Month: March 2012

You could face a £1000 penalty for non compliant Letterheads

We have all been aware of this for sometime now, but Indicator have highlighted that Companies House are now taking a harder line and giving out £1000 penalties, so what are the rules:

The Companies (Trading Disclosures) Regulations 2008

(1) Every company shall disclose its registered name on—

(a)its business letters, notices and other official publications;
(b)its bills of exchange, promissory notes, endorsements and order forms;
(c)cheques purporting to be signed by or on behalf of the company;
(d)orders for money, goods or services purporting to be signed by or on behalf of the company;
(e)its bills of parcels, invoices and other demands for payment, receipts and letters of credit;
(f)its applications for licences to carry on a trade or activity; and
(g)all other forms of its business correspondence and documentation.

(2) Every company shall disclose its registered name on its websites.

http://www.legislation.gov.uk/uksi/2008/495/regulation/6/made

Letterheads: Company letterheads must show:

  1. The name of the company. This must end in “Limited” or “Ltd” or their Welsh equivalents. If the name you trade under is different in any way from the name of your company as shown on your certificate of incorporation, then the full name, including “Limited” etc must be shown on the heading, usually at the foot.
  2. The registered office. It must be identified as the registered office. If there is only one address shown on the letterhead, the words “Registered Office” can appear in small type just above or below, or you can mention it at, say, the foot of the heading by saying “Registered at the above address”, or something similar. The important point is that your registered office must be clearly identified. If this were an address other than your trading address then it would be appropriate to print the address, clearly identified as such, in small type at the foot of the letterhead and the trading address elsewhere in larger type.
  3. The registered number.
  4. Whether registered in England (or ‘England & Wales’) or Scotland.
  5. A Welsh company which has chosen “Cynfngedig” instead of “Limited” as the last word of its name must also state (in English) that it is a limited company.

http://link4business.info/2008/08/business-disclosure-requirements-information-which-must-appear-on-your-letterheads-invoices-websites-and-email-messages/

Make sure you comply, no one wants a penalty.

steve@bicknells.net

 

 

 

 

The Cash Cycle – What is it? what is your Cycle? How can you improve it?

As the saying goes, Sales are Vanity, Profit is Sanity and Cash is King. The Cash Cycle also known as the Working Capital Cycle helps you to quickly understand how much cash you need to run your business.

Here is a great example from Steve Grice for an average business

Average time to collect payment from customers           60 days            plus..

Average days sales held in stock                                   25 days            less..

Average days taken to pay suppliers                             35 days            equals…

Cash cycle                                                50 days

This means that you need enough cash in your business to finance 50 days worth of sales. If your sales are £1,000,000, you will need cash of £136,900. In practice, your business will probably need more cash available than this to pay for rent, rates, wages etc. You may also get cash spikes at the quarter end if you pay VAT.

http://stevegrice.wordpress.com/2012/02/06/working-capital-cycle/

Here is a brilliant Cash Flow Improvement Tool from NAB http://oms.nab.com.au/media/10/power_of_one/CF.html

This model quickly and easily calculates your cash cycle but also shows the effect of making improvements.

Having discovered what the cashflow cycle is, what can you do to improve it? well that depends, assuming you have agreed the best possible terms with your suppliers, you need to find ways to speed up cash received from Customers, if your business Sells to other businesses the first thing to look at is Credit Management.

CIMA have produce a comprehensive guide http://www.cimaglobal.com/Documents/ImportedDocuments/cid_improving_cashflow_using_credit_mgm_Apr09.pdf.pdf

But Credit Management may not be enough on its own, perhaps Invoice Finance might help?

Invoice discounting is an excellent, cost-effective way for certain businesses to improve their cashflow position.

  • Invoice discounting is most suitable for businesses with good financial controls in place and a strong financial background.
  • Invoice Discounting is ideal if you have an annual turnover above £500,000
  • Invoice discounting is suitable for business with an established credit control department.
  • Invoice Discounting is suitable for a wide range of businesses including manufacturers, wholesalers, transport firms, employment agencies and providers of some business services.
  • Suitable businesses for invoice discounting are growing businesses because the level of funding grows in line with increasing sales.

For more details look at http://www.rbsif.co.uk/invoice-financing/invoice-discounting

If your business sells to end customers you might consider Card Processing Advances http://www.credit-card-processing-loans.co.uk/

You must be masterful. Managing cash flow is a skill and only a firm grip on the cash conversion process will yield
results.

steve@bicknells.net

HMRC Results from Business Record Checks so far – will they start again in April?

BRC are short, face-to-face, real time interventions which aim to encourage greater voluntary compliance in record keeping among small and medium business enterprises (SMEs). They aim to put the customer on the right record-keeping footing and so save costs the business might incur as a result of inadequate record keeping.

Click to access review.pdf

HMRC were carrying out Business Record Checks under their existing powers in Schedule 36, FA 2008. They had set a target to make 50,000 visits, this then dropped to 20,000 visits and after just 2,437 record checks, on the 3rd February HMRC announced that it was to postpone making any new business record check appointments until a revamped approach is launched early in the 2012/13 financial year.

So how did the checks go:

Total number of visits 2,437

61% (1,495) of businesses received a “green” rating – which in HMRC terms means they were satisfactory or better

28% (681) got an “amber” rating – meaning there were some issues

11% (261) got “red” – meaning they get follow up and if they don’t improve face fines of up to £3,000

Number of follow up visits 61 percentage improved to Green assessment 80 per cent
percentage improved to Amber assessment16 per cent percentage with no improvement 3 per cent

A key problem has been agreeing what constitutes poor record keeping

steve@bicknells.net

 

£50 to £500 in Cash if you can get enough votes…..

I was looking at PayPal becuase I had to up date some details and spotted they were promoting Fund 101 from Enterprise Nation its backed by Intuit and PayPal.

Every month they give £5000 to new businesses and they invite businesses to ask for amounts from £50 to £500, details as follows:

http://www.enterprisenation.com/fund101/?mpch=ads&mplx=3484-133899-12439-45

If you have an idea for a business and need a bit of cash to get started or you’re running a small business and need up to £500 to buy equipment, promotion flyers, hardware etc, you can apply.

Apply for between £50 and £500 and once you receive the money, the only thing we ask is you agree to be profiled on the site so we can see how you’re getting on. The money doesn’t have to be paid back; it’s for you to use on your idea or business.

Apply online and outline how much money you need and for what purpose. Make a good case for your idea and then encourage as many people as possible to vote for you. The number of votes required is equal to the amount of funding you’re looking for so to obtain £500 you’ll need to secure 500 virtual votes.

Remember, the Enterprise Nation community will help you spend the dosh! Want to use it to buy a camera to take good pictures of your products? Ask peers about the best deal on the market. Want to spend the money on a Google Adwords campaign but not sure where to start? Watch our video clips that will show you how!

Sounds like an interesting idea and if all you need is votes, how hard can it be?

steve@bicknells.net