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Cash flow Tips – How we achieved steady cash flow for our client

Cash flow Tips – How we achieved steady cash flow for our client

Cash flow Tips – How we achieved steady cash flow for our client

One client was struggling – feast and famine with money coming in then drying up and bills to pay!! He couldn’t achieve steady cashflow because he was pulled with all the many tasks a growing business owner must juggle! WE have found a system that improves getting paid and is more consistent than the old traditional monthly statement and phone call method of traditional business practice.

How he was going under

One week he could get on top of who owed him what, and what he owed, then he was out of touch again within a week with calls, quotes, staff issues, client issues and so on. He’d stay up after the children and wife were in bed and it was quiet, to concentrate and get back on track – but it was making him more tired and he was being drained.

How he bit the bullet and solved the problem

  • He decided to call us back in for regular help – that would free him up to work on what he did well, and win more clients to grow his business!
  • We got all his bills to pay, nagged him to check all his emails and that all bills were emailed to our account email, and entered them in the software – about 10-15 min work – now there is a list of what is due, and when! Up to date!
  • We reconciled the bank for the last month, checked where it was at because the accountant’s office was reconciling it monthly. And checked that the last quarter was correct, as some invoices were of the same $ but remittances from clients said they paid different ones and not always the oldest! Re-did some payments, aligned the correct ones paid. Up to date!
  • We synchronized the project software with his accounts software, and checked the 2 systems had the same invoices due, by number and $ – the invoices exported into the accounts software, but unfortunately the accounts can’t update paid invoices back into the project software – hopefully this will be rectified in time! Up to date!
  • Filed all paid invoices, checking back on the bank when paid and marking clearly as paid, then put in folder alphabetically.
  • Reported on clients due – debtors – accounts receivable, in an aged report to be able to easily see what was overdue – the business had 7 day terms – of course many larger businesses ignore and still pay on 30 day cycles! There were 12 well over due, 5 just a day over due, and 10 not due as yet
  • Reminders – emailed all over due outstanding receivables with a friendly tone, and “REMINDER” at the start of the subject message so it stood out
  • System – send reminders FORTNIGHLY – not monthly! It’s too long and people forget! And for those well over due – WEEKLY email reminders

RESULT

  • Over 3 weeks the old 12 outstanding accounts were up to date except 1!
  • Only 1 client needed to be called after several reminders, excuses, requests for invoices again by accounts – the usual delay tactics that indicate possible cashflow issues!
  • Regular clients realised we were on to them straight after the 7 days due!
  • 70-80% now pay before, on time, or a day or two after the time due!
  • Client has regular income to cover expenses
  • Client is sleeping better and serving prospective and new clients with more enthusiasm and energy!
  • Low costs – all this weekly for under a few hundred dollars!!!
  • Peace of mind with professionals handling what they can do very well!

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

0407 361 596 Aust

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 Tips – How recognition of employees helps your business and should be the TOP priority

Business Tips – How recognition of employees helps your business and should be the TOP priority

How recognition of employees helps your business and should be the TOP priority

Recognition of Employees should be a top priority of your business – both for the benefit of them and for the business health and happiness! Here are some findings from research and authorities – around the globe and Australia (our emphasis added) –

Stuart Hearn at business.com writes – A recent workplace study conducted by Clear Review, a performance review software system, found the number one workplace frustration to be a lack of appreciation regarding effort and performance. A remarkable 40 percent of employees, from a diverse range of fields and positions, stated that employee recognition was simply not a priority in their business, something that limited their motivation to truly excel.
We have known for a long time that employee recognition is a critical aspect of performance management. As a result, many companies make it a point to acknowledge employee performance during monthly check-ins. But how can employee recognition benefit a company? And how can you give your employees the appreciation they deserve?
Employee recognition improves engagement levels
Many sources will attest to the fact that recognition is a fundamental human need. In order to feel engaged at work, we need to know that what we are doing actually matters, and that it is appreciated. Without this knowledge, employees consider their role purposeless, and employee engagement levels within your organization will plummet. In fact, recognition has consistently been shown to be a top engagement driver. If, however, you dedicate time and resources toward developing an employee recognition program, employees will become more loyal and positive toward their company.
To further demonstrate the effect of recognition on employee engagement, we can look to the following facts and figures:
An Australian Company, Red Balloon, performs quarterly surveys and in one report finds –
There are six basics or standards required to deliver on expectations and start to engage a workforce; our suggestion is that organisations that do not include these activities as part of their engagement mix stand little chance of breaking past average levels of engagement.
  • Training and Development Programs
  • Recognition Programs
  • Non-Cash Rewards & Incentives
Training and Development is of particular interest as organisations that do not invest in it are highly unlikely to have an employee engagement score of over 40.
  • Parental Leave
  • Time off for Study
  • Flexible Working Arrangements
These last three activities are core ingredients of engagement because organisations scoring <40% are just as likely to invest in them as 80%+ organisations. Investing in them is now a standard that has little uplift in terms of engagement scores but would definitely have a negative effect if not invested in or taken away once they were in place.
What are your thoughts and experience?
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


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MYOB Bookkeeping – MYOB running slow all of a sudden when doing the books? – Tips to speed up the PC

MYOB Bookkeeping – PC running slow all of a sudden when doing the books? – Tips to speed up the PC

Bookkeeping – MYOB running slow all of a sudden when doing the books? – Tips to speed up the PC

Have you found your MYOB is running slow all of a sudden while you are doing the books, or when you came back after a break? Here are some tips that may help –

Win10 –

In the Cortana window, type “Run”

Click the App “Run” in the list

Type “%localappdata%” > OK

Go to the MYOB folder

Go to the AR folder > 2017.1 > Cache folder

Delete all files there “Company File Cache”

Close the window

Then

In the Cortana window, type “Run”

Click the App “Run” in the list

Type “CMD” > OK

At the cursor type “ipconfig /flushdns” (note there is a space after config) > Enter key

Should get a message.. successfully…

Close the window

Then

Restart your PC

Win7

Click the Windows button, lower left corner

In the search box, type “Run”, and continue as above

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

Call and you also get for 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 Tips – How Recognition of employees helps your business and should be the TOP priority

Business Tips – How Recognition of employees helps your business and should be the TOP priority

Business Tips – How Recognition of employees helps your business and should be the TOP priority

Recognition of Employees should be a top priority of your business – both for the benefit of them and for the business health and happiness! Here are some findings from research and authorities – around the globe and Australia (our emphasis added) –

Stuart Hearn at business.com writes – A recent workplace study conducted by Clear Review, a performance review software system, found the number one workplace frustration to be a lack of appreciation regarding effort and performance. A remarkable 40 percent of employees, from a diverse range of fields and positions, stated that employee recognition was simply not a priority in their business, something that limited their motivation to truly excel.

We have known for a long time that employee recognition is a critical aspect of performance management. As a result, many companies make it a point to acknowledge employee performance during monthly check-ins. But how can employee recognition benefit a company? And how can you give your employees the appreciation they deserve?

Employee recognition improves engagement levels

Many sources will attest to the fact that recognition is a fundamental human need. In order to feel engaged at work, we need to know that what we are doing actually matters, and that it is appreciated. Without this knowledge, employees consider their role purposeless, and employee engagement levels within your organization will plummet. In fact, recognition has consistently been shown to be a top engagement driver. If, however, you dedicate time and resources toward developing an employee recognition program, employees will become more loyal and positive toward their company.

To further demonstrate the effect of recognition on employee engagement, we can look to the following facts and figures:

  • Businesses that spend as little as 1 percent of payroll on recognition have a 79 percent greater likelihood of seeing more positive financial results.

 

An Australian Company, Red Balloon, performs quarterly surveys and in one report finds –

There are six basics or standards required to deliver on expectations and start to engage a workforce; our suggestion is that organisations that do not include these activities as part of their engagement mix stand little chance of breaking past average levels of engagement.

  • Training and Development Programs
  • Recognition Programs
  • Non-Cash Rewards & Incentives

Training and Development is of particular interest as organisations that do not invest in it are highly unlikely to have an employee engagement score of over 40.

  • Parental Leave
  • Time off for Study
  • Flexible Working Arrangements

These last three activities are core ingredients of engagement because organisations scoring <40% are just as likely to invest in them as 80%+ organisations. Investing in them is now a standard that has little uplift in terms of engagement scores but would definitely have a negative effect if not invested in or taken away once they were in place.

What are your thoughts and experience?

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


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Business Tax Tips – Managing Small Business Taxes and Obligations

Business Tax Tips – Managing Small Business Taxes and Obligations

Managing Small Business Taxes and Obligations

Running a small business has many extra requirements – one of the most important is planning for reporting and managing small business taxes. Here are tips for the ATO – Australian Tax Office, to get you organised –

Reporting and paying tax

As soon as you start up your business, you need to plan for how you will pay the tax you will owe each year when you lodge your tax return.

Paying tax in your first year

In your first year of business, you can stay on top of your obligations by:

  • making tax pre-payments into your tax bill account;
  • putting money aside for your expected tax bill;
  • voluntarily entering into instalments.

See also:

Paying tax by instalments

Once you lodge your first income tax return and report a tax-payable amount above a certain threshold, you will automatically enter the pay-as-you-go (PAYG) instalment system.

If you voluntarily enter into instalments prior to lodgment of your first tax return, you will be able to make quarterly payments towards you tax bill.

See also:

Reporting

Once you’re up and running, you’ll need to report your business income and other tax information. The key reports you should be aware of are:

  • Business Activity Statement (BAS) –

    • the main taxes you will report on will be GST (if you’re registered for GST)
    • any tax you withhold from employees’ pay
    • instalments towards your own tax once you are in the pay as you go instalments system;
  • Income tax return  
    • to report your personal and business income and claim deductions.

Most of your business reporting can be done online.

Next steps:

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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Bookkeeping – Motor Vehicle Assets – How to set up cars in accounting records

Business Tax Tips / Bookkeeping – Motor Vehicle Assets – How to set up cars in accounting records

Business Tax Tips / Bookkeeping – Motor Vehicle Assets – How to set up cars in accounting records

Client emailedOur Company bought 2 cars  –

  • Holden Cruze for $16,700.00 includes GST/stamp duty/transfer fee          
  • Barina for $12,888.00

We traded in the company car – Holden Commodore for $3000 and the wife’s car for $1500. Daniel has not claimed the $1500 but gave it to the business.

Now both ’new’ cars belong to the company.

Invoice for Holden Cruze is $16,700.00

The $4,500 trade in was netted out of the purchase of the Barina so the invoice is

($12,888- $4,500) $8,388.00 net.

We have in our accounts:-

MV @ cost                             18539.37

MV Accum Depn                  15412.00

Please advise. Thank you.

How to EnterTo keep things simple, we need to set up some new accounts (“NA”) for each motor vehicle, and new accounts for the loans on each car – it is then easiest to leave the final reconciliation and adjustments to your accountant year end.

I assume the 2 MV accounts are only for the Commodore and no other cars. It is good practice to create new accounts for EACH vehicle so the accountant can reconcile at year end with ease!

Separate the Rego (and Insur if included in the deal) from the $16,700 (or you can leave for accountant at year end to pick up).

AKP Case Study*Is the Loan a Chattel Mortgage? – Can mention type of loan in account name as well

Monthly payments – for simplicity, allocate from bank to NA Liability MVeh Loan Fin Co Name (the new finance account).

The old car accounts – Asset MVehicle @ Cost Commodore, and the MV Accum Dep can be left for the accountant to calculate and adjust at year end, in case there are other adjustments he needs to do.

For other examples of entering MV assets in the accounts, see –

Quickbooks – How to go about setting Chattel Mortgage up and accounting for the monthly payments in Quickbooks.

Another Asset Example – How to enter assets in the books

How do I show liabilities for the total borrowed including interest, not just the principle/asset amount?

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

0407 361 596 Aust

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 – What is the meaning of, & what does a Cashflow Statement show?

Cashflow Tips – What is the meaning of, & what does a Cashflow Statement show?

Cashflow Tips – What is the meaning of, & what does a Cashflow Statement show?

The Cashflow Statement is also called the Statement of Cashflows, and here we explain the meaning of, and look at what the statement shows us. It is one of the 3 main financial statements that businesses report on – the other 2 are Profit & Loss, and the Balance Sheet.

The cash flow statement reports the actual cash generated and used during the time interval stated in its heading. The period of time that the statement covers is chosen by the company, for example, “For the Three Months Ended 31 December, 2015” or “The Fiscal Year Ended September 30, 2016”. Most common is annual.

The cash flow statement actually uses data and the CHANGES between periods from the Profit & Loss and Balance Sheet, and organises and reports the cash generated and used in the following categories:

Operating, Investing and Financial activities

Business Cash Flow

What the Cashflow Statement shows

The profit & loss or Income Statement is prepared under the accrual basis of accounting, meaning the sales/revenues reported may not have been collected yet. Similarly, the expenses reported on the income statement might not have been paid. You could review the balance sheet changes to determine the facts, but the cash flow statement already has integrated all that information. As a result, savvy business people and investors utilize this important financial statement.

Here are a few ways the statement of cash flows is used.

  1. The cash from operating activities is compared to the company’s net income (profit/loss). If the cash from operating activities is consistently greater than the net income, the company’s net income or earnings are said to be of a “high quality“. If the cash from operating activities is less than net income, a red flag is raised as to why the reported net income is not turning into cash.
  2. Some investors believe that “cash is king”. The cash flow statement identifies the cash that is flowing in and out of the company. If a company is consistently generating more cash than it is using, the company will be able to increase its dividend, buy back some of its stock, reduce debt, or acquire another company. All of these are seen to be good for shareholder value.
  3. There are also some financial models that use the cash flow.

The statement of cash flows has four distinct sections:

  1. Cash generated from operating activities
  2. Cash generated from investing activities
  3.  Cash generated from financing activities
  4. Supplemental information.

The differences in a company’s balance sheet accounts from one period to the next, will provide much of the needed information. The changes—or differences—in the account balances will likely be entered in one of the sections of the statement of cash flows.

Of the four sections of the statement of cash flows, those balance sheet accounts which affect each section include –

1. Operating Activities

This section reports the net income and then converts it from the accrual basis to the cash basis by using the changes in the balances of current asset and current liability accounts, such as:

  • Accounts Receivable
  • Inventory
  • Prepaid Insurance
  • Other Current Assets
  • Notes Payable
  • Accounts Payable
  • Wages Payable
  • Payroll Liabilities
  • Interest Payable
  • Income Taxes Payable
  • Unearned Revenues
  • Other Current Liabilities

Note – as well as using the changes in current assets and current liabilities, the operating activities section may list adjustments for depreciation expense and for the gains and losses on the sale of long-term assets/investments.

2. Investing Activities

This section reports changes in the balances of long-term asset accounts, such as:

  • Long-term Investments
  • Land
  • Buildings
  • Equipment
  • Furniture & Fixtures
  • Vehicles

Investing activities involve the purchase and/or sale of long-term investments and property, plant, and equipment.

3. Financing Activities

This section reports changes in balances of the long-term liability and stockholders’ equity accounts, such as:

  • Notes Payable (generally due after one year)
  • Bonds Payable
  • Deferred Income Taxes
  • Preferred Stock
  • Paid-in Capital in Excess of Par-Preferred Stock
  • Common Stock
  • Paid-in Capital in Excess of Par-Common Stock
  • Paid-in Capital from Treasury Stock
  • Retained Earnings
  • Treasury Stock

Financing activities involve the issuance and/or the repurchase of a company’s own bonds or shares as well as short-term and long-term borrowings and repayments.

4. Supplemental Information

This section of the cash flow statement reports the amount of interest and income taxes paid as well as significant exchanges not involving cash. For example, the exchange of company shares for company bonds would be reported here.

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