Tax & admin · 17 November 2016

British entrepreneurs arent naturally numbers based, but they need to be

British entrepreneurs planning
Get your numbers in order ahead of time
The Autumn Statement and Budget announcements given by the chancellor are all about the financial infrastructure that supports and powers the British economy, so are a must follow for any switched on business leader.

However, while the subtle elements of corporation tax or relief rates are often hard to get excited about, Bivek Sharma is firm in his belief that a firm understanding of your cash flow, debt exposure and funding needs are what separates British entrepreneurs that fail in the early years with those that go on and prosper.

Sharma is the head of KPMG Small Business Accounting, a division set up to cater for the burgeoning SME community in the UK. It was driven by a belief that too many were relying on outdated accounting practices that produced financial information so out of date it was almost useless.

if you look at the market the majority still hasn’t changed. Many businesses are over reliant on manual processes, big lever arch files. it’s all a bit un-reactive and limited, he added.

I used to run my own business, so I know all about the issues associated. Ive been through that process of pulling together paperwork and handing it over to an accountant way after the year had finished none of which helped me or my business with financing or exit planning.

KPMG Small Business Accounting is all about providing timely information to British entrepreneurs, so businesses can understand their cash flow situation. Think of it as a virtual finance professional powering smarter decisions overlaying technology to make that quick and easy. The UK has a notoriously high fail rate according to commercial insurer RSA, with more than half not making it beyond five years, so this kind of guidance can be golden.

Sharma thinks this failure rate isnt because someone ploughed on with a bad idea, but more often than not that they simply ran out of cash and didnt have the time to sort it out. You get stuck in the day-to-day, losing sight of the financials, and then realise suddenly you need working capital. But by then it is too late, he explained.

The entrepreneur turned intrapreneur, as he calls himself, sees KPMG Small Business Accounting as a provider giving the gold star service to British entrepreneurs that is normally the luxury of bigger corporates.

Since setting up the offering 18 months ago, Sharma and the team have come to the conclusion it is better to focus on a few mission-critical elements of the business success formula. it’s about the really need? rather than the nice to haves. First off are issues such as an entrepreneur making sure they are compliant, then knowing how they are performing every month. After that comes the need to have early warnings about cash flow, implementing cool, clever and quick? ways of getting this all done.

All of the alliance firms KPMG Small Business Accounting has joined up with integrate seamlessly with the its online platform, meaning clients only have to use one system to manage all important dashboards.

Ahead of the Autumn Statement 2016 address being given by Hammond on 23 November, Sharma was keen to explain what the common problems he and the team frequently come across. Whereas the government takes more of a focusing creating a tax-friendly environment for business creation, it is often more of an education and planning set of issues influencing business survival.


 
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ABOUT THE EXPERT

Hunter Ruthven was previously editor of Business Advice. He was also the editor of Real Business, the UK's most-read website for entrepreneurs and business leaders at the helm of growing SMEs.

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