www.adval-accounts.com 01908 219100
Newsletter Spring 2014
Nigel Adams â€˘ Managing Director
Welcome to our Spring newsletter...
f the commentators are to be believed we have seen the worst of the downturn - note the non-use of the “r” word - and for once I tend to agree. Last year we started to see strong growth in particular from our clients in the recruitment sector, which is a sure sign of renewed optimism.
Gavin was with HSBC for 30 years and was my original bank manager when I set Ad Valorem up. As is the case with most of the major banks, once a manager has learned his trade and can start to understand what makes a client tick they are offered early retirement! However HSBC’s loss is our gain.
That said, the banks are still not lending at anywhere near the levels they were pre-crash and the micro SME sector (typically with small funding requirements) have no more confidence in the banks now than during the previous six years.
Gavin has extensive experience of working with funding requirements for small business. We have already established our factoring/ID funding panel which has resulted in £1000’s being saved for clients already. We can also review your current tariffs and offer other banking options if you need a fresh perspective.
This is particularly concerning as it is just as dangerous for small business post-recession as it is going in to recession. The market is smaller so the requirements tend to be greater which puts an unbearable pressure on the previously stripped down infrastructure so a tendency to over-commit can cause significant cashflow problems. I cannot guarantee that I can get everybody the funding they need but I thought that it might be a good time to introduce a new member of the Ad Valorem family, Gavin Bray.
Small loans are still a challenge, however, but we do have the option to consider other methods for you, including second tier funding houses and crowd/funding circles. As a matter of course we will review your spend when we do your accounts. However, if your banking charges are going to exceed £3,000 in your current year, do not wait for us to do the year-end. Drop Gavin an email at firstname.lastname@example.org
t might also be worth you noting the following members of the Ad Valorem extended family, all primed to save you money. (OK, I am writing this in the States so please excuse the flamboyance!)
David Nichol - Some of our clients have already had the benefit of Dave’s advice but for those who haven’t, Dave is our estate planner which is a nice way of saying will writer. He brings over 30 years experience to the table and is well known for his detail and candour. Wills are crucial if you have business assets. Sally Cattle - A new member of the team, Sally specialises in ensuring that you are not overpaying and has done great work for us in ensuring that our utility and phone costs are with the correct provider and that we are not overpaying for the services. It’s all about margin and its best friend ‘cash’ folks! Paddy Behan - Paddy is one of the country’s leading VAT specialists and we are delighted that Paddy has made himself available to our clients. In one case already he has managed to reduce a client’s VAT penalties from £20,000 to £600. Of course Wendy and the team are able to answer most questions. However, it is good to
know that we can unleash Paddy on the quirkier areas of VAT. Neil Brown and David Munton - Last, and by no means least, we have the deadly duo of Neil and David - both very experienced Independent Financial Advisors who work alongside our accounts and tax team. Neil and David work almost exclusively with us so you can be sure that the advice they give perfectly aligns to our stewardship of your affairs. So if you have a question or need a mortgage, pension advice (including Auto-enrolment), Life, Commercial, Key Man or Critical Illness insurance please contact us. I guarantee that we will make every effort to identify if there are any areas where we can potentially save you money. However, please don’t be bashful. Give me a call if you have any concerns as we want you to get the earliest benefit from the resources we have assembled to work with you. That’s enough from me. It is great to be part of your team. We’re looking forward to helping you capitalise on what promises to be a frantic year or two. With kindest regards, Nigel Adams.
ver the last six months we have been looking at our infrastructure and investing to allow us to better service our existing clients and provide a strong base to allow us to grow. I thought it might be useful to introduce you to some of the new members of the team and also provide an insight on what further things we have in the pipeline which will hopefully allow us to become more than just accountants.
Valerie Lindsay Commercial Director
Ruth Thomas Head of Compliance
Delyth Barnett Senior Tax Consultant
Val has come to us with a strong track record in driving small fast growing companies helping develop systems and resources to support the growth and avoiding common pitfalls.
Ruth joins us from a five partner practice in Bedford with a mandate to oversee and support our accounts team from a technical perspective and be a second face to our clients.
We have seen a dramatic uplift in tax planning over the last couple of years and Richard was rapidly losing his hair!
Her skills and experience include developing UK and International sales, Marketing, Legal and commercial contracts, Human Resources and Training. Val is keen to work alongside our clients helping them develop their businesses.
Running the regular accounts meetings and also using her commercial background to deliver the role of financial controller to those clients who subscribe to that service. More about that below.
Delyth joins us from a mid-tier firm and brings a wealth of technical knowledge to further supplement the excellent advisory service that Richard has developed. Some clients have already felt the benefit of Delythâ€™s knowledge. In one case a new client had not been made aware of the ÂŁ100k of his money that HMRC were holding!
Peter Cox Director of Business Planning and Innovation Peter was the former founding partner of Thomas Cox and Co, based at Luton Hoo. Peter is well known for his work with growing businesses and particularly his strong belief and passion for outstanding customer service. Peter has a group role and his time is split between internal training and bespoke client project work.
The UK Patent Box will introduce a 10% tax rate on UK profits attributable to patented inventions. The new regime will be phased in over four years from 1 April 2013 with the 10% tax rate being achieved in 2017 for larger companies.
Amanda Codling Principal Manager We welcomed the staff and clients from Luton Hoo based practice Thomas Cox and Co in November. We have retained the office and team as an independent operation, although the practice is very much part of the Ad Valorem family and both team members and clients will benefit from the increased resources offered by the group.
Andy, from the Newport Pagnell office has been helping with the back office implementation for the past couple of months as well as getting to know some of the Thomas Cox clients. Andrew will retain a floating role between the two offices. However, we are delighted to welcome Steve Brown who has joined as a senior Client Manager after a short period in Australia and with nine years of experience.
• This change is good news if you’re a company with patented intellectual property in UK or a UK company that could patent their technology in the future. • These new rules will benefit companies from a wide range of industry sectors. To give just a few examples, this will be applicable to companies manufacturing a wide range of items which include patented items such vacuum cleaners, stereo speakers, prosthetic limbs as well as services such as delivery of mobile phone communications. • Typically, smaller companies have shied away from patent applications due to cost perception. However, a simple patent application can cost as little as £750 with the benefit of only paying 10% corporation taxes on profits arising from those patented products. • HMRC is actively encouraging Patent Box claims from smaller companies by allowing a simplified reporting regime to apply. Contact us on 01908 219100 to see whether your business can benefit from the Patent Box regime.
a few Goodbyes... Vanessa Bowyer Vanessa joined Ad Valorem in 2005 and has been at the heart of the company’s growth over the last nine years. As many of you will know, Vanessa had recently gone part time so that she could juggle her hectic family life and made the difficult decision in March to make that permanent. However, we can’t let good people go that easily and we are delighted that Vanessa has agreed to come back as part of our extended family working with two of our clients as a book keeper.
Natasha Higgs Natasha was one of the junior team and worked extensively in our outsource function of late. Clearly trying to keep the boys in check proved too much to take! Tash leaves us to further her experience in industry and we wish her well.
Helen Robinson Helen had been offering excellent tax advice at Thomas Cox for many years but had advised us prior to the acquisition that she would retiring to spend more time with her grandchildren at the end of the tax season. We wish her a happy and not too tiring retirement!
Sarah Quiggin Sarah was Peter’s PA for many years and a constant source of support to both Peter and clients. Sarah took the decision to move on in February, having ensured that the clients and practice management had been properly handed over. We would like to thank Sarah for all of her hard work both prior to the sale and subsequently.
To Grow a Business
ncrease your customer numbers BUT of the type that you want. Customer selection criteria are vital because the emphasis must be on chasing what makes you the money rather than the money itself. For instance, do you know who your most profitable customers are? And what your most profitable products or services are? This is where you will identify your A and B customers and thus help you determine your customer selection criteria. Your aim should always be to have quality customers who are prepared to pay for your products and services.
ncrease your average transaction value. There are lots of ways to achieve this for example sell other items with an initial purchase, package a group of associated products, partner with complementary businesses but above all do not forget to remember your margins and be proactive on pricing. Did you know that a business with say a gross margin of 35% could afford to lose 22% of volume if it raised its prices by 10% before it would be any worse off? On the other hand if it reduced its prices by 10% then it would have to increase its volume by 40% just to stand still profit wise.
ncrease the number of times that your customers come back and do business with you. Did you realise that most businesses concentrate too much on trying to win new customers and therefore miss out on the gold mine that exists in their current customer base. There are many strategies that can help you increase business in this area but a very simple and effective idea is to draw a chart that shows the products and services you offer and then match those with your current customer list. The gaps will identify which products your customers are not currently buying and there is your opportunity to educate them and make that extra sale. Delivering awesome service is another great way to nurture existing customers.
ncrease the effectiveness of each process in the business so that you can achieve the first three ways. This is all about working ON your business. If you as the business owner are stuck in the day to day operations, then growth will be slow. You need to step out of the day to day stuff and look at all the processes that help make your business work. Are they really as efficient as they could be? Are there areas for improvement? Are your team focused in these areas and have you ever asked them for process improvement ideas?
t is the combination of the small improvements across the four ways that will have a substantial impact on your businesses bottom line. If you would like to learn more about how these simple principles can help improve your business then give Nigel or Peter a call on 01908 219100. We will be delighted to help you.
his newsletter reaches you after we have just had a photo session to get new images for the new website; please have a look and tell us what you think. The shine from my rapidly thinning head was a challenge for the photographer, the only explanation for my folically challenged state being the ridiculous change in direction that HMRC have adopted. Clearly they are now bored with the business of collecting tax as it is far too difficult. The business that they now want to follow is akin to the police force safety camera slush fund. Namely we will just come up with as many different penalties for failure to comply and just chase the money there. We have already seen the penalties for non-submission of self-assessment tax returns change from the amount of underpaid tax to a blanket ‘we don’t care if you don’t owe tax - if you don’t send us a form we will fine you’ approach. This situation was further open to ridicule recently when I heard of a case where a company had filed a paper form as opposed to filing the form on line. The end result was a penalty of £8K levied against the company, the tax at stake 0!! The upsetting thing is that the company had to make a junior member of staff redundant in order to be able to service the debt! The world has gone mad - rant over! We will always remind you of deadlines so please do not prevaricate or get annoyed with us; we are just saving you unnecessary cost. Over the coming months you will see RTI penalties come into effect and, of course Pension Auto-enrolment is now on the horizon and also has a hefty penalty for non-compliance. We are able to assist you with the compliance burden and answer any questions that you may have. To that end, we will shortly be calling all our smaller clients to ensure that they are fully prepared.
Ad Valorem Accountancy Services Ltd www.adval-accounts.com 2-3 Bassett Court, Broad Street, Newport Pagnell, Bucks MK16 0JN t: +44 (0) 1908 219100 f: +44 (0) 1908 219116 Thomas Cox & Co 4 Home Farm, Luton Hoo Estate, Beds LU1 3TD t: +44 (0) 1582 482224 f: +44 (0) 1582 720605