Tag: CIMA

CGMA Compass taking Management Accounting to the next level

I have been privileged to have been working with CGMA and taking part in the Global Management Accounting Principles:

1. Self-assessment Tool Pilot Community

2: Pioneer Advocates

CGMA Compass followed on from the worlds first management accounting standard.

BSI, the business standards company, has published PAS 1919:2016 Guide to management accounting principles. The guide which was sponsored by CIMA (Chartered Institute of Management Accountants) also saw collaborative input from such organizations as Environment Agency, Fujitsu, NHS and Siemens.

Designed as a best-practice guide to management accounting, defining what “good” looks like, PAS 1919 provides organizations with a framework to support their decision making and contribute to overall improved performance and sustained success.

The finance function is key to unlocking value across the organisation to drive performance and success.  Yet business leaders are under increasing pressure. Quality decision making is essential but impulse often takes the place of insight.

As your finance function transforms itself to deal with challenges and harness opportunities, how do you measure success?

Underpinned by the Global Management Accounting Principles©, the CGMA Compass is an online self-assessment diagnostic that enables organisations to gain a 360 degree view of the strengths and weaknesses of the finance function to drive effectiveness.

This is achieved by assessing performance against the 14 management accounting practice areas outlined in the Principles:

  • Cost transformation and management
  • External reporting
  • Financial strategy
  • Internal audit
  • Internal control
  • Investment appraisal
  • Pricing, discount and product decision
  • Project management
  • Regulatory adherence and compliance
  • Resource management
  • Risk management
  • Strategic tax management
  • Treasure and tax management
  • Management and budgetary control

Analysis is provided in the form of heat maps – presenting rich data in an easy to read format which highlights aspects of high performance alongside those where improvements can be made.

With all of this insight you will:

  • Build confidence and trust by increasing business resilience, preserving value.
  • Join the dots and understand how things are being done in practice.
  • Shape the conversations which drive good decisions.
  • Put finance at the heart of business decision-making.
  • Build a shared understanding of levers for value creation, transform information into insight.
  • Better manage risk and capitalise on new opportunities

Don’t miss Samantha Louis, Association of International Certified Professional Accountants presenting the CGMA Compass Webinar on 30th October at 12.30!

Webinar sign-up: http://www.cimaglobal.com/Events/Events/Finance-Proving-youre-more-than-just-an-overhead/

CGMA Compass web information: https://www.cgma.org/cgmacompass

You can also get further details from alpa.saujani@aicpa-cima.com

I fully endorse and recommend CGMA Compass, its a first class management tool

steve@bicknells.net

What defines good management accounting?

Taschenrechner und Statistk

CIMA CGMA members are qualified to work across an organisation, not just in finance. In addition to strong accounting fundamentals, CIMA teaches strategic business and management skills:

  • Analysis – they analyse information and using it to make business decisions.
  • Strategy – they formulate business strategy to create wealth and shareholder value.
  • Risk – they identify and manage risk.
  • Planning – they apply accounting techniques to plan and budget.
  • Communication – they determine what information management needs and explain the numbers to non-financial managers.

Picture 1

Now we have the worlds first management accounting standard.

BSI, the business standards company, has published PAS 1919:2016 Guide to management accounting principles. The guide which was sponsored by CIMA (Chartered Institute of Management Accountants) also saw collaborative input from such organizations as Environment Agency, Fujitsu, NHS and Siemens.

Designed as a best-practice guide to management accounting, defining what “good” looks like, PAS 1919 provides organizations with a framework to support their decision making and contribute to overall improved performance and sustained success.

David Fatscher, Head of Market Development for Sustainability and Services at BSI said: “CFOs have much more reporting responsibility than they once did and the management accounting function is now an integral part of an organizations strategic planning. PAS 1919 outlines the key principles and activities they have to deliver on to assure stakeholders of sustainable business performance.”

The PAS sets out four outcome-based management accounting principles, and provides a basis on which organizations can set their own benchmarks for the management accounting function.

  • Communication provides insight that is influential – encouraging insightfulcommunication that drives better decisions across an organization
  • Information is relevant – reviewing past, present and forward looking performance management information
  • Impact on value is analysed – understanding an organization’s strategy and business model
  • Stewardship builds trust – balancing short-term commercial interests against long term value for stakeholders

Tony Manwaring, CIMA’s Executive Director, External Affairs, said: “This sets the standard for decision making around the world. The content of PAS 1919 represents best practice management accounting and enables organizations to take decisions that drive value in the short, medium and long-term.”

SCA group

SCA Group are now working with CIMA and taking part in the Global Management Accounting Principles:

1. Self-assessment Tool Pilot Community

2: Pioneer Advocates

The team at SCA are excited to be involved the project and to use the tools to improve their management accounting.

steve@bicknells.net

You need to read – Business Accountant Magazine!

cover-April2016

This is a fantastic free online magazine packed with useful advice for accountants and business owners.

http://www.uk-accountant.org/wp-content/uploads/Flipbook%20April%202016/data/mobile/index.html

It’s the second edition published by the Association of UK Accountants

It’s been written in jargon free way to help you get a better understanding of accounting and tax rules, this issue is 30 pages.

The articles are written by CIMA CGMA Accountants in Practice.

Take a look and see what you think

steve@bicknells.net

 

Why your SME needs a CGMA CFO!

Flying Superhero

Many businesses require the skills of professionals to oversee and direct financial operations. These professionals are referred to CFOs, chief financial officers, or financial directors (FD).

So what should your Chief Financial Officer be doing for your business…..

1. The CFO should be able to look into to future to see what the future financial needs of the business will be
2. He/She should negotiate funding facilities to ensure the business can manage its cash flow needs
3. The CFO should be able to foresee the future tax consequences and risks of decisions
4. He/She should help the business to achieve the best possible credit scores
5. Identify ways to reduce costs and improve profitability
6. Understand the business owners objective and focus the business on achieving those objectives
7. Ensure financial and regulatory compliance
8. Ensure accurate and timely reporting of management information
9. Evaluate growth opportunities
10. Apply corporate governance

What key questions should you regularly ask your CFO…..

1. What is our cash cycle and how can we improve it – Cash Cycle Blog
2. What Key Performance Indicators should we use and what are they telling us – KPI Blog
3. How can we improve profitability – 15 ways to improve profitability Blog
4. What is our Business Plan and is it the right plan – How can you create a Business Plan
5. Can we reduce Overheads – 10 creative ways to reduce overheads Blog

Many smaller businesses and SME’s can’t afford a Full Time (or even in some cases a Part Time CFO or FD) but they need help with:
• Business Plans
• Budgeting and Forecasting
• Cash Flow Management
• Buy or Rent decisions
• Capital Investment Appraisal
• Accounting Procedures and Systems
• Business Strategy
• Busines Funding and Investment
• KPI’s

Expert Advice Fotolia

Virtual FD’s fill this gap because:
1. You only pay for what you need
2. There is no employment contract
3. It provides access to higher level of expertise (in theory)

But be careful who you choose. There is no law preventing anyone from calling themselves an accountant, and as a result small businesses are unknowingly paying someone without the necessary skills to handle their finances and help their business grow.

So what experience does your accountant have to show that they have the skills to be your Virtual FD?

I am sure that in theory they have the technical skills but is that enough?
With the exception of CGMA (CIMA) accountants many accountants in practice have never worked in business let alone been a Finance Director!

I happen to think that time served experience as a CFO does make a difference because it greatly improves your insight and skills.

Would you get on a plane with a Pilot who in theory knew how to fly but had never actually piloted a plane before?

When you choose a Virtual FD you are trusting them with the success of your business. Choose wisely!

CIMA operates a Masters degree standard scheme of qualifying examinations for prospective members. It is active in promoting local education, training and management development operations, the promotion of new techniques through its research foundation and the dissemination of management accounting practices through publications and other media related activities. WIKIPEDIA

Chartered Global Management Accountant™ (CGMA®) is the global designation for management accountants. It’s powered by the resources and expertise of AICPA and CIMA, two of the world’s leading accounting organisations.

steve@bicknells.net

 

10 things a Business Accountant will tell you when you start your own business

Badge

According to Government figures, there has been a net increase of 146,000 businesses in the past year, taking into account all start-ups, closures, takeovers and mergers. It means more businesses have started than closed.
The Business Population Estimates also show the number of businesses that employ people has grown for the second year running, with 35,000 more at the start of 2015 than in 2014.
Small businesses continue to make up 99.3% of all businesses and generate over £1 trillion turnover for the UK’s economy.

Business Accountants (Association of UK Accountants) are Chartered Management Accountants (CIMA) and when you start your new business they are will tell you:

  • Choose the right business structure for your business – most businesses start out as sole traders but once they start making profits convert to limited companies, this is because sole traders pay more tax than company structures

http://www.sage.co.uk/~/media/markets/uk/images/business-advice/infographic-starting-your-business.gif

  • Choose the best VAT Scheme you might be better off with Flat Rate or Cash Accounting
  • Choose the most suitable accounting software

Accounting Clients

  • Don’t mix up Business and Personal Expenses – always have separate bank accounts
  • Reconcile your Bank Transactions regularly – its easy to forget what you have spent checking the bank account keeps you in control
  • Understand and manage your cash cycle – how long does it take to get paid and what credit terms do you suppliers give you?
  • Manage customer payments and make it easy to pay your invoices
  • Understand and Comply with rules like National Minimum Wage and Holiday Pay
  • Understand and set money aside for Tax, don’t be late paying your tax
  • Have a Business Plan and Forecast it will improve your chance of success

steve@bicknells.net

Contact Us

Business Accountant Magazine Launched

Magazine

Starting a magazine is a big undertaking and the Association of UK Accountants CIC has been working on it for months. Its funded by Advertorials.

The Association is run by Volunteers, the Directors, Editor and Assistant Directors give their time for free, we work to help and support CIMA Members in Practice and the 6 monthly Magazine is designed to provide practical tips and advice written by CIMA Members in Practice to help those in practice with compliance and to widen their skills and knowledge.

Click on this link to read it http://www.uk-accountant.org/wp-content/uploads/flipbook/1/mobile/index.html

Special thanks go to our Editor Joy Quarrie for making the Magazine a reality.

CIMA MiPs are invited to join the Association for Free

https://mybusinessaccountant.com/membership/mfm-join/#account/join

Or we have a Premium Membership which has additional benefits

As a Community Interest Company run by Volunteers all the profits are use to create benefits and resources for CIMA MiPs.

If you have services you would like to advertise and promote to AUKA members please drop me an e mail steve@uk-accountant.org

FRC figures show CIMA has fastest growth

Happy businessman with case.

The FRC have just published their Key Facts and Trends in the Accountancy Profession – June 2015

The Financial Reporting Council is the UK’s independent regulator responsible for promoting high quality corporate governance and reporting to foster investment. We promote high standards of corporate governance through the UK Corporate Governance Code. We set standards for corporate reporting, audit and actuarial practice and monitor and enforce accounting and auditing standards. We also oversee the regulatory activities of the actuarial profession and the professional accountancy bodies and operate independent disciplinary arrangements for public interest cases involving accountants and actuaries.

You can download the full report here FRC Key Facts

It compared ACCA, CIMA, CIPFA, ICAEW, CAI, ICAS, AIA and found CIMA grow its members by 16.9% between 2010 and 2014, well above the average of 10.3% and beating the growth rate of all the others.

23% (77,551 out of 335,552) UK accountants are CIMA members.

CIMA also had the biggest growth in Worldwide Students 28.8% between 2010 and 2014.

The sectorial employment data in figure 5 showed that 75,429 (97%) work in Industry & Commerce which is 28% of accountants in Industry & Commerce.

Great statistics!

 

steve@bicknells.net

 

Has your Virtual FD ever been a Real FD?

Flying Superhero

If you search the internet you will find that almost every accounting practice now offers to be your Virtual FD. Compliance work on year end accounts and tax returns has become highly competitive and accountants feel they should provide additional services.

Many smaller businesses and SME’s can’t afford a Full Time (or even in some cases a Part Time FD) but they need help with:

  • Business Plans
  • Budgeting and Forecasting
  • Cash Flow Management
  • Buy or Rent decisions
  • Capital Investment Appraisal
  • Accounting Procedures and Systems
  • Business Strategy
  • Busines Funding and Investment
  • KPI’s

Virtual FD’s fill this gap because:

  1. You only pay for what you need
  2. There is no employment contract
  3. It provides access to higher level of expertise (in theory)

In May this year the ACCA issued a warning after research from cloud accounting software provider ClearBooks showed just 8 per cent of small businesses considered an accountant’s qualifications when choosing one. There is no law preventing anyone from calling themselves an accountant, and that as a result small businesses could be unknowingly paying someone without the necessary skills to handle their finances and help their business grow.

Although some unqualified accountants may do good work, an unqualified accountant is not answerable to any regulatory body and so cannot be disciplined. They have not passed exams that would have tested their knowledge, they are not subjected to any ongoing inspection of their practices and processes, and, crucially, they are not obliged to participate in any ongoing training to keep them up to date with ever changing legislation. Many may not even have any professional indemnity insurance, which clients can turn to if their qualified accountant makes a mistake.

So what experience does your accountant have to show that they have the skills to be your Virtual FD?

I am sure that in theory they have the technical skills but is that enough?

With the exception of CIMA accountants many accountants in practice have never worked in business let alone been a Finance Director!

I happen to think that time served experience as an FD does make a difference because it greatly improves your insight and skills.

Would you get on a plane with a Pilot who in theory knew how to fly but had never actually piloted a plane before?

When you choose a Virtual FD you are trusting them with the success of your business. Choose wisely!

steve@bicknells.net

 

 

 

 

Is your accountant qualified?

Accounting Standards

The ACCA issued a warning in May after research from cloud accounting software provider ClearBooks showed just 8 per cent of small businesses considered an accountant’s qualifications when choosing one. There is no law preventing anyone from calling themselves an accountant, and that as a result small businesses could be unknowingly paying someone without the necessary skills to handle their finances and help their business grow, who isn’t regulated or insured against risk.

CIMA (Chartered Institute of Management Accountants) Members in Practice are monitored by CIMA for:

  1. Continuous Professional Development
  2. Anti Money Laundering Compliance
  3. Professional Indemnity Insurance
  4. Continuity Agreements
  5. Letters of engagement
  6. Ethical conduct

CIMA operates a Masters degree standard scheme of qualifying examinations for prospective members. It is active in promoting local education, training and management development operations, the promotion of new techniques through its research foundation and the dissemination of management accounting practices through publications and other media related activities. WIKIPEDIA

You can find out more at www.business-accountant.com and www.cimaglobal.com

Why is it that small businesses do not check that their accountant is qualified?

steve@bicknells.net

Can you cope with Auto Enrolment?

Retro Drama Woman

A survey by AutoenrolSME found that 6 out 10 businesses can’t cope and hired additional staff to manage the process!

A Poll in April 2014 of 200 businesses with 62 to 249 employees found:

63% of the employers didn’t know when their staging date was.
58% had not set up an auto-enrolment pension scheme.
90.5% of employers without an auto-enrolment pension scheme hadn’t even started researching one.

If you think you can ignore Auto Enrolment, think again, The Pensions Regulator will make you comply……..

Non-statutory action
We can issue guidance and instruction by telephone, email, letter and in person. Or we can send a warning letter confirming a set time frame for compliance with the duties.
Statutory notices
Statutory notices can direct you to comply with your duties and / or pay any contributions you have missed or are late in paying. We have further discretionary powers which allow us to estimate and charge interest on unpaid contributions and direct you to calculate and / or pay unpaid contributions.
Penalty notices
We can issue penalty notices to punish persistent and deliberate non-compliance.
A fixed penalty notice will be issued if you don’t comply with statutory notices, or if there’s sufficient evidence of a breach of the law. This is fixed at £400 and payable within a specific period.
We can also issue an escalating penalty notice for failure to comply with a statutory notice. This penalty has a prescribed daily rate of £50 to £10,000 depending on the number of staff you have.
We can issue a civil penalty for cases where you fail to pay contributions due. This is a financial penalty of up to £5,000 for individuals and up to £50,000 for organisations.
Where employers fail to comply with a compliance notice or there is evidence of a breach, we can issue a prohibited recruitment conduct penalty notice. This is currently set at a maximum fixed daily rate of £5,000 for organisations with over 250 staff. We aim to fully recover all the penalties that we issue.
Court action
We can take civil action through the court to recover penalties.
Employers who deliberately and wilfully fail to comply with their duties may be prosecuted.
We can also confiscate goods where there is a criminal conviction and restrain assets during criminal investigations.

The first case was Dunelm http://www.thepensionsregulator.gov.uk/docs/section-89-dunelm.pdf

Research shows that Accountants are most likely to be asked to help SME’s and Business Accountant (a service provided by CIMA Members in Practice) have created a booking service to assist SME’s in getting help http://business-accountant.com/auto-enrolment/

So don’t be scared by Auto Enrolment, don’t delay drawing up a project plan, take action now to avoid problems with the Pension Regulator later!

steve@bicknells.net

 

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