dont know what i am doing

[Bro's lacky]

Hello......I need your expert help please. My brother has opened a shop, and asked me if I would keep his books up together !! He says he has not got the time and it is easy! Well it might be easy to him, as he never does it.
He has been open since Nov 07 and last week dropped off his "paperwork" for me to get started. It was in a box, no paid or unpaid, bank stats that dont add up, but the worse thing is he is missing payment dates, because he files everything in this "box". Suppliers are threaterning to stop dealing with him, and red bills everywhere.
He is a great bloke and is doing really well in the shop, but his financial side is terrible. He is fine with pc's and I was wondering if there is a excel program that I can put all this on, then he will be able to see when things are due?
Im not a user of excel but I should be able to enter things on there, its the timescale of payments, or non-payments that is a big problem. Any help would be gratefully received.

[bumfluff]

The OpenOffice suite is a free replacement for MS Office and includes an Excel-like app.

There's various freeware accounting programs too, like PWSMoney. Moneybox is shareware (30 euros), but I've heard people say it's good. Never tried it myself, mind.

It might be worth just biting the bullet and getting a professional accountant to go through the books this once, just to get them in some kind of order. Once it's sorted, it'll be easier for you to keepon top of it.

I'd have words with your brother, though. He really needs to either keep SOME kind of order, or pass things on to you as they happen, rather than dumping everything on you at one go.

[MikePage]

I agree with BumFluff – If you are nor sure what you are doing talk to an Accountant now – especially if you are going to use one to help with the Year End issues of Accounts & Tax Returns. So at least you can get a simple system running asap that is good for you, bro & accountant!

It’s not clear from your post if Bro has registered with the Tax Office yet - & what the VAT position is.

A couple of simple pointers on suppliers : Get him at least to run 2 Ring Binders – for suppliers invoices – one Marked Paid & the other unpaid – get him to write Chq No. & Date on Suppliers invoices when he pays them.

Be very careful as to where you get your sales figure from. For shops Tax man will expect some sort of daily Z reading from tills ( he needs to keep till roll) but what is left in till is often different because of cash drawings, buying stamps & Stny, window cleaners – you get the picture. Thus you need some sort of taking sheet to reconcile sales > bankings.



Regards
Mike Page

[monaghan]

You can also get a free version of Microsoft Office Accounting, however I would echo bumfluff's advise, if you are out of your depth, get a "proper" accountant in and get the system setup so that you can just continue to add things the way you've been shown.

[Bro's lacky]

Thank you all for the info. I did say to my brother, to get the accounts started with an accountant, but he said he can not afford it ! He is a great guy and I have no doubt he will be a sucess, but he is oblivious to any form of paperwork !
I have got my self a collins catherdral book, and have started, but listing credits to the front, and splitting them into sales/banking. and the rear into debits and spliting them into utilities/wages/supplier payments/car costs/premisis rent ect.
I have no idea of vat extra, but I assume that the accountant he WILL have, at the end of the year, will do that?
I think he has registared with the tax office, as for VAT is there not a cut off point that earning below that you can not claim back?
As for the invoices, I will go in once a week and pick all post up, as none of it will be opened, and I persume that he will leave it to me to pay everything ! at least I will know what has and hasnt been paid.
I am going to give him a petty cash tin for stamps stationary etc, am I right in thinking that initally £25 out of till to petty cash, all receipts for p/c to go in tin and then cash and invoices should reconcile?
The daily takings or weekly takings will the tax man want to see? Would it be better to get him to write what sold how much and payment method. I an not sure if his till has a till roll, or its more than likely has but hes not got one in !
Thanks so much guys, I think I need to sit down with him and be firm.

[Brian Turner]

If he can't afford an accountant, he has no viable business.

I'm sorry, but an accountant is essential - there's a great chance of losing more money through tax issues than over-spending on a good accountant in my opinion. Mine costs £100/month + VAT and easily saves me time and money.

If he's still refusing to get an accountant in, then he needs a book keeper at least - a professional paid third party one - probably looking at around £25/hour but only a few hours each week required, in all probability.

That's the least that's needed - otherwise your brother's business could be in serious danger of collapse if the financial records are not properly sorted out.

I tell you all this from experience - I left my book keeping till late, poorly organised at the start, and I can assure you it cost me a *ton* of time when I could least afford it, and a fair wad of cash as well (probably a few grand) precisely because I didn't get on top of it from the start.

I'm not talking about cutting you out of the picture, either - if it's a good viable business, then you could be invaluable as an office manager, liaising as required on all aspects of admin.

2c and hope that helps.

[DavidToohey]

The financial side really is the guts of any business... and should always be kept on top of.

Unless you are considering the options of getting a bookkeeper/accountant involved, you are probably best to grab a quality piece of software (e-conomic, Sage, Quickbooks, MYOB) and a book... and just take it a step at a time.

I would suggest firstly get a Chart of Accounts setup... then get all the sales info in (no receipts), then the purchase side... and after that tackle the receipts, payments alongside the bank statements a month at a time.

Only after that is all done and reconciled (info may be missing too) then you will start to get a true idea of how the business is going. I have seen clients operate for years on a loss without realising it, but it may be profitable too. To really know you will have to take into account accruals, stock on hand etc.

Hope that helps, and if we can help further in any way please let me know.

David Toohey

[georgy]

Well done Brian and David words of wisdom.It makes sense to start at the very beginning, bookeeping piles up which can mean wrong balances,wrong tax tariffs and invariably wrong amount being coughed out by director. It is practically impossible to get the backlog right.

[lin robinson]

If he can't afford an accountant, he has no viable business.

Very pithy, Brian. I always like phrases that clang in like they should be on a plaque or operating manual.