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The 6 Points of “ONE”: weConnect’s Unique Solutions Model

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The 6 Points of “ONE”: weConnect’s Unique Solutions Model

The key to our value proposition is our ability to truly streamline your global accounting, payroll, tax, and corporate secretarial compliance, known as “back office accounting” compliance. 

Most companies that are looking for global back office accounting services want to work with one provider and receive consistent service across all office locations.

But the reality is that most global providers are associations or networks, including the Big Four accounting firms. That means that each office operates independently in each country. So what you are getting is a global brand, but not a global solution.

At weConnect, we’re different. Our mission is to provide you with the best global solution. How do we do it? We’ve put together a list of the five things we do differently to make this a reality. 

Here are the benefits of our “ONE” concept:

1. ONE Team

When you work with other global providers, you’ll wind up working with different teams in each country that don’t communicate with each other. That means that each time you expand your office to a new location, you’ll have to do training all over again which is a lot of extra work.

When you work with weConnect, you’ll have the same team of experts working on your back office for all of your office locations. This means you’ll train us once and never again for all offices and you’ll receive a streamlined experience no matter which country you need to focus on. 

2. ONE Point of Contact

Most global providers don’t have managers who are in charge of multiple locations. That means that if you have an issue with something in, for example, Japan, Thailand, and Korea, you’ll have to have three conversations with three different managers. 

Plus, you’ll face issues with too many lines of communication for the day-to-day work; depending on if you want to discuss tax, payroll, HR, labor law, new services, etc., you’ll have to speak to a different person for each topic. The list of people you’ll need to communicate with is vast in just one country, let alone the world.  

At weConnect, you have a named single point of contact with the experience and ability to discuss any point about any country at any time. 

3. ONE Accounting System

When you have a global provider engaged to support you with accounting in different countries, not all of their offices will know how to use your accounting system, even if you’re using internationally-recognized software. 

You’ll either have to convince each office to learn your accounting software, or you’ll have to compromise by using their local software and having different accounting systems in each location. In most cases, firms are resistant to using clients’ software and will push to use their own. 

At weConnect, you choose. We can either use your accounting system or we can use our cloud-based accounting system. We are experts at delivering on your company’s requirements while ensuring local compliance. 

4. ONE Reporting Format

Another downside to using different kinds of accounting software with multiple vendors is that you’ll likely receive reports in different formats from each office location. 

Whether we use your accounting system or our own, we can provide reporting in the same standardized format for each country. 

5. ONE Commercial Experience 

When you work with other global providers, your sales experience will be different for each of their offices. You’ll receive different proposal formats, different pricing structures, different terms, and different contracts for each country you need support in.

At weConnect, we have a consistent sales experience. Our clients enjoy one proposal format, one pricing structure, one set of terms, and one contract for all country locations. This enables a streamlined and comprehensive engagement.

Ready to be ONE with your back office accounting?

Our ONE model will save you time, paperwork, communication, and frustration as you scale your business globally. So whether it’s one country or many, we can cover it all. To learn more about how we can help you, contact us here and experience the power of ONE. 

The Benefits and Challenges of Offshoring Accounting

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The Benefits and Challenges of Offshoring Accounting

There are a lot of benefits to offshoring accounting, but it doesn’t come without its challenges.

We have deep experience in setting up offshore accounting operations and want to share with you our insights on what you will face.  

Here are the benefits of offshoring accounting: 

1. Cost Savings

Cost savings is one of the most attractive reasons why companies consider offshoring. When you hire employees in low-cost countries, the salaries are typically much less than the equivalent of hiring locally. In addition, the greater economies of scale means you don’t need as many people to get the same work done. You can also spend less on hardware and software.

2. Communication

Global organizations typically operate in English, but not all countries have strong English capabilities such as Japan, Korea, Thailand, and Vietnam. 

Communication is not just about language; it’s also about culture and mindset. For example, Japanese people use an indirect way of communicating, which means that words can be misinterpreted even if they are speaking in English.  

When you offshore and centralize your accounting in a country with strong English capabilities and similar culture and mindset, such as Malaysia, India, or the Philippines, you can anticipate a high level of communication across all locations.

3. High Quality Talent

You’ll find talent in offshore locations who are highly educated and open to doing tasks such as data entry that your local employees would otherwise resist. It’s easier to get these tasks done when you have employees who are happy to execute them.

4. Operational Excellence

There are locations in the world with rich histories of operational excellence due to global multinational companies leveraging these locations as centralized offshore centers for decades. Places like Malaysia, India, China, and the Philippines are notable locations.

Most of these centers deal with the transactional processing while technical compliance support stays onshore. As a result, operational excellence and continuous improvement becomes a priority and culture for these locations.

5. Centralization

When you have different teams around the world performing the same process, it creates inefficiency by having unnecessary handoffs. For example, would you rather have twenty different accounting teams performing the same process, or one?  By centralizing a process within one team, you’ll eliminate unnecessary handoffs and maximize efficiency. 

But here are the challenges you may run into and need to consider before taking the plunge

1. Building an offshore team is extremely challenging

It’s hard to build an offshore team remotely because building a proper team requires someone present on-site who understands the local culture and knows how to attract top talent. The first real challenge is to find a great resident leader or leadership team. Without this, your offshore initiatives will likely fail.

2. Initial Investment

Setting up an offshore team takes time and money. If you’ve been able to find the right offshore leadership, it still requires investment in infrastructure, time to ensure internal alignment on the goals, and at least a year if everything goes smoothly. Change management is also a big factor so the ultimate return on investment could take longer than you initially anticipate. Plus, there is the risk that your initial leadership could quit or wind up not being the right fit, and you’ll have to start from scratch again.

3. An onshore team is still required for some tasks 

There will always be finance-related tasks that require technical competency that you can’t get offshore. That means that you won’t be able to offshore 100% of the finance department and you need to ensure the onshore and offshore teams can work well together.

4. Your existing onshore team might not want to work with offshore employees

For many companies, change management is hard. Even though you’ll think that offshoring is a great idea, your existing finance department might not warm up to the idea immediately. The existing team might feel like having an offshore team is a threat to their job security, or worry that mistakes will be made which will burden them with twice as much work to do. 

5. Cultural differences can impact work quality

In most countries, there are specific expectations for how work should be executed and the quality of work that is required. You might find that your onshore team views the offshore team’s work as substandard, even if the quality is satisfactory on a global level. This can cause resistance from the onshore team who might feel that it’s easier to execute the tasks themselves. 

Here’s how to overcome the challenges of offshoring accounting, using weConnect as an example

We’ve had success in developing offshore operations, so we’ll share with you some strategies we’ve used to make it happen. 

1. We have a “clean-slate” hiring philosophy

At weConnect, we make sure that each person we hire for our onshore team is onboard and open to the idea of working with an offshore team. This has helped us avoid resistance from onshore staff who are instead extremely supportive of the offshore model. It is very difficult to shift a person who has been doing the work themselves for a long time into a support role, which is why our “clean-slate” philosophy has become our only philosophy with respect to offshoring.

2. We assign transactional tasks to our offshore employees 

Any tasks that are transactional such as data entry or repetitive like payroll are dedicated to our offshore team. The onshore employees really benefit from having support on these tasks and it frees them up to focus on other local work in line with their competencies and desires.

Instead of having two teams simultaneously working on like-tasks, we have an onshore team and offshore team working on separate tasks that integrate like pieces of a puzzle. 

3. We pay way above market for our offshore talent

We make it our mission to find the top talent, starting with the leadership, from our low-cost offshore jurisdiction and attract them to our company by offering salaries that are 25% above what they’d make in their already high-earning roles. By sourcing the top talent, it ensures that the quality of work produced offshore is in alignment with the high expectations of our onshore team and clients.

So here’s our advice laid out simply:

Find the best local talent, pay them great salaries, hire onshore teams that are bought into the concept (clean slate!) and allocate the tasks effectively.

If you think offshoring is for you, feel free to contact us here so we can share how you can make it a reality.

The Tesla of Accounting: How weConnect is Innovating the Back Office Industry

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The Tesla of Accounting: How weConnect is Innovating the Back Office Industry

weConnect started with a mission to do things differently. To deliver back office solutions, such as accounting services, in a way that defies the outdated and ineffective practices of the industry. And to provide clients with an incredible experience never thought possible. When we were thinking about how to explain how we are innovating our industry, we noticed similarities between our values and some of the most innovative companies in the world like Tesla, Amazon, and Apple. Here is a list of what we believe are the key aspects of innovative companies and how weConnect embodies these qualities.

Here are the qualities shared by innovative companies

1. Innovative companies attract the best talent with an inspiring mission 

A high salary alone does not attract and retain top talent these days. People who are the best within an industry are looking for opportunities to be part of something bigger than themselves. Joining an organization that has an inspiring mission is something that talented people want to experience and contribute to.

2. Innovative companies are focused on the Customer Experience

In order to provide the best experience for the customer, you can’t have any assumptions about how things “should” be done. It’s important to look at a problem from a clean slate without preconceived notions about how to resolve it. Then, set goals and develop solutions that make the most sense for customers, even if they’ve never been implemented before. 

3. Innovative companies have a high degree of vertical integration

Maximizing the customer’s experience requires being in control of everything that affects the end product or service. This requires a high degree of vertical integration, which is where a company owns and controls each part of the supply chain or service procedures. Innovative companies use vertical integration to ensure that they are achieving their goals of providing the best quality for customers at each stage of the product or solution development.

Here’s how weConnect embodies each of these qualities for innovation

1. We ensure that all of our team members are aligned with our ambitious mission

Our mission at weConnect is to create the first truly global accounting, payroll, and tax solution. This means one completely consistent solution across every country. One team, one point of contact, one system, one standard reporting format, and one commercial experience, for the world. 

From day one, we have been committed to inviting only the most talented individuals who are inspired by and united in this mission to join our global organization.

2. We are focused on the Customer Experience

Finding the most innovative solutions means looking at each problem from a clean slate. Traditional ways of thinking can create preconceived notions of how to approach problems, and this can get in the way of designing effective solutions. At weConnect, we have tossed out all traditional industry assumptions and are building our global solution from the ground up with the customer experience being our top priority.

3. We have a high degree of vertical integration

Most global back office providers are not vertically integrated. They are associations or networks (including the Big Four accounting firms) which means each office operates independently in each country. So what you are getting is a global brand, not a global solution

With these global providers, you’ll wind up working with different teams in each country that don’t communicate with each other. You’ll have too many lines of communication for the day-to-day work. You’ll have to compromise by using their local software, which means you’ll have different accounting systems in each location. And you’ll receive different proposal formats, different pricing structures, different terms, and different contracts for each country you need support in.

But at weConnect, we have a high degree of vertical integration, which means we’ve centralized our operation. It’s supported by our top technical experts in each country so that we can deliver one consistent, global solution as one team.

This means you’ll have the same team of experts working on your back office for all of your office locations. You’ll have a named single point of contact with the experience and ability to discuss any point about any country at any time. You’ll choose your accounting system. And you’ll have one consistent sales experience, enjoying one proposal format, one pricing structure, one set of terms, and one contract for all country locations.

(To learn more about our unique solutions model called “ONE”, click here)

The future of the back office industry is weConnect

Want to work with a company that has your best interests in mind? Contact us here, we’re happy to help!

Exporting Goods to Japan? You May Be Getting Ripped Off.

weConnect Resources

Exporting Goods to Japan?
You May Be Getting Ripped Off.

Here’s a common example of exporting gone wrong:

A Japanese company is looking to purchase USD $10 million of goods from a foreign company. Tucked away in the fine print of the Japanese company’s request for proposal is an “innocent” requirement that the proposal must be inclusive of “all taxes” and that the goods are to be delivered to the Japanese company’s premises. 

The foreign company’s sales team doesn’t think much of it. They submit a proposal for USD $10 million, win the deal, and export the goods to Japan.

Fast forward to one year later and the foreign company has lost USD $1.9 million in unexpected Japanese taxes. 

What happened!?  

Here are the two key issues where the foreign company got trapped: 

1. The Japanese customer requested that the foreign company deliver the goods to their premises

In Japan, the delivery site of imported goods impacts two things:

  1. Who is responsible for paying import consumption tax (10% of the value of the goods), and
  2. Whether or not the sale of goods is subject to Japanese sales consumption tax (10% of the sale price).  

If the transfer of ownership of the goods from the seller to the buyer takes place at port, it’s the buyer’s responsibility to pay the import consumption tax. Also, the sale of goods is not subject to Japanese sales consumption tax. Most exporters envision this simple and clean scenario when sending goods to other countries. They don’t have to worry about any consumption taxes.

However…if the foreign company is required to deliver the goods to the customer’s premises, then everything changes.  

First, it means that the seller (the foreign exporter) is responsible for paying the import consumption tax – not the buyer. Also, it means that the sale of goods is subject to Japanese sales consumption tax as the transaction is taking place within Japan. The seller is responsible to collect the consumption tax from the buyer. Then, they must remit the tax to the Japanese authorities. In this situation, foreign exporters are required to file consumption tax returns in Japan. Even though they do not have a physical location in Japan.

2. The Japanese customer stipulated that the proposal be inclusive of all taxes

The foreign company’s sales team simply stated the price of the goods, which is USD $10 million. They weren’t thinking about Japan’s tax regulations – that’s not their area. 

The foreign company learned long after the deal was closed that the transaction is subject to Japanese sales consumption tax. And, that they’re responsible to collect and pay it to the tax authorities. 

Like most foreign companies that find themselves in this situation, they assumed that they could just add the Japanese sales consumption tax on top of the USD $10 million price since it’s the customer’s responsibility to bear the consumption tax. Right?

Wrong. 

The Japanese customer argued that the fine print in the contract stipulates that the price was inclusive of all taxes, including Japanese sales consumption tax. Therefore, the price of the goods in the contract is not USD $10 million. It’s USD $9,090,090 with USD $909,090 in Japanese sales consumption tax. 

To make matters worse: 

The foreign company used a global freight forwarder like DHL to handle shipping the goods. DHL takes care of everything and the foreign company doesn’t really think about it. 

Nestled away in DHL’s invoice is the 10% import consumption tax that DHL paid on the foreign company’s behalf. This import consumption tax was actually refundable, but the foreign company didn’t know this. With inadequate tax advice, it became an additional cost of USD $1,000,000, for a combined total tax hit of USD $1,909,090.

Here’s why we suspect that the foreign company is getting ripped off (and that cases like this are not innocent oversights). 

Our experiences have led us to suspect that some Japanese customers knowingly take advantage of a foreign company’s lack of knowledge of Japanese tax regulation. 

Japanese customers have a strong incentive to request that goods are delivered to their premises and that prices are tax-inclusive. If the foreign company doesn’t include sales consumption tax, then the Japanese customer is effectively getting a 9% discount. 

In the example above, the original USD $10M price tag for the Japanese company became a USD $9,090,909 cost with a refundable US $909,090 consumption tax.

If you are planning to or are already exporting goods to Japan, it’s worth having us take a look at your situation. 

  1. Engage with us before proposing or contracting with your Japan-based customer on your pricing.
  2. If you already are exporting, have us do a review of your contracts and tax situation to make sure you are not getting taken advantage of and also to make sure you are getting the full refund you deserve.
  3. If you are getting taken advantage of but it’s too late to change things as you’re locked into a contract, then we can at least make you aware of the situation so when you work with another Japanese customer in the future, you won’t let it happen again. 

Want to make sure you’re not getting ripped off? Contact us here to hear how we can help.

Dear Business Executives: Here’s Why You’re Not Getting What You Need From Your Finance Department

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Dear Business Executives: Here’s Why You’re Not Getting What You Need From Your Finance Department

Business executives think it natural for finance department employees to be aligned with company goals, however, it is quite alarming how often this is not the case…

We’ve heard countless stories from business leaders wondering how to align employees with company goals. They don’t understand what the finance department is doing. And they aren’t getting the reports they need to make informed business decisions. 

For example, maybe you want a simple report to help you decide how to allocate costs. But you sense resistance from the finance department and have no clue when you’ll receive the info you need. 

Or, maybe you see this big finance department with a big cost. But you aren’t really sure of what they’re doing and how they’re bringing value to the business.  

At the end of the day, you need a finance department that actively communicates with you and supports your business!

Here are the reasons why these issues happen in the first place 

1) Internal finance department employees often lack a customer service mindset 

Finance employees generally do not have a background in customer service. That means that they don’t realize that they should treat the other departments of the company as if they are clients. In other words, they don’t have a “how can we support you” mentality. 

2) Internal finance department employees are not solutions-oriented

In many companies, the finance department is only thinking about finance-related tasks, procedures, and compliance. They’re not thinking about the other departments of the company and how their work supports the overall success of the business. 

As a result, you might feel “policed” by your finance department. This is because their primary aim is to make sure that policies are followed and procedures controlled  – not to help facilitate the needs of the business.  

Of course, what they are doing is important, but a better balance can be struck if they have an open-minded, solutions-oriented approach. When you have a need, you want a finance department that works with you. One that comes up with practical solutions that help you get what you want without putting the company at risk.  

In a nutshell, there’s a gap between what support the business needs from the finance department and what the finance department is actually doing. 

3) Internal finance department employees want a bigger team because they don’t know how to leverage process and technology to optimize their work

The career path of an internal finance department employee does not provide them the opportunity to develop process and technology skills. 

A typical path is they study accounting at University, work for an accounting firm while studying for their CPA, and then move into a corporate internal finance department role. 

As a result, they are unable to use the best software and applications that would streamline day-to-day finance tasks. An unstreamlined finance department prevents them from focusing on providing more value to you. And it’ll also cost you more because you need more people to handle the manual tasks.

Here’s how to align employees with company goals

It’s difficult to overcome these issues from within. You need an external consultant with an accounting AND business background to listen to your needs and business requirements and then work with the finance department to operate with a customer-service mentality.

This external consultant must also have exemplary process and technology skills. They need to work closely with the finance department to not only design but also support in implementing new processes and software that are crucial in delivering value to the business. 

weConnect has helped hundreds of companies make this a reality, and we can do it for you as well. Contact us here and we will walk you through exactly what needs to happen. It’s time for you to get what you need from your finance department!

Warning: In-House Accountants Could be a Risk to Your Business

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Warning: In-House Accountants Could be a Risk to Your Business

When companies are building their finance department, they typically believe they should hire in-house accountants. However, from our experience, this can cause a lot of painful issues. In this article, we’ll share with you the real risks and a viable alternative.

First…here is why businesses love the idea of having in-house accountants:

It feels great to have someone in charge of all of the accounting and finance-related tasks that are not the best use of your time. You can assign anything to them with few limitations. You can work with them for a fixed cost for what seems like a lot of flexibility. Plus, it feels great to be able to talk to the person in the office anytime you need!

But, here are the problems that businesses don’t realize exist with their in-house accountant until it’s too late:

Your primary risk? Your accountants won’t stay with you forever. Maybe they won’t leave for another 2-3 years, but it’ll happen.

Companies, especially those with small finance departments, expect their accountants to be as strategic as a CFO, execute junior-level bookkeeping, and be happy to do everything in-between. That’s a lot of pressure! 

The reality is that all finance-related skills cannot be found within a single person. You might hire someone who’s skilled in tax compliance without realizing they lack process management and technology skills. Because of this, most in-house accountants find themselves stressed. They are trying to keep everything afloat because they have too many expectations placed on them and end up leaving.

And when that happens, you’ll have to scramble to find someone new, FAST, because your accountant is going to use up all of their accrued paid leave before their last day. 

Unfortunately, you’ll realize that you have no clue what that accountant had been doing. They had created their own inefficient system without any documentation. So if you can’t perform a proper handover before they leave, you’ll be left trying to train a new person on data and files you’ve been in the dark about.

So, in a nutshell, when you hire an in-house accountant, there is a good chance they will get burnt out and leave. And you’ll wind up in charge of a rushed handover for work you don’t know anything about.

So, how do you avoid this risk? 

One good alternative is to outsource work to an accounting firm. When you outsource, you gain two main benefits compared to having in-house accountants: business continuity and a team of experts.

Business continuity means that you won’t have to worry about any complicated handovers or business disruptions when a team member leaves. With a good accounting firm, they will handle any turnover within their team behind the scenes without disrupting your business.

You’ll also be equipped with a team of experts. This means that instead of having a single accountant with limited skills stretched too thin trying to do everything, you’ll have a team that excels at each skill necessary for a comparable cost.

If you agree this is a real risk to your business, feel free to contact us here and we’re happy to walk you through how we can help.

How to Optimize the Structure of Your Finance Department

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How to Optimize the Structure of Your Finance Department

From our experience, the structure of most finance departments is not optimized. And the main reason is that people with the right skills are not matched to the right tasks. Instead, companies hire individuals to fill generic titles like Office Manager, Accountant, Finance Manager, etc. and assign them a variety of tasks that may not play to their strengths.

When this happens, employees can become overwhelmed by working on tasks that don’t suit their talents. And the company is not maximizing productivity. 

We have experience in optimizing finance department structures. Here is our insight into how you can optimize yours:

In order to run a successful finance department, different tasks require different skills.

Some examples of such skills include: 

  • administrative skills for scanning documents and organizing data,
  • analytical skills for analyzing financial reports, 
  • technical skills for preparing tax filings, 
  • managerial skills for managing the team below and executives above,
  • communication skills for ensuring alignment across the organization, 
  • process management skills for ensuring a streamlined and controlled operation, and
  • technology skills for ensuring the latest applications are being fully leveraged to support the business.

Listed below are some generic titles of a finance department and examples of how tasks are often incorrectly assigned. Especially for subsidiaries in Japan, some combination of these roles actually makes up the entire finance department.

  1. An Office Manager who has high administrative and communication skills hired into a position where 50% of the tasks also require technical, process management, and technology skills that they don’t have.
  2. An Accountant who has administrative and technical skills hired into a position where 90% of the tasks also require communication, process management, and technology skills that they don’t have.
  3. A Finance Manager who has communication, technical, managerial and analytical skills hired into a position where 70% of the tasks also require process management and technology skills that they don’t have. 

Example skills possessed by employees in a typical finance department:

You might have noticed that process and technology skills are missing from the example department despite them being critical to its success. This is because in-house finance talent often don’t have these skills.

Spoiler alert: there’s a better way!

Here’s how to structure an effective finance department: 

1. Identify the skills of each individual in the department

Often you will find there are certain skills that go hand-in-hand, such as administrative and communication skills.

2. Break down all of the finance department’s work into individual tasks and determine the corresponding skill needed to do each task well

In order for you not to miss any tasks, make sure you have every member of the department list up everything they are doing at a very detailed level.

3. Then, group tasks by skill, and assign each group to the appropriate individual with those skills

As mentioned above, you’re going to notice that the tasks that require process management and technology skills will be difficult to assign.

4. Outsource tasks that require skills that are not the strength of your in-house team

In most cases, this would be the tasks that require process and technology skills. 

After you do these 4 steps, your finance department should look something like this:

  • An in-house administration-focused individual or team that handles tasks like scanning invoices and coordinating internally with other departments and externally with vendors and customers. The ideal candidate will have great administrative and communication skills. Technical skills are not necessary for this role.
  • An in-house management-focused individual or team with qualifications in accounting, who in addition to overseeing the department spends the majority of time supporting business executives with financial insights and strategic planning. The ideal candidate will have great managerial, technical, communication, and analytical skills. 
  • An outsourced transaction-focused firm that will handle things like bookkeeping, the monthly close process, financial reporting, and compliance. The ideal firm will have all of the skills, with exemplary strength in technical, process management, technology, communication, and administrative skills.

Example skills distributed in an optimized finance department:

Here’s how to leverage our expertise

Restructuring your finance department can be a daunting and challenging exercise. We can help advise you on how to reallocate the tasks to the right individuals as well as take over the transactional work in an effective way.

Ready to optimize the structure of your finance department? Contact us here, we’re happy to help!

7 Ways We Make Japan Accounting a Breeze with Xero’s Cloud Accounting System

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7 Ways We Make Japan Accounting a Breeze with Xero’s Cloud Accounting System

One of the toughest obstacles many foreign-run businesses face in Japan is accounting. If you’ve worked with an accountant in Japan, they are probably using Japanese accounting software that you can’t understand, and they’re only providing you with excel-based financial statements on a monthly basis.  

Plus, any time you want to understand any details behind the numbers, you have to email your accountant and wait for their reply.  

It’s inconvenient. It’s clunky.  

Let’s face it: as a business leader, at a minimum, you need real-time access to financial data you can understand. Language barriers, receiving excel files infrequently, and difficult-to-understand reports are not going to cut it.  

Introducing Xero: a cloud-based English accounting system you can use in Japan 

Xero is the leading global accounting software that we use to manage all of our client’s financial information. You might have heard about Xero before and its capabilities, but what you might not know is that you can use it in Japan.  

One of the biggest perks of using Xero is that it’s easy for our clients to access, use and gain insights into the information they need even if they’re not accounting experts. Plus, finance departments love Xero as it has robust capabilities for complex data management.  

Here are the awesome benefits of using Xero accounting software: 

1. Language: Xero operates in English 

You don’t have to use Japanese software (and if your accountant in Japan has insisted that you do, well, they’re wrong). Xero is an English software and when configured correctly, perfectly compliant for the Japanese market. 

2. Accessibility 

If you’re using an excel spreadsheet or getting financial reports in excel, you usually have to wait until the end of the month for your accountant to send you the latest file. Or, if you want to see a transaction mid-month, then you’d have to put out a request and wait for them to update the file and send it to you. 

But with Xero, as many users as you want can access and view the full financial information of your business, all the way up to the most recent input. Even if you are using a firm that does not use excel as an underlying system but still exports reports in excel, you most likely will not get this kind of access to the system.   

3. Usability 

The Xero interface is visually appealing and easy to use, making it a thousand times more user friendly than hard-to-read excel files. 

When you log in to your account, you will see a dashboard which can be customized by showing only the key financial information that matters to you.  

Want to know how many customers haven’t paid their bill yet? Boom. You have access to that information right on your dashboard. When you click on the report, you can actually see the details of not only how many customers owe you but the details of each customer and the history of how many payments they’ve made. 

Whatever info is most important to you, you can put it right on your dashboard. Plus, Xero has a mobile app which also makes it easy to check any info you need while you’re on the go with your phone, tablet device or laptop. 

4. Transparency 

When you use excel – or worse, paper – it’s pretty tedious to find specific transactions or information in your financials. You might even waste time emailing your accountant with questions on where to find additional data.  

One of Xero’s best features is the ability to search for specific transactions within your financials. You can log transactions and attach images of receipts to each payment record and easily use the search function to find anything quickly. Plus, if you had a batch transaction, you can even see the small transactions within that batch.  

5. Streamlining  

Xero is a global software system. That means that you can use 1 system to keep track of your finances across multiple entities around the world.  It’s comforting to know that you can streamline your accounting all into one platform. And, you can avoid using separate excel sheets for each of your business locations.  

6. Multi-Everything 

If you were concerned about needing multiple language capabilities or currencies, Xero has it all. While the Xero navigation buttons are in English language only, you can create invoices in Japanese (or any other language, for that matter) and you can also insert multiple languages for the account and report names. Plus, the platform has multi-currency functions, so it’s very flexible.  

7. Keep track of Quotes 

One of the most helpful functions in Xero is the ability to manage quotes in the form of draft invoices. With this function, you can track potential sales, and once you’ve closed a deal with a customer, you can convert the draft into a sales invoice.  

weConnect is Xero’s Only Gold Partner in Japan 

We’ve worked with clients of all sizes from startups to large entities and they’ve all had a positive experience with managing their accounting in Japan using Xero.  

Want an easier experience with your accounting? We can set you up in no time. You can get in touch with us here to learn more. 

The Best Time to Upgrade Your Tax Accountant in Japan

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The Best Time to Upgrade Your Tax Accountant in Japan

In an ideal world, we’d love to see new business owners start off on the right foot with their tax filings by hiring a partner who can properly advise them.

But when companies are starting out, they typically look for the most inexpensive tax accounting service. And that’s understandable, especially when every yen, dollar, euro, etc. matter.

And at first, everything with your tax accountant can seem great

“My tax accountant can prepare my tax returns in a day!” 

“I can send them a doggy bag of loose receipts and they just take care of it!” 

“They never ask me any questions, it’s so smooth!”

You feel so well taken care of that you don’t even realize what’s about to happen to you.

Because things will go wrong. Really, really wrong.

For starters, there’s likely a gap between the expectation you have for what a tax accountant will do for you as a baseline and the services that you’ve actually hired them to complete. 

Here’s what everyone assumes their tax accountant will help with (no matter how inexpensive the service)…

  1. Proactively advise on what is needed for full compliance
  2. File all necessary documents, correctly, on time
  3. Review and catch mistakes

To put it simply, you probably assume that since you don’t know anything about tax filings in Japan, the professional you hire will take care of everything for you.

…but here’s what you’re actually getting

If you’re paying your tax accountant for their bare minimum service, what they’ll do is take the data you give them and drop them in only the filings you have specifically engaged them for. That’s it.

They won’t review and check all of your bookkeeping records. They won’t proactively advise you on everything you need to do to be compliant as a business. 

So, if you make a mistake with the information you provide and it gets filed in the return? Not their problem.

If your business situation changes which will trigger additional filings you didn’t realize you have to file? Not their problem.

If you miss the filing deadline because you weren’t aware that you needed to provide information to them by a certain date? Not their problem.

If you get audited and are penalized for an accounting error you missed? 

You guessed it! Not. Their. Problem.

When any of these things happen (which they will under these circumstances), you’ll throw your up your hands and think, “They know I don’t know anything about tax compliance in Japan! How could they expect me to take any responsibility for this?! It’s their fault!”

Bottom line? Many tax accountants only do what you’ve specifically engaged them to do. Even though you assumed they would provide a holistic, proactive service to ensure you never have a problem.

Find out for yourself

After reading this, if you’re now unsure whether your tax accountant has been following through with each of the points listed above, then send them this message and see what they say: 

“As you know, I don’t know anything about Japan tax, so I’m relying completely on you to make sure I don’t have a tax issue. Can you please confirm that the following is part of your service:

  1. Proactively advising on what is needed for compliance
  2. Reviewing and catching mistakes
  3. Filing all necessary documents, correctly, and on time.”

You need to ask them in exactly this way in order to receive a clear answer. 

You might be surprised by their response!

By the way, we’re not harpin’ on tax accountants’ services here; we just mean to explain to you there is often a gap between expectations in service delivery that can get people into trouble. 

So when will you upgrade your tax accountant? 

After hearing all of this, you must be super motivated to confirm that you have a good tax accountant, right?

Probably not. In our experience, even if you know the risks, you’re not going to want to think about tax until you actually have a “pain event”. 

A “pain event” is an event that pulls your attention to tax matters, and annoys the hell out of you because it distracts you from building your business. 

In most cases, businesses have a “pain event” when they’re audited, which happens randomly once every 3-5 years. So, unlike payroll where an angry employee will bang on your door as soon as a mistake is made with their salary payment, with tax, everything seems fine until all of a sudden it isn’t and you have a mess on your hands that could go back years.

So when this “pain event” happens, you have two choices: 

You can either put a band-aid on the problem and kick the can down the road, which will ensure that you’ll have a larger pain event later. 

Or, you can bite the bullet and change to a proper, long-term tax partner who will actually be proactive, hold your hand through all tax-related matters, get your accounting and taxes cleaned up, and make sure issues never happen again.

Here’s what it’s like to have long-term tax partner:

At weConnect, “pain events” are not okay. We’re all about being proactive and aligning with our clients to ensure we meet their expectations. If you’ve experienced your own “pain event” (or two or three) and want to make sure it doesn’t happen again, contact us here and we’re happy to help!

The Two Biggest Lies that Your Accountant in Japan Will Tell You

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The Two Biggest Lies that Your Accountant in Japan Will Tell You

Whether you’ve been working with an accountant in Japan or are planning on hiring one, make sure you understand this insight before you run into issues!

Let’s say you walk into a meeting with your accountant in Japan for the first time. You’re looking for insight on how to streamline your bookkeeping and file your taxes. Once your accountant hears about your business’ accounting policies, they may say something like this:

“In Japan, your taxes have to be filed a certain way. Since you need monthly financials based on your company policy, you [the client] will need to handle that. Additionally, we’ll need to record everything in a separate statutory accounting book to ensure that filings are handled properly. Also, because of this thing called JGAAP, your records will need to be kept in Japanese, so we’ll need to use Japanese software.”

This sounds reasonable to you. Japan has a different way of operating, so it makes sense that you’ll need to be compliant with Japanese ways. (Plus, you have no clue about JGAAP requirements).

But your accountant has lied to you. Twice. Did you catch the lies?

Here they are in detail – don’t fall into these traps!

Lie #1: You need to keep a separate statutory accounting book for the purpose of your tax return

You don’t need to maintain a separate accounting book for tax purposes. In fact, there’s no problem with you attaching your normal financials to the tax return and have your tax accountant make off-book adjustments at the end of the year for the tax calculations.

When companies agree to have a second accounting book, they wind up doing all of their accounting on their own, then paying a monthly fee to have their accounting done twice by their accountant in Japan. It’s a frivolous expense with zero benefits.

And to make matters worse, having a second accounting book can lead to problems.

The problem with having a separate accounting book is that you’ll wind up having a gap between what your company’s financials are and the financials that have been filed with the tax office. 

Why? Because your accountant in Japan is focused on making sure that the financials are compliant for Japan tax purposes, and typically won’t think about the need to reconcile the financials with your company’s financials. 

From the tax office’s perspective, your financials are only the financials attached to the tax return. When you’ve finally realized that there is a discrepancy, it could be years later. That means years of returns that don’t match the company books that you can’t tie back. 

At that point, you can either refile for all of the previous years (a huge pain and not recommended unless absolutely necessary) or manage the gap between your tax financials and company financials, forever. That’s right, forever!

Lie #2: You need to use Japanese accounting software

Many accountants in Japan tell you that your accounting needs to be recorded in Japanese software, but this is not required. You don’t have to maintain your books in Japanese, which means you can take comfort in knowing that it’s perfectly fine to continue keeping your records in English. 

Now, you do however need to attach your financials in Japanese to your tax return. But all you have to do is simply translate and reformat your documents. There’s no need to maintain your records separately on a monthly basis in Japanese; you can just do a translation of the year-end financial reports and make adjustments to align with the financials with the tax code at the end of the year. 

Wait…but how come accountants in Japan mislead people? Why would they do that?

Well, the reason is pretty innocent, actually. Many accountants learn that these are the ways to handle accounting in general, so they assume that it must be done in this way for people who handle their accounting in English. Many have no clue that a separate accounting book and using Japanese software is not required. 

Plus, Japan is a culture known for people following procedures to a T. So, they might not think to consider if their procedure is the most effective for your situation.

Accounting services that actually are accounting services 

Here’s how we at weConnect have designed a solution to be perfect for you, that’s compliant, and that actually provides you with real services for the money you invest: 

We will do your full accounting (bookkeeping, payments, and reporting) on a monthly basis according to your company policies, closing requirements and consolidation schedule. We’ll do it in English, and use the accounting systems that make sense for your business. 

We’ll actively communicate with you on a monthly basis to ensure that all records are updated properly for a smooth transition to doing the tax filings. We do your tax adjustments. And at the end of the year, we use your accounting books as the basis for the Japanese financials attached to the tax return. 

That means you’ll never have discrepancies between two books (because there’s only one!), and you can keep track of your accounting in English while still ensuring full compliance. Ready to make your accounting process as smooth as butter? Contact us here to learn more!