From Reactive Accounting to Proactive Business Decisions

Domestic Heroes is an appliance repair company that also supplies replacement appliances when a customer's existing appliance can't be repaired. The business had grown steadily over a number of years, but as it grew, the owners wanted more visibility over their finances and a better understanding of where the business stood throughout the year.

Their existing accounting arrangements dealt with the necessary compliance, but they weren't providing the timely financial information the owners needed to plan ahead and make informed business decisions.

Before working with CASS, Domestic Heroes used Sage alongside a traditional, largely paper-based accounting process. Receipts would be collected and sent to their accountant each quarter so the VAT return could be prepared.

The problem wasn't simply the amount of paperwork. It was the lack of visibility that came with it. Financial information was largely historical, making it difficult for the owners to know exactly where the business stood at any given point.

VAT was a particular frustration. The business could receive an unexpected VAT bill with only a matter of days to find the money to pay it. Without an up-to-date picture of the finances, forecasting liabilities and planning cash flow was difficult.

As the business continued to grow, the owners needed their accounting to do more than tell them what had already happened. They needed financial information they could use to plan what happened next.

After an initial conversation with Paul Barnes at CASS about cloud accounting and what it could offer the business, Domestic Heroes decided to explore a different approach.

At around the same time, the business was looking at a CRM and job management system. This created an opportunity to connect the operational side of the business with Xero and create a much more joined-up approach to its financial information.

Instead of relying on paperwork being collected and processed retrospectively, financial information could flow into Xero and provide a much more current picture of the business.

But moving to Xero wasn't the end goal. The real objective was to give Domestic Heroes better financial information and then help the owners understand and use those numbers to make better business decisions.

The biggest change was visibility. With more timely financial information available, Domestic Heroes could understand where the business stood rather than waiting until weeks or months later to find out.

That improved the owners' ability to forecast, plan for upcoming liabilities and make decisions with a clearer understanding of the financial implications.

The conversations with CASS could also move beyond bookkeeping, VAT returns and looking at historical figures. Instead of simply discussing what had happened during the previous few months, the conversation became about what the numbers meant for the decisions the business needed to make next.

That included considering when to replace vans, the best way to purchase them, how available capital allowances could be maximised and what future VAT liabilities were likely to look like. It also allowed tax planning conversations to happen before the year end, while there was still time to consider and act on potential tax-saving opportunities.

Domestic Heroes now has greater visibility over its financial position, improved forecasting and a better understanding of upcoming liabilities.

VAT can be anticipated rather than arriving as an unexpected bill, while investment and tax decisions can be considered before they happen rather than after the event.

Most importantly, the owners have financial information they can actually use. Their accounting has moved from being predominantly about recording the past to becoming part of how they plan and make decisions about the future of the business.

As the owners themselves put it, they've moved from “reacting to being proactive.”

For us, this is what Giving You More Than Numbers is really about. It isn't simply about replacing paperwork with Xero or producing accounts more quickly. It's about helping business owners understand where they are, what's coming next and using their numbers to make better decisions about what happens next.