The Importance of Accounting

Published on August 2, 2010 by Crawfords Accounting

Most businesses have been greatly affected by the recession that hit the UK in 2009. The recruitment industry is one such line of business. With high redundancy rates and many companies unwilling to pay recruitment agency fees, many employment companies have struggled.

A good example of how not to try and overcome these tough times is reflected in the case of C Limited; a recruitment agency who find employment for labourers. A VAT inspection highlighted numerous discrepancies which were then investigated by the HRMC and discovered that £360,794 of VAT and £410,254 of PAYE/NIC had been withheld with £2 million was being paid out to other factions. After being taken to court, the company director was consequently banned from owning or managing a company for 8 years and was also jailed for 15 months.

“Keeping proper accounting records isn’t an optional extra when running a business, but a strict requirement under the Companies Act 1985,” warned Alex Kachani, Crawfords Accountants.

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