THE INTELLIGENT ELECTRIC CHEQUE BOOK

In strict commercial confidence.

All copyright, trade-names and design rights are the sole property of the inventor.

Noel Hodson, Director, Experts Unlimited Tax-Advice-Line ,14 Brookside OXFORD OX3 7PJ. UK

TEL +44 (0) 1865-760994. FAX 764520. Email: NoelHodson@btconnect.com

A Unique Product Concept for Banks, Tax Authorities and Small Businesses

AN INVESTMENT OPPORTUNITY FOR BANKS, GOVERNMENT DEPARTMENTS AND COMPUTER MANUFACTURERS.

IN STRICT COMMERCIAL CONFIDENCE

ALL RIGHTS BELONG TO Noel Hodson 14 Brookside OXFORD OX3 7PJ UK

Contact – email: noelhodson@btconnect.com tele +44 (0)1865 760994

THE INTELLIGENT ELECTRIC CHEQUE BOOK

In strict commercial confidence.

All copyright, trade-names and design rights are the sole property of the inventor.

Noel Hodson, Director, Experts Unlimited Tax-Advice-Line ,14 Brookside OXFORD OX3 7PJ. UK

TEL +44 (0) 1865-760994. FAX 764520. Email: NoelHodson@btconnect.com

A Unique Product Concept for Banks, Tax Authorities and Small Businesses

HAPPY BANKERS - HAPPY BUSINESS OWNERS - THE INTELLIGENT ELECTRIC CHEQUE BOOK, is a handheld computer/small printer, loaded with loose leaf cheques which bar-codes them as they are written to include the VAT and other tax elements and (1) internally uses the information electronically to produce the small businesses forecasts, P & L Accounts and Balance Sheets; & (2) the bar coded cheques are fed through the same software by the bank to give them instant trading-accounts on their customers, reducing the bank's time and costs.

HAPPY SMILING LOVABLE TAX OFFICERS - At the bank, tax accounts are opened for each customer, to which are transferred any taxes due for payment/receipt. The customer's current account operates without those amounts blurring the picture. The taxes (if the customer agrees) are immediately paid to the taxing authorities - keeping them happy and reducing their costs. THE INTELLIGENT ELECTRIC CHEQUE BOOK estimates the taxes recommended for transfer using software to be developed by Noel Hodson & Experts Unlimited Tax-Advice-Line.

HAPPY FAMILIES - NO MORE TEDIOUS EVENINGS OF BOOKEEPING - Cheques drawing cash are coded when written for the approximate expenditure anticipated or on the Imprest system - entering what was spent last week on this week's cash cheque. Items paid in are also written on THE INTELLIGENT ELECTRIC CHEQUE BOOK using loose leaf paying in slips - and bar coded - including VAT and estimated taxes calculated by THE INTELLIGENT ELECTRIC CHEQUE BOOK This captures 99% of all small business transactions and their tax effect at the point of writing cheques - and requires no book-keeping time or further costs on the part of the 3 million UK small-business owners.

BANKING MADE EASY AND FAR MORE PROFITABLE - The banks get low/no cost instant information and the tax authorities get paid, earlier, with no cost of collection - both should back the production of THE INTELLIGENT ELECTRIC CHEQUE BOOK - and give it free to bank customers. Every business customer is given for example " The Business Bank Electric Cheque Book , one shot, user friendly business accounting - leaving you free to get on with your business". As, for example, with Hewlett Packard PC printers, the hardware can be sold at low prices or given free because the profit lies in the consumables - which are charged for (no bank charges), via a monopoly supply of the special cheques and paying-in slips.

Valuable to Banks, Government Tax Collectors and Busy Business People.

Contact: Noel Hodson Tel +44(0) 1865-760994 Fax 01865 764520. noelhodson@btconnect.com

Noel Hodson started in accountancy aged 17 in a Manchester practice. He has over 30 years work experience in that field. He founded in 1969, built and managed for ten years, the firm Blackstone Franks, Accountants, Aylesbury and London. He founded in 1980, built and managed Morton Hodson & Co Limited, the first UK Business Expansion Specialists. He has practical, hands-on experience of more than 5,000 family owned businesses and self-employed people. In 1968 he was the first person in the UK to write a single entry accounting suite for small businesses, in COBOL, run on Pergammon Press's ICL 1900 series mainframe computer in Oxford. He assisted the development of the South Bank Technopark in 1980 and worked with Wolfson College and Sir Martin Woods on the Oxford Research Science Park proposal. Hodson anticipated by eight years the emergence of teleworking, setting up Morton Hodson & Co Limited, BES advisers, with 54 offices across the UK, on a teleworked basis. He wrote the seminal paper The Economics of Teleworking (BT Martlesham) in 1991 and the book Teleworking Explained (Wiley & Sons) in 1993. He is a consultant on telework to BT and the EC. He was Chairman of the GATChain, in the EC ACTS programme (Advanced Communications Technologies and Services) under the auspices of DGXIII in Brussels. He was the Fiscal Issues Partner in the Diplomat Project - the European Charter for Telework and a founding member of The European Forum for Work Organisation - exploring the future of the Information Society. He is a member of the Future Work Forum at Henley Management College. He specified the formulas for the software TeleworkAudits^tm and TeleworkAnalysys^tm for Telework Analytics Inc. (see WWW.teleworker.com) and is a director of ITAC, International Telework Association and Council (Washington DC). THE INTELLIGENT ELECTRIC CHEQUE BOOK is an idea he has nurtured for a decade - the technology is now available to make the product and relieve all those concerned with the accounts and reports of small businesses from costly, time consuming and tedious information gathering and form filling processes. It presents a great opportunity for banks to score a significant PR bonus with the small business community and with Government. 26 March 2002.

From – Mr Noel HODSON,

SW2000 Teleworking Studies,

14 Brookside, OXFORD, OX3 7PJ, UK

Tel +44 1865 760994 fax 764520 noelhodson@btconnect.com

To – European Commission, Directorate-General for Science, Research and Development.

By Email research-sme@cec.eu.int and Fax +32 2 295 7110.

28^th August 2001.

Dear Sirs,

I would like to submit an Expression of Interest for the device and R&D set out below. It is some years since I wrote an EC proposal and I do not have access to the OJ. I would therefore be most obliged for any guidance you can give by fax or email on the form and content of Part One of this submissions and, if this is accepted for further consideration, on Part Two – the proposal itself.

Yours truly,

Mr Noel HODSON

Director SW2000 TELEWORKING STUDIES

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Proposals on SME innovation and participation

Indirect research and technological development (RTD) actions on promotion of innovation and encouragement of SMEs participation (1998 to 2002)

RCN 17087 OJ No C 198 of 13.07.2001

Expression of interest

Part 1

To identify topics that best satisfy the objectives of the further restricted call for proposals.

The Intelligent Electric Cheque Book

A programmed hardware tool for micro-enterprises and SME's.

Appearance - size of a palm-top/personal organiser.

What it does - Replaces the paper cheque book for small business owners. Holds bank supplied pre-printed loose-leaf paper cheques and paying-in slips. The owner writes cheques/pay-in-slips through a screen with a stylus as if using a pen and traditional cheque book. The owner is prompted for further information that is ticked into check-boxes on VAT, Taxes, categories etc.

Objectives: To greatly increase the efficiency and to reduce the work SMEs are required to do in most EU regions in order to comply with and to pay profit taxes, payroll taxes, personal taxes and Value Added Taxes and to meet all other government requirements and to reduce the time and costs of day-to-day book-keeping and accounting. To reduce the incidence of SMEs falling into arrears of taxation and of all other mandatory payments including filing fees and thus to reduce the need for governments to pursue SMEs, particularly new SME’s and micro-enterprises, to the point of bankruptcy or liquidation. To equip SMEs with a tool that automatically categorises their income and expenditure into the categories required to complete government reports and tax returns and thus to enable electronic filing of self-assessment tax returns and other reports.

Relevance to SMEs: The majority of new start enterprises and innovations evolve through a period, often a period of several years, when the innovator is unable to cope in a timely manner with the reports, returns and taxes imposed by and required by government. In many cases the new or micro enterprise falls into arrears and becomes a creditor of government. Much time, effort, stress and costs are then incurred by both the SME and by government to bring the innovator up to date. In far too many cases the innovator has relied too heavily on delaying payments to governments, cannot recover the cash-flow deficit and ultimately is forced into liquidation or bankruptcy. The process is stressful, costly and creates needless friction between innovators or business owners and government.

Community Added Value: Many employed people and a proportion of people in business are aware of the risks inherent in starting a new business or of owning and managing an established business. This perception of risk is particularly strengthened in the case of small firms being forced into bankruptcy or liquidation due to debts owed to governments. The perception of risk and the awful personal and family consequences of bankruptcy naturally dissuades many potentially able entrepreneurs from embracing self-employment or from starting their own company – thus inhibiting innovation. On the other hand, government cannot afford to be seen to allow small business’s, that employ up to 70% of the workforce, to escape the consequences of non-payment. Reducing the incidence of this unpleasant and unnecessary conflict will improve the life-work balance of business owners and bureaucrats alike and will greatly encourage innovation and will encourage the backers of innovation – the Venture Capitalists. Automating and speeding up the flow of payments to government and of repayments to firms, will increase government revenues at greatly reduced costs. Below is a calculation of the impact this improvement may have on the UK, £23B or Euro32B for a population of 57 million, that can be adjusted to suit the other member states after suitable thought about the different cultures. On a simplistic basis the benefits across the EU would be worth more than Euro145B.

It will make a major contribution to the E-Commerce ability of Europe.

The Intelligent Electric Cheque Book thus will contribute to the social objectives of the EU by reducing work stress, improving life-work balance, encouraging innovation and venture capital and by improving the net revenues of the member states by some Euro145B.

The Research Content: There is no doubt that the Intelligent Electric Cheque Book as specified here can be manufactured by a European based maker. IBM London, Hewlett Packard France and BT Martlesham UK have all confirmed that they could make and mass-produce the device. Experts UK Limited Tax-Advice-Line and other experts are confident of programming it to produce all the required reports, reserve all the taxes and create profit and loss accounts and balance sheets required by a specified region. BT say they could add an internet linkage to transmit the information to the owners’ banks where the data would be used to operate the traditional bank accounts and to produce accounts and reports that the banks like to have from SMEs, but often have to wait many weeks for. The research would therefore certainly include the making of a working prototype prior to mass production, with programming compliant with at least one EU region; but mainly the research period and work would be used to consult all the main players, in depth, to ascertain their requirements and specifications for the device and to win their approval and support for the project. The main players have to include: Tax and company reports government authorities; Banks; Electronic filing experts from government and industry; IT Manufacturers and distributors; SME representatives; Bank-systems and other software experts. The dissemination will come through the selection, perhaps via self-selection, of a joint-venture consortium to make and to put into use the first generation of Intelligent Electric Cheque Books.

Partnerships, Resources and Management: There already exists an outline proposal to bring together partners from industry into a joint-venture with officers from E-Volution government agencies dedicated to Information Society principles and with bankers who provide services to SME’s. The outline proposal is to have a series of meetings between the main, influential parties and to have them commit to the project, at the earliest possible stage. Management will be provided by the proposers in conjunction with those manufacturers who are dedicated to making and distributing the device. Distribution will most likely take place through the banks when they renew the cheque-books used by SME’s.

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Description – (copyright Noel Hodson)

THE INTELLIGENT ELECTRIC CHEQUE BOOK. (TIECB)

Inventor: Noel Hodson, Oxford, UK

A programmed hardware tool for micro-enterprises and SME's.

Appearance - size of a palm-top/personal organiser.

What it does - Replaces the paper cheque book for small business owners. Holds bank supplied pre-printed loose-leaf paper cheques and paying-in slips. The owner writes cheques/pay-in-slips through a screen with a stylus as if using a pen and traditional cheque book. The owner is prompted for further information that is ticked into check-boxes on VAT, Taxes, categories etc.

The Intelligent Electric Cheque Book prints the cheque, BAR CODES it with the information and issues it. The owner signs the cheque in ink and hands it to the supplier/recipient in the normal way.

The Intelligent Electric Cheque Book is programmed to create and to continuously update cheque by cheque, Trading and Profit and Loss Accounts and a Balance Sheet; plus ALL required Tax Returns, Wages Forms, etc etc. - all paperwork. The owner need do no other bookkeeping whatsoever. The UK productivity saving is about 3M self-employed/SME's x 4 hours per week x 48 weeks = 576M hours at say, £30 = £17.2B.

The bar coded cheque/pay-in-slip then goes into the bank clearing system. The owner's bank processes the bar-codes through software to (A) Create Tax reserve accounts for all taxes and VAT and (B) create management accounts on that client. With the owners' permission the bank sends the tax reserves monthly/quarterly to the appropriate tax offices.

The savings here are 3M x 4 times per annum management accounts that banks normally chase - say 1 hour per annum x 3M. Fees that SME's pay to obtain management accounts, say 3M x £1000 per annum = £3B. and .....

The tax collectors no longer have to chase to collect their taxes - say 10% of SME's do not pay on time = 3M x 10% = 300,000 chased for 5 civil service hours a year = 1.5M hours @ £30 = £45M saved of tax collection time. Plus ......

No bad-debts for tax collectors, worth about 10% of 3M SME's who default on payments of £10,000 = 300,000 x £10K = £3B extra government revenues --- Plus ....…

HM Government is the largest single creditor precipitating bankruptcies and liquidations in the UK economy. While they have bad-debts HM Gov has no alternative but to pursue them. This is an embarrassing and wasteful use of civil service resources in cultures that promote innovation. The saving here is on both sides of the dispute, worth perhaps 2,000 firms x £20,000 costs = £40M.

Finally, and where the idea started, The Intelligent Electric Cheque Book produces all the information required to complete Self-Assessment tax returns for Micro-Enterprises and SME's, with the business information in the required format. Such information is not currently available via SAGE and other accounting packages categorised in the required format/s.

IBM London, say they could build such devices as I have specified "easily".

BT Martlesham Heath say they could "easily" add wireless links to transmit the data daily to desk-tops and/or to banks AND they could sell the idea to their main bank customers (Barclays Nat-West etc).

Experts UK Limited (Tax-Advice-Line) will specify the programming.

The Intelligent Electric Cheque Book is applicable in any country and to any economy.

Like all major changes The Intelligent Electric Cheque Book needs kick-starting with R&D funds - about £1.25M or 1.7M euro to make the working prototypes ready for production (built in the EU). To be distributed by banks - with funds from the government tax agencies.