Hateful accounting: could be so much easier

I hate doing my accounts. I loathe doing tax returns. All this entering and re-entering of transaction information is painful. Everyone seems to want information in a different format. Ugh.

We should not have to suffer in this way.

Think about the moment when you pay for something, be it a can of beans or a new camera. At that point all the information about the transaction is available: time, location, price, tax, account being debited etc. ... but from that point the information gets split up. The bank gets a bit, the shop keeps a bit and we get a bit of paper so that we can re-enter all that information into an accounting program at home and later total it up for a tax form etc. etc.

What we need is a file format for a transaction that would capture all the details of the transaction. Everything. The size of the can of beans and how many cans (the makeup of the entire shopping basket!), the serial number of the camera, the tax authorities that took some money and how much. For one transaction this would be a small file, much smaller than, say, a photograph taken by the camera in your mobile phone.

Lets say that the till makes up this file (after all, the till needs all this information to do it's job). We can then save the file to customer media (e.g. your phone via bluetooth) or send it to your bank along with the other transaction details or even just print it out ... or all of the above.

Given one such little file for each transaction which I can add into my accounting system I can now easily search my records to find out when I bought the camera, what the serial number is, how much tax I paid etc. etc. I should be able to complete my tax return without having to re-enter any data. The only data entry point will be that moment at the till when the purchase was made.

There are two big issues:

• The format of the file and getting banks, retailers, accountants to adopt it
• Privacy: Who gets to see and/or keep a copy of the file

For the former I think we need to see some activity in a standards body like ISO, and I think we should look to our governments to kick off this process. Once started I think the interested parties will join in if only to avoid having something foisted on them without their having a say.

On the privacy I think we just need to be able to control who keeps the transaction files and how long they may be retained. By default the file is destroyed by the till and we just get a paper receipt, just like today. We should be able to have a copy of the file sent to a device of our choice (e.g. a phone or even the chip on the card we use for payment). For bank or credit card payments it may be useful to let the bank keep a copy of the file on their records (then imagine banks offering gmail-like on-line accounting facilities ... but that's for the future).

Let's get the transaction file format standardised first.