeping up with some of our previous posts, you’ll probably be sick to death of us discussing the Cash Flow Forecast, however this is still the highest on the priority list to master.  It is a pretty safe bet that if you master managing the Cash for the 12-18mths ahead; you have got some key foundations in place to keep the business healthy. You can request our FREE Cash Flow resource here.

Next on the to do list are the Profit & Loss and the Balance Sheet Reports, so what are they and what do they tell you?

If you have ever heard of your bookkeeper or accountant talk about double entry bookkeeping, these are the key reports that the system produces.  All that effort in allocating your transactions to a particular accounting category, ultimately ends up on either the Profit & Loss or the Balance Sheet.  So all transactions end up in one of these two reports.

Profit & Loss Report
The crucial point of the Profit & Loss (P&L) Report is to determine just that, have you made a profit or a loss.  It looks at how well the business is performing.

Key things to note:

1. It is only ever prepared for a single period, e.g. the month, quarter or year.
2. It therefore only considers the transactions that occurred in that period
3. If you record more sales than costs, this is deemed a profit
4. If you record more costs than sales, this is a loss
5. Not all transactions hit the P&L, e.g. buying an asset or paying off a debt so it won’t match your cash flow forecast exactly
6. If you are VAT registered, your P&L does not include VAT paid or received

What can you do with a P&L report?

• See at a glance whether your business has made a profit for that time period
• Compare how the business is doing over different time periods, e.g. look at profit by month
• See how your costs compare across different periods, eg rent costs this year compared to last year
• This will give you greater insight for managing costs and looking at income going forwards
• Use net profit to estimate post-tax profits for dividend planning

Balance Sheet
The balance sheet shows what the business owns (assets) and owes (liabilities) at a point in time.  The key point of the Balance Sheet (BS) Report is to determine how healthy your business is and what position it’s in.  The best way I have heard it explained is that it is like a photograph in time of all your assets, liabilities, reserves and capital/equity.
Let’s break down some of that terminology:

Assets = Items that you own or control that help create a benefit for you in your business
For example, a cake baking business could buy an oven that will help to bake cakes to sell.
Assets can also be the cash in your bank account.
  
Liabilities = Items that you owe to others in the short or long term
For example, that Start Up Loan you may have got when setting up; or the invoices owed to your suppliers; or amounts you owe in tax to HMRC.

Capital/Equity = The money owners have put in to the business
Or the funds from shareholders when they bought their shares.

Reserves = This is a blanket term for value generated by the business while trading
For example, profits or increase because of a revaluation of assets, less what’s been paid out to owners.

Overall, the Balance Sheet shows whether there are more assets in the business than liabilities and tells you if you are solvent at the time the report is created.

Key things to note:

1. It is a snapshot in time of the balances to date, so it will account for previous years’ transactions in the ‘opening balances’.
2. Ideally you will have more ‘current assets’ over ‘current liabilities’ as this might suggest you are insolvent if not.
3. The ‘net assets’ is the surplus value in your business over the cost to set up and finance, again this would hopefully be positive.

What can you do with a balance sheet report?

• See whether your company is ‘solvent’ (owns more than it owes)
• Check at a point in time how much you owe others, eg suppliers, employees, HMRC
• See how much other people owe you (debtors)
• Check the balance on your director’s loan account
• See how much is available in undistributed reserves for dividend planning

Management Reports vs Financial Statements
I think it is just worth mentioning that there are degrees of pernickety when preparing financial reports, and so the aim for business owners that want to get a lot closer to their numbers is to develop a sensible reporting structure that tells them about their business.  Something that can be used weekly, fortnightly, monthly or quarterly, makes sense year on year and has enough detail to help decision making. 

This firmly fits into the ‘Management Accounting’ and ‘Management Reporting’ aspects of financial reporting.  These are internal documents/reports, solely used for managing the business and are usually not shared outside the organisation.  It therefore has more freedom than those your accountants might prepare that at the end of the year, we often refer to these as ‘Financial Statements’.

Financial Statements are more formal, follow accounting principles and standards as set out by the relevant authorities.  Here in the UK, we are concerned with satisfying Companies House and use a certain set of standards applied based on the classification of your business size.  It is really important for accountants to follow these standards as this is what makes the published accounts a level playing field, especially for parties outside the organisation. They want to be able to compare performance, knowing the same rules are applied.

E.g. If you wanted to know which supermarket was doing better and who you wanted to buy stocks in, you want to be able to compare the key players with each other and compare like with like.

Here at Pyramis we love to make the management accounts and the financial statements talk to each other. So our aim is to help you develop management reporting that works for you as a business owner, but that also feeds smoothly into the financial statements and any other external reporting you need to do, so that there are no surprises when your year end statutory accounts are prepared.

How to create these reports?
Using an accounts package such as Xero or Quickbooks makes reporting very easy as these reports are built into the system and can be accessed within a few clicks.

Another benefit of accounts software is that as the data is all cleanly entered, so changing the reporting to different time periods, altering the format or the level of detail is also fairly simple to do.

It also allows you to quickly compare previous periods or look for trends over time.

And the biggest benefit is that you should be able to export these reports into a spreadsheet format, which then allows you to convert that into graphical formats or apply calculations to gain metrics on the values.

What do you do if you don’t currently have an accounts package?
Well, the answer depends on how comfortable you are already with financial reports…

Ultimately you can build them yourself from your prime book-keeping records and may need to do a bit of online learning to work out what categories you have and where they go on the reporting structure, however that might not be everyone’s cup of tea!

If you have an accountant, it may be worth asking them if they can help provide these more regularly, or even help you set them up, and ask how much that might be as a regular service.

Alternatively, here at Pyramis Solutions, we offer ‘Working Sessions’ for such a task, we can sit down with you to help create a template for you to continue working with over the coming months or years. 

We would recommend that as soon as it’s feasible, move over to an accounts package.  With Making Tax Digital becoming more prevalent and packages becoming even more automated and useful for business owners, it can save pounds in your time and it is less likely to have those awful spreadsheet errors.  

As a Xero partner, we know that their basic package is becoming much more suitable for a lot more businesses, so may be worth having a look.

Other Useful Reports & Metrics
We could talk about useful reporting all day, but here is a snapshot of some other useful reporting elements that would be worth looking at:

• Aged debtors: if you have lots of customers on credit then this is a critical report for showing you what each customer owes you at a point in time.  Ageing on the report will show which invoices are longest overdue.
• Aged creditors: like the aged debtors, but this shows what bills your business owes to its suppliers.  Useful for planning supplier payments, particularly if you need to plan cash flow around supplier credit terms.
• Ratios: once you’re comfortable with the profit-and-loss report, you can go one step further by starting to analyse particular trends in your business.  A key one is Gross Profit Margin (looking at profit after direct cost of sales).  This can give you a good indication on whether your pricing is appropriate, whether particular areas of the business are more profitable than others, or whether your costs are matching your sales.  For example if sales increase you might expect direct costs to increase, but the profit margin (as a percentage of sales) to stay constant.

You Get Out What You Put In
Ultimately, your reporting can only be as accurate or as up to date as the information being put into it.  So another Pyramis passion is encouraging clients to keep up to date with their books so you’ve got better data for working with!

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With the news of another lock down days away, Alison, over in our sister company, Pyramis Accountancy, has quickly pulled together some information which we hope will help.

The new JSS (Job Support Scheme) was supposed to be coming in from this month.  However instead, the ‘old’ JRS (furlough) scheme is being extended.
 
Key points are:
•    The basics are the same as the original furlough scheme
•    Furloughed employees would receive 80% of their gross salary up to a maximum of £2,500
•    Employers can choose to top up the wage to 100% salary
•    Employers will need to cover the cost of related national insurance and pension
•    Part time furlough is available, where employers will pay for any hours worked by the employees
•    To be eligible employees must have been on payroll by 30th October 2020
•    It’s not clear yet what ‘usual’ wage level the JRS will be based on
•    The government will confirm shortly when claims can first be made in respect of employee wage
       costs during November, but there will be no gap in eligibility for support between the previously
       announced end-date of CJRS and this extension
•    The JSS will not start until the JRS has finished
 
 
Support for Self-Employed Workers

Originally there were to be two further grants for self-employed workers, covering the periods November 2020 – January 2021 and February 2021 – April 2021.  The first of these is now to be at 40% of average wages (instead of 20% as previously stated).
 
There’s further information here, which will be updated as details develop: https://www.gov.uk/government/publications/self-employment-income-support-scheme-grant-extension/self-employment-income-support-scheme-grant-extension
 
Key points are:

To be eligible individuals (and partnerships) must:

• have been previously eligible for the Self-Employment Income Support Scheme first and second grant (although they do not have to have claimed the previous grant
  
• declare that they intend to continue to trade and either: are currently actively trading but are impacted by reduced demand due to coronavirus / were previously trading but are temporarily unable to do so due to coronavirus
  
• The online service for the next grant will be available from 14 December 2020. HMRC will provide full details about claiming and applications in guidance on GOV.UK in due course.

 

Links to other support:

You can find a lot of information here: 
 https://www.gov.uk/coronavirus/business-support

• The Local Restrictions Support Grant supports business that have been required to close due to local lockdown restrictions.  It provides support for businesses with premises, similar to the previous rates grant.  The guidance is currently being revised in the light of the national lockdown.  Further updates and information will be available here: https://www.gov.uk/guidance/check-if-youre-eligible-for-the-coronavirus-local-restrictions-support-grant
  
• The Kickstart scheme provides funding to create new job placements: https://www.gov.uk/guidance/apply-for-a-kickstart-scheme-grant-29-or-less-job-placements
  
• There’s also more information here on additional resources and support, including a business support helpline: https://www.gov.uk/guidance/additional-government-resources-to-support-your-business-during-coronavirus-disruptions?priority-taxon=09944b84-02ba-4742-a696-9e562fc9b29d
  
• Bounce-back loan scheme provides access to quicker finance with a 12 month interest free periods: https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan