BusinessMatters - the business blog for SMEs

Helping businesses succeed. For more technical "stuff" and tax data look at my website . If you would like to receive new postings when they appear subscribe via one of the buttons in the right-hand window below. If you would like to send an article to a friend just click on the envelope after the date.



Don't miss my latest blog on Money and don't forget to subscribe as well.

My "New" Blog and Bloglet

I have managed to add a Bloglet subscription to my new Blog which I have decided is the easiest e-mail subscriber to use. Sorry to mess you around.



I have taken the plunge and moved the BusinessMatters blog to TypePad. The new URL is here. If you have subscribed via Bloglet you should click on the Blogarithm logo ( at the top of the left column) to continue to receive e-mail updates. If you subscribed via Bloglines click on the FEEDBURNER logo and then click the SUB BLOGLINES logo and enter your details.


Baarmy Cumbria Tourist Board

Guess what? Cumbria Tourist Board couldn't be bothered. Despite being offered the simplest of contracts with minimum work on their part and a share of each ring-tone sale they said no. Mind you they didn't reply to any of my three e-mails or my two phone calls. The Chief Executive was on holiday when I phoned but he has two PAs. One was on holiday as well and the other was out all day. The "Public Relations Specialist" didn't return my calls and the other one works part-time! Just to prove I'm not a total cynic, my phone has the Baarmy Sheep ring-tone on it. I bet I don't hear many others.

Light Relief

I was delighted to see that yet another of our clients has responded to my request for more human content in their accounting records. Yesterday I came across a cheque for "French Lessons" in a farmer's books!


The Christmas Number One

Every so often one of Cumbria's quangos does something right. Cumbria Tourist Board are releasing their version of Jingle Bells today, the day before the Crazy Frog releases his. There is a ringtone as well but this is where it goes slightly downhill. Instead of being able to have it sent direct to your phone you have to download it to your computer and then transfer it to your mobile phone and it only works on phones which play MP3 ringtones. Come on Cumbria get real. I know a local firm which would delight in marketing the ringtone. Speed, however, is of the essence. So, let's get off our a(r)sses and just do it. You never know you may even have the Number One.


Don't ask the Inland Revenue for advice

I may be a little old fashioned but I can't help thinking that if you ask the Inland Revenue for advice then they will find it very difficult to be impartial. As a rule I tend to agree with the views of other qualified accountants but I have noticed that over the last few years more and more of my colleagues have been immunised by the new user-friendly attitude of the Revenue. I cannot believe they really think we are customers, I always thought there was a choice if you were buying! Last week there was a query in the Sunday Times about the employment status of cleaners. Kingston Smith suggested asking the Revenue. My advice is don't bother you'll only be told they are employees. Instead, find an accountant who respects the Inland Revenue but isn't frightened of them.


Since mentioning TypePad I've had three readers tell me it's a great product and two others offering their help to move my site. What better recommendation could there be than that? No matter how much companies spend (waste) on advertising it's the customer/client/user who decides if it's G-R-E-A-T or not. Long live word-of-mouth advertising.

Fashion Guru or Scrooge

The Daily Mail published a story recently about black Christmas trees. Well we have had one for years! My comment appears at the top of the list but if you can't find it I said: Fashion item! Bah! Humbug! We have had a black Christmas tree for eight years. We first saw it in a shop window ten years ago at �120. The next year it was reduced to �60 and the following year it was halved in price yet again. At �30 we couldn't resist it (we are Chartered Accountants after all). What better way for accountants to celebrate Christmas than a black Christmas tree. By the way, we're not that miserable, honest. On second thoughts, though�


How to make your accountant happy

Preparing accounts is pretty boring and still consists of reviewing receipts and payments and allocating them to the correct headings. To do this we sometimes have to look at cheque book counterfoils to find out what a cheque represents. I must have looked at thousands and thousands of cheque books but have never laughed until today. One of my clients wrote a cheque to the "Clerk to the Justices" for �60 and in very large letters underneath wrote A very BLACK day! Not maybe too funny out of context but when you've been ploughing through accounting records all day it seemed absolutely hilarious. So, if you want to make your accountant happy (well, happier) add some human content to your accounting records. Express your emotions. P.S. I have another story about cheque book counterfoils but it relies on the similarity between certain Anglo Saxon expletives and abbreviations for "accountant", so it doesn't really suit this medium!


My "New" Blog

I have been advised to move my blog to TypePad . I think the reasoning behind it is twofold. First it looks more professional and second "it's better". This is a warning. If everything is lost in the transfer you will always be able to access my blog from my website. By the way it will probably take me at least a fortnight to understand the "user friendly" instructions so don't panic yet. That's my privilege.

What businesses REALLY think of their accountants

Sage the accounts software company has recently published the results of a survey of more than 2300 businesses and this is what they said about their accountants:
  • A third don't believe their accountant saves them money; and
  • Three quarters don't think their accountant helps them grow their top line (sales)
Their top frustrations are:
  • Surprise fees 32%
  • No free advice 26%
  • Not talking my language 19%
A long time ago an American accountant told me "Perception is reality" so I quite willingly accept this criticism of my profession. My job is to prove the results wrong in the case of 3CA so, dare I say, watch this space?

George Best

I have only ever watched three professional soccer games in my life, one of which was Manchester United v Crystal Palace in February 1970 and George Best was playing. What a footballer. These Best quotes are from an avid United fan on . This is how I remember him. I spent a lot of money on booze, birds and fast cars. The rest I just squandered. I was in for 10 hours and had 40 pints - beating my previous record by 20 minutes. I used to go missing a lot... Miss Canada, Miss United Kingdom, Miss World. He cannot kick with his left foot, he cannot head a ball, he cannot tackle and he doesn't score many goals. Apart from that he's all right. -- (his assesment of Manchester United's David Beckham) In 1969 I gave up women and alcohol and it was the worst 20 minutes of my life. Pele called me the greatest footballer in the world. That is the ultimate salute to my life.


The cold spell

Just in case you hadn't noticed the weather AXA Insurance have issued a timely reminder to us all to make sure we're not caught out at work.

A small business survey which you can believe

The SERTeam is an independent, non-profit charitable association dedicated to:

* conducting and publishing entrepreneurship and small business research * improving understanding of key enterprise issues * working with and supporting other small business organisations

Once a quarter they research and produce the NatWest/SERTeam Survey of Small Business in Britain.

Their findings do reflect the views of the small business sector and at its most basic level it's nice to know that your current concerns are shared by other business owners.

You can complete the survey by going to their website . The highlights of the last survey were:
  • For the first time in the three and a half years since the sample
  • for this survey was refreshed, more small firms saw their sales
  • fall over the past year than managed to increase sales.

  • Though sales performance is down, small firm employment and
  • investment are relatively stable and inflationary pressures remain.

  • The sales balance is down sharply for small firms in the
  • health/education/leisure & other personal services sector
  • and in construction and retail, though small hotels & restaurants
  • remain buoyant.

  • The general economic climate is of increasing concern and is
  • now the top-ranked problem for SMEs with fewer than ten employees
  • and for manufacturers, wholesalers and retailers. Overall though,
  • government regulations and paperwork remains the biggest problem.

  • Expectations about prospects for the current quarter are down,
  • though that is usual for this time of year.

  • There was a big fall in underlying confidence in the previous survey
  • and there seems to have been little real change since then.


Learning from others' mistakes

My comment on National Enterprise Week was added to by Stuart Bruce. His experiences when his business failed as told in Real Business are well worth reading and remembering.

Blowing my own trumpet

Never ever (well in print anyway!) has my passion been mentioned until today. And I'm sorry but I'm going to share the comments with you. I have decided to turn over a new leaf and be less conservative, reserved, boring, ........



I am PASSIONATE about business but I don't always (never?) show it. Well here goes. This week is National Enterprise Week and it is mentioned on the Tom Peters' blog. I have added my two pennyworth - scroll down and click Comments.


Despite the upbeat comments by the Governor of the Bank of England we think it's pretty tough for small businesses. Customers are taking longer to pay which is a sure sign that things are getting worse. We've had a week of clients telling us sales are down, overdrafts are up and debtors (money owed to the business) are up as well. What should you do? If you are starting in business make sure that you have enough cash (literally money) to survive for at least six months no matter what happens. If you're already in business watch your cash instead of sales. Don't sell to people who don't or won't stick to your credit terms. Don't overbuy or overspend. And, if you are going to need an overdraft, ask for it sooner rather than later.


Cost Cutting

I've said it before but please if you are struggling to make enough money in your business don't immediately think of cutting costs. Chances are you will cut the very costs which the future of your business depends on e.g. marketing, training, information technology and, dare I say, business advice. Note I didn't say accountants fees. If your accountant is just preparing a set of accounts then sack him and employ a bookkeeper. It will be far cheaper. By the way (BTW) a reader thought I was far too polite in my posting about the local start-up seminar. I was. It was crap. How the bloody hell are we ever going to encourage entrepreneurism when the people talking about it are dead from the neck up?


Fiddling while Rome Burns

And this is nothing to do with the rather risque serial on BBC1 Earlier this year the Inland Revenue and HM Customs and Excise merged and became HM Revenue & Customs. I accept that it is still early days but nothing seem to have changed. The continuing Tax Credits fiasco is just one example of a number of seemingly intractable problems still facing the "new" department. After more than thirty years calling the Inland Revenue "the Revenue" and HM Customs & Excise "the VAT office" it is going to be difficult to refer to "HMRC" instead. What's more I didn't think it mattered until last Monday when I received an e-mail from Francis Taylor, a Media Relations Officer at the News Strategy & Planning Desk, HMRC Media Relation about my blog. In it he said "I note that in recent articles on the Construction Industry Scheme ....... Stuart Jones, reported on a presentation by 'the Inland Revenue'. To assist both your readers and our customers, who are often one and the same, I would be grateful if your publication could use the new department's title when referring to the Department." Up until last Monday I didn't realise it really mattered what I called the Revenue (within reason!) but I now realise it does. What a load of cr*p. I shall continue to refer to the "Revenue" and the "VAT office" for three reasons:
  • The terms are more understandable;
  • It's still a free country; and
  • To annoy Media Relation Officers
By the way if you want to check the Revenue's treatment of their "customers" tell them "The customer is always right" and see what happens. Bl**dy political correctness!
Regular readers will know that my attitude to most business advisors' concentration on health and safety issues to the exclusion of useful advice is somewhat cavalier. However, I recently came across a site which mixes both compliance and enterprise. AXA4Business manages to list our obligations as well as as our opportunities - a rare happening nowadays. Look at their National Business Awards pages - the winner is from the North West and there is a local business as well Flowers Direct in Morecambe. Well worth a look at both sites. P.S. By the way I'm just a little cross today as my next post will reveal. Talk about fiddling while Rome burns!


A question

My desk calendar from Who Moved My Cheese today posed the question : Why is it that some things which people envision never happen? The answer: The missing ingredient is PASSION!


Business Start-up Seminar

Yesterday Barclays Bank and the local Enterprise Agency (CREA) put on a seminar for people contemplating going into business. I asked a "business manager" at the local branch of Barclays for more information and was told to contact CREA. The person I spoke to there didn't know anything about it because she hadn't organised it! One thing I shall never understand is why seminars like this are put on by people who have never been in business and more than likely never will be otherwise they would have done it by now. Their whole approach lacks the enthusiasm vital for success in business.


Why accountants always tell you what you shouldn't have done rather than what you should do

Today I listened to a presentation by the Inland Revenue on the new Construction Industry Scheme (CIS). Although aimed mainly at builders themselves it seemed sensible for me to hear what the Revenue had to say. Not surprisingly I was the only accountant there. The Inland Revenue don't like the use of self-employed labour in the building industry and if they had their way would make everyone an employee. To "help" the building industry they are providing a web-based tool to determine workers' status i.e. whether a worker is self-employed or employed. What they failed to point out was that it was only their opinion. The business doesn't have to follow their "advice". I shall be writing to all my builder clients warning them about the Revenue's offer to help but will your accountant know about it if he wasn't there. That's why he'll be telling you that you shouldn't have followed the Revenue's advice but by then it will be too late.


Now I Know How Much My Opinions Are Really Worth!

I found this tool on Tom Peters' website and thought I would try it on my blog bearing in mind his blog is worth $576,959.88.

Doing the Right Thing

I once read that we will regret the things we didn't do in life far more than the things we did do. In my opinion this applies to most businesses and their owners. We spend most, if not all, of our time doing what has to be done (production and admin) rather than what we should be doing (marketing and business development). This isn't, however, a reason for the owner to stop doing the mundane and starting to employ staff to allow him to concentrate on the other work. There aren't many businesses which can afford to do this. Sadly, it probably means doing more work but making sure that the additional hours are spent doing the "right" things. It will also mean that most of us will have to move out of our comfort zone.


The Construction Industry Scheme

Last week the Government announced that the introduction of the new rules for the construction industry would be deferred for a year and will therefore not start until 6 April 2007. The announcement was so unexpected that the Inland Revenue haven't had time to list it on their website. The Construction Confederation, however, have published some brief details.


Accountancy IS exciting. Well sometimes!

It's not often that another Chartered Accountant actually excites me but a recent posting on another accountant's blog is (I don't want to go over the top) out of this world. Take a look at Music for the masses via Silicon Valleyally Scoll down and click on Pandora website and take a look. It takes a lot to excite me but this is something else!

European Week for Safety and Health at Work

Did you know that next week is European Week for Safety and Health at Work and this year it is focusing on the issue of noise at work, under the slogan, 'Stop that noise!', with the tagline, 'Noise at work - it can cost you more than your hearing'. No I didn't either but a reader of this blog, Joanna Tidball, did and she has referred me to the campaign microsite which contains lots of information about the awareness week and the issue of noise at work. Thanks Joanna. My father lost the hearing in one ear because of noise at work - he was a tank commander in World War II. Times have changed though. My son is an infantry officer and always has to prepare risk assessments before any exercise even those in Iraq or Afghanistan.

Bank Managers - Yet Again

Last week I asked the question Who will you dump first � your spouse or your bank manager?�.

Well, as it took the bank manager four days to reply instead of one as promised and another six days to put the overdraft in place I would suggest for that particular client it should be the bank manager.


Accounts Software

I saw an advert today for accounting software which was described as �fun� and quoted the familiar statistic that �70% of businesses fail within their first year�, the main reason being �because businesses don�t manage their accounts properly�.

Absolutely right except for one minor point, their software only kept a record of the invoices the business issued and the supplier invoices it had received. There was no record of the bank balance which I would suggest is a pretty important thing to know when you are in business.

I don�t want to explore the pros and cons of this software except to say that one of the benefits listed for the program is �save your accountant time, and you time and money�. Don�t believe it!

If you are contemplating buying accounts software always ask your accountants for suggestions. They are the ones who will be working with it at your year end. Don�t listen to a salesman.  


Who will you dump first? Your spouse or your bank manager.

A few months ago I read that business owners were more likely to �change� their spouse than their bank. Yesterday one of our client�s was promised a decision by their bank manager in connection with increasing their business borrowings. Today at three o�clock the bank manager phoned to say that he wouldn�t be able to say yes or no until tomorrow. This is not good enough. Banks do vary, although to be correct I should say �bank branches vary�. Don�t be frightened of your bank manager (or accountant while we are on the subject of advisors!). If you think they aren�t helping your business find another one. There are plenty to choose from.


A New Product

We are currently working on a new product which will allow business owners to control their business rather than as so often happens the business controlling them. It isn't complicated and is based on a cash flow forecast and budget. The main difference is that we show what needs monitoring to ensure the 12 months "happen" as planned. We are in our final version and we are pleased that it has allowed one client to raise a �10K overdraft to fund their business until the Spring. The client also knows: What the sales have to be every week; What they can spend their money on in the next six months; The maximum stock they can hold And, if the actual figures are the same as the forecast then the results will be exactly as forecast.


Trust in Business

At last week's Start-up Seminar I said it was important not to trust everyone you meet and everything you hear if you want to succeed in business. Client confidentiality often prevents me from giving examples but coincidentally the evening before the seminar I was at a Cumbria Chamber of Commerce meeting in Kendal. Mandy Dixon, the K Shopping Village manager, was also at the meeting and, to cut a long story short, the retailers in Kendal believe that their businesses will be hit if the Shopping Village is redeveloped and the number of shops is increased. To counter their objections Mandy Dixon a few years ago helped introduce a free bus service from the Shopping Village into the town (The Kendal Klipper). On Monday she announced that the bus service over a period of eight weeks this summer carried 22,000 passengers. A wonderful boost for the town centre shops you would think until you check the actual passenger numbers. The true figure was 8608. Bearing in mind this was passengers going into and coming out of town and the last passenger survey showed more locals used the bus than tourists the picture is slightly different. The moral of this story is to be very wary of other peoples statistics, surveys, views, etc especially if you are the one who will suffer if they are wrong. If the Kendal Klipper never carried another passenger it wouldn't affect K Shopping Village's customer figures one iota. The "difference" in the number of "shoppers" coming into the town centre will have a profound affect on every business which relies on the "statistics".


K Shopping Village

The proposals to redevelop K Shopping Village will make a huge difference to the town. Mandy Dixon, the manager of the "village", is very forthright in expressing her views. I think it is only fair that the rest of us have a chance to comment without being shouted down before we have finished! I have therefore set up a web survey which allows everyone (business owners, employees and the public) to vote. And don't worry the power of the internet allows you to comment without being ridiculed, shouted at or interrupted. Enjoy!


Why visitors don't stop in Kendal anymore

Having screwed up the traffic system over the last couple of years South Lakeland District Council have now told us whose fault it is that visitors don't stop in Kendal and guess what? It's the businesses (owners and employees) who park in the town! Councillor Peter Thornton said that plenty of parking for visitors would encourage tourists to come and spend in the town. Well that's sorted then!


Not a lot of people know this

This may come as a shock to the vast majority of you but there is a weekly magazine devoted entirely to discussing taxation! Not only that, but people pay nearly �5 a week for it. Rather imaginatively it is called Taxation! I think it is fairly safe to say it doesn't appeal to everyone but I am rather pleased this week as the editor has published a comment I have made about changes in paying tax at local tax offices.


Success in Business

Some of you may have been surprised that Number One on the list of characteristics of successful businesses was better accounting records. The reason is quite simple: The quality of the results is based on the quality of the decisions made in the business. The quality of the decisions is based on the quality of the information (records) in the business.


Is It Time to Hire Some Help?

Knowing when to hire is just as critical as knowing who to hire. While small businesses can be reluctant to hire additional help, it's critical to hire help when you can no longer keep up with your business's rate of growth.

You need to hire help when:

  • You are unable to balance the demands of your professional life with the demands of your personal life.
  • You have trouble meeting deadlines.
  • You lack the expertise to do it (i.e. bookkeeping or advertising).
  • Your health is adversely affected by workload.
  • Your relationships are strained.
  • You frequently hire independent contractors to complete certain tasks.
  • You consistently decline work that you cannot handle.
  • You are preoccupied with menial tasks, such as typing and answering phones.


Small Business Hit Yet Again by the Park Authority

The Lake District National Park Authority has once again ignored the effect of their actions on local businesses - see yesterday's story in The Westmorland Gazette.


Why Accountants are Boring

I was going to try and prove the opposite but when I reveal that if I'm given a set of accounts, no matter whose, I will read them, why should I bother because nobody will believe me! Last week Cumbria Tourist Board sent me a copy of their accounts for the year ended 31 March 2005. Very glossy, full of famous people - Chris Collier (Chief Executive of Cumbria Vision), Eric Robson, etc. but not the most exciting publication to land on the doormatl. Until you read the final note to the accounts (Number 17) which says, "On the 19th April 2005 the company {Cumbria Tourist Board} purchased property in Staveley to be used as its new headquarters at a cost of �485,000." WOW! How did they afford to do that? Well I'm quite certain the fact that Rural Regeneration Cumbria gave them �4 million last year didn't help (see my earlier Blog entry) but the question I would like to ask is: "How will owning your own offices attract more tourists to Cumbria?" I have sent a copy of this post to the Chief Executive of Cumbria Tourist Board so we'll wait and see.

Good Advice for Any Business

Reading my own Blog I realised there is a danger that it is concentrating on the failure of Cumbria's business support organisations (Quangos) rather than offering advice to SMEs. To correct this I thought you may be interested in the findings of Dr Alan Williams, PhD, who has conducted a study of nearly 14,000 new businesses. It was found that, in contrast to failed businesses, successful businesses were most likely to have: � Better accounting records � Records which were more frequently made available � Better preparation for business ownership � Consulted with a knowledgeable person or other source of information before starting business � Conducted a market survey to assess whether or not a market existed for their product or service � A large number of customers � Used formal written long-range (more than one year) plans � Used time management techniques � Regularly reviewed the suitability or otherwise of their location � Continuously updated their product knowledge and the technologies associated with their major products and the services � Continuously reviewed their firm�s marketing effectiveness and quality of business image � Used financial data for managing � Hired and retained good employees � Been able to manage the firm�s financial resources


A Quiet Week

I am still waiting for answers to the various matters I raised about the use of public money in Cumbria. The Chief Executive of the NWDA has written to me to say that he has asked Cumbria Vision and Business Link to contact me but ..............I'm still waiting. Well there's always tomorrow's post.


Free Advice for Starters

Having criticised the lack of support for the small business sector in Cumbria we have decided to put our money where our mouth is and are starting to hold FREE monthly seminars for start-up businesses. More details are available at This is the Lake District or by phoning our office on 01539 721002.


The Kendal Employment Fund

My offices are in Sand Aire House which used to be the head office of Provincial Insurance. To cut a long story short, Provincial was taken over in the early 1990s and closed its offices in Kendal a few years later. To compensate for the loss of high paid jobs the property developers who bought the building set up the Kendal Employment Fund. Crosby contributed �200000 to set up a fund to help businesses which were willing to create new, higher-paid (�14,500+) jobs in Kendal. Guess what? Nothing seems to have happened since the fund was set up. I have suggested that clients apply but they have ALL without exception been rejected. Today I have obtained details of how the fund has been administered and not only has very little of the fund been used but more importantly the fund administrator, South Lakeland District Council, has actually profited from the arrangement! I shall reveal more over the next few days.


The North West Development Agency

Last week The Westmorland Gazette published a story about my comments on the help available to small businesses in Cumbria. The full text is on my website By the way it is nearly a week since I delivered my comments personally to the Chairman of the NWDA and guess what? Nothing. No phone calls, no letter, nothing.


The Purpose of a Business

Peter Drucker, the business guru, said there is only one-valid definition of business purpose: to create a customer. He went on to say that "because its purpose is to create a customer, the business has two - and only these two - basic functions: marketing and innovation." How much of your time do you spend on marketing and how much on innovation. My guess and I would be the first to put my hand in the air with my answer is "Not enough".

New Rules for the Construction Industry

The Inland Revenue are changing the rules for using self employed subcontractors with effect from 6 April 2006. Don't fall into the same trap as a local builder who told his bank manager that "Next April the tax office are making me employ all my self employed subbies". The Inland Revenue would like businesses to do that but, without a shadow of a doubt, they CANNOT MAKE THEM. We have a number of ways to allow you to continue to use subbies without having to worry about the Inland Revenue telling you they should have been employees and hitting you with a huge tax bill. Contact us on 01539 721002 if you would like to discuss this in more detail.


Make sure your accountant isn't giving your secrets away

Each year limited companies have to file a set of abbreviated accounts with Companies House. These accounts are available for public inspection for a fee of �1. However, abbreviated accounts don't provide very much information - in very simple terms, a snapshot of the business at its year end showing what it owns and what it owes. The detailed information is contained in the statutory accounts which are sometimes referred to as the full accounts. They usually contain at least a dozen pages and have a detailed profit and loss account at the back showing, in detail, the business expenses for the year. Over the last four weeks we have seen two local accountants file the full accounts instead of the abbreviated ones. Very useful for our clients checking up on the competition. Not so helpful for the two companies.


Selling - The Basics

One of the commonest reasons I hear for poor business performance is lack of customers/sales. Having said this it has always surprised me that businesses take so little interest in recording who their customers and more importantly their prospective customers are. Yesterday I called in at an estate agents to ask about offices to rent in a nearby town. Admittedly it was nearly five o' clock and they wanted to close! I was handed three leaflets and told there was nothing else available. Nobody asked for my name, address or telephone number. If an office comes on the market next week how will they let me know?


Taking Action - Part II

"Never mistake motion for action" Ernest Hemingway


Another worrying sign for corporate Britain

was the way last Saturday's Financial Times described the 12.5% increase in the number of companies going to the wall compared with the previous three months. The paper did say it could be a blip - albeit a big one. But at the end of a week in which the Bank of England cut interest rates for the first time in two years, it might also reflect the pain companies are feeling as they face a slump in consumer spending, stagnation in the housing market and a flagging manufacturing sector. The FT did as always offer sound advice, namely: With the UK economy on an increasingly slippery slope, let's hope lower interest rates don't make businesses borrow even more recklessly.


Taking Action

Too many business owners think they are doing something (taking action) which will change their situation. Most of them fail to realise that in the words of Albert Einstein "doing the same thing over and over again but expecting different results is a definition of insanity" To change things you have to change.


A New Type of Accountant - Part II

Don't confuse a plan with a goal. Goals tend to be "loftier" ideas than plans. For example a goal would be "To have the most successful architect's business in the North West" wheras a plan would be "To double our sales next year". Also, too many motivational books and speakers give setting goals a magical power. See

The "Yale Study of Goals":

A Self-Improvement Urban Legend

We need a plan for one specific purpose - to take action.


A New Type of Accountant - Part I

Having committed to not wanting to prepare your accounts, we have to now explain what we do want to do, which is:

Help business owners make more money and secure their future

The starting point for this action is a plan. Unless you know what you want to achieve we cannot help. To paraphrase the Cheshire Cat in Alice in Wonderland "If you don't know where you are going, any road will take you there".



I've said it before but it won't do any harm repeating it:
Has your accountant changed what he does for you over the last 10/20/30/40 years?
I bet the answer is NO! He still prepares a set of accounts which you don't understand, completes your tax return and then sends you a bill for something you didn't really want in the first place. Yes? Well my inactivity on this Blog is due to me re-thinking my purpose in life and it isn't to prepare accounts. In fact, and you will have to bear with me over the next few weeks to learn why WE DON'T WANT TO PREPARE YOUR ACCOUNTS!


Creeping Taxes

Economists have an expression called "Fiscal Drag" which in simple terms means that as our income increases so does the proportion of tax we have to pay because the Government doesn't increase allowances in line with "wage inflation". Over the last few weeks I have noticed clients are facing bigger tax bills on static profits. One of the main reasons for the self employed is the increase in Class 4 National Insurance contributions over the last couple of years. This has made us re-examine whether clients should be operating as limited companies. There are tax savings to be made. Just make sure your accountant is checking the various options available to you.


Business is becoming more and more a battle

"A good plan violently executed right now is far better than a perfect plan executed next week" GENERAL GEORGE PATTON or as Yoda said "Just do it"


Red Tape

The Financial Times has seen fit to publish another of my letters:

Sir, As the owner of a small business and adviser to many more, may I be permitted to make the following observations on Gordon Brown's plan to lighten the regulatory burden on business.

1. Red tape, especially in the small and medium-sized companies sector, is more than inspections and visits; it consists of an ever-increasing number of rules and regulations aimed at the business sector, but in terms of resources consuming a far higher percentage of available time in SMEs than in large businesses.

2. It is clear that a considerable number of the 600,000 businesses eligible for the value added tax flat rate scheme will be worse off in financial terms by opting for less paperwork. A government example of "heads you lose, tails we win".

3. Legislation to reduce red tape? Isn't that akin to putting fires out with petrol?


More on Marketing

When a business looks at matching up supply and demand, the critical question is: What should it consider first-supply or demand? Unfortunately, too many businesses start with supply and simply assume that, because supply is organised, and because they know that their products or services are good, demand will automatically follow and all their products and services will sell. This supply-driven approach is not recommended, as many small (and large) businesses have found out to their peril. In fact, they don't have to buy from you at all! The trick is to find out what people want. What do they need, or what do they think they need? Once you know this, then look at supplying the products and services they want-not the other way round. If you want to succeed, you must look at demand first, not supply: This is known as being customer-focused or market-oriented. People who persist in placing the emphasis on supply are seen as being sales-oriented. If you adopt a market-oriented approach, then sales and profit should result, as you will be giving the customers what they want. However, if you adopt a supply-oriented approach, sales and profit will be much more difficult to achieve, as you will be concentrating on what you want to sell-not what the customers want to buy.


If a man can... make a better mousetrap, the world will make a beaten path to his door

My parents were very fond of this quote by Ralph Waldo Emerson, the famous American essayist. They believed it and so did I. Over the years, however, I have begun to have my doubts and recently I have been trying to analyse why. The main reason, I believe, is that people aren't as honest as they used to be. Nowadays, it is quite acceptable to be "economic with the truth" and people are more inclined than before to say their product is the best. Also, there are too many messages and not enough time to "beat the path". People like convenience rather than what is best for them. How does this relate to business? Easy, if you have a better mousetrap you'd better spend all your time telling as many people as possible about it but firstly make sure they trust you because otherwise your message will be forgotten as soon as the next one is seen/heard. Secondly, if you're buying a mousetrap don't believe everything you're told. Judge the person as well as the product. Whatever you do, don't think that the world nowadays will make a beaten path to your door. There are too many distractions along the way.


The latest stealth tax

I have lost track of the number of stealth taxes introduced by this government but even I was amazed when I read about the latest one in Accountancy Age. Click here to read about it and I promise you it's not April Fools Day.


The Next Five Years

  1. Taxes, both direct (National Insurance) and indirect (road fuel, etc) and don't forget all those stealth taxes (extra tax on pension funds), will undoubtedly increase. Make sure you take every opportunity to reduce your tax bill. This is tax avoidance and is perfectly legal not to be confused with tax evasion which is illegal.
  2. Red tape will increase. Make sure you cover the riskiest areas eg employment legislation, health & safety.
  3. Pensions will become, quite rightly, a major issue. Don't be conned into buying insurance products by commission based salesman who hide behind the title "independent". There are alternatives.
  4. Prosperity will be concentrated in the public sector and big companies. Try and make sure your customers are in this sector. In any event, make sure that you don't add to this sector's wealth by paying for unnecessary products and services ie banks selling insurance, paying too much tax,etc.
  5. Finally, make sure you have an accountant who is willing to fight for you rather than back down in the face of an ever more aggressive stance from the Inland Revenue and Customs & Excise. Remember, if your accountant hasn't changed in the last twenty years then the financial advice your business is receiving is twenty years out of date.


Something for the Weekend

Tim, my younger son bought me a calendar for Christmas, Who Moved My Cheese?, an amazing way to deal with change and win. Today's quote is highly relevant to all business owners (NB "Cheese" is a metaphor for whatever you want to have in life -- job, relationship, health, peace of mind.) :
Take a Moment
What might you be losing by not pursuing New Cheese? List three things you want that you don't have right now - for example, a job you love, more loving personal relationships, or a better sense of financial security. Will you accomplish these things doing what you're doing or do you need to take new actions?


A Marketing Message

Yesterday morning I was walking through our local shopping centre. The shops open between 9:00 and 9:30. One shop, however, had a sheet of paper taped to its security grille stating:
Open at 10:00 today
Inside, the shop assistant was stocking the shelves. What sort of message was this to its customers? Why didn't they use this one?:
Today, although we are in the shop, we are doing something far too important to serve our customers. B****r off till 10:00


What is marketing?

One of the biggest problems faced by small businesses is understanding the concept of marketing. I recently came across Peter Drucker's definition:
Marketing is the whole business seen from the customer's point of view.
A little ethereal perhaps but it does move us away from thinking marketing is just selling and nothing else.


Make sure your accountant isn't doing the same this year as last year and the year before and ...

What better time than the start of the new tax year to reconsider your business plans, both long term and short term. Central to these thoughts should be your accountant but be careful: Some people who claim to have twenty years' experience really have only one year's experience repeated twenty times.


An easy answer to bad memory

Those readers who know me will realise that patience is not one of my best qualities. When coupled with technology (ie my computer) the result is not a pretty sight. I hate waiting for a computer to do something. If it doesn't happen immediately then I hit the key again which I am told by the IT experts actually slows the process down more. Wonderful! Imagine my surprise when I discovered that for less than �40 I could speed up my computer by fitting extra memory (RAM) and more importantly I could do it myself. The Crucial Memory Advisor Tool takes the guesswork out of upgrading and the site even has a pictorial guide showing you step by step what to do. Well worth a visit.


Accountant with a fly in his eye

Having mentioned my letter in the FT it's only fair that I publish a reply from Mr Harvey Cole which was in yesterday's letters. Stuart Jones strains at the gnat of a business owner on a 1997 retail price index-linked income of �20,000 now paying �1 a month more than he did. This blinds him to two more relevant and important facts. First, average incomes have increased by much more than the RPI; and second, marginal rates remain at the same 33 per cent as in 1997 (then 23 per cent income income tax and 10 per cent national insurance; now 22 percent tax and 11 per cent NI). Hence, the vast majority of taxpayers retain two-thirds of any growth in their real incomes - just as they did under that nice Mr Clarke - and up to a threshold for higher-rate tax that has itself been increased by slightly more than the RPI. Harvey Cole Economic and Development Consultant Winchester Hants SO22 5BP


One Lord-a-Lying

Earlier this week Lord Haskins, chairman of the Better Regulation Taskforce, wrote in the Financial Times "this government has earned the grudging approval of business for its management of the economy". The editor of the FT was kind enough to publish a letter I wrote about the accuracy of some of the other statements in the same article. Click here to read the full letter (you may have to scroll down the page when it opens)


Have you ever wondered what accountants look at on the internet?

Believe it or not there is a site especially for accountants. Normally I would never suggest that anybody who wasn't an accountant wasted their time looking at it unless it was two o' clock in the morning and they were suffering from insomnia. However, every once in a while there is something which will interest the rest of the human race rather than us "bean-counters". Today's stories includes one on the Inland Revenue's attitude to people who carry on a business on eBay. Read the article but don't worry if your selling is no more than a hobby, the Revenue won't be interested.


Have you joined The Forgotten Army?

Last week the Institute of Fiscal Studies announced household incomes had fallen for the first time in a decade. The Labour Party were quick off the mark to explain that if the self employed were excluded household incomes had actually increased! You will no doubt have you own views. See if they agree with those of the Federation of Small Businesses by reading this article and don't forget voting day is May 5th.


Watch your passwords

More and more small businesses are using internet banking but as the number increases so does the number of fraudsters trying to steal your details. The Forum of Private Businesses has highlighted the problem in a recent press release (click here to read the article). Finding the most appropriate combination of hardware and software is not always easy. If you would like some help e-mail us with your problem at and we will put you in touch with the firm which protects our systems.


If you think this year's business rates are high......!

Hidden away in the discussion about the affect of the 2007 council tax revaluations was a comment by Nick Raynsford, the local government minister. Once again (!) he put pressure on the business community to pay more in business rates as a way of easing some of the pressure on council tax payers. The power to increase business rates without consequence was taken away from local authorities by the Conservatives to prevent local authorities treating business as a cash cow. At the time, it was said that central government would be better placed to treat all businesses the same. If Labour win the next election businesses will be paying yet another stealth tax next year. Don't say you weren't warned!


If you only read one thing this year make sure it's this letter

Todays Financial Times contains a letter commenting on an editorial which said most people under 50 will not be able to retire in their 60s. The writer's comments echo my feelings about how the insurance sector, both providers and brokers, seem to think their products are the only answer when it comes to savings and pensions.


Your 2005 Tax Return will drop through your letter box next week

and it's hard to believe that the quicker you submit your Return the easier it is to manage your tax affairs. Some of the benefits are:
  • You will know your precise tax payments for the next two years
  • The Inland Revenue Statements of Accounts which you receive every few months will be correct
  • You will be able to budget (save) for your tax bills
  • Paying your tax on the correct dates will make you less likely to be investigated by the Inland Revenue

Try to avoid leaving the Inland Revenue to calculate your tax liability. Not only does this take time but there is no check on the calculation. Remember that you cannot rely on the Revenue to get your tax bill correct. By its own admission, one in four tax bills is wrong.

If you have an accountant make sure that your tax liability is calculated and your Return is sent to the Inland Revenue electronically. If you are in the fortunate position of being due a repayment of tax this action should mean that you should have your cheque within days rather than months.


Thought for the Day

Easter Week seems an appropriate time to read Thought for the Day from The Rev Dr Alan Billings, vicar of St. George's Church, Kendal (the church is on the opposite side of the river from our offices). Alan is a regular presenter on BBC Radio 4 and his comments on work are well worth reading.


Why do professionals think they're not running a business like the rest of us?

A client has decided to sell her business and has asked a firm of chartered surveyors to advertise the business and handle any inquiries. There has not been a great deal of interest but at the end of last month a couple were shown around who said they would have to speak to their bank manager about the finances. I phoned the client last week to see if there had been any developments. To cut a long story short, she didn't know because the agents hadn't contacted her since the couple had looked round the shop. When I phoned the agents I was told they didn't know either because in their own words "We don't like to push people". Not surprisingly I have suggested to my client that she finds another firm of surveyors to handle the sale. The moral of the story - the professions are no different to any other supplier. Treat them accordingly. If they don't do a good job then sack them.


"What do you think of the Budget, Stuart?"

Rather than give a straightforward answer to a question I shall be asked many times today I have decided to reply with another question. Governments raise money from tax or loans. Tax pays the loan interest as well as the loan repayments. Tax is paid by you and me. Guess who is going to pay for Gordon's "generosity"?


Economic Development � an Accountant�s View

Cumbria�s economy is failing and despite the number of organisations which exist to improve matters when all�s said and done, a great deal more is said than done. The most up to date statistics from the European Commission on gross value added were published in February 2004. These show that Cumbria is the only county in the UK experiencing economic decline. This fact is brought into even sharper focus by comparison across the recently extended European Union. Only Berlin, one sub-division in both the Czech Republic and Bulgaria, and parts of Romania show economic declines as fast as Cumbria. The only growth industry in Cumbria would appear to be economic development initiatives and organisations. Over the last couple of years we have had Rural Regeneration Cumbria (RRC), the Cumbria Strategic Partnership and most recently Cumbria Vision. The Cumbria Strategic Partnership by its own definition �brings together key public, private and voluntary sector partners to improve the economic, social and environmental well-being of Cumbria�. Last year they produced a report Sustainable Cumbria 2004 to 2024 based on the questioning more than 50 public, private and voluntary sector organisations. Closer study of the report reveals that there are only two businesses included in the partnership, Pirelli and Innovia Films (both multi-national companies). When asked for a list of any other businesses interviewed the Partnership was unable to supply exact details but said that the �Chairman spoke to many businesses during his inquiries�. Rural Regeneration Cumbria�s objectives include attracting and developing new industries as well as supporting agriculture and tourism, where Cumbria has traditionally been strong. Set up in late 2002 to aid rural regeneration post Foot and Mouth the organisation will have a budget of �42.25 million. A quick glance at its website reveals the astonishing fact that more than 70% of its Strategic Regeneration Fund in 2004 went to just three other quangos; Cumbria Rural Enterprise Agency (�9.8m), Cumbria Tourist Board (�4m) and the Cumbria Small Business Service (�1.7m) . No doubt RRC will be quick to point out that money given to all three organisations will benefit Cumbrian businesses. Further examination of the money given to the Small Business Service to help business start-ups reveals a different picture. Of a total budget of �2.7million less than �1 million will go to businesses, the other 65% (�1.7 million) being spent by the Small Business Service on itself. Only 1% of the RRC�s 2004 budget of nearly �25 million went to small businesses. Cumbria Vision aims to provide the strategic leadership necessary to drive forward the future economic regeneration of Cumbria. It has recently advertised for two non-executive board members with a business background. As neither position is salaried the number of applications from individuals in the small business sector will be minimal. Contrast this approach with the chairman of Cumbria Vision (David Brockbank) who is paid at an annualised rate of �70,000 for his work as a board member of the North West Development Agency. In conclusion, Cumbria will never prosper until: 1) Government financial assistance is given to businesses instead of being retained by the ever growing group of economic development quangos; 2) New blood is brought into these organisations instead of as so often happens at present when recruitment comes from within or from another �associated� organisation; and 3) More attention is paid to the fast changing technological world we live in as opposed to the idealised, chocolate-box world so beloved by the present incumbents.


The Value of Paperwork!

I may have "shot myself in the foot" over the paperwork issue! I should have said it is important and valuable. One of the problems with tax planning is that it produces very little in the way of tangible benefits other than a few sheets of paper and the tax savings, of course. David Maister, a the leading authority on professional service firms, compares our work to an iceberg. The clients only see 10% of it.


Yet more paperwork but, good news, it's for accountants

The recent rush to save tax by re-registering businesses as limited companies must have the Inland Revenue rubbing their hands in glee. Yes, trading as a limited company will save you tax but it may well be costly in the long term because of the extra tax rules involved. As a sole trader or partner you are able, within reason, to take whatever you want from the business in the way of salary, drawings, private cheques, etc. and the Inland Revenue can't touch you. This isn't the case with a limited company. Provided you have sufficient funds of your own invested in the company withdrawing money isn't a problem. If you don't you must withdraw it as salary or dividends. Failing to do this may allow the Inland Revenue to start inquiring into your tax affairs as well as allowing them to charge tax, interest and penalties on any money you have withdrawn in the wrong manner. But don't worry, there is a solution and although it's tied up with planning and paperwork most of the work will probably fall on your accountant. Make sure you know what you can withdraw from the company (your accountant should be able to tell you) and make sure that if it is salary it is taxed under PAYE and the tax and National Insurance are paid to the Inland Revenue at the correct time. If it is a dividend make sure that the correct company law procedures have been followed and that the correct paperwork has been produced. Confused? As I said, most of the work will probably fall on your accountant anyway. Just make sure he is doing it.

Quarter of firms failing to set financial targets

A recent survey by careers advice and training service, learndirect, has found that a quarter of small- and medium-sized businesses are inhibiting their own growth by failing to set regular financial targets. I think the figure is higher but it does show the importance of the saying:
What you can measure you can manage


Cutting Costs

We recently quoted for preparing a limited company's accounts and dealing with its corporation tax affairs. Time was of the essence because the accounts had to be filed at Companies House within four weeks and we had promised that they would be filed before the deadline. A competitor beat us on price and the director told us that his decision was based solely on saving money. In this case it was �200. And that firm had also promised to complete the work within the deadline We have been here before and people who know me are aware of my views of the majority of accountants. Not surprisingly, the other firm failed to complete the accounts in time and the company will be fined �100 by Companies House. The moral of the story? Integrity. Not everyone you meet in business has it, even (especially?) accountants.


Cumbria Vision

Cumbria Vision are advertising for four non-executive directors. I had half a mind to apply but discovered that despite a two day per month requirement the positions were unpaid. Compare this with Cumbria Vision's chairman, David Brockbank, who is a director of the North West Development Agency and is paid as if he was on a salary of more than �70,000 per year for the days he attends board meetings of that agency. How on earth do they expect business owners to give up two days per month without pay? No doubt the positions will be filled with seconded employees, retired "executives" and the "great and the good". P.S. It has occurred to me that having half a mind may mean I am over-qualified for the job!


Good news for a client

Remember the client who was suffering severe cash flow difficulties? Well, good news, they've managed to reduce their repayments by 25% using our suggestions and we have reduced their annual tax bill by 75%. So we are feeling pretty smug at the moment. The next step is to increase their sales (Top Line Outcome) as opposed to their bottom line.


How to Succeed in Business

Probably the most important point to realise in building a successful business is that it is not just how hard you work but also what work you do which is important. Too may business owners do not spend enough time working ON improving their business. Their first step should be to have regular meetings. This article will explain why.


Cost Cutting

As we are no longer allowed to mention the word recession (The government's spin doctors will not allow it!) I shall have to use "difficult" instead. I have noticed over the last few months that business life is becoming more "difficult" ie profits are falling and, inevitably, the armchair-pundits have started to give their advice which usually consists of cutting costs as quickly and by as much as possible. I have no problem with cutting waste and cost-cutting will often work in the short term (the harder the cuts the better the results) but in the long term it can prove disastrous because the expenses which are cut tend to be the "soft" ones ie advertising, marketing, training, investment, etc. All of which are vital for the future success of the business. A couple of quotes reinforce my opinion: In the final analysis you can't continue to reduce costs and grow Paul Cook - Raychem No business can (cost) cut its way to success Bill Gates - Microsoft


Cumbria Vision

The announcement of the new chief executive for Cumbria Vision raises just one question: Is one of the reasons Ms. Chris Collier has been appointed chief executive of Cumbria Vision to avoid any accusations that jobs in Cumbria's quangos are only filled from "the old-boys network"?


Testing our Skills

One of our new clients is in a mess! They bought a business last year and the seller suggested they paid for it over a period of five years. Sounds great doesn't it? Until you realise that the repayments are more than the profit. Worse still the couple who bought it did the right thing - they contacted their bank manager who recommended a solicitor and an accountant. Sadly the accountant (not us) didn't point out the fact the business couldn't afford the repayments (he was more interested in reporting the previous owners for money-laundering) and the solicitor didn't mention it either despite his website stating " we have the professional expertise to deal with every aspect of Business & Commercial Law. We�ll take care of the legal work whilst you concentrate on running your business"! We (Anne and I) have set ourselves a challenge. Within the next week we shall give the owners the answers to making a success of their business. Too ambitious? Maybe, but if we don't nobody else will. To add insult to injury, the bank manager has told them they have a really good business. His judgement is based on how they operate their account rather than the facts. The moral of this story? Make sure you have accountants who can run a business rather than add up figures and complete tax returns. How do you know when you have the wrong accountant? Easy - INSTINCT. If you think you don't have good accountants then chances are you're correct. Ditch them now before it's too late.


An �825 Gift from the Government

Did you know that the Government will GIVE you �825 over the next five years if you submit your PAYE end of year forms (P35s and P14s) over the internet instead of using the paper forms. The Business Link website has an article which explains how it works. Don't worry if you don't have a computer/don't use the internet/don't complete tax forms - we will do it for you. We already have for all our clients. After all, it isn't every week that the Government gives YOU money.


Moving from Compliance to Business Development Work

The deadline for submitting tax returns was yesterday so we can stop form filling (compliance work) and move onto tax reduction and wealth creation (Business Development Work = BDW). As a starter - did you know that there are only four ways to grow your business? 1. Increase the number of customers of the type you want to have; 2. Increase the number of times customers come back; 3. Increase the average value of each sale; and 4. Increase the effectiveness of each process in the business.


The Accountants are Letting Us Down

I couldn't resist this article on Tom Peters' website - The Accountants are Letting Us Down Although a little heavy I agree totally with the heading! Businesses should as well as other things be focussing on KPIs (Key Performance Indicators). Now we are rid of all the tax returns we have decided that 3CA will make things happen rather than report on what has happened. Let us know if you're interested. We want to make sure 2005 is not the same as 2004, 2003, 2002 ............


Creating more time

I have yet to meet a business owner who doesn't need more time. Advice on time management is legion but I have just read an article which may help and may even kill two birds with one stone. Employing a bookkeeper as well as ensuring more accurate records (one of the most important ways to prevent an Inland Revenue investigation) will allow your accountant to focus on financial advice rather than correcting errors in your books. The extra hours you will find can be used to concentrate on the important issues which your accountant should be pointing out because of the extra time he has been given.


Is the glass half full or half empty?

A few days ago I wrote about how Gift Aid can increase gifts to charities by nearly 30% but you have to pay tax to make it work. I did say, however, that if your spouse/partner paid tax then you should ask them to make the donation and allow the charity to claim the tax relief. I have just read an article by Armstrong Watson a local firm of chartered accountants which says very much the same BUT their advice is "just make a simple donation in cash rather than using the Gift Aid scheme". This fits in rather nicely with an earlier post of mine about the character of most accountants and the headline of this story. Don't forget the answer is often decided by the approach - is the glass half full or half empty?.


More about Blogging

The Beginner's Guide to Business Blogging explains why e-mail newsletters aren't enough anymore and why every business should have its own blog.



Albert Einstein's definition of insanity: Doing the same thing over and over again and expecting different results must ring a bell with many business owners. I, along with thouands of other accountants, spend each January trying desparately to make sure that all our clients' tax returns are submitted to the Inland Revenue before January 31. Most of us moan a great deal but do nothing to change the situation. I'm not suggesting that we all give up what we're doing and find new careers. All I'm saying is that perhaps every so often we should step back and see what we could change to make things better. My somewhat late New Year resolution?


There is No Such Thing as a Free Lunch

This morning I received a letter from Business Link Cumbria (a Government funded body set up to help businesses) telling me they have carried out a survey which shows that businesses are confused about the choice of products and services available throughout the county. Personally I am not surprised because the Government promises the world to small businesses and delivers nothing. However, Business Link want to liase with 3CA and other accountants in the county. Fair enough, but to do that they are holding an �event� at The Netherwood Hotel in Grange-over-Sands to �share ideas�. The meeting starts at 12 noon with a drinks reception followed by a three-course lunch. The presentations start (eventually) at 13:45 and finish at 15:15 for afternoon tea/coffee until 16:00. What a waste of time, 90 minutes work in four hours, and what a waste of money - our money, the taxpayers� money. Why do I complain about this? 1) Because I�m an optimist. I believe that if enough people demand change then the Government will have to listen; 2) Because Business Link are not addressing the problems facing small businesses by events like this one; and 3) Cumbria has one of the weakest economy�s in the European Union and Business Link are fiddling while Rome burns. Let me know what you think by adding a comment and don�t forget you can receive an e-mail to let you know when I add to my Blog by completing the subscribe box on the right.


Tax and the Forthcoming Election

Within a few months we will once again be asked to decide our Government for the next five years and it seems a good idea to present my thoughts on the three political parties varied approaches to tax. At this stage I must state that politically I am slightly to the right of Ghengis Khan And Attila the Hun! On a more serious note, the parties have the following policies on taxation: The Liberal Democrats They will break the two party consensus on taxation by promising to increase income tax on those earning more than �100,000 a year. The Conservatives They have earmarked �4 billion which will be used to reduce taxes. The Labour Party Since coming into power they have introduced 66 ( Yes SIXTY SIX new taxes). The choice is yours but if you want to pay LESS TAX you must vote Conservative.


Accounts Software

Having spent most of today trying to make sense of 40 spreadsheets which are the accounting records of a small company may I urge all of you not to try and save money by not buying accounts software and deciding to design your own in a spreadsheet. The ones I have been working on today:
  • Don't add-up (See below)
  • Cannot be read on the screen without moving the figures around
  • Don't give accurate results

Software is so cheap nowadays (from upwards of �100) it is short sighted not to invest in it. Be careful though to make sure you buy one which suits your business.

Remember - Sage isn't always the answer.

"Don't add-up" = don't balance in accountancy language ie the figures don't reflect the actual amounts received and paid by the business. Not much use really!


What is a Blog?

Something for the Weekend

I have just renewed my office insurance and have been sent a Certificate of Employers' Liability Insurance certificate to display on my office wall. Last year's certificate was just about to go in the bin when I read a note on the back: The Employers' Liability (Compulsory Insurance) Regulations 1998 require you to keep this certificate or a copy for 40 years. 40 years! Which clown dreamed this one up? I shall be long gone well before then. What do I do with all those certificates when I die? Bequeath them to my eldest son? Why do I have to keep them anyway? Doesn't the insurance company have a copy?

The Tsunami Appeal

Many of us will have given money over the last few weeks to help the victims of this disaster. Did you know that if you are giving the money direct to a charity it is possible to increase your donation by more than 25% by stating you want to use Gift Aid? This is a Government inspired way of encouraging us all to be more charitable by in effect giving the tax we have paid on earning our donation to the charity instead of using (wasting?) it themselves. There are two things to remember:
  1. Keep details of the donation as it has to be entered on your tax return; and
  2. Don't use Gift Aid if you are not paying tax. If your spouse/partner pays tax, ask them to give the money in their name


The 3CA Website Our website is now over four years old and although it has been revised over that time we feel it is starting to show its age.

We are proud that it is different from the vast majority of accountants' websites but think that the start of a new year is a good time to change it and start from scratch.

Our opinions are important but not nearly as important as the users. So please let us know what you think.

We are tempted by the idea of a small "public" website ( a few pages giving details of who we are, where we are and what we do) and this Blog for news, tax tips, business tips, etc. Other ideas are:

  • A website for clients to access containing detailed advice on tax and business topics
  • A secure area for each client where copies of accounts, details of tax due, etc can be accessed without having to contact us

Please let us know your ideas by adding a comment below.


Advice for the Small Business Sector Am I the only person who thinks that most of the advice "given" to small businesses is at best irrelevant and at worst downright insulting? I have just received this month's e-mail newsletter from our local Business Link. In it they are suggesting that we adopt the following resolutions for our businesses:
  • I will recover any outstanding debts and know my rights for the future
  • I will introduce some crime prevention measures, both for my business premises and IT system
  • I will identify key risks to my business and create disaster recovery plans to deal with them
Come on guys, this isn't going to set the world alight. How about listening to Peter Drucker's advice that there are two basic functions in business - marketing and innovation. Success is dependent on these two factors not a "disaster" recovery plan.


What is a blog? For the last few months I have been toying with the idea of having a blog instead of using my firm's website to publish news, thoughts, tips, the occasional photo, etc. Whenever, I have discussed this with friends their immediate question is "What's a blog?". Well, for everyone's benefit here goes.

A blog � short for "web log" � is an online personal journal that covers topics ranging from daily life to technology to culture to the arts. Blogs made such an impact in 2004 that Merriam-Webster named it the word of the year.


The Bootstrapper's Bible For more years than I care to remember I have been suggesting to business owners that borrowing money is not usually the answer to their problems nor is it a way to succeed - there is usually another way. I recently came across a variation on this theme in Seth Godin's The Bootstrapper's Bible. Under the heading, What's a Big Company Got that You Haven't Got, he lists access to capital and goes on to say "If a market can be bought with cash, a big company will do it". Bootstrappers, in the author's words, are "entrepreneurs who are working their butts off to start a great business from scratch with no (or almost no) money". The book is available for free download until the end of December at


Something for BUSY people Nobody seems to have enough time nowadays but in business we are constantly being told not to use the word "busy" - nobody evers gives new work or referrals to busy people. I have recently read an article about this phenomenen It doesn't answer all your questions but it may help.


Paperwork Tells the Story Last Wednesday I was listening to a tax specialist talking about tax savings schemes for small businesses. I don�t want to bore you with the detail but the results are REALLY exciting. There was one point, however, which may explain why your accountant produces more and more papers for you to sign, or at least he should be if he is doing his job properly � the paperwork tells the story. Most ways of saving tax relate to certain things (e.g. dividends being paid, businesses being transferred to limited companies, etc) happening at a certain time. The Revenue can examine these events many years later. Without paperwork it is very difficult, if not impossible, to prove they happened at the correct time. At the very least, if you are now trading as a limited company make sure your accountant is preparing dividend vouchers whenever a dividend is paid.


Earlier this week I was accused by a client of being negative. Now, clients are never wrong but I could not resist asking him how many chartered accountants he knew and had he ever been to an accountants' meeting? If you think I'm negative then you should meet .........! 3CA's primary objective is to care for its clients. We don't think we are negative in fact we aim to portray a "positive frame". One of the few accountants I respect, who sadly died a few years ago, was called Tim Beauchemin. His office was in Canada and he used to say "Talk about what to do rather than what not to do". I call this "The Beauchemin Principle" and try to live it every day.


The Cranfield School of Management have recently produced a report  which highlights the top ten differences between fast and slow growing small and medium enterprises. To read it click on "report". Although it is based on a survey of 2000 businesses whose turnover ranged between �1/2 million and �20 million a year it is in fact extremely relevant to every small business. If you would like to explore any of the conclusions in more detail please e-mail me at