S M E - Accounts

For more detail about us

Background

SME Accounts is a simple cash plus accounting system
It has been developed as a direct result of the personal experience of a Chartered Accountant who has run various businesses as an SME owner
This experience covers accounting systems from start up to £7 million turnover
It includes hand written books, spreadsheet based books, moderately priced accounts packages, expensive accounts packages, integrated accounts packages (all with expensive yearly maintenance charges) and personally developed systems, over a period of 25 years

Because accountants are rigidly trained to use a classic double entry based system, all experience of bought in accounts packages is of technically accurate, time consuming systems

If you ask an accountant   -   what is the cash position ?   -   he will look at his cash book

If you ask a businessman   -   what is the cash position ?   -   he will look at his bank statement

The Concept

SME business people are bright cookies who know how to get the most done with the minimum effort
They work harder than most, cover more areas of knowledge than most, achieve more than most
They hate the accounts function because everything disappears into a sludge of time wasting recording

Not here

We take the bank statement

We enter what is on the bank statement into a spreadsheet

We have finished

Who is this for and how resilient is it ?

This system is designed for owner managed or private businesses varying in size from start up, with no turnover, to a multi-branch business with turnover up to £20 million

It requires an owner, MD, CEO or their assistant who has used Excel at a very basic level and can follow simple procedures

It is a s resilient as Excel itself

We give you the procedures, including taking back up copies

We explain, so that you can understand, how the system operates

If (when) someone drops a clanger it is easily rectified

Because the system is easy to understand it is equally useable for budgets and forecasts

The System

This system is possible now because of the power of this century personal computers together with the simple cleverness of an Excel spreadsheet

An Excel spreadsheet is a "workbook" made up of individual spreadsheets called "worksheets"

We use one workbook consisting of 8 worksheets

Worksheet 1 - The Chart of Accounts

This is a simple listing (already given in the package o accounts and account numbers

It is a reference and looks like this

Worksheet 2 - The Cash Book

This is a direct copy of the bank statement, laid out in the same way as the bank statement

We enter

Month number

Description

Account Number

Vat code 1 = 17.5%, 2 = 5%, blank = zero

Amount paid out, or

Amount paid in

The worksheet gives us the balance so we can see we agree with the bank balance as we make entries

Worksheet 3 - The Journal

For the cash system, at the end of each month we make just 3 entries

1. we copy from the cash book worksheet the change in bank balance over the month

2. we copy from the vat worksheet the vat figure for the month

3. we copy from the profit & loss worksheet the profit figure

Worksheet 4 - The Data file

This an intermediate worksheet, you do nothing with it

It automatically picks up the details from the cash book and journal and keeps them so that the other worksheets can use the data

Worksheet 5 - Nominal

This is another intermediate worksheet

It automatically extracts the details from the data file, sorts and adds up to give us totals

Worksheet 6 - VAT

This is a month by month summary of

Input tax - vat on purchases - to be recovered

Output tax - vat on sales - to be paid out

Gross input and output figures for the vat return

Worksheet 7 - Profit % Loss Account

This gives you, month by month, your Profit & Loss Account broken down by your account headings, as set out in your chart of accounts

Worksheet 8 - Balance Sheet

This gives you, month by month, your Balance Sheet broken down by your account headings, as set out in your chart of accounts

The System - Cash Plus

The system described above is a cash accounting system which suits many businesses because it is so simple and you know exactly where you are with your records and accounts tied in to your bank statement

The cash plus system is exactly the same with the addition of extra journals to adjust each month for the change in debtors, creditors, depreciation and other non cash variables

These are adjusted this way, with the detail kept outside the system so that the "core" accounting function can always be kept up to date