Leading professional advisory firm Broomfield & Alexander has announced it’s merger with W R King & Co., the largest independent firm of accountants in Neath.
Three directors and seven members of staff from WR King & Co. will join the team at Broomfield & Alexander from 1 October. The turnover of the merged firm will be approximately £5.5 million with a combined staff count in excess of 100.
The merger will allow WR King & Co.’s clients to access the many specialisms on offer at Broomfield & Alexander, including access to grants, corporate finance and specialist tax planning. It will also allow clients from both businesses access to a wider base of professional expertise and experience in accounting, audit and tax advice.
The specialist legal team at Broomfield & Alexander are currently undertaking our annual visits to our legal clients, pulling together the accounts and monitoring compliance with the SRA Accounts Rules with a view to preparing our accountants report.
As a team we have identified a couple of points through the course of our work to share with you.
- Residual client balances
Scenario: A matter is complete and there is a residual client account balance. What do you do?
Return the monies to the client promptly by way or cheque or a direct bank transfer to the client’s bank account at the end of or substantial completion of a matter.
If you are unable to trace or contact the client and the firm has made every attempt possible to return the monies then you can follow one of two options.
If you are the COFA for your firm you may wish to consider including ‘billing’ in your staff handbook to ensure all employees and managers comply with your firm’s policy. This is important as part of your firms monitoring of financial stability and compliance with SRA regulations.
In contrast to the standard VAT accounting scheme where you pay VAT on bills issued, and reclaim VAT on supplier invoices received, there is an alternative scheme designed to deal with cash flow issues, especially if your clients are slow payers.
The Cash Accounting VAT scheme
This scheme can currently be used if your firm’s estimated VAT taxable turnover (net of VAT) is less than £1.35 million per year. Although this turnover limit is subject to change by HMRC, using the scheme allows you to declare the VAT on your fees only when your clients pay you; and reclaim VAT on your expenses/ purchases only when you have paid your suppliers.
Solicitors regulator reveals phased approach to creating exemptions for lawyers from the accountants report
Plans to streamline the elements needed to complete annual accountants’ report for law firms have been revealed by the Solicitors Regulation Authority (SRA).
Its newly simplified approach has been put forward as a more amenable alternative to its previous plans – announced in May – to do away with the reports completely, a move which met with resistance from both solicitors and accountants. The accountants’ report is an audit of solicitors’ client account – where they hold client’s money.
Now, while firms will still have to commission accountants’ reports within six months of their financial reporting period, only those reports that are qualified will have to be filed with the SRA.
A new tax relief scheme was released by the government in July 2014 which aims to encourage taxpayers to invest and support social enterprises and other socially driven organisations.
It is hoped that this will provide a new source of finance for charitable organisations. Details of this new relief were published in the Finance Bill 2014, and the tax relief is available on qualifying investments made after April 2014. Providing all conditions are met, the taxpayer can effectively deduct 30% of the cost of their investment from their income tax bill; there is also the option to defer the tax on realised capital gains by reinstating the proceeds via a SITR. Furthermore the future disposal of the SITR investment will be free from capital gains tax.
A new accounting standard shall soon come into force that fundamentally changes the financial reporting for many UK companies. Although these changes may affect companies in general, there are a number of key changes that will affect companies with ownership of properties.
Unless, as it currently stands, but this may well be changing further, you are preparing your accounts in accordance with the FRSSE (Financial Reporting Standard for Smaller Entities) or applying the IFRS international accounting standards, then your company’s financial statements will need to be prepared in accordance with a new accounting standard, FRS 102, which takes effect from periods beginning on or after 1 January 2015.
On transition to this new standard, your company will be required to restate its comparative results to amounts as if it had applied the new accounting standard in previous years. Careful planning and identification of the main changes is therefore required now as you cannot wait until 2015 to deal with the points.
Employers with fewer than 50 employees will face automated in-year penalties for late real-time PAYE returns from 6 March next year.
Those who employ 50 or more people will face penalties from 6 October 2014.
HM Revenue and Customs (HMRC) will send electronic messages to all employers shortly to let them know when the penalties will apply to them, based on the number of employees shown in the department’s records.
Where employers believe they have a reasonable excuse for sending a return late, they will be able to appeal using HMRC’s new, online appeals process for automated penalties. This should speed up the appeal process for businesses and HMRC.
In the run up to March 2015, HMRC will examine other ways to encourage employers to comply with the rules, in addition to financial penalties.
HMRC have published information for employers on what to do when they receive a reminder through PAYE Online because their payroll submission or payment is made late.
There are three types of messages that an employer could receive: late filing notice; non-filing notice; and late payment notice.
When a late filing notice is received in respect of a Full Payment Submission (FPS) and if an employer has a valid reason for sending their FPS after any of the payment dates, they should let HMRC know why in the ‘Late reporting reason’ field in their payroll software. A list of late reporting reasons and when to report is available here.
The manufacturing sector is calling on government to move towards ‘demand-led education’ to help the sector bridge the current skills gap.
Businesses contributing to a ‘Manifesto for Manufacturing’ report compiled by the Manufacturing Group at MHA, the national association of independent accountants, say that secondary and tertiary education needs to be re-focused away from ‘abstract academic targets’ towards skills needed by employers.
The recommendations in the report, which will be sent to politicians of every political persuasion ahead of the 2015 election, are designed to put the case for increasing the support given to the manufacturing and engineering sector by whichever party forms the next government.