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Blog 2017-09-24 Sage One Training for Start ups Before considering Sage One training for start-ups the most important basics of accounting with any software program needs to be mentioned.: These accounting basics are that the bank accounts or cashbooks should be balanced. Before internet banking most people and businesses used cheques as the most common means of payment. If you are familiar with that era then you will know that the bank reconciliation formed an important function in ensuring the integrity of your accounting system. These days , in most instances the bank balance in your accounting system will balance with the balance in your bank account. One common regular difference will be outstanding cash deposits if your business receive cash payments. Secondly while you may choose different chart of accounts or classify your income and expenses different to the next business it is important that similar transactions are posted to the same account consistently right throughout the accounting period. Keeping an asset register which also balances with your accounting records is also important. It is required by the companies act. Adhering to these basics will ensure that your accountant or auditor has less work to do at year end resulting in lower fees. How does Sage One training differ for a start-up compared to an existing business converting its accounting software to Sage One? Start-up businesses who require Sage One training present the following problems and opportunities:
Let’s discuss these challenges and opportunities in a little more detail and how I prefer managing them. Actual data to capture I prefer training people on Sage One with their actual company data. I have trained a qualified accountant on Sage One and in that instance all the training needed was completed in one hour. The Sage One software is incredibly easy to understand and master. If you would like to add the skill of Sage One to your CV I suggest you contact a friend or family member with a small business and offer to do their books at a reduced fee or even for free for the first year or two in order to get the experience which is needed using actual company data. Once you understand the general workings or “language” of a software it becomes easier to master the whole program. I can also prepare demo data if needed. Often not all functions available in Sage One is needed by a start-up. This can be confusing for someone not experienced in accounting. Small businesses will often not need to use the Purchase order function, the budgeting function or even the Suppliers system but only account for transactions on the payment system (as it is reflected on bank statements). This can be a problem where a company is registered for VAT since companies are required to be registered on the invoice basis for value added tax. The Sage One Training I offer can be spread over a few months as the business gets started. Often only a few 1 to 2 hour sessions are needed at a time as you settle into your new business and the Sage One accounting Software. Vat registration in progress Until a company is registered for VAT all transactions will have to be accounted using the No Vat option. In business one often sends out quotations or negotiate with potential clients who only later decide whether to accept the quote or not. You should be clear with potential clients about your Vat status and the possibility that you might be registered shortly. That would not be a problem if your potential clients are registered themselves. If this is not clearly communicated as is required by law your potential clients can well argue that the price quoted is assumed to include Value added tax. During training the different types of VAT types will be discussed and how accounts can be created to automatically generate the correct default VAT type. Standard chart of accounts Sage One comes with a standard chart of accounts. During the initial set up of your set of books you will have to create additional accounts which relates to your industry. You will also have to decide whether to classify your payments as cost of sales or expenses. For business management reporting purposes you should use what works best for you. As long as you consistently post similar transactions to the same account your accountant or auditor will be able to compile your financial statements according to IFRS (International Financial Reporting Standards.) Doing things correctly from the beginning The fees of auditors and accountants are determined according to the complexity of the work as well as the total time it takes to complete the work. If you can produce to your accountant an accurate trial balance which reconciles with bank accounts and with your suppliers statements then you can expect a lower annual fee. Equally important if you comply with Vat legislation from the beginning you will avoid having to pay penalties. You have no choice but to familiarize yourself with how the Value Added Tax system in South Africa works. Some opportunities that exist for start-ups in this regard include legally claiming deemed input VAT on the second hand assets directors often sell to the start-up company. You will have to learn what constitutes a valid tax invoice. Non-compliance can lead to extensive financial pain and losses, especially if only detected a few years after starting your business. As can be seen from some of the things one need to consider when starting up a new business and getting Sage One Training there is more things to consider. Sage One training cannot take place in a vacuum. I am willing to offer the training in short sessions over a few months and to assist with ensuring that your first few Vat returns are accurate and correctly calculated using Sage One software. Before considering Sage One training for start-ups the most important basics of accounting with any software program needs to be mentioned.: These accounting basics are that the bank accounts or cashbooks should be balanced. Before internet banking most people and businesses used cheques as the most common means of payment. If you are familiar with that era then you will know that the bank reconciliation formed an important function in ensuring the integrity of your accounting system. These days , in most instances the bank balance in your accounting system will balance with the balance in your bank account. One common regular difference will be outstanding cash deposits if your business receive cash payments. Secondly while you may choose different chart of accounts or classify your income and expenses different to the next business it is important that similar transactions are posted to the same account consistently right throughout the accounting period. Keeping an asset register which also balances with your accounting records is also important. It is required by the companies act. Adhering to these basics will ensure that your accountant or auditor has less work to do at year end resulting in lower fees. How does Sage One training differ for a start-up compared to an existing business converting its accounting software to Sage One? Start-up businesses who require Sage One training present the following problems and opportunities:
Let’s discuss these challenges and opportunities in a little more detail and how I prefer managing them. Actual data to capture I prefer training people on Sage One with their actual company data. I have trained a qualified accountant on Sage One and in that instance all the training needed was completed in one hour. The Sage One software is incredibly easy to understand and master. If you would like to add the skill of Sage One to your CV I suggest you contact a friend or family member with a small business and offer to do their books at a reduced fee or even for free for the first year or two in order to get the experience which is needed using actual company data. Once you understand the general workings or “language” of a software it becomes easier to master the whole program. I can also prepare demo data if needed. Often not all functions available in Sage One is needed by a start-up. This can be confusing for someone not experienced in accounting. Small businesses will often not need to use the Purchase order function, the budgeting function or even the Suppliers system but only account for transactions on the payment system (as it is reflected on bank statements). This can be a problem where a company is registered for VAT since companies are required to be registered on the invoice basis for value added tax. The Sage One Training I offer can be spread over a few months as the business gets started. Often only a few 1 to 2 hour sessions are needed at a time as you settle into your new business and the Sage One accounting Software. Vat registration in progress Until a company is registered for VAT all transactions will have to be accounted using the No Vat option. In business one often sends out quotations or negotiate with potential clients who only later decide whether to accept the quote or not. You should be clear with potential clients about your Vat status and the possibility that you might be registered shortly. That would not be a problem if your potential clients are registered themselves. If this is not clearly communicated as is required by law your potential clients can well argue that the price quoted is assumed to include Value added tax. During training the different types of VAT types will be discussed and how accounts can be created to automatically generate the correct default VAT type. Standard chart of accounts Sage One comes with a standard chart of accounts. During the initial set up of your set of books you will have to create additional accounts which relates to your industry. You will also have to decide whether to classify your payments as cost of sales or expenses. For business management reporting purposes you should use what works best for you. As long as you consistently post similar transactions to the same account your accountant or auditor will be able to compile your financial statements according to IFRS (International Financial Reporting Standards.) Doing things correctly from the beginning The fees of auditors and accountants are determined according to the complexity of the work as well as the total time it takes to complete the work. If you can produce to your accountant an accurate trial balance which reconciles with bank accounts and with your suppliers statements then you can expect a lower annual fee. Equally important if you comply with Vat legislation from the beginning you will avoid having to pay penalties. You have no choice but to familiarize yourself with how the Value Added Tax system in South Africa works. Some opportunities that exist for start-ups in this regard include legally claiming deemed input VAT on the second hand assets directors often sell to the start-up company. You will have to learn what constitutes a valid tax invoice. Non-compliance can lead to extensive financial pain and losses, especially if only detected a few years after starting your business. As can be seen from some of the things one need to consider when starting up a new business and getting Sage One Training there is more things to consider. Sage One training cannot take place in a vacuum. I am willing to offer the training in short sessions over a few months and to assist with ensuring that your first few Vat returns are accurate and correctly calculated using Sage One software. |
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