AccountKeepingPlus – Administration, Bookkeeping, Compliance News & Tips MYOB Reckon Quickbooks Training BAS Small Business

Making Business Books and Accounting Come Alive! MYOB Reckon Quickbooks Training BAS Small Business


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Cashflow Tips – A cool tool to see the effect changes make on your Cashflow

Understanding your cash flow is critical to your business success, and a handy tool that bank NAB have created is an online cash flow improvement tool. Whether using MYOB, Reckon/Quickbooks or Xero for bookkeeping, Try it and see what you think! (Click icon to go to the page)

Cashflow Tips – A cool tool to see the effect changes make on your Cashflow

A cool tool to see the effect changes make on your Cashflow

Let us know how you went…

For other NAB cool tools see Calculators and tools

Also see Cashflow Tips – 5 Ways to Keep Cash Flowing

Or Cashflow Tips – To Discount or ADD VALUE?

Need help? Not sure? Call for FREE 30min advice / Strategy session today!

                Call 0407 361 596 Aust and also get FREE “Avoid these GST mistakes” – There’s 18 that the Tax Office see regularly – Get them right!

 


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MYOB – How to catch up super missed on past pays?

MYOB – How to catch up super missed on past pays?

MYOB – How to catch up super missed on past pays?

Client - We have processed the last 2 months payroll payments and have found that the super for many of them has not been calculated as it was not ticked on.

Is there a way to enter this after the pays have been paid?

SolutionMYOB will look at a full month if set up correctly, and balance for the WHOLE month from the monthly minimum to trigger super above $450 month. You can process a zero dollars pay in each of the months you have missed the super and MYOB will calculate the super payable for that month for you! Save the pay and override the warning that this has very little information and will generate a void pay.

Get a FREE 30 min answer to your query, and FREE ongoing email or phone support – No-one offers as much! Call and you also get FREE “Avoid these GST mistakes” – There’s 18 that the Tax Office see regularly – Get them right! Email info@accountkeepingplus.com.au or call 0407 361 596 Australia


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Business Tax Tips – “I didn’t know” is not an excuse with ATO – Know your tax liability and the risk of error or face fines!

Business Tax Tips – “I didn’t know” is not an excuse with ATO – Know your tax liability and the risk of error or face fines!

“I didn’t know” is not an excuse with ATO – Know your tax liability and the risk of error or face fines!

Don’t underestimate your liability as a small business owner for tax credits claimed, or not knowing what your bookkeeper/wife is reporting in your BAS and tax returns – ignorance is not an excuse with the ATO! As Terry Hayes relates in Smart Company about a carpenter in a recent Dispute with the ATO –

While it’s often said that lawyers and accountants are their own worst clients, or doctors are their own worst patients, taxpayers too can be their own worst clients when they represent themselves in disputes with the Tax Office.

This happened recently with a carpenter who represented himself before the Administrative Appeals Tribunal in a GST dispute with the Tax Commissioner.

In that case, the AAT upheld the Tax Commissioner’s decision to impose on the taxpayer a 50% administrative penalty on the basis of “recklessness” because he had over-claimed GST credits.

The taxpayer is a carpenter by trade, a sub-contractor in the building industry. He is a sole trader and has no employees. The Commissioner audited his Business Activity Statements for the period 1 January 2007 to 30 June 2010 and found he had over-claimed input tax credits. The BASs showed that claims for ITCs exceeded his GST payable in all but six out of the 42 BASs lodged in the relevant period. The tax shortfall amount was around $130,000 and the penalty imposed was some $65,000 based on 50% of the shortfall amount.

The taxpayer said that his wife prepared and lodged his BASs and that he never reviewed them or any of the supporting documents, including the invoices that he kept in a box in the linen closet which, as it transpired, did not substantiate his ITC claims. He also did not keep vehicle log books. Nor did he ever check any of his bank statements and so he was unaware that he was receiving GST refunds from the Commissioner over a lengthy period of time in the joint bank account that he had with his wife.

The taxpayer did not dispute the tax shortfall but argued he was not responsible for the penalty maintaining that it was the Commissioner who was mostly responsible for it. He alleged that Tax Officers had represented to his wife that he was entitled to claim ITCs for the purchase of his family home because he maintained a home office (although the AAT noted the settlement statement for the purchase of the home did not show any GST having been charged by the vendor to the taxpayer and his wife as the purchasers). Additionally, the taxpayer claimed it was the Commissioner that allowed the situation to go on for so long without him being audited.

The taxpayer also alleged that a car salesman had represented to him that he could claim back the GST on the purchase of two vehicles, but he accepted before the AAT that he was given wrong information by the salesman.

The taxpayer also stated that he had lost a lot of information about his purchases when his old computer died and that many other receipts that he had stored had faded and were illegible. The taxpayer contended that the mistakes in his BASs “were not made intentionally by his wife and that he had always been honest with the Commissioner”.

The taxpayer was self-represented. The AAT did not accept what the taxpayer said his wife was told by the Tax Officers or what the taxpayer said he was told by the car salesman. It agreed with the Commissioner’s contention that the taxpayer had over-claimed ITCs “for a lengthy period of time in circumstances where he knew or should have known that he was not entitled to claim the ITCs”. The AAT said the taxpayer had conceded he was “indifferent as to whether the BASs were accurate”. It also noted the taxpayer “never checked any of the BASs or whether he had the supporting documentation for the ITC claims because he thought everything was fine”. The AAT was of the view that the taxpayer “chose to leave the preparation of his BASs in the hands of his wife who had no taxation expertise”.

In the Tribunal’s view, the taxpayer’s conduct amounted to recklessness because there were foreseeable risks as to a tax shortfall where his BASs included claims for ITCs to which he was not entitled. The AAT said a reasonable person in the taxpayer’s position should have known about those risks. The Tribunal said the taxpayer “displayed complete indifference to the high risk of non-compliance in his GST affairs”. Game, set and match to the Tax Office on this occasion.

The AAT held the taxpayer had failed to discharge the onus of proving that the penalty was excessive. It held the decision to impose an administrative penalty of 50% was correct and that it should not be remitted in the circumstances.

Taxpayers must exercise care in their taxation affairs. They have that responsibility, and while they may claim they have no intention of making mistakes, that does not unfortunately stack up. Leaving the preparation of BASs to a family member (even if they are well versed in this), be it a wife or someone else, does not absolve the taxpayer from his or her responsibilities.

One part of solving your record problems is good accounting software!

Need help? Not sure? Call for FREE 30min advice / strategy session today! 0407 361 596 Aust

***BEFORE you BUY – Ask us for a competitive software price BELOW retail – No obligation!

You also get FREE 30 min to assist in setting up your company in the software, and FREE ongoing email or phone support – no-one offers as much! Call and you also get Free “Avoid these GST mistakes” – There’s 18 that the Tax Office see regularly – Get them right! Email info@accountkeepingplus.com.au or call 0407 361 596 Australia


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Business Finance 101 – How the Profit & Loss Statement works and how to use it

How the Profit & Loss Statement works and how to use itThe profit and loss (P&L) statement, is also known as an income statement, which shows the profitability of a  business over a specific period and is commonly produced monthly, quarterly or annually.

The profit and loss report is a useful tool for monitoring business activity for business owners, as it highlights whether and where their business is succeeding and where it is struggling. Investors use profit and loss reports to gauge the financial health of a potential investment, and use it to calculate what kind of return (profit) they are getting on an existing investment.

What makes up the Profit & Loss Statement?

In general, your profit and loss report will be split into 3 sections:

  • Revenue/sales – details of all income from primary business activities (sale of products and services), as well any revenue from secondary activities (e.g. bank interest) and any other financial sources
  • Cost of salesif selling product, the cost of that product, before any shop or warehouse costs
  • Expenses – details of all expenditure on primary business activities (e.g. premises costs (overheads), labour costs), any secondary expenditure and any other losses during the period.

Revenue/Sales

The top part of the revenue section of your profit and loss report is total sales. Secondary revenue and other income can be unpredictable, so to grow the business you should focus on your primary sales revenue.

Look at how much sales have risen or fallen since your previous profit and loss report. Then by breaking sales figures down into individual products or product lines will help you see which products are performing well and which products need attention.

Aim to increase revenue in the period between each profit and loss report. A pattern of falling revenue shows a business in trouble.

Cost of Sales

Keep an eye on the cost of goods sold (COGS) – these are the cost of product, or of your manufacture, the direct labour and any raw materials used to produce your goods or services. Also watch if suppliers are pushing prices up – try to use your good credit history of paying them, to negotiate a delay in price rise, or a slightly better price for your loyalty – most businesses will be open to negotiate!

Also don’t ignore early payment discounts – eg pay earlier or on-time – it can all add up!

Expenses

These are the operating expenses (i.e. cost of indirect labour (office staff etc) and any other costs not directly linked to the production of product or services).

Again be on the look-out to reduce costs wherever possible. A rising figure for material costs could mean you need to find a different supplier, or find more efficient ways to produce your products. Inflation is another factor likely to cause costs to increase across a market over a period of time, so some increase will be inevitable.

The operating costs can be harder to bring down. For example, if rent increases it may not be practical to move to cheaper premises, or the move itself may cost more than the increase in rent. Labour costs can also be complicated, as you cannot usually bring down your wage bill without reducing the number of employees (which may not be possible or desirable) and will usually affect the business flow. Also check your profit and loss report for any sudden or unexpected spikes in costs, rather than gradual increases over time (due to factors such as inflation and annual employee pay rises).

Key Parts of the P&L Statement

From the profit and loss report, look for these of important figures to explain your business’s profitability and also COMPARE them to the last reporting period:

  • Gross profit = revenue – cost of goods sold This is the difference between total sales and the cost of producing the goods or services you sell. It is an indicator of overall production efficiency and a key figure for setting prices and sales targets.
  • Gross profit margin (%) = (gross profit ÷ revenue) x 100 Shows what proportion of gross profit you keep from each dollar of revenue generated (e.g. 60% gross profit margin means you keep a gross profit of $0.60 for every $1.00 of revenue generated).
  • Operating profit = gross profit – operating expenses This is the profit generated after overheads. It does not include expenses from interest or taxes (often called ‘earnings before interest and tax’ or EBIT).
  • Net profit = operating profit – (taxes + interest) Also known as the ‘bottom line’, net profit is the total amount earned (or lost) after paying all expenses including interest and tax.

For more on Profit Margins, see:

Need help? Not sure? Call for FREE 30min advice / Strategy session today!

Call 0407 361 596 Aust and also get FREE “Avoid these GST mistakes” – There’s 18 that the Tax Office see regularly – Get them right!

Email info@accountkeepingplus.com.au or call 0407 361 596 Australia


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MYOB – Logo disappears when you email – How to fix if the logo on the invoices doesn’t appear?

MYOB – Logo disappears when you email – How to fix if the logo on the invoices doesn’t appear?

MYOB – Logo disappears when you email – How to fix if the logo on the invoices doesn’t appear?

On Linked-in, had a question from Sam Naidu DFP, MCom, FIPA, FCIS, FGIA - How do you fix if the logo on the invoices doesn’t appear on invoices when you email?

Hi Sam – if the logo doesn’t appear on the Invoice (or other templates), it means QuickTime is missing on the PC. It is required with MYOB templates. It will be on the install disk, or get a FREE copy from here - http://support.apple.com/kb/DL837

Click Download, follow the prompts > Save – wait until complete > Run > Next > Yes > Typical > Tick off the 2 options for icon and auto updates > Install Allow Install > Finish > No Thanks to upgrade to Quick Time Pro.

To test it – Generate a form and email to yourself, see if the PDF has the logo now. Let me know if you need more help! Thanks for asking – Paul

Need help? Not sure? Call for FREE 30min advice / Strategy session today!

Call 0407 361 596 Aust and also get FREE “Avoid these GST mistakes” –

There’s 18 that the Tax Office see regularly – Get them right!


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Business Tip – What Dyson learnt, about how customers can help you run a better business

Business Tip – What Dyson learnt, about how customers can help you run a better business

What Dyson learnt, about how customers can help you run a better business

Bri Williams writes - When James Dyson was pitching his new vacuum cleaner with its revolutionary clear plastic container, retailers warned him off, telling him that no one wants to see dirt. This was confirmed in market testing when consumers baulked at the notion of seeing their own filth but despite this Dyson famously persevered.

According to Forbes his company made $2 billion in revenue this year and his personal wealth is estimated at $4.4 billion. Apparently lots of people want to see dirt after all.

I thought of Dyson last week when I was on a panel at a retail accounting forum. There was much talk in the session prior about customer data and the importance of asking the customer what they want. But as Dyson (and others like Apple) have shown, the dirty little secret of customer insights is that often customers don’t know what they want and their past data can’t predict reaction to a new concept.

Given these two challenges, where can we turn as business people to get a sense of what customers are likely to do in the future without asking them?

Behavioural Economics

As I wrote in a previous article (Why you should ignore what customers say they want”), behavioural economics is the closest thing we have to forecasting behaviour. It is the study of how decision-making behaviour is influenced by a person’s social, cognitive and emotional context, based on observed rather than self-reported responses. In other words, “what we do when…”

So as I stated on the panel, and my central message to you as a business is to worry less about what customers tell you and more about how what they do changes in response to the context (your shop, office, website, offer, ad) you create for them.

To see a diagram of Bri’s model of using customer insights, go HERE to Smart Company

Get a FREE 30 min answer to your query, and FREE ongoing email or phone support – no-one offers as much! Call and you also get FREE “Avoid these GST mistakes” – there’s 18 that the Tax Office see regularly – get them right! Email info@accountkeepingplus.com.au or call 0407 361 596 Australia


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Cashflow Tips – Improve Cashflow – Invoice Promptly!

 

Cashflow Tips – Improve Cashflow – Invoice Promptly!

Improve Cashflow – Invoice Promptly!

Often, small business owners are uncomfortable about asking to be paid, yet the top way to improve cashflow is to invoice PROMPTLY! If you run a business, (especially service businesses) and you don’t invoice promptly as well as collect payment promptly (which cause cash crisis in the first place), then consider the following –

Consequences for your cashflow:

  1. Clients can quickly forget what they owe you.
  2. They are less likely to remember how much they loved your work and pay you promptly.
  3. They may conclude that you do not expect quick payment and will take their time in sending in their money.

Some ACTION solutions:

  1. Where possible, issue invoices at the time services are delivered.
  2. Send your invoice by email to speed the process.
  3. If you can’t issue immediately, be sure to issue your invoices weekly, or at least twice per month on designated days, such as on the 15th and the last day of each month.
  4. Do it like clockwork – it will help to even out your cashflow.

Take-away message -

Create the habit - invoice quickly and often.

Need help? Not sure? Call for FREE 30min advice / Strategy session today!

Call 0407 361 596 Aust and also get FREE “Avoid these GST mistakes” – There’s 18 that the Tax Office see regularly – Get them right!

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