We are often asked at The Accounts Dept as to what services we provide, and as we are a boutique firm, we keep our offering narrow to book keeping, management accounting and Chief Financial Officer (CFO) services (and VAT services, of course!)
However, some of our potential clients are unsure of what these services entail and how we differentiate ourselves between the other firms in the Dubai market.
Book keeping is the data entry of information into an accounting software, both desktop or cloud-based, to capture transactions related to the running of a particular business. Tasks may include raising sales invoices, posting receipts against these sales, entering of expenses and supplier invoices, recording petty cash expenses and payroll etc. More experienced bookkeepers may reconcile bank accounts back to statements, prepare month-end journal entries such as accruals, depreciation of fixed assets, amortisation of prepaid expenses and even VAT returns.
Our primary focus as a company is to add value to our clients through our accounting offerings rather than just being a generic book keeping provider. Although we do provide bookkeeping via our own in-house team to clients, our team of Chartered Accountants focuses on the management reporting and CFO side of the accounts.
This is not to lessen the importance of good bookkeeping; much like the foundation of a house, solid bookkeeping practices will ensure a robust set of books; whereas accounts prepared incorrectly will result in the analysis of incorrect figures, which is meaningless, and potentially an incorrect VAT return and penalties if these errors are discovered.
What then does management accounting entail? Management accountants will prepare financial reports for the use of a business’ management, for management to make timely and informed decisions. It differs from financial accounting, which are statements prepared normally half-yearly or yearly for statutory bodies or outside parties such as shareholders. Management accounting reports are usually prepared on a monthly or even, in the case of larger companies, on a weekly basis. Typical items which are analysed are sales revenues, ageing of accounts receivable and accounts payable (monies owed to and from the company respectively), inventory levels and available cash on hand. Accountants will usually look at gross and net profits (the difference between sales revenues and direct costs and sales revenues and total costs respectively), to analyse whether certain sales line items are profitable and if others are not.
A good accountant will normally meet with company management on a monthly basis to discuss the month’s figures and any issues identified, as well as addressing queries by management.
A CFO’s role goes beyond that of a management accountant, and may include (although not an exhaustive list) the following:
Assisting with year end audit preparation
Advising on internal controls procedures and identifying weaknesses
Assisting with tax and VAT returns, as well as overseeing the preparation of these returns and checking accuracy if prepared by a different team member.
Preparation and/or assistance of monthly, quarterly or yearly budgets and forecasts
Playing a lead role with senior management and investors in defining strategic vision of the company
Involvement with external fund raising for working capital/capital expenditure purposes
Preparation of financial models and valuations
There does exist an overlap between these three areas between bookkeeper/management accountant and management accountant/CFO, however at The Accounts Dept, we offer all three on an outsourced basis with packages starting from only AED4,000 per month.
For more information on your business’ financial needs, speak to someone at The Accounts Dept today by emailing email@example.comBACK TO BLOG