5 myths about starting a new job Posted 03/11/2023 by Jessica Bown & filed under Job hunting. Advice from friends and family is one thing most of us are not short of when we start a new job. Well-meaning as your counsellors undoubtedly are, however, not all that advice will be good. So how do you distinguish true pearls of wisdom from unhelpful opinions? We have set out to help by debunking five popular myths about how you should act when you start a new job. Get in early and leave late New job starters are often advised to create a good impression by showing they are prepared to work long hours. But while you definitely want to turn up on time and show you are willing to stay late if required, always being the first to arrive and last to leave could backfire on you in the longer term. That’s what project manager Claire Pinder, found when she started a new role last year. “I was really excited to get this job, so when I started I decided to show my enthusiasm by turning up early every day,” she said. “It was only several months later that one of my colleagues revealed this was annoying other members of the team, who felt I was trying to make them look bad!” It’s also worth noting that your manager is likely to get used to you working longer hours, which could make it difficult to do just your contracted hours at a later date. Shake things up as soon as you arrive You may have lots of great ideas about how to tackle your new role or, if you are taking on a managerial position, how to improve the performance of your team. You may even have been brought in to cut costs or overhaul the organisation. But however keen you are to shake things up, it pays to take the time to understand how the company works from the inside beforehand. Allowing your new colleagues and employees to show you the ropes will help you to build bridges, while also giving you a clearer idea of what changes need to be made. “My advice would be to keep your head down a bit at first, and to spend your first few weeks listening to those who have worked there for a while,” said electronics company director George Menton, who employs more than 50 people. “Once people see you are competent, you will find it much easier to persuade them to accept new ideas.” Stick it out, even if you don’t like it at first Sometimes new jobs fail to live up to your expectations. You may, for example, be required to work much longer hours than you were told, or find the job that sounded so exciting on paper involves a lot more boring admin than you thought. Traditionally, the advice in this situation has been to stick it out because only staying in a job for a short time looks bad on your CV. But while it’s often worth giving yourself a few months to bed in, staying in a job you hate is more likely to damage your career than leaving it for a new, more promising one. Recruitment manager Richard Lowe, who works for a large estate agency, said: “In the past, companies may have been wary of taking on ‘job hoppers’ who switched employers at the drop of a hat. “But nowadays they know good people can pick and choose their opportunities. “It’s also much more common for people to only stay in a job for a short time, so there’s no longer the same stigma around it.” Just be prepared to explain to any prospective employers why you want to leave the role. It pays to take the time to understand how the company works Assert yourself from the start Nobody wants to be a doormat, but while your friends and family may advise you to show your new manager you are a force to be reckoned with, it’s also important to avoid coming across as too pushy. The time for negotiating benefits such as, holidays and flexible working hours was before you signed your contract. If you missed that opportunity, it’s best to leave it for a while before you start making demands. “A few years ago I took on a guy who asked for two weeks off on his second day,” Menton said. “He obviously hadn’t read his contract properly because it clearly stated he couldn’t have any holiday during his three-month trial period. “I probably would have allowed it had he asked politely during his interview. “As it was, though, it was just one of many issues that convinced me not to keep him on.” Start networking straight away If you are ambitious and hope your new job will be a stepping-stone to a higher position, your friends and family might encourage you to make friends in high places as soon as you start. But while there’s no harm in introducing yourself to high-level colleagues if an opportunity arises, forcing an introduction could prove awkward and ultimately unrewarding. It’s also sensible to allow relationships with your colleagues to progress naturally, rather than immediately treating them as your new best friends. “It’s good to get to know people away from the office, for example over a drink in the local pub,” Pinder said. “It’s important not to get carried away, though. One friend of mine got drunk at a work do shortly after starting a new job, and it took her a long time to be taken seriously after that.” Menton agrees. “There’s plenty of time for people to find out how fun and interesting you are once they have learned to respect you as a colleague.”
Why does what we buy impact how much things cost? Posted 03/08/2023 by Gill Myers & filed under Study tips. What we buy, on both a regular basis and as occasional purchases, has an impact on how much we pay for products and services. But why is that? This is the third article I’ve written about microeconomics. The other two explore the concept of supply and demand and how it affects pricing as well as the impact of changes in income. If you haven’t read them, then just follow the links: Study tips: Understanding supply and demand Study tips: Understanding supply and demand curves (advanced level) The story so far The price of goods and services is determined by the price mechanism (represented by shifts along the supply and demand curves due to price changes), market forces (which cause shifts of the curves) and the impact of the type of goods: normal (either inferior or luxury), necessity, substitute and complementary. Whilst all three areas are related, it is the type of goods that I will focus on now. Normal goods Normal goods are the products or services we buy on a regular basis. They will vary from person to person and are linked to our personal preferences and priorities. As our income rises, generally, we buy more, so demand for these goods increases. Normal goods can be sub-categorised as luxury goods and inferior goods. For example, vegetables are a normal good, but you can buy organically grown heritage varieties, which would be considered a luxury good or a bag of supermarket own wonky veg, which would be classed as an inferior good. Overall demand for normal goods fluctuates with increases and decreases in our income. However, more distinct and significant changes take place within the sub-categories. As our income rises, we buy less inferior goods, maybe choosing to swap a supermarket’s own brand cake for one made by an artisan baker. So an increase in income means a decrease in demand for inferior goods. However, for luxury goods, an increase in income not only causes an increase in demand, as for any other normal good, but it results in a bigger percentage increase too. This is because when our income increases, not only do we spend more, but we spend a larger proportion of it on luxury goods. The result is that luxury goods are more price sensitive than other normal goods. This means that if our income falls, we will cut back harder on luxury goods than other normal goods and reduce the proportion of our income that we spend on them. For example, we might choose to go on a self-catered camping holiday instead of staying in an all-inclusive hotel, but we’ll still go away. Necessity goods Some goods and services are known as necessity goods. For example, food, clothing, utility and housing costs, in other words, the things that we need to survive. However, what a normal good is and what’s a necessity can be subjective. I think we’d all agree that having water is a necessity but is access to multiple TV subscriptions? A definition of a necessity good is a product or service that we buy regardless of any changes to our income. Therefore, they are less sensitive to income and/or price changes than other types of goods. Substitute goods In the Comment about supply and demand curves, I used the example of a sim card as a substitute good. This is because this type of good gives consumers choices, as it includes products and services that can be used for the same purpose. So one sim card can be substituted for another because texts, calls and data are the same regardless of the supplier. So, if the price of one increases, then demand for its substitute will increase as well. That said, some products which, in theory, can be used for the same purpose, such as a games console, can be seen as completely different by the consumer. Whilst I think that an Xbox and a Playstation are the same, my son has a completely different opinion and would most definitely not substitute one for the other, regardless of any changes in their prices. Complementary goods The last category of goods I’m going to cover is complementary ones. These are items we buy together, like nachos and salsa, a mobile phone, a case and screen protector or a games console and a game. As these kinds of goods are linked, then if the price for one increases, then the demand for both will fall. Summary I said at the start that the price of goods and services is determined by the price mechanism, market forces and the impact of the type of goods. We now know that generally: Increased income results in increased demand for normal goodsDemand for inferior goods is decreased by an increase in income Increases in income cause a bigger percentage increase in demand for luxury goods Necessity goods are bought regardless of changes in income If the price of a good increases, then demand for its substitutes will rise Price increases for a good will result in reduced demand for its complementary goods.
How to manage your career as an accountant Posted 03/08/2023 by Marianne Curphey & filed under Career. Rapid changes in finance and accountancy mean that students and graduates joining the profession today will need to embrace technology and Artificial Intelligence (AI). In the years to come, they will also need to develop their personal skills and CDP (Continuing Professional Development) as part of their lifelong learning. What does lifelong learning mean? Broadly speaking, it means having a mindset to learn continuously throughout your life and work towards personal or professional goals. This may be through formal study and qualifications, voluntary courses, networking and leadership opportunities, or taking on new or wider roles at work. Not only does lifelong learning enhance your career prospects and keep you motivated in your job, but it can also help you develop useful skills that you can use in your life outside work. As the industry incorporates new and powerful technologies, it also means upskilling so that you can provide clients with cutting-edge services and future-proof your career. For an accountant, lifelong learning might encompass studying AAT to Level 4 and then going on to take further professional qualifications. It could also mean understanding the technology and developing so-called “soft skills” such as effective communication and active listening. As you become more senior and deal with clients, strategic planning and the ability to translate big data into information that clients can understand will also be essential. How can I manage my own career as an accountant? The AAT Learning Portal has a wealth of study support resources which cover the learning mindset, the changes to the industry, s-learning, practice assessments and study tips. It is simple to use. You select the unit you are studying, choose the type of support you want to try and select the activity you are going to work through. You can evaluate your progress whilst managing all your key resources in one place. You can add review notes to resources so you know which were useful to you, add reminder dates to resources so that you don’t overlook them and view recommendations on topics that may interest you. There is also a wealth of information on study tips, synoptics, transferable skills, apprenticeships and study guides. What are the benefits of extra qualifications and CPD? Adding to your knowledge and skills, either through further study or taking on more senior or different roles, can enhance your profile, earn you a potential pay rise and lead to more interesting job opportunities. Neil Parsons, Managing Director of Wolters Kluwer Tax & Accounting UK says that most of the day-to-day key skills that accountants need to run operations and satisfy delivery and compliance haven’t changed much over time. However, he says that within accountancy practices, there is an increasing requirement for better communication both internally and with clients. “Today, accountants must be comfortable with holding open conversations and giving constructive, data-rich feedback,” he says. “Companies expect advisors to show emotional intelligence while also sharing appreciation and taking accountability for their future goals and those of the practice.” Why is keeping up with data knowledge so important to accountants? As big data and Artificial Intelligence (AI) move into the mainstream, those accountants who can understand and communicate data insights will have a competitive advantage, says Neil Parsons. “The ability to gather and analyse big data into insight that can help clients is a big differentiator, but not all accounting firms have achieved this yet,” he says. “The right data strategy and software can help advisors to deliver real-time insight to their clients, which may uncover new business opportunities or risks to avoid. With the right data processes and the real-time ability to realise insight, the possibilities are endless.” He says AI and advanced analytics will take this one step further, helping advisors to identify key trends and use real-time predictions as a basis for critical business decisions. Nick Jewell, Technology Evangelist for Incorta, a data and analytics platform, says finance teams are under increasing pressure to deliver data and insights in ever-tighter time frames to support business tactics that can’t wait for a traditional once-per-month snapshot of the company’s revenue or liabilities. “As digital transformation delivers accessibility and analysis of data within the general ledger closer to real-time, it’s become possible for organizations to move towards a more continuous approach to accounting and financial control as a result,” he says. “Real-time visibility into key performance indicators, such as revenue, working capital and operational cash-flow allows finance professionals to monitor these metrics on a continuous basis and identify any potential issues or opportunities as they arise.” What other skills do accountants need to learn? Aside from keeping up to date with technology, communication is also going to be a very important part of the future accountant’s job. Soft skills can be learned, and even if you feel that communication is something you need to work on, it is possible to build your skill set, says Ollie Ollerton, motivational speaker and founder of BreakPoint, which delivers a range of corporate and individual training. “Communication, empathy, teamwork, time management, problem-solving; these are skills that can make someone really good at a job. Some of us will be natural communicators, while others will be better at keeping time, but we can all improve,” he says. “Soft skills can span any kind of business, even life in general. It’s about identifying areas of strength and areas of weakness and committing to either putting these to good use or improving them.” Identifying your strengths and weaknesses Hayley Brightmore, founder of due diligence company Knight Transaction Services, has ten years experience as a due diligence specialist at Mazars and Grant Thornton and has worked with a wide range of private equity houses, banks and corporate clients. She won Young Accountant of the Year at the 2022 Young Insider North West Awards. She says it can be difficult to identify your own strengths and weaknesses in isolation, especially if you are working from home. Being around colleagues is a good way to reflect on areas for improvement and ask for feedback. They might also recognise strengths that take for granted in yourself. “Those days when you are in the office, use your time wisely and look for opportunities to learn from those around you,” she says. “Listening to the way more senior colleagues handle tricky phone calls and conversations, for example, can be a great way for younger team members to pick up techniques that they can incorporate into their own work. Being open to learning and asking colleagues to show you how something is done is often much easier when it’s a simple conversation across a desk, compared with a virtual equivalent.” If you are looking to identify your own areas for development, she suggests you start by asking your manager for an appraisal and ask whether they would be open to a 360 approach which incorporates feedback from all levels of the business. “As an employer, I make sure all team members are on a clear development path – whatever their starting point – and I make sure everyone is getting regular one-to-ones, no matter how busy things get. Welcoming input from the entire business, not just managers, is a good way to ensure that all voices are heard and gives you a full picture of a person.” Further reading: The new AAT Lifelong Learning Portal has been launched Start exploring the AAT Learning Portal today How to keep what you’ve learned and carry on Tips for moving from classroom to remote study AAT Study Tips 8 tips for success – Career advice from accountancy experts
Sustainability disclosures could come in this year, minister tells AAT audience Posted 03/07/2023 by AAT Comment & filed under AAT news, Policy, Sustainable Business. Companies “across the economy” would be affected, the Treasury Minister announced at AAT’s new strategy launch. Treasury Minister Baroness Penn was keynote speaker as AAT launched promoted its new strategy Securing Future Relevance at the Houses of Parliament. She signalled new green finance regulations could be introduced this year that will lead to companies “across the economy” reporting on sustainability. The Baroness also used the occasion to call on more accountancy firms to back the Women In Finance Charter, which she and AAT have helped pioneer. Government backs responsible business Baroness Penn welcomed the fact that responsible business is one of three pillars in AAT’s strategy to 2030, along with keeping the profession relevant and driving up professional standards. As minister responsible for the Government’s Green Finance Strategy, she promised further action this year to follow the introduction of mandatory reporting in line with the Task Force on Climate-Related Financial Disclosures. “We plan to build on this with new Sustainability Disclosure Requirements and they will see businesses across the economy reporting consistent sustainability information that will incorporate into national standards such as those being developed by the global-based International Financial Reporting Standards foundation.” AAT: Securing future relevance We have a new strategic plan to secure a bold and ambitious future for accounting technicians. Read more in our digital guide. Read the plan The IFRS’s standards are expected later this year. If the Government adopts them, there will be keen interest in the size of companies that will be required to report, and whether the public sector will be required to comply. The baroness also called on more organisations to support the Women In Finance Charter, for which she is responsible. “AAT was the first accountancy body to sign up to the charter and [has] met its original target of 50% women in senior management positions ahead of schedule. “I am keen to see greater representation of accountancy and other professional services as part of the charter.” The charter still has fewer than 30 firms in professional services, including accountancy. AAT emphasising social mobility In launching AAT’s strategy, CEO Sarah Beale stressed our resolve to open up accountancy to all. “As a professional membership organisation, we can enact and inspire societal change, both through our own business activity and by demonstrating leadership in our community and across the profession. “AAT will continue to fight the perspective that the profession is only open to the privileged, where access can only be gained through a rigid, exclusive and [possibly] elitist route.” She told the assembled stakeholders how AAT will pursue its priorities and gave a flavour of what action would look like. “We will push for greater levels of funding to improve access to apprenticeships and vocational qualifications – properly establishing parity for FE. “We will continue to campaign for a requirement that all paid-for tax advisers and accountants are members of a recognised professional body and we will develop a pathway for those currently unqualified and unregulated to be able to join our community. “We will continue to push for a simpler, fairer and more effective tax system and for tax policy reform that supports growth amongst small businesses. And by 2030 we will have raised levels of awareness and engagement in the global sustainability agenda.” Leading the way on apprenticeships The Parliamentary reception was hosted by former Chief Secretary to the Treasury and Labour MP Sir Stephen Timms, who warmly welcomed AAT’s strategy. He particularly praised AAT’s work to increase social mobility through apprenticeships. “I am pleased to see [AAT’s] use of apprenticeships to bring people into the profession. It’s the kind of imaginative and creative approach we need to overcome recruitment difficulties.” He added that America was looking to follow the lead of professional apprenticeships. “The kind of apprenticeship that they particularly want to see in the USA are the kind provided by AAT,” he commented.
The pros and cons of the digital pound AKA ‘Britcoin’ Posted 03/06/2023 by Annie Makoff & filed under Cryptocurrency, Members. We asked accountants what the impact of a digital currency separate from the Bank of England might be. The government and the Bank of England are currently consulting on the possibility of a new form of currency which would sit alongside, rather than replace, banknotes and coins. Digital currency, such as the digital pound, would be used by both households and businesses for everyday payments. But unlike the private sector cryptocurrency, it would be officially issued by the Bank of England and therefore subject to strict regulation including privacy and data protection. According to the consultation paper released in early February, spending has become ‘more digital’. Stats from UK Finance and Bank Calculations reveal that cash transactions for goods and services are in decline. Between 2012 and 2021, cash transactions fell from 55 per cent to 15 per cent. The digital pound model would work as follows: A public-private partnership, with the private sector providing services such as digital wallets to support the new currency. Issued by central platform operated by the Bank of England. Hold the same value as cash. Accessible to UK and non-UK residents. Be used by both households and businesses. Seamlessly exchangeable with other forms of money. Issued via smartphones and bank cards. So what do accountants think? What benefit might the digital pound bring to businesses and the UK economy? Or conversely, what concerns and challenges might be associated with its introduction? Digital currency could enable sophisticated digital payment functionality in the future Neil Parsons, MD, Wolters Kluwer Tax & Accounting UK The proposed central bank digital currency may not seem to offer much in the way of immediate benefits. But as a digital solution, it is the tip of the iceberg and could provide a foundation from which to access increasingly sophisticated digital payment functionality in the future. A digital pound may seem superfluous now, but the UK payments system is not immune to financial crises, and when it comes down to moving money quickly, having a wholly digital currency may offer advantages in terms of speed and resilience. From a tax and accounting point of view, accountants are already seeing the benefits of increased digitisation in terms of compliance and reporting, and digital transactions will mean more trackable data, which can translate into better financial insight across the board. As with any new technology, advisors will have to work to communicate the benefits to their clients, and to ensure they have the technology workflows in place to integrate digital currencies into every facet of cash flow and compliance reporting. Verdict: Accountants are already seeing the benefits of increased digitization, and digital currency is no different. It could provide a platform to access sophisticated digital payment functionality in the future. Digital currency comes with concerns around infrastructure, logistics and financial security Nicola Goldsmith, Head of Private Clients, Haines Watts There are positives to digital currency. Regulation should make it less volatile than cryptocurrencies, which are decentralised finance. In an increasingly cashless society, Britcoin would allow different and new ways to pay which do not involve bank accounts, Paypal or similar payment accounts. That in itself should make everything a lot faster – including international transfers. Plus, in theory, digital currency may help those who are bankless as they will not need to hold the account via a traditional bank account. But these pros come with cons, or at least uncertainty. Who would provide loans, and would these be regulated? Would the wallet providers need to have the same reserve requirement as a bank? What about security? Cryptocurrency wallets can be hacked, for example, although as with most bank fraud, an individual is more likely to be the victim of a scam. On an individual level, how might someone open digital currency accounts? How would they move traditional currency into the digital account? How expensive will such accounts be? Verdict: Digital currency will be less volatile than cryptocurrencies and transactions will, in theory, be much faster than traditional bank accounts. But it comes with more questions than answers on details such as loan providers, regulation and security. Digital currency could cause more issues for the economy than it would solve Matt Portt, Director, Portt & Co The current issue with cryptocurrencies is that they’re generally not government backed so value can, in theory, drop to nil. The Bank of England’s backing would therefore be positive as this would create a secure foundation. However, I do not feel that the introduction of a digital pound issued by the Bank of England would add anything to our economy. There is currently little demand for digital assets among the small business community – digital assets are viewed as high-risk investments and currently, small businesses do not to have this level of appetite for risk. Also, digital currency could pose issues around borrowing. If, during economic uncertainty, deposit holders withdraw funds and instead hold digital currency, there could be a lack of liquidity available for the banks to issue and they would have to increase borrowing costs. In addition, the consultation paper suggests that digital wallets would be held/managed by private companies, who are not banks, and so I imagine there would be a steep learning curve for those organisations in terms of security and anti-money laundering regulations. Verdict: Digital currency could cause more issues for the economy than it would solve, particularly around regulation, anti-money laundering and liquidity.
What you need to know about changes to NICs top ups Posted 03/02/2023 by Annie Makoff & filed under Members, Pensions and payroll. The National Insurance contribution top up window is reverting to six years, and individuals with NICs gaps may have to retire on a smaller pension. So what action should you take between now and April? State pension entitlement is dependent on an individual having 35 full qualifying years of National Insurance contributions (NICs) in order to receive the full state pension or 10 qualifying years to get a smaller state pension. Previously, the full state pension requirement was for 30 qualifying years but increased to 35 with the introduction of the new state pension on 6 April 2016. To support people who would not otherwise have achieved the required number of years by the time they retire, the government temporarily extended the standard NIC top up window from 6 years to 16 years. This meant that individuals could fill any NIC gaps in their NI history from as far back as 2006 to ensure they receive a full state pension. From 5 April this year, the 16-year top up window is reverting back to six years. Individuals with gaps in their NICs may have to pay larger contributions to make up for any shortfalls, or retire on a smaller pension. NI credits will continue to be available to fill in gaps in NIC history in place of voluntary contributions, but as before, they are only available in certain situations such as: where parents are registered for Child Benefit for a child under 12 years long-term unemployment maternity leave those who are in receipt of Carers Allowance. So what action should individuals take between now and April? And is the advice the same for everyone? We spoke to four accountants for their views. Obtain a state pension forecast and improve financial awareness Jess Long, Senior Tax Consultant, Monahans Prior to April, we advise individuals: Obtain state pension forecast and review National Insurance record. Individuals on low earnings, self-employed with low profits or those living or working outside the UK may not automatically be making NI contributions. A forecast will show the cost of voluntary contributions and financial advice should then be obtained. If 5 April deadline is missed, a review of records can still be beneficial. Improve financial awareness. Everyone should consider how many more years they have until they have a full state pension. Investing time into your understanding now will enable you to plan ahead effectively. There’s a general lack of awareness of potential implications a gap could have. For example, individuals who have taken career breaks or couples who have decided not to claim child benefit may be at a disadvantage. This could occur where the primary caregiver is not working or claiming and will therefore miss out on qualifying years for National Insurance purposes. Don’t take a blanket approach. Apppropriate action is dependent on individual circumstances, for some making additional contributions may not increase the state pension entitlement at all. Verdict: Obtain a state pension forecast to identify any gaps and focus on improving financial awareness to future-proof retirement. View NI records to identify any incomplete years Stephanie Sharpe, Director, Moore Kingston Smith Individuals should log on to (or create) their personal tax account and view their National Insurance record. This will show which years are incomplete and give the cost of voluntary contributions to top up the year(s) for a full state pension qualifying year. If someone already has 35 qualifying years, paying to fill gaps will not increase the pension they finally receive. Similarly, someone still in work, earning over £123 per week and expecting to reach 35 qualifying years by retirement need not top up. Verdict: View personal national insurance record to identify any gaps and total cost of voluntary contributions still needed to qualify for state pension. Some individuals may be better off paying into private pensions Lauren Harvey, Assistants Account Manager, The Accountancy Partnership Before April, people should check their Personal Tax Account and check if there are any gaps in their NIC record so there aren’t any nasty surprises in the future. However, even the government advises people to make other arrangements. People shouldn’t rely solely on the state pension because it’s unlikely to be enough to live on when they’ve retired. This is why there are auto-enrolment and workplace pensions for employed workers and other arrangements for the self-employed – and tax advantages for using these. This might mean that some people are better off paying into their private pension, rather than topping up missing years, but it’s crucial to make an assessment on a case-by-case basis. Verdict: Topping up missing years will not be appropriate for everyone, especially because there shouldn’t be sole reliance on a state pension. Some may be better off paying into private pensions instead. Advice to ‘top up’ depends on individual circumstances Tom Jamison, Managing Director, Abbeygate Accountancy Before April, businesses and individuals should check their NIC records to see if they have any gaps that need filling. This can be done online through the government’s ‘Check your State Pension’ service. Seeking advice from the Department for Work and Pensions (DWP) or your professional advisors is also recommended to ensure you are making the right contributions. If you do have gaps in your NICs, the advice is not always the same for everyone. It depends on personal circumstances, such as how many years they have already paid and how much they can afford to pay. However, for most people, it is worth topping up if they can afford it. Verdict: Check for any gaps through government’s Check Your State Pension service but be aware that advice won’t the same for everyone – it will depend on individual circumstances.
How perks and benefits can help win and keep talent Posted 03/01/2023 by Neil Johnson & filed under Members, Practice management. Salaries will always be the star of any remuneration package, but to gain an edge in the ongoing finance talent war, you need to go the extra mile and offer attractive benefits and perks. “It’s very important to get your benefits package right,” says Louise Tallboy-Wood, Associate Director at Robert Walters UK. “Having well-thought-out and comprehensive benefits emphasises the sense of value firms have for their teams. “On the flip side, we see that those who pay little to no attention to this often give the sense to their teams they’re replaceable, which usually correlates to lower levels of employee loyalty and productivity, and in turn, lower profits for the firm.” Yet while offering competitive benefits might be essential for attracting and retaining top talent in a competitive job market, it can be pricey, especially for SMEs and smaller practices, and especially if not done right. “Businesses may struggle to identify the right benefits to offer that will appeal to their employees and help them stand out from their competitors. Finding a balance between offering competitive benefits and managing costs is a key challenge,” says Callum Laurie, associate director at Robert Walters UK. Know what people want It therefore makes sense to take some time to understand the market. For example, every January East Anglia-based Scrutton Bland do a market sweep of all the benefits. “We look at competitors and beyond to see which benefits are in and which are not; also, what the economy is telling us — is it cash people want, or is it more holiday, or more of a work-life balance?” says the firm’s HR director Caroline Bixby. Their increased headcount in a challenging climate suggests the system is working. Alongside this, Laurie suggests talking to industry and recruitment specialists, reading their white papers and employee surveys to ensure the benefits you’re offering are competitive. You also need to talk to your employees, getting to know their concerns and ambitions via internal surveys and educational talks, something Scrutton Bland also do on an ongoing and annual basis. “Every year we do a benefits questionnaire to understand what people want,” says Bixby. “We also do a massive amount of communication. We have a project plan from January through to May that involves webinars, Q&As, on-site presentations and information sessions around benefits”. Lifecycles and lifestyles There’s no one size fits all to benefits, but neither do they need to be too complicated. Understanding that your staff are people with differing needs and at various stages in their careers is a great place to start. For example, a 19-year-old apprentice might be less interested in paying into a pension than receiving financial support for education, study days and learning and development (L&D) pathways, while more senior people will be interested in retirement, health plans and equity schemes. “It’s about packaging your benefits offering in a way that people can pick and choose what’s best for them,” says Bixby. “As an organisation, we can get better rates than the employee, for example, private healthcare is cheaper through the company than going direct. Family members can also benefit; I have life insurance and income protection for my husband, two things I’ve chosen as optional extras that are relevant to me at my time of life.” Other common pick’n’mix benefits include gym memberships and brand discounts, while third-party platforms such as Benefit Hub are offering businesses a one-stop solution for perks and rewards. A solid core But getting your core package right should be the priority, otherwise any perks and benefits may end up being viewed with cynicism. The core package is usually made up of salary and annual leave, with pensions, study support and healthcare also common. Combined, the core package should reflect people’s greater awareness of and desire for well-being and work-life balance. Holidays: “People get this really wrong,” says Jason Reynolds, Operations Director at recruiters AJ Chambers, overseeing the Audit, Accounts and Taxation teams. “I’ve seen lots of people turn down offers because of the holiday.” Indeed, don’t scrimp and make it a benefit that grows with the employee. “We close between Christmas and New Year, and we offer additional holiday, so if you’re coming in at ground level you get 36 days a year (28 days plus the eight bank holidays). As a manager you get 38 and directors 41,” says Bixby. Flexibility: This needs to be taken seriously. “Despite companies driving a return to the office, many professionals still expect at least two days working from home – if not more,” says Tallboy-Wood. Indeed, businesses that don’t offer flexible working are now the outliers and will struggle in the talent marketplace, says Reynolds. “Whereas three years ago working from home was the anomaly, now it’s completely flipped. A hybrid structure: three days in the office, two at home is becoming the standard.” Scrutton Bland don’t consider hybrid working a benefit, it’s just simply how they work now. Study support and L&D: When hiring for junior positions, study support can trump salary. Reynolds knows of candidates being offered a higher salary to self-study or a lower salary but with study support (courses costs, membership fees, study leave), and the lower salary winning out. “Employers should want their juniors to pass the exams as much as they do, but it does come down to cost considerations for very small firms,” he says. Relocation bonuses are ok, but careful with signing on bonuses: While Reynolds has noticed an increase in firms offering retention and signing on bonuses since the pandemic, which might seem an attractive carrot to dangle, it thankfully isn’t yet the norm. “Most business owners want to stay on the right side of desperation, and they want people to want to work there,” he says. However, relocation bonuses have their place, as they can help broaden a business’s geographic reach, especially when looking to fill more senior positions with people who may have families to uproot. Health and well-being: This can be a great area for the pick’n’mix approach. Scrutton Bland, for example, offer a cash plan — a type of insurance scheme whereby the firm pays £1 per week to enable their employees to gain £810 worth of benefits per year. These can range from massages to physio, from dental check-ups and eye tests to 24/7 telemedicine. They also provide an employee assistance programme – a 24/7 legal and support helpline, as well as up to six online or face-to-face counselling sessions per year.
How to entice prospects using social media Posted 03/01/2023 by Annie Makoff & filed under Members, Technology. Hear from AAT members who have built up a waiting list of prospective staff and clients through their online presence. Social media can make or break a reputation. Ill-thought-out comments have ruined brands and prominent people. But, used carefully and wisely, many platforms can be extremely effective business development tools to gain visibility, build engagement, improve sales and even construct a pipeline of prospective hires. We spoke to AAT members who have made good use of social media platforms to help build their businesses. Personal approach Social media platforms Instagram @busy_books_westbury_ltd (255 followers) Facebook (532 followers) Twitter @Busy_Books (862 followers) Natasha Penny-Rowe, Founder of Westbury-based accountancy firm Busy Books, uses social media to dispel the ‘stuffy accountant’ image. “We use it to show who we are,” she explains. Although Penny-Rowe does post key tax deadlines and information about business grants predominantly, the content is much chattier. “We post pictures of our pets, pictures of us doing normal, human things,” she says. The no-strategy strategy seems to work. People visit their Facebook page after seeing their posts on local groups or when their content has been shared. Penny-Rowe, who prioritises interacting on social media over the website, says they’re getting a ‘small handful’ of new clients each month as a result, and 80% of enquiries via social media become regular customers. “We want to show we’re humans behind this serious job, with families, hobbies and interests. A huge amount of our clients choose us for this reason.” Fuelling the talent pipeline Social media platforms Instagram @accountant_she (8,705 followers) YouTube (5,867 followers) LinkedIn (3,937 followers) TikTok (545 followers) Rachel Harris MAAT, Director of accountancy firms StriveX and accountant_she, has over 600 clients on her books, 25 prospective clients a week and enjoys a 70% conversion rate. There is even a talent pool of potential employees waiting to join her business. And StriveX, one of the UK’s fastest-growing accountancy practices, has grown 400% since it was set up six years ago. “I have a very strategic approach,” Harris explains. “I provide accessible and valuable content while monetising it behind-the-scenes through sponsorship, brand collaborations or simply by the number of views. It always remains free for the end-user. Being a friendly face, that’s at the heart of everything I do.” Harris works with three ‘content pillars’ – each relating to a different target audience: practice owners, business owners and accounting students. “I rotate my content across these pillars evenly. One week, content will be targeted towards practice owners, the next week it’ll be business owners, then the following week will be accounting students, so every single third of my audience is served every three weeks. Consistency is important – people like it and so do the algorithms.” Harris uses Instagram, TikTok, YouTube, LinkedIn and Facebook to provide free webinars, advice-led posts and explainer videos to her 20,000 followers across the various channels. “A lot of what I do is around financial education, providing accessible, approachable content for people who need it, whether they are business owners or just starting out,” she explains. Even the business talent pool – or employee waiting list – is highly strategic. It came about when Harris realised she disliked recruitment due its costly, time-sensitive and stressful nature. The talent pool solves these problems – potential candidates upload their CV and answer a few questions. When a vacancy comes up, Harris already has a bank of potential employees who already know her business and culture because they already follow her on social media. “People on the waiting list already know about me and understand my brand. So the main question for me is: are they confident and capable enough to deliver?” As Harris explains, social media has “literally” grown her business: 85% of enquiries come from social media, as do 15% of referrals. “People think social media isn’t quantifiable, but it absolutely is,” she says. “70% of people I speak to on social media become clients. I think that speaks for itself.” Beauty of rapid growth Social media platforms Instagram @riajaine (5,908 followers) and @thebeautyaccountant (1,227 followers) LinkedIn (2,245 followers) Facebook Ria-Jaine: Beauty Business Accounting (906 followers) When Ria-Jaine Lincoln, Founder of The Beauty Accountant, began supporting businesses in the hair and beauty sector in 2018 after identifying a gap in the market, her initial focus was getting her name out. Yet Lincoln had inside knowledge of the industry, having worked in a nail salon before setting up her accountancy business. Prior to that, she’d worked at Deloitte. “I knew Mondays tend to be the day off for hair and beauty businesses so that’s when everyone is doing bookkeeping. It wouldn’t work posting tax content on a Friday when businesses are focusing on clients.” Armed with this knowledge, Lincoln threw herself into her social media campaigns, creating regular posts about cash flow, tax and bookkeeping advice and responding to every comment. She even secured a speaking slot at the prestigious Olympia Beauty Show in her first year of business. During the pandemic, when things started coming together. “I learned about strategy, wordplay, hashtags and engagement. Hair and beauty by its very nature is a visual industry, so I moved over to Instagram and that’s where my focus is,” she says. Her business saw a 300% increase – her client base grew from 10 to just under 100 and she was getting 16 to 21 leads a month. Since then, Lincoln has received a 2020 Covid Hero Award for her support and guidance to business owners during the pandemic, she’s been twice listed as one of the top 50 women in accountancy internationally, and she’s been a regular columnist for nail magazine Scratch. “All of this is directly attributable to my social media strategy,” she explains. “It’s been about positioning myself as an expert in my industry, ensuring I’m providing regular, relevant content for my audience.” At any one time, Lincoln has 300 posts ready to go. She uses automated responses on Instagram, negating the need to respond personally to comments, and she repurposes posts that have done well in the past. And then there’s the question of growth. “If you go big, you have to be prepared to have 100 leads in one day.” It’s why Lincoln now operates under a separate brand, The Beauty Accountant, as a way to gently nudge potential clients towards the brand rather than her, personally. “Clients just wanted to work with me, but that’s unsustainable,” she admits. Now, Lincoln’s focus is on the client journey and maintaining what she’s built up. “With my social media ticking over, I can focus on clients.” Opening doors for your brand Social media platforms Instagram @toddoors (8,355 followers) LinkedIn (2,245 followers) Facebook (6,500 followers) Pinterest (1,200 followers) “Back in the day, we used billboards for advertising – now we use social media,” says Farha Jamadar FMAAT, Head of Finance at Todd Doors, one of the UK’s leading suppliers of high-quality timber doors. Todd Doors, which sells predominantly to the higher end of the market, targets the trades sector, including developers and interior designers, as well as consumers, providing both off-the-shelf internal and external doors as well as custom-made, bespoke products. Jamadar is heavily involved in budgeting and maximisation of the marketing strategy, a big part of which includes social media. “Our social media strategy is focused on brand awareness and engagement. It draws interest, which ultimately drives people to our showrooms. People need to see the doors in situ, to experience the look and feel.” Todd Doors uses Facebook, Instagram, Pinterest and YouTube to showcase its products through photographs, short video interviews with industry experts and visual walk-throughs, but it’s Instagram and Pinterest that are the biggest drive’ of sales. According to Jamadar, conversion rates are around 40%. “Advertising through social media is a much richer experience than other traditional methods,” says Jamadar. “We can keep things current and respond to trends. We post photographs of our doors in real life with seasonal themes and these get a lot of engagement. In December, the doors are decorated with wreaths and Christmas lights and during Hallowe’en there are autumnal colours and pumpkins on the porch. It’s all about aesthetics and showing them off. We often have competitions and promotions and these attract a lot of interest, too.” Jamadar says they tried TV advertising, but found it wasn’t as effective as social media. Their selling point is talking directly to customers and engaging with posts. “Most customers want a lot of hand-holding through the process, with a consultation to go through ideas and possibilities. So we try to reflect this approach on social media, by being responsive and on hand.”
What is data analytics, and how is it used in business? Posted 03/01/2023 by Gill Myers & filed under Professional Diploma, Study tips. Organisations and individuals around the world create enormous amounts of data on a daily basis. Lots of our personal data is created in the moment; a like on a social media post or a comment on a feed. Often I’ve forgotten those interactions as quickly as I made them. However, that data will have been stored, and whilst it won’t be very meaningful or valuable on its own, when added to other data to create a data set that will be growing bigger at an ever-increasing rate, it becomes a prized asset. So how does that happen? Data analytics makes raw data meaningful It is important to understand that there is a difference between data, information and knowledge. Data is a collection of unorganised facts or figures that requires processing. Once that has happened, the data becomes information that can be used to enhance knowledge and be a basis for well-informed decision-making. In essence, data analytics is the process of transforming raw data into knowledge by analysing it to identify patterns and trends which are meaningful. These insights are valuable as they can provide organisations with competitive advantages. For example, understanding the buying patterns of target customer groups can aid a range of business activities, from product development, marketing and customer retention to ensuring supply chains are managed efficiently. Data analytics = business intelligence Data analytics can be likened to a kind of business intelligence in as much as it can be used to identify opportunities in organisations to work smarter, be more focused and set priorities. It does this by revealing trends that would otherwise be lost in the sheer volume of data, which can be used to predict the future and from which suggestions and recommendations can be made. Four main types of data analytics There are four main types of data analytics, all of which have slightly different roles in the overall process and can be used to answer different questions: Descriptive analytics Descriptive analytics involves the initial work of gathering data about what is happening now. However, it may be more accurate to say, it looks at what happened in the past because data is out of date as soon as it is generated. Analysts put the data into a format that summarises it and then looks for patterns in it. However, they are not trying to explain the data or establish any cause-and-effect relationships. Descriptive analytics simply determines and describes what happened and then presents it in a way that can be understood by non-technical as well as technical users. Accountants use this type of analytics to create reports, maybe to understand an organisation’s income and expenditure, and to prepare financial statements. Diagnostic analytics Once descriptive analytics has established ‘what’ happened, then diagnostic analytics seeks to understand ‘why’ it happened. This is done by looking for anomalies in the patterns that were identified by descriptive analytics and now trying to explain them. For example, a spike or drop in revenue that is out of kilter with the general trend or expected seasonal variations. Diagnostic analytics tries to uncover causal relationships. It might involve looking at data from other sources to try and understand, for example, why sales spiked or dropped. Maybe a celebrity endorsement coincided with a marketing campaign or perhaps unseasonably bad weather kept customers away. Predictive analytics The purpose of predictive analytics is to answer the question, ‘what is likely to happen in the future?’ It seeks to remove guesswork for decision-makers by coming up with insights grounded in data that are actionable. For example, a manufacturing company may have analysed the runtime, downtime, and work queues for its machines so it understands the patterns in their usage and any anomalies that have arisen in the past. It can then use predictive analytics to plan the machines’ workloads to optimise their efficiency. Prescriptive analytics Prescriptive analytics seeks to show how the outcomes that have been predicted can be exploited. In other words, it suggested the best course of action to take. Prescriptive analysts will explore a range of scenarios, given the predicted outcomes, and evaluate what decisions and/or actions an organisation might take. A company may be considering increasing its service provision capacity, for example, so it requires more warehousing to meet predicted future demand. Perhaps it could relocate to new premises or expand its current facilities? What implications would that have for capital expenditure? How long would it take to payback, given projected future costs and revenue? Benefits of data analytics Many of the techniques and processes of data analytics have been automated, aided by artificial intelligence (AI) and machine learning. Whilst this can pose some challenges, the technology is complex and is not always error-free, it does have significant benefits in the way of reducing the time needed to analyse and interpret vast amounts of data. This in turn, means that decisions can be made quickly, enabling opportunities to be capitalised.
Quiz – Which type of accountant should you be? Posted 03/01/2023 by The content team & filed under Students. Should you work towards a role as a financial accountant, management accountant, auditor, tax technician, or bookkeeper? What area of accountancy suits you best? Take our short quiz based on your likes, dislikes and interests and find out which one of the following options would suit you best… Management accountant Financial accountant Auditor Tax technician Bookkeeper What type of accountant should you be? Take the quiz and find out which area of accountancy suits you best…. Take the quiz Further reading: Study hacks to help you slay your final assessment Study tips: Write in a more professional way How to learn smarter and faster