With ‘open banking’, anything goes when it comes to financial services. And it’s let Tim Fouracre chase his dream of a fully integrated banking and bookkeeping system.

Three years ago, Tim Fouracre, the creator of the software Clear Books, argued that the worlds of banking and accountancy should be more closely entwined.

“Too much time is wasted by small businesses transferring data between accounting software and online banking,” he wrote. Legislation such as the revised Payment Services Directive is opening up the financial services market to disruptive new companies. This has given Fouracre, along with CTO Mike Moate, and their development team, the tools to make his vision a reality. His new venture, Countingup, is a banking and accounting platform in one, aimed at small businesses.

Essentially, it’s a banking app that automatically creates the books as users handle day-to-day transactions – and it’s something that Fouracre believes small businesses and their accountants are crying out for.

“Small businesses now start with their bank records as the primary source for bookkeeping records,” he explains. “They get their bank statements and explain all the transactions, rather than populating the records from invoices and bills in the first instance. So the bank statements are the main way of creating the accounting records.”

This year has seen a flurry of challenger banks launch themselves into the financial services market. ‘Open banking’ has made it possible to combine banking with accountancy relatively easily, giving Fouracre the chance to make his vision of an “accounting bank” a reality.

“I just believed so much in the idea,” he says. “I think it makes so much sense for a small business to be able to combine these two services in one single app.”

Bank app with benefits

There are several time-saving benefits with a bank app that does your bookkeeping. For one, reconciliation is no longer necessary, as the data comes straight from the bank account.
It also removes duplication of effort when setting up a supplier, says Fouracre: you don’t have to go to the bank, make a payment, and then make a record of the payment in the accounts.

“By putting both functions in one place, you’ll only do things once, which will be a time saver for small businesses,” he says. The biggest benefit, Fouracre argues, is that small businesses won’t have to think about their accounts at all.

“A small business doesn’t really like doing the accounting, especially if they’re a start-up. There’s a lot of jargon you don’t understand, and it’s a bit scary. Even when you’re running an established business, it’s admin – it’s a chore,” he says.

Fouracre believes Making Tax Digital will bring the worlds of banking and accountancy together, as small businesses and sole traders try to find the easiest way to take problems off their plates.

“The world’s most popular accounting software is a spreadsheet. [Sole traders and small businesses] are going to be forced, at some point in the future, [due to Making Tax Digital,] to use some sort of online system that can do the digital records for them,” he says.

Not so fast…

While all this sounds great, there are question marks. For example, what about businesses and individuals with more than one bank account? Fouracre concedes his app is not a one-size-fitsall solution: “There’s still a place for the large accounting software firms working with banks, because larger businesses are probably going to have several bank accounts and more complex needs. I’m pitching this at the one-man band – the sole trader.”

There’s also the argument that a bank app that does accounting might take away work from actual accountants – particularly bookkeeping and compliance work. Fouracre counters that accountants will want to work with an “accounting bank”.

“Currently, when accountants are dealing with this kind of client, they’re emailing spreadsheets back and forth, or emailing the paper records,” he says. “By bringing it all together into one simple, digital solution, accountants can switch between clients – obviously without access to their banking data – and view the accounting information that they need to.”

This article appeared in our Jan/Feb 2018 issue of AT magazine.

Mark Rowland is a journalist and former editor of Accounting Technician and 20 magazine.