Account Keeping Plus – Administration, Bookkeeping, Compliance News & Tips MYOB Reckon Quickbooks Xero Software TrainingSmall Business

Making Business Books and Accounting Come Alive! MYOB Reckon Xero


Leave a comment

Bookkeeping – Paid Parental Leave – What is it and how to do the bookkeeping

Bookkeeping – Paid Parental Leave – What is it and how to do the bookkeeping

Bookkeeping – Paid Parental Leave – What is it and how to do the bookkeeping

The Paid Parental Leave here we explain what it is and how to do the bookkeeping in your accounts. The scheme became compulsory on 1 July 2011 – it is an offer from the government of up to 18 weeks paid parental leave is offered to eligible working parents of children born or adopted on or after 1 January 2011. The government makes a payment to the employer to then pass on to the employee. This post explains generally what is involved to setup and record paid parental payments within your software.

What is the current rate of parental leave?

The rate is paid at the National minimum wage. For more information see Paid Parental Leave for employers.

How to do the bookkeeping

1.     Create an account to track parental leaveWe need to create a Liability account to track your Parental Leave. Depending on your Parental Leave reporting obligations, you may want to create an Expense account to track this leave instead of a Liability account. Speak to your accountant or the ATO for the appropriate solution based on your circumstances.

2.     Create a new wages category

3.     Exempt Paid Parental Leave from calculating superannuation

4.     Exempt Paid Parental Leave from accruing entitlements – depending on the way the employee is set up

a.     Hourly employeesthe entitlement will not accrue as there are no hours to calculate the percentage. This seems contradictory, but normally hourly employees will accrue leave as a percentage of hours worked. While they are on Paid Parental Leave, they are being paid via a Salary Wage category, rather than an Hourly Wage category. Therefore having no hours on the paycheque means that no leave will accrue.

b.     Salary Employeesneed to have the Entitlement(s) deselected in their card. This is because generally these employees will be set to accrue a flat amount of hours per Pay Period/Month/Year, and unless the entitlement is deselected in their card, the entitlement will continue accruing throughout the period of their Paid Parental Leave.

5.     Note: When the employee finishes the Paid Parental Leave you will need to select these entitlements again so that the leave entitlements will accrue.

6.     Action – when my employee is taking paid parental leave?
In MYOB for example, you go to the standard pay and zero all the salary or hourly $ amounts, and against the Paid Parental leave category, enter the amount that is to be paid.

7.     We are now ready to process Paid Parental leave payments for your employees. When you have finished paying the paid parental leave payments, you can use the Reset to Original Amounts button on the Payroll Details tab of the employees card (as shown above) to restore the values back to the standard hours.

8.     Receiving the payment from the government. When the employer receives parental leave payment from the government, this needs to be recorded as a Receive Money transaction into the Liability account created.

9.     Note – Paid parental leave and Payment SummariesIf you include the paid parental leave amount in the Gross Wages on your Payment Summary, you will need to account for this if you attempt to reconcile the total from the Payment Summaries with the total in your Wages & Salaries expense account. The paid parental leave amount is not shown as an expense, and therefore it is expected that the Payment Summary total will be higher than the total of the Wages & Salaries expense account. For more information on Payment Summaries, see the MYOB support note Preparing and printing Payment Summaries.

10.   Removing paid parental leaveWhen an employee returns to work after parental leave, their card needs to be updated so the Paid Parental Leave payment will be removed from the employee’s standard pay, and their normal Base Salary will be reinstated.

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

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


Leave a comment

Business Tax Tips – What if you consider not paying tax to the ATO and help with paying tax owed

Business Tax Tips – What if you consider not paying tax to the ATO and help with paying tax owed

What if you consider not paying tax to the ATO and help with paying tax owed

Business can be hard – do I spend money to grow such as advertise or pay the tax bill? What if you consider not paying tax to the ATO (Australian Tax Office), and how do I get help with paying tax owed?

The ATO explains –

If you don’t pay –

If you don’t pay on time:

o    interest will accrue on your tax debt

o    we’ll use any refunds to reduce your debt.

If you don’t pay, we will:

o     contact you soon after the due date

o     refer selected debts to external collection agencies for collection on our behalf

o     take stronger action against taxpayers who are unwilling to work with us to address their tax debt or repeatedly default on agreed plans.

Make sure you lodge your activity statements and tax returns on time, even if you can’t pay by the due date. You’ll avoid a penalty for failing to lodge on time and show us that you’re aware of your obligations. Read More.

Help with paying tax owed

If you can’t pay on time, we can help you.

You still need to lodge your activity statements and tax returns on time, even if you can’t pay by the due date. You’ll avoid a penalty for failing to lodge on time and show us that you’re aware of your obligations and doing your best to meet them.

If you require a payment plan, for debts:

o   $100,000 or less – set up online and automated payment plans

o   over $100,000 – phone us.

Online and automated payment plans

If you’re an individual or a sole trader with an income tax or an activity statement debt of $100,000 or less, you may be eligible to use our online services for individuals to set up a payment plan. You’ll need a myGov account linked to the ATOExternal Link.

Read more on Help options and instructions.

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!


Leave a comment

Business Finance 101 – Do you know – What are the Accounting Principles?

Business Finance 101 – Do you know - What are The Accounting Principles?

Do you know – What are The Accounting Principles?

In accounting (recording the monetary values of financial transactions) there are general rules and concepts developed over many decades that apply. These are called basic accounting principles and guidelines and are the groundwork on which more detailed, complicated, and legalistic accounting rules are based. In Australia. The Australian Accounting Standards Board (AASB) uses the basic accounting principles and guidelines as a basis for their own detailed and comprehensive set of accounting rules and standards.

There is a phrase “generally accepted accounting principles” (or “GAAP“) which consist of three important sets of rules: (1) basic accounting principles and guidelines, (2) detailed rules and standards issued by AASB, and (3) the generally accepted industry practices.

When a company distributes its financial statements to the owners or the public, it is required to follow generally accepted accounting principles in the preparation of those statements. Further, if a company’s shares are publicly traded, federal law requires the company’s financial statements be audited by independent public accountants. Both the company’s management and the independent accountants must certify that the financial statements and the related notes to the financial statements have been prepared in accordance with GAAP.

GAAP is useful because it attempts to standardise and regulate accounting definitions, assumptions and methods. Because of generally accepted accounting principles we are able to assume that there is consistency from year to year in the methods used to prepare a company’s financial statements. And although variations may exist, we can make reasonably confident conclusions when comparing one company to another, or comparing one company’s financial statistics to the statistics for its industry. Over the years the generally accepted accounting principles have become more complex because financial transactions have become more complex.

The Accounting Standards are split into various categories eg “Statement of Cashflows”, “Construction Contracts” etc, and a list with the most recent updates/ pronouncements for Australia can be found HERE.

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


Leave a comment

Cashflow Tips – Does profit mean cash? – Do you know the difference?

Cashflow Tips – Does profit mean cash? – Do you know the difference?

Cashflow Tips – Does profit mean cash? – Do you know the difference?

I hear many clients say there is a profit in their business, then say they don’t have cash in the bank – what they often don’t realise is Profit does not mean Cash!

If you have all cash sales, profit will usually correlate closely with the bank account, depending on when banking is completed – that is you get paid immediately and bank it, and do not invoice (waiting to be paid in 7,14, 30 days etc). And you pay your expenses with cash direct from the bank, the balance should be the cash Profit.

But if you invoice clients for goods and services, the timing of when customers pay has an effect on the cash the business actually has. For example not everyone pays on time, but if they did you would have more regular cash flow, and at the start the first money coming in would only be delayed by the terms at the beginning eg 7 days, 30 days. Once those days of waiting have passed, the regular payments will mean regular flow of money to cover your expenses.

What happens if clients are late paying? Then the debtors/accounts receivable asset account on your balance sheet will grow (that is where the invoice “waits” for payment) until the client pays.

As an example, in our earlier post explaining Profit and Loss, (see HERE) we gave an example of Profit and Loss resulting in $15,000 profit.

Cashflow Tips – Does profit mean cash? – Do you know the difference?

Consider now, that you were only paid half of the sales at the end of the period (which is more close to reality – eg most pay the next month or two…in 60 days)

Sales (invoices)                                       $100,000

But only paid (actual cash)                   $50,000

Which goes to bank (in assets)

Net Left                                                       $50,000

Which sits in debtors/receivables (in assets)

NotePROFIT would be same in accounting terms,

but CASH Profit would be -$35,000 – see below

Business Cash Profit

That is – if you still had paid all your bills, you would have to find $35,000 to pay them!

This is where businesses will use credit cards or overdrafts to keep paying suppliers and the rent to stay open!

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!


Leave a comment

MYOB – What Reports to use for paying Super

MYOB – What Reports to use for paying Super

MYOB – What Reports to use for paying Super

Our Client has been trialing a replacement bookkeeper, who called us asking what are the best reports to use for paying the super last month?

Answer is to look in the Super folder when we did the super last month to temporarily do the books while a new bookkeeper was being advertised, see the reports we used:

1.     Superannuation Employee Advice Detail (or Summary) – is good as it allows you to see all the pay weeks/periods and the total super;

2.     Payroll Activity Summary – dated for the last month 1st to 31st, as long as no deductions are being used, the Expenses column at the Right is all super, per staff member and should match the employee totals – and will also give the TOTAL super so you can reconcile to the total on the online data you enter in your SuperStream super fund portal;

3.     Paying – The superannuation should all match, print the contribution once reconciles, for proof, and finish as per method of your chosen portal. MYOB Super is a great method Free with a Subscription, that takes less than 10 min or so to pay the super for 30 staff for one client, we assist. And the ATO Small Business Super Clearing House is great for up to 19 employees – login, fill in the amounts, get a Bpay or EFT detail to confirm and print, and pay from your banking online.

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

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


Leave a comment

Business Tips – Get moving again when feeling stuck in business

Business Tips – Get moving again when feeling stuck in business

Business Tips – Get moving again when feeling stuck in business

Here’s a 5 step process to get moving again when you are feeling stuck with problems or your business, from Flying Solo’s Jayne Tancred.

When you’re in one of those situations where nothing seems to be working or the best way forward is distinctly murky, it’s easy to fall into a state of paralysis or reluctant resignation.

If you want to be the master of your own destiny, however, neither staying stuck nor admitting defeat is an acceptable option. So, over the years, I’ve worked out a nifty little approach that helps me sidestep the roadblocks and find my momentum. I hope it helps you too.

Step 1: Do nothing

When you’ve been doing everything you can to get things going, and you just aren’t seeing any results, there’s no point continuing to beat your head against a brick wall.

Instead, schedule a block of time in your calendar to dedicate to the issue, and then declare a holiday from the whole catastrophe until that time arrives.

Your goal is to return to the issue with a fresh perspective, renewed energy, and a different attitude, so if the topic crosses your mind in the interim, gently remind yourself that there’s an agenda set for this to be revisited later and in the meantime do something completely different…

Step 2: Go macro – revisit the big picture

Often when we’re stuck, it’s because we’re concentrating on the obstacles rather than on our objectives. With that in mind, the first thing I do upon re-entry is to re-familiarise myself with why the issue at hand is important to me, and what my goal is in addressing it.

I always find that when I stop thinking about how I’m going to make something happen and instead focus on my best-case scenario outcome, I shift out of a defeatist mindset and into a can-do one….

Step 3: Go micro – zoom in on what you can do

If your big picture review has confirmed that you’re on the right track and the issue you’re trying to push forward is one that you really are committed to, you may still be stalled by not knowing all the steps it’s going to take to create the breakthrough you need.

Whenever there are lots of unknowns, it’s easy for me to fall into the trap of thinking that I don’t know anything at all, but that’s actually rarely the case. I almost always have some idea of what’s needed, even if I don’t yet have a handle on everything there is to know.

At this point in the process, it always seems to help to step away from the computer and go old-school with paper and pen to create a list or (better still) a mind map of all the tasks and milestones that might need to be completed in order for my big picture goal to be achieved….

Step 4: Make it fun

If everything’s still feeling really overwhelming or as though you’re not gaining any traction, try turning parts of it into a game.

My business partner and I did this recently when we decided to pursue an opportunity we hadn’t budgeted for but really wanted to take up. The first time we ran the numbers, the cost of participation was so far outside our reach that no-one would have blamed us if we’d walked away. But from a big picture perspective it was a no-brainer, so we set ourselves the challenge of coming up with the cheapest way possible to achieve our goal.

Once we made the decision that we were going to go ahead regardless of cost AND that we were going to do so in a way that was affordable for us, momentum came as we amused ourselves coming up with wild and wacky ways that we could achieve our objectives while spending a minimal amount of money….

Step 5: Rinse, repeat and learn along the way

None of the processes above work unless you commit to learning everything you can about yourself, your business and what’s effective every step of the way, and applying what you learn.

Often a project that’s big enough to make you feel stuck in the first place will also be big enough to involve many layers or moving parts. Applying the steps above in an on-going loop has helped me get unstuck so many times that I’ve lost count, and might be just what it takes to help you move forward too.

For the full article and more on each point go HERE

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!


Leave a comment

Business Tax Tips – GST Error Correction – How to put it right

Business Tax Tips – GST Error Correction – How to put it right

Business Tax Tips – GST Error Correction – How to put it right

The Australian Tax Office (ATO) site has information on what to do when you find you have a GST error correction to make – and how to put it right in a way that is easier than revising a prior statement, as well as you can save penalties (see how the ATO is really NOT your business enemy!) –

“If you made a GST error on an earlier activity statement, you can choose to correct that error on a later activity statement if you meet the conditions set out in this guide.

The benefits of correcting GST errors on a later activity statement are:

  • you are not liable to any penalties or general interest charge (GIC) for any GST error you correct on a later activity statement provided you meet the conditions to correct a GST error on a later activity statement
  • generally, it is easier to correct a GST error on a later activity statement rather than revising the earlier activity statement.

Alternatively, you can correct any GST error by revising the earlier activity statement that contains the error. You can revise an earlier activity statement online or obtain an activity statement revision form by phoning us on 13 28 66.”

Here are a series of links about correcting GST errors –

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