Episode 9: Big Questions for Accounting with Joanne Bell of Bells Accountants.

In this episode, entrepreneur, accountant and new mum Joanne Bell gives me her answers to big questions on accounting, coronavirus and making the world a better place.

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Transcript

Kirsten Gibbs: [00:00:00] Welcome to the pioneer accountants podcast, where pioneering accountants answer big questions about accounting. I'm Kirsten Gibbs, and I help accountants to build an autonomous practice they can step up with, or away from whenever they want without killing themselves or their business in the process today, I'm talking to Jo Bell from Bell's accountants.

Jo runs a multi-site accountancy practice covering Kent, Surrey, and London. Her particular specialism is property tax, as she has her own investment portfolio. On top of all this, Jo has recently become a mum, which is a huge challenge. You're a better woman than I am. I must say. And Jo really loves hearing from business owners on how they got into the trade they're in and what inspires them to keep going when times get tough.

That's brilliant, Jo. I can really relate to that. So. Hello, welcome. Thank you for agreeing to come on this podcast. 

Jo Bell: [00:01:01] Hi Kirsten. Thanks very much for having me. I appreciate it. 

Kirsten Gibbs: [00:01:05] Good. Okay. I'm good. Get straight into the big, what is accounting for? 

Jo Bell: [00:01:15] So I feel that accounting has two purposes really at the end, the first is that we are responsible for company compliance.

So that means filing returns with companies, house, and HMRC, keeping everything legal. And that's the thing really that most clients expect from us, initially. When they go and see an accountant, that's what they say. I've got this deadline and I need you to do this for me. Cause I'm not really numbers, et cetera.

Second purpose, which sometimes they don't expect. Well, they're not aware that that an accountant can offer, is helping the owner to understand the story behind the numbers we give them. So not just historically, well, this is, this is your year end accounts, this is what you made last year, and this is how much tax you pay; but actually about planning, looking forward, looking into the, the numbers in more detail to say how profitable maybe a specific department is, or a specific product or service that they're offering. And this type of consultancy work is, is actually the work that helps them to make decisions within their business.

To plan because you're looking forward as well as backwards. So you're looking at forecasting, you're looking at cashflow. All those types of things, which, which are generally a lot more interesting, I would say than the basic compliance, for most people. 

Kirsten Gibbs: [00:02:30] They're interesting to you. I think probably which is great because I think probably for the majority of small business owners, they're not interesting at all, in fact they can be quite daunting. And so I think the problem is that most, a lot of small business owners don't even look at them and they don't even really realize that they should. So that's where, you know, having a good accountant, like you would be - is brilliant because you enjoy doing that. 

Jo Bell: [00:02:59] I do. I think you're right, because I think that's why specifically I worded it as a story as well, because maybe it is that the numbers and sales are not interesting.

Then if you can say to them something like, what would you say if I said you could do less work and make more money? That that might be interesting. 

Kirsten Gibbs: [00:03:16] Yeah. 

Jo Bell: [00:03:16] And then it's just about how they can go about doing that. Using the knowledge that we have because of the unique insight into their, their own numbers that we have as accountants.

Kirsten Gibbs: [00:03:27] Yeah. Yeah. Brilliant. So is that what accounting should be for? 

Jo Bell: [00:03:33] Yeah. So, I mean, I feel that both aspects are equally as important. one may be more interesting than the other from my perspective, but actually it's very, very important to lots of business owners that the basic compliance is dealt with well and efficiently, and that the whole customer experience is, is good and positive when, when going through that, cause it can be quite, frightening for people as well that, you know, they're quite worried about HMRC, Companies House, so they don't want to be late. They don't want to get a fine, they certainly don't want to get an investigation.

So they need assurance that everything's going to be done on time. And that they'll be reminded as to when they've got to provide information. And also that there are no errors. You don't remember things everything's done accurately. So the basic compliance work we do is, is very valuable, but also the, the consultancy work on top of that, that, also has a huge impact on our clients. So, so it's very, very important. And I think the other thing which, which I learned quite early on, is that accounting- it should be whatever the business owner wants it to be? Some people, they have different values. I'm a high growth person. I'm very interested in sort of ambition, high growth businesses that want to grow quickly or get into a new area, but not every business owner is of that mindset. Some people they just would like to sustain at the same, but they're at and how can they best go about that? Other people might be looking at exiting the business, so they might want to be looking at restructuring or something like that. So it's very important to have conversations with clients early on about what they want from the business, because their, why might be very different to yours. 

Kirsten Gibbs: [00:05:14] Yeah. That's interesting. And I agree. I think, one of the things, I think business owners don't always realize is just how much perspective an accountant can have on a business. Because you know, you like me, you deal with loads and loads of different businesses. You've seen lots of different ways of doing things. Lots of mistakes being made, you know, lots of really good things being done. So, you've got a perspective that it's almost impossible for one person to have on their business. And you can bring that to bear when you're, when you're looking at theirs. So I don't, I think people don't realize how much of that is available to them from their accountant. 

Jo Bell: [00:06:00] Yep, absolutely. I agree. It's a very unique insight that accountants have as we see that individual's business in great, great detail, we will even sort of get to know them through their numbers. You know, we, we know where they like to eat and very, very rapid access to their bank account. So we have a very, unique perspective. But also like you say it's the cross section is, its that individual, but it's also other people in that same industry, or even different industries that mistakes that are made across the board, you know, when, when someone is first starting out or when they get to a certain level, they start taking people on and then they make this mistake or it grows too fast and they weren't, you know, weren't looking at all the right places.

So, as a, as a fellow business owners and, and that cross section, we, we are able to offer a lot of advisory and we encourage our clients to communicate with us. Cause that's really where we come into our own. And we want to be involved in the decision. So when, when people ask, I'm thinking about buying this vehicle, for example, or this new piece of machinery, there'll be a better way or worse way to do that in terms of tax efficiency.

And there'll also be a better or worse time to do that. But if we're not involved in that decision making process, then, then we won't be able to provide the input that we're, we're able to. And sometimes, you know, how much advice you're getting from accounting can literally mean the difference between success or failure.

it's important that you have that close relationship with them. But one of the things I really enjoy as well is linking people up. 

So accountants have a good network of, of people and it doesn't always occur to them that they can pass details between one. So if you have a, one business that business may well be a really good customer for another one of your businesses, to be able to assist them with their marketing or their processes or whatever.

So if you can. Help to, to use your network as an accountant, as well, to help generate a community feel. And that, that I think is really powerful as well. And you'll take credit for that. Yeah. Hooking them up with useful people, you know? 

Kirsten Gibbs: [00:08:05] Yeah, exactly. And I think there's a, there's the whole cross-fertilization thing as well. That as you said, you know, it's not just that you see the same mistake made in the same industry. You might see something. If somebody is saying, Oh, how, can I do X, Y, Z ? You're in a position to say, well, actually, nobody else does that in your industry, but these people over here and this completely different industry do this, and you might try that.

And I think that's where an awful lot of innovation comes from, is that whole taking something that's normal in one industry and applying it in another. And that's quite hard for a business owner to do because they're looking after their business, but you've got the perspective of going well. I've seen that work over here, I wonder if it would work here?

Jo Bell: [00:08:54] Is I'm sure it's very, very. Difficult these days to come up with something completely and utterly original. it's likely that it has been done before somewhere, but maybe not in your particular field, as you say. but, but your accountant will be a good person to speak to, to find out if they've seen anything similar in their, in other industries.

Kirsten Gibbs: [00:09:12] Yeah. Brilliant. Okay. So yeah. Can accounting help to solve some of the big problems that we face today. I'm thinking of things like inequality, climate crisis is going to be the next one. I think we've probably already seen some of what accountants have been able to do to bring people out of coronavirus in good shape.

So what, you know. Can it solve some of the big problems? 

Jo Bell: [00:09:41] And one of my favourite sayings is that I truly believe accountants can change the world. That's quite often met with, with chuckles from other accountants and sort of new new employees. Goodness, this is a different perspective, lots, lots of accountants kind of cover their face when they walk into a network and go ooh I'm an accountant you know?

Kirsten Gibbs: [00:10:01] Oh my God. Yeah, 

Jo Bell: [00:10:03] Exactly. It's there's people think that what is boring maybe. whereas actually it's important to, to educate people and help them understand the, the, the insight that we have, because we do have amazing insight into, into lots of things. And we have the ability to really, really help people, I think, on a large scale. And a small scale. one of the ways we can do that is that we we're good at measuring things. We like measuring things its part of our personality.

If you have key performance indicators, which you want to measure within your business - and some of those might be financial, such as the the, the turnover or your debtor days or the amount of money in the bank. And some may be sort of financial, but not, for example how many new clients you've got. So more marketing based KPIs, but others might be based around your, your value system.

So for example, the impact that you're having on, on the environment, as you alluded to in your question about climate crisis and absolutely an accountant can help you come up with a way to, to measure that. and, and then you can use that information for all sorts of things, mainly to sort of improve the, the measurement in whatever it is that you're, you're looking at.

Kirsten Gibbs: [00:11:16] Yes, but of course, then once you're doing that, then you can share that information as well with other people like your team, your clients, your prospects, you know, other accountants. 

Jo Bell: [00:11:29] That's exactly it. So I think once, once you've measured it, the important thing is then what you do with that information.

So what things do you implement? And that's, that's about improving. and making sure your key performance indicators are going in the right way. And as you say, you need to share that information as well, internally amongst your team, but also your, your clients and prospects potentially because someone you - ideally what we're looking for is, is clients that share our value system.

Kirsten Gibbs: [00:11:57] Yeah, exactly. 

Jo Bell: [00:11:58] You measure these, these specific things that would also appeal to them. Just the fact that you're measuring it, can be very impressive and make them more inclined to work with you then maybe another provider. 

Kirsten Gibbs: [00:12:09] Yeah. And as, you know, the technology issues of remote accounting, cloud accounting, all of that is disappearing.

It is going to be even more important. I think for accountants to realize they need to think about this. They need to think about who do you enjoy working with? Who do you want to work with? Who can you most help? Because you can't work with everyone. Because that wouldn't be practical and there's going to be plenty of competition out there once everybody realizes location, isn't the issue. 

So you really need to be thinking about who is it that we really want to work with, that we are best placed to help. and how do we explain that? So that those people find us basically, 

Jo Bell: [00:13:00] That's it, the explanation is the key, isn't it because you might know internally that yes, these are the people we, we know we can work with, but it's how, how you get that message across to people.

And one of those things is, is measuring certain key performance indicators so that you can demonstrate it is evidence. Isn't it, it's evidence this, you know, this is something that's important to us. One factor, for example, if someone was looking to go to a coffee shop, might be, if they're using, you know, fully recyclable cups and things like that, that, that if that's something that's important, then they'll choose to go there rather than their Nero or their Costa or whatever.

And I think it's the same in, in any industry. And the key now is, is exactly as you say, and it's because of the location issue gone away, somewhat because of the benefits of Zoom meetings and all of that, that means there's an awful lot more. Choice of consumers. and they're gonna, they're gonna think, well, you know, what, what things are important to me and they're going to be looking for that in your marketing message, really?

Kirsten Gibbs: [00:13:58] Yeah. Which actually is all a brilliant example of how talking to your accountant could impact your business way beyond where you think it might. Cause it's really not just about the finances. It's about, measuring it's about getting numbers, evidence, as you say, to show what you're doing and how well you're doing whatever you're aiming to do. And then being able to share that evidence, with the outside world, which is amazing. But most people don't think of an accountant like that. 

Jo Bell: [00:14:34] No, 

Kirsten Gibbs: [00:14:35] No. Interesting. Okay. So. I think I know the answer to this question. Can accounting help make the world a better place? 

Jo Bell: [00:14:45] Oh, I would say yes. I think we absolutely can. and that's based on a large scale, which is what we've spoken about with, with KPIs and all of that sort of thing, and looking to make a difference, but also on, on a small scale to individuals, so something that's very important to me, and I'm very, very aware of is that small businesses are run by people, with families, and children who live within a community, and accountants have the option to have an impact, a huge impact on the owners of those businesses.

But that has a ripple effect outwards on all the people that that business interacts with and that business owners, family, for example. So if, if you helped to save that business owner money, because you may be point them towards something that they could claim against their tax, that they weren't aware of, or show them how to take their money out from the business in a slightly different way that means they pay less taxes. When you extrapolate that, saving that they've made, be it £2000 pounds a year for over 10 years. That's a big, big impact that money that they've saved will be spent on maybe education their children or spent, you know, donating maybe to a particular cause that's, that's important to them depending on what their own value system is. 

It might impact on where they live, the lifestyle they live, and that's really, really important. So I think we have a duty as accountants to make sure that we're, we're doing a really good job because you, you, you have no idea what that business owner or that community might be missing out on.

If you miss something, if you haven't had the right conversations with the client, to make sure that you're helping in all the ways you have the unique ability to help. 

And it's a constant thing as well. It's not just a, when you sign up a client, because obviously their circumstances change all the time and they might not necessarily think to come to you if they don't understand that all the ways you can help them, they might try it to make those decisions on their own.

Whereas actually, had you been able to be a part of the decision making process, if they're looking to invest in a new asset or diversify the business and go in a different direction it's important that you, as an accountant, I think have the conversations with them so that you can make sure you have a say in that decision and you can offer your input to that business owner, which is gives them more chance of success.

Kirsten Gibbs: [00:17:03] Yeah. Yeah, no, brilliant. I think that's really, that's been really another, Another positive actually out of the recent crisis has been this realization I think among a lot of small businesses that your accountant is really well worth talking to. But also, I think it's been pretty good for good accountants who realize that you might have to go out and do that talking yourself, not wait for the client to come to you. 

But I think on the whole, a lot more small business owners will realize will have realized that, your accountant is much more than a way of keeping compliant. So I think that's been brilliant actually, and puts all of you in a really good position to keep making the world a better place.

Jo Bell: [00:18:00] Hundred percent. I truly, truly hope so. And to do it more. More than weve been doing it before as well, because like you say, I think there's a realization for clients as well, that they can reach out and have those conversations and that we have a lot to offer. So long may that continue. 

Kirsten Gibbs: [00:18:17] Yeah. Brilliant. Well, thank you so much, Jo.

That's been really interesting. It's really nice to talk to you again, actually, I haven't done that for a while. Is there anything else you'd like to say? 

Jo Bell: [00:18:29] No, I think, I think Kirsten, only what I alluded to earlier that I found it insightful speaking to you myself, I've very much enjoyed being part of your podcast then, but also it's clarified my own thoughts as well.

Cause I think we we've had a lot of time to reflect during this. Consider where our own businesses are going and, you know, what we're offering and whether we're doing it in the best way that we can. So it it's really helped me to clarify my thoughts as well and what I'd like to communicate to customers about the impact that we can have on them going forward.

Kirsten Gibbs: [00:19:04] Brilliant. I'm really pleased it's been useful as well as enjoyable. So thank you. Thank you again. 

Thank you for listening to the pioneer accountants podcast, where pioneering accountants answer big questions about accounting with me, Kirsten Gibbs, if you're a pioneering accountant, and you'd like to be part of this podcast, just head over to my website, www.gibbsandpartners.com and send me a message.

I look forward to hearing from you.