How to avoid cashflow problems


Here are two startling statistics of start-up businesses:

  • One in four businesses don’t make it through the first year
  • More than half don’t survive past the fifth year of trading

There can many reasons for this, but one of the main reasons for this is down to cashflow – without it, a business simply cannot stay afloat. Below are some of the most common cashflow problems and some advice on preventing them from occurring in the first place.

Keeping accurate company records

Lots of new business owners put off bookkeeping duties as they are so busy with the huge workload that can be involved with setting up a new company.

The longer the books are neglected, the worse the problems will get; records and forecasts are pivotal to you knowing what is happening in your business.

It’s also important to ensure that you keep a proper record of what customers have and haven’t paid you to avoid significant sums of money that may owed to you getting overlooked. An effective accounting system is vital to manage your cashflow.

If you don’t have the time to do this yourself, an accountancy practice or bookkeeper will be able to do this for you.

How to manage company debts

Slow payers or bad debt is money that is owed but not paid.

This can be crippling for any new company but is usually preventable if a proper credit control system is put into place early on. If you discover that a customer has a poor credit record but you still want to take them on as a client, ask them for an upfront deposit or issue partial invoices so they can pay as portions of the work are completed. In other words, understand your customers and manage the risk.

A customer at any cost?

Calculate very carefully if want to offer credit terms – does your business model support it? If it doesn’t work early on don’t do it; you can always introduce credit terms as and when the business can afford it.

If you are currently in this situation then re-negotiate terms with your customers and/or suppliers or consider factoring the debt.

No cashflow forecast

A cashflow forecast is vital for any new business and is something that a qualified accountant can put together for you. This will allow you to forecast the months you can expect to see a cash deficit and the months when you may experience a surplus.

It will allow you to plan ahead as well, as give you a pretty good idea of how much cash your business is going to need over the next 12 months in order to survive. It is a good idea to keep the forecast on a rolling 12 month basis.

Free of charge accounting advice from Chartered Accountants

Omni Chartered Accountants offer totally free of charge advice for any business – new or otherwise – that may be experiencing difficulties. We are also here if you or would like to find out more about our cost-effective solutions that are designed to help your company run smoothly.

How to avoid cashflow problems

Call us now on 01902 837 408 or request a free of charge call back from our website today!

Women beat men in ICAEW examinations for first time in history

Women beat men in ICAEW examinations Interestingly, after our recent blog exploring the gender wage gap, it seems that the ladies are steaming ahead when it comes to the ICAEW examinations.

And this is for the first time in the institute’s history.

In November 2014, 77 percent of top scorers in the ICAEW’s Advanced Level results were women – 100% were female and will win the prizes.

PwC boasted the best performing students with others coming from KPMG, Hagen Streiff Newton, Deloitte & Oshiro Accountants.

Modern female accountancy careers

It is hoped by the institute that these latest figures will encourage more females to choose accountancy as their career – hopefully, it will mean the end of the age-old gender wage gap as the younger professionals start their careers.

At present, ladies entering into accountancy stands at around 35% of students, according to latest figures from accounting watchdog FRC.

Executive director for learning and professional development at ICAEW, Mark Protherough, said;

“Women are demonstrating real excellence when it comes to chartered accountancy exams. At this stage of entering the profession, it’s women who are dominating the top scores and they are role models for all women thinking about taking up chartered accountancy.

“Our qualification is known for creating business leaders, and I hope these scores mean we see a stream of female business leaders in the future.

“I’d like to congratulate all our students as these results were phenomenal. We had consistently high pass rates across the papers. It’s important to celebrate these results – our students are showing us and employers that we have a bright future of ICAEW chartered accountants coming through. It’s not just about passing these exams, it’s about taking that next step in their career.”

Women beat men in ICAEW examinations

Do you think that this new wave of success could help with the gender wage gap problem as the new generations embark on their chosen career path? Let us know your thoughts @Omnitastax or of course, join in the conversation on Facebook!

Is public trust in British business still dangerously low?

Is public trust in British business still dangerously lowPolling and Research Company research YouGov has just released their findings following its recent survey regarding public attitude towards business.

The results do not make for happy reading.

Some six years on from the financial crisis, trust in corporate Britain remains at worryingly low levels. Asked how much they trusted various sectors and professions, the public revealed the extent to which trust between business and customers has been eroded.

Whilst 81% trust teachers and 89% trust nurses, only 49% trust managers of small firms. Entrepreneurs are trusted by just 30% of the public.

What are your own experiences and thoughts? Is trust affecting your business?
Is public trust in British business still dangerously low?

In this new economy, a positive trust rating is highly prized by both buyer and seller. Transactions are humanised and social media allows experiences – good or bad – to be shared locally and around the globe.

Addressing the lack of trust in business should be a priority for government, policy makers and, of course, for business owners themselves.

The price for not addressing this will be the emergence of a society that risks turning permanently against its wealth creators, and a society that goes down that road will very soon face a number of serious challenges.

A new economic system based upon trust, transparency and accessibility is one we at Omni strongly believe in.

We would love to hear your thoughts on the matter. If you are a business owner, how do you build trust with your clients? Is the interactive way in which we all research our purchases and decisions a good or bad thing?

Tweet us @OmnitasTax and let us know your thoughts, or join in the conversation on Facebook – we are here to help and offer impartial free of charge advice to UK businesses, however big or small they may be.

Are you on cruise control with your business?

Are you on cruise control with your business

I spend a lot of time driving.

I stuff my face with Maltesers (the giant size pack) and listen to sporting trivia on Talk Sport. My only company in the car is the Sat Nav lady who  occasionally interjects with phrases like “You are no longer on the planned route. Do a ‘U’ turn when safe to do so”.

I sometimes ignore her instruction and take another handful of Maltesers.

I’m back on cruise control.

Only another 96 miles to go.

I’m not bothered about the journey, I just want to reach my destination.

Before I know it, the Malteser bag is empty. I cannot believe I’ve consumed so many in so short a space of time. I promised myself I would only eat half the bag and save the rest for my return journey but I have failed again (miserably).

But let’s forget driving for a moment – the above scenario can be a fair reflection of my life at times:

  • Operating on cruise control
  • Not appreciating the journey
  • Ignoring advice
  • Getting caught up in trivia
  • Lacking self-discipline

I’m not trying to make myself (or you for that matter) feel guilty, I’m just pointing out the down sides of being “on cruise control”; in other words, coasting through life rather than taking a firm grip of the wheel.

So I’m re-committing myself to the following:

  • I want to reach my destination and have appreciated the journey.
  • I want to listen to and weigh up the advice of others.
  • I want to focus on what’s important and not get side tracked by trivia.
  • I want to really feel I’m driving my life and not simply coasting on cruise control.

What about you? Which of the above particularly strikes a chord? Is it time to switch off cruise control?

This is relevant to everyone, but I think it is particularly pertinent when you are self-employed or running a small business. Stay focused and make the most of every available minute.

And above all, remember to enjoy the Maltesers!

Omni Chartered Accountants are here to help you take more control of your company finances and taxation affairs – request a free of charge call back from this website or click here to contact us today.

KPMG’s 2015 Global Audit Committee Survey


According to a recent survey by accounting giants KPMG, audit committees around the world are seeking better technology information and more ‘thinking outside the box’ from members to improve their effectiveness.

The KPMG’s 2015 survey questioned 1,500 audit committee members from a total of 36 countries. Tim Copnell, KPMG UK Audit Committee Institute Chairman, said that some of the most interesting results from the survey were about the subject of improving audit committee’s effectiveness.

Copnell said;

“From a UK perspective we had 58% of respondents saying a greater diversity of thinking on the committee would improve its effectiveness and that is in an environment where all the codes and guidance and things coming out of Europe tell us again and again to have accountants and people with audit knowledge on the audit committee.

“They are saying fine there is a need for hard skills but actually there is also a big need for soft skills.”

Lack of technology knowledge

Although respondents pointed out that whilst they recognised that it is important to have audit committee members who have accounting and auditing skills, it is also of importance to have members with other varied skills. One particular worry was the general lack of technology knowledge in audit committees.

Cybersecurity concerns

Another finding from the survey was based around the quality of the information at the audit committee’s disposal. Respondents rated the quality of information that they receive regarding specific topics – when asked about cybersecurity, a whopping 90% of them aired concerns.

Copnell said;

“That is quite important, because these are the risks audit committees really engage with nowadays… it is one thing to debate these issues, but if the information the audit committee has is below par then that is quite a difficult position to be in.

“The whole audit reform environment of the last five years, not just in the EU, has been to create more clarity about what is the audit role and the advisory role and obviously to prohibit non-audit service with a view to maintain independence and objectivity.

“But at the same time they would argue that as a result of that process, the relationship between auditors and audit committee has changed such that the auditors no longer provide perhaps a richness of support as the audit committee would wish.”

Keep up to date with the latest news on our blog page and we love to hear your thoughts on Twitter and Facebook, too.