Silverfin policies and procedures

Using the Silverfin platform to prepare a set of accounts is a very different (and hopefully more efficient) way of working and it does mean we have to make a number of standardisation or policy choices in how we want to work and how to implement the use of the platform. These are discussed below and we would welcome feedback from all involved.

KEY CONCEPTS

There are two fundamental concepts that underpin our introduction of Silverfin that are worth emphasising before discussing policy choices.

1. Business Process Review – Silverfin will change the way we prepare accounts in many ways, but it will still require planning, preparation and review/completion. We have taken the lesson from the accounts production BPR exercise we carried out and adapted them into the Silverfin environment. We are deliberately not trying to simply translate our way of working into Silverfin, but take the best from both.
2. Standardisation – This has been highlighted as a key area for focus by both Silverfin and JC, and has been a discussion amongst FC partners and offices for some time. Obviously the more we standardise certain processes and formats, the more efficient we will be. Whilst we must always ensure the client is a prime focus, we also should ensure that where we change standards this is really valued by the client. Therefore we will have focused on agreeing a common set of documents (sole trader, partnership and company accounts, supporting documents such as Letter of Rep, dividend minutes, etc) and only change this for specific cases (such as sector specialisms such as doctors, etc where there again will be one standard for each of these).

POLICY CHOICES

1)  Risk and overall approach to work done: Whilst we want to standardise processes, we also want to make sure that we are not over working the assignment. We have adapted our planning approach to ensure it is suitably tailored to both address the risk of that job but also the circumstances of the client. The combined revised approach is outlined here and this should be followed for all assignments within Silverfin as the templates have been created and refined in line with this approach. Please note tax risk is separately assessed and there is a separate Tax Risk Assessment in Preparation covered by this help note.

2)  Access to clients files: All staff and partners will continue to have access to the majority of client data, apart from those subject to Chinese Wall procedures. This will mean the home client screen will contain all clients, but there is a very good search function (Ctrl J) within Silverfin

All staff will also be able to create clients, although they must exist within Practice Engine. This set up process will be undertaken from within Frank using a new app.

It should be noted that a client within Silverfin will not necessarily directly match a client in Practice Engine, as client code in PE may include several different entities (group companies, sole trader, partnership, etc). In Silverfin we therefore refer to a client entity. The new FC central database does contain a unique record for each client entity so we have the ability to distinguish this internally.

Only certain staff (mainly champions) will be set up as admin users although this only really affects the altering of templates and adding new users.

3)  Sage desktop– Although Silverfin can be synced to Sage backups we take for clients, we currently (re)use the same FC Sage licence for a number of clients during a year, overwriting previous data when we upload new client for processing. There is a danger that this may then link a Silverfin client with the wrong Sage client when a new Sage client is restored to the same Sage licence internally.  In order to avoid this the following procedure should be followed

• The Sage username and password should not be changed and are always stored within Silverfin in the Permanent Information section so will be easily available.
• Once the client data has synchronised into Silverfin then the link to Sage should be disconnected using the guide here.  This will ensure that data is not accidentally overwritten.  The sync can be re-established the when the next backup is received which may be with a different Sage version using the guide here.

4)  Clients with manual records – Although, Silverfin can import records from an Excel nominal ledger activity download, it works best with a direct link to accounting software (Xero, Sage, QuickBooks, etc). We have been encouraging the use of accounting software for many years, spurred by the original (VAT) MTD and this will continue as we progress towards the wider MTD initiative. Silverfin should encourage another boost to this, but we will still have clients that maintain manual records.

Our general policy here is:

a) Live sync if possible to software

b) If client does use software then download nominal ledger activity into Excel and manually upload into Silverfin. Silverfin are continuing to expand their software links and if there is one consistent missing software, please let support know.

c) Consider use of Auto Entry/Receipt Bank to scan data into an internal FC QuickBooks client that we then link into Silverfin

d) Last resort/for smaller clients: code up trial balance from client into Excel using Silverfin nominal codes and then load into Silverfin.

5)  Client year end procedures and posting of year end opening/opening balances – Part of the attraction with Silverfin is that it reads directly from our clients software (so no imports to DAPA/DAP, export to Excel, make changes in Excel/DAPA, etc). It will read all data, including prior years. As such, if the client hasn’t posted the year end journals we send them, this will mean the data in their systems will not match the accounts we prepare. Silverfin keeps track of all journals processed (FYI they are raised in Silverfin using the client nominal codes), but over time this can become a problem, mainly in reconciling opening reserves. This also applies if clients back post entries after the year end exercise has been done.

We regularly deal with this problem, but the efficiency of Silverfin is maximised when the clients data equals the final accounts.

We are therefore encouraging all partners and staff to be firmer with clients to “insist” that opening balance journals are actually processed in their systems (where possible) and the data for the previous year is locked (depending upon the software used). Obviously if this is not done, additional costs will be incurred within Silverfin that may then expose poor recoveries for these clients.

More formally however, we must not start detailed work until the opening reserves figures agree between last year's accounts and the client system (although this needs to be done with reference to the different way Sage and Xero, for instance, handles year end/opening journals).

In addition, as part of our completion procedures each year, the adjustments made within Silverfin should be reviewed and reversed once they have been posted into the client’s bookkeeping system.

6) Use of DAPA/DAP to produce accounts - We are moving towards using Silverfin to produce all of our accounts over time. However, as we develop templates for sector specialisms and Silverfin develop support for more technical clients, we will use continue to use DAP / DAPA to produce accounts. However, we should still wherever possible use Silverfin for working papers and then export the data to DAPA/DAP. This will automate the majority of mapping from Silverfin to DAP/DAPA for most clients.  The guide for this is here.  

7)  Document storage – Another advantage of Silverfin is that it stores within its system all relevant records and these can be directly linked (without hyperlinks) to individual items (schedules or figures). These documents could be individual receipts (these can actually be read/accessed in Silverfin directly from software such as Xero if it is set up correctly), schedules (stock lists or complex fixed asset registers in Excel although Silverfin can create most of these from imports as needed) as well as items such as Letter of Representation (which can be generated within Silverfin with the correct, up to date stock figure) and dividend vouchers (again automatically generated – this should then replace First Order).

This also mean that packs containing multiple documents (draft accounts, points for clients, adjustments, LoR, etc) can be automatically generated (JC have pre-defined packs for pack for management review, pack for client meeting, pack for partner sign of, etc).

As such, it is policy that all relevant documents will be stored within Silverfin and there are templates that define what documents should be stored. We are aware that this will lead to some duplication of documentation that is stored within M Files (we confirm that documents within M Files can be uploaded directly into Silverfin), but these will actually be few, although as per M-Files policy final copies of documents such as signed accounts, LoE will continue to be stored appropriately within M-Files, which will continue to operate as the FC Document Management System.

9)  Adjustments (journal) tags – Silverfin allows you to tag each Adjustment (journal) with appropriate pre-defined tags. These allow the adjustments to be grouped, sorted or searched. All journals/adjustments must be tagged either External or Internal tags (distinguishing between those that are needed to be processed into client systems and those that are just presentational for FC use). We should also use the Reversing journal tag to identify these when starting a new period.

We are not introducing other tags immediately although would welcome comments on other useful ones that could include Stage of process (Post Client/Manager/Tax Review, etc), PY Opening Balances Adj, PY Restatement, etc

9)  Communication process – Review points, notes, action points, points for clients, etc are all contained within Silverfin and will replace all paper notes, emails, etc.

These comms can be tagged for individuals to action, but this must only be done when the action is needed in order to progress the file (so mainly manager/partner/tax review needed) – therefore the vast majority of comms will not be tagged. Tagged comms within Silverfin will result in daily email notification which, if used sparingly, does serve as a good reminder of what needs to be done.

The Communication panel appears to the right side of all reconciliations and should be pinned in place at all times to ensure all points, notes and checks relevant for that reconciliation are visible (although any incomplete checks will prevent achieving 100% completeness for that workflow).

There is the ability to Follow a file within Silverfin (and you may be asked this in a large yellow bar at the top of the workflow screen). We are using this function and you can see more information here but we do nto user the @internal function (which would tag all followers of that file).

10)   Review process:

a)  Planning workflow  - must be reviewed and signed off by the assignment manager before further work is undertaken in the Preparation and Accounts workflows.  

Review is carried out in the Workflow Review screen, with each section to be marked as reviewed by the manager (Silverfin will automatically record who presses the “Mark as reviewed” button).

Review is evidenced by the manager in the Manager Review checklist by answering the questions therein– this checklist must be assigned to the manager (and this should be done by preparers during their process in setting up planning, when they remove the anyone option here).

b)  Preparation and Accounts preparation workflows – Review can be carried out in the Workflow Review screen (although for Preparation you may find it easier to work with the individual reconciliations), with manager discretion as to what reconciliations need review.

c)  Completion – similar with Planning review, but preparer, manager and partner all have specific checklist to be signed off (the preparer ones are built into the individual reconciliations as part of the Communications panel on the right of the screen).

11)   Accounting Framework - For the majority of our corporate clients, we should prepare accounts under FRS 102 1A if they qualify (see https://library.croneri.co.uk/cch_uk/fi/1-2 for qualification criteria). For those that are larger than these limits, we should be using FRS102. Whist we are able to use FRS105 for our smallest corporate clients, there are a number of disadvantages to this. As such, if you do wish to use FRS105 (and qualify to do so), please confirm with the engagement principal that this is acceptable before you start the assignment.

If you are unsure of which frameworks the entity qualifies for or which would be appropriate please contact the technical team.

12)   Completion procedures – Once the final accounts have been filed at Companies House and the file is completed, the file must be locked from within Silverfin (Client Home Screen, Actions, Lock). Whilst the data will still maintain a live sync with the clients accounting system (if relevant) this prevents any changes to the reconciliations and checklists within the file itself.

13) Completion - All workflows must progress to 100% to finish a file. This means all relevant (starred) reconciliations must be complete (green circle or yellow square), all checklists complete and all review points cleared. Workflows 1, 2 are straight forward to complete - 3 (accounts) and 4 (completion) have certain questions that can only be cleared once the accounts have been signed/approved by the client, but then must be fully finished before the file is then locked.   

14)  Materiality – Although not consistently used outside of audit until now, all accounts assignments should have an assessment made at planning as to the level of materiality that should apply to that job, to prevent us spending excessive time in areas which are not worthwhile (either to us or our clients). A default level of £500 has been set. This level should be adjusted depending upon the client and the assignment risk. Some managers may want to set different limits for, say, prepayment adjustment or bank reconciliations, but it should be considered for all clients.

15)  Budget – A budget should be undertaken for all assignment with a fee over £500 (although again this can be changed during planning at manager/partner discretion). The template in Silverfin allows this to be created quickly, especially if only a few people are allocated to a job. You may also want to insert a time costs level beyond which the prepare should not proceed without seeking further input from management, partner or possibly client. At completion, we advise that whilst a full actual to budget exercise can be carried out (and there is a Silverfin template for this), that for most jobs, we would only compare total costs to budget and report on that (where we might highlight internal efficiencies for points forward or how client can improve for points for client).

16)  Client naming – The Client Name within Silverfin should be set up for that Client Entity and may therefore vary from the PE name, and this is fine. The File Number will be set up to show the PE Code and both the Entity Name and PE code will be shown at the top left of all screens (together with the period).

17)  Companies’ House Link – There is the ability to automatically copy data from Companies House  (Firm name, Firm address, Legal form, Directors / secretaries names, start dates and resignation dates). This should be once done at the start of the assignment, but the data should then be carefully checked as it may differ in terms of being inaccurate or inconsistent with the correct data. Where it is inaccurate we should correct it at Companies House as soon as possible, after of course checking with clients.  If it is inconsistent (where Companies House insist on “and” rather than “&”) Please add a note to the file to explain differences so that other users can ensure these changes are not overridden by any further sync with Companies House.  

18)  Client deletion – we are charged by Silverfin for every client file in their platform, with an agreed minimum. It will therefore be important that if we lose a client, that the client is archived as appropriate within Silverfin. This data is retained within Silverfin for at least 3 years so we can restore it if needed.

19)  Standard v Analytical client type – For our more complex clients where they use formal divisional or enterprise reporting within the accounting software, this can still be used with Silverfin, but requires a different licence. Please consult our support team if you deal with this type of clients.

20)  Support – Initial support should be sort from the FC Help page and Silverfin articles as we have built extensive FC specific help articles to cover the majority of procedures. Beyond that, support should be sought from within the local team and office Silverfin champions. If this does not sort the issue, we have a specific help channel within the Silverfin Team in Teams to use.

21)  Branding on Accounts and other Reports– We should not put our branding on our client's accounts as they remain their accounts. For other report from Silverfin such as pack for client meeting, etc, there is a standard template branded front page (to which Silverfin will add client name) that should be used.