The Accrual or Cash basis for Management Accounting? There are two basic methods for producing management accounts through the year – with accruals or just measuring the ‘cash’ through the bank. The accruals basis takes into account purchases and sales incurred by the end of the month that have not yet been paid. The cash basis is just that – simply what has passed through the bank account and nothing else. When accountants talk about "accruals and prepayments" they are referring to the monthly adjustment required to follow the accruals method. READ MORE

Making Tax Digital - should you be concerned? Making Tax Digital is a government plan to update HMRC with financial information four times a year instead of simply at the year end. This is set to affect about 1.6 million companies, 2.4 million self-employed and 900,000 residential landlords. READ MORE

Do you know the big challenger to both Sage and Xero? It’s something called Paper. Over 1 million businesses, about a quarter of all, use this method for their ‘accounting’. By paper I don’t mean Excel, I mean the real thing. With half using Excel that leaves only about 30% using proper accounting software. So HMRC’s Making Tax Digital, starting in 2018 up to 2021, is in for a challenge, or perhaps it’s the business owner with the problem as MTD is hardly optional. So should small businesses use accounting software? READ MORE