September 2010 Quarterly BAS reminder

BAS preparation business tax

Need help preparing your BAS statement?

 

One month to go!  How are you going?  It’s nearly time for your next BAS again. So start this financial year off right and make sure you get your first quarterly BAS in on time. 

If you’d rather spend your time on something else – doing something you can make money from or enjoying your evenings and weekends – Samantha in Manly West (Brisbane) and Leesa in Menai (Sydney) can help you.

Leesa Dalton – (02) 9532 1302 | leesa@samsabc.com.au

Samantha Monahan – (07) 3348 4323 | samantha@samsabc.com.au

www.samsabc.com.au

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Business or Hobby?

business bookkeeping tips

With the ease of selling things on the internet, it is probably more important now than ever to consider whether what you are doing is a business or a hobby.  If you are operating a business the money you earn is assessable income, and many of the expenses related to earning that income will be deductible.  If your activity is a hobby you don’t need to pay tax on any earnings.

So, is it a Business or a Hobby?

Each activity will have to be judged on a case by case basis.  Following are some of the factors to take into account when determining whether the activity is a business or hobby (taken from the ATO’s website www.ato.gov.au)

  • Does your activity have a significant commercial character? (i.e. for commercial reasons and in a commercially viable manner)
  • Do you have more than just an intention to be in business?  (i.e. have you decided to start and done something about it)
  • Is your purpose to make profit? 
  • Are there repetitive and regular transactions? 
  • Is your business similar to other businesses in your industry?  (i.e. is it consistent with industry norms)
  • Is the size, scale or permanency of your activity enough to allow you to make a sustainable profit? 
  • Is your activity planned, organised and carried on in a businesslike manner such as keeping business records, a separate business bank account, having business premises, a registered business name, licenses?

This information is intended as a general guide only.  For clarification on any of these points, please give us a call.  You may need to speak to a tax agent for detailed tax advice.

 Leesa Dalton – (02) 9532 1302 | leesa@samsabc.com.au

Samantha Monahan – (07) 3348 4323 | samantha@samsabc.com.au

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PRACTICAL NETWORKING TIPS

networking with Advanced Bookkeeping and Consulting

Over 80% of business is done through networking

 Recently I (Leesa) attended the Women In Business function at the Sutherland Shire Business Development Week and enjoyed learning some practical networking tips which I wanted so share…

Physical Preparation

Before you go, think about where you are going and what message you are trying to convey.  For women in particular the way we dress can have a big impact on this.  That is why wearing appropriate clothing is very important. 

A good way to get conversations started is by wearing something eye-catching, which can then be used as an ice breaker, plus it helps people to remember you.

Wearing a name badge is also important.  Wear it on your right side so it is easy for the other person to see when shaking hands.  Take time to notice other people’s name badge and perhaps ask a question about the business name to get a conversation going.

The correct handbag is important.  A big bag that you need to search through and that opens up to reveal all of your “little secrets” is not professional.  Have a handbag that makes it easy to get your cards or phone etc out easily.  It is also suggested that you may get two business card holders – one to give out your cards, and another to collect business cards.

Emotional Preparation

You need to have the right attitude and realistic expectations.  Networking is about the other person.  It is a relationship building exercise.  Listen to the other person – don’t just talk – you want to take the time to learn all about them.  Then they are more likely to repay the courtesy.

Set goals – it could be to form strategic alliances, get help or make friendships.

Focus on the Other Person

Here are some suggestions of how to remember what kind of questions you can ask to start up a conversation: FORM

(About their)

F      Family                     

O      Occupation

R      Recreation

M     Message

If you see someone alone, talk to them.  If they look new, help them, introduce them to others. 

If you are standing in a group, open the group up at an angle to allow others to enter the group.

Follow-up

Once you’ve made those contacts, keep them.  Strengthen the relationship. 

File the business cards and if necessary write something on the back of the cards about the person, such as where you met, what you talked about or what they do.

Send a follow-up email and invite them to join your social media network such as your business’ Facebook page, Linkedin or Blog site.

More than 80% of business is done through networking – so if you haven’t got out there and tried it yet – use these tips as a starting point.  You won’t regret it!

If you’d like to free up some time in your busy business schedule so you can get out and network – contact us so we can take care of the finances!

www.samsabc.com.au – Empowering your Business through Superior Financial Management

Sydney Office

leesa@samsabc.com.au

P | (02) 9532 1302 or 0412 635 559

Brisbane Office

samantha@samsabc.com.au

P | (07) 3348 4323 or 0424 190 448

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Liquidity – What is it and how to manage it

money advice budgeting

Is your business at risk?

Who knows what liquidity risk is? I’m sure everyone has heard the term but it’s important to understand it and manage it. Liquidity risk is the risk that a business will be unable to meet its financial commitments in a timely manner – either as short term cashflow or in the long term when loans are required.

Here are a couple of the financial ratios which can be used to identify and measure liquidity and risk.

Current Ratio is Current Assets/Current Liabilities Depending on your industry, a good ratio would be close to 2:1 and if it is lower and closer to 1:1 then maybe you should look at either increasing your current assets, reducing current liabilities or trying not to finance non-current assets with current liabilities.

Working Capital is Current Assets – Current Liabilties

It is said that a good target for working capital should be one half of operating budget. This can be improved by reducing current liabilitites such as short term debt, or increasing current assets such as the collection rate/time of accounts receivable.

Consider how you can change some fairly minor things in your business such as: –

  • comparing the timing of when or how often you pay your bills with how often and how soon you are paid
  • how many days your stock sits in your store or wharehouse
  • how long you have to wait for a stock order to be filled once you place it (ie how long might you be without any of that stock)

Also be aware of outside influences which may have an effect on your cashflow such as seasonal fluctuations.

Are there any things that you have done in your business that you think might help other businesses manage their cashflow and their liquidity risk? We’d love to hear about them…

www.samsabc.com.au

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Build your Business with Uncommon Thinking…

Uncommon Thinking

Uncommon Thinking in Business

At least, that’s the mantra spoken by “message creation expert” Wazza Bray, founder and Managing Director of LMG Digital Media.

“What is uncommon thinking” you ask?  In a nutshell, it’s letting the market know that your business stands out from your competitors by thinking creatively, and not limiting our creativity just because it sounds too unrealistic or “dangerous”.

In his presentation at the Wynnum & Districts Chamber of Commerce Business Luncheon on Wednesday 21st July 2010, Wazza imparted three principles when it comes to Uncommon Thinking;

First, Wazza suggested that we start thinking like a child again (What! You say…).  He used the example of thinking like a six year old boy.  In the world of a six year old boy anything is possible.  His thinking and ideas are not constrained by physical limitations or rules or what is generally accepted by society.  He can do anything!

Wazza recommended that we should start thinking like that when it comes to planning, or marketing or business.  After all…it worked for Albert Einstein when he discovered the theory of relativity!

The second point Wazza made was to be aware of “Reticular Activating System” (RAS)…sounds fancy doesn’t it!  So what is it?  Basically it describes a type of brain activity where once you become interested in something, all of a sudden you start noticing it all around you, whereas prior to your interest, you didn’t notice it.  For example, when you buy a new car, as you drive it home you notice that model of car everywhere on the road.  Did hundreds of people buy the same car as you today? Of course not; you simply hadn’t noticed them before because you had no reason to.

What this means for business is basically your product or service will be invisible until someone needs it!  With this in mind, it is clear why our business must stand out from our competitors.  We need to make sure that when someone is in the market for our product or service that we get noticed and remembered.  And again, Wazza suggested the most effective way to do this is by using uncommon thinking…

The third point Wazza discussed was market research.  It is important to note here that Wazza made it clear that due to the RAS phenomenon mentioned above, the question “How did you hear about us” will not give you a truly accurate answer when it comes to market research.  The purchase process undertaken by consumers happens over time…they talk about it with others, they “window shop”, they become familiar with a certain brand, and then, once they have finally made the purchase decision they look up the brand they are familiar with, often in the yellow pages, and contact you (we hope).  So if you ask, “how did you find us?”, what is their likely answer?  “The yellow pages”!  Clearly their purchase decision was not due to your ad in the yellow pages…it was part of a whole thought process together with effective branding.

Instead Wazza recommended that we ask direct questions…for example ask “what motivated you to choose us over our competitors” (i.e. what, according to the consumer, is your point of difference).

I think there is a valuable lesson learnt from understanding the human thought process when it comes to marketing your product/service.  Just having a better understanding of the consumer purchase decision making process will help any business market themselves more effectively.

What do you think?  We would love to hear about your marketing successes….

And as always, if you would like to free up some time to focus on your business, contact us to find out how we can help…

http://www.samsabc.com.au/ 

Brisbane Office
samantha@samsabc.com.au
p: (07) 3348 4323
m: 0424 190 448

Sydney Office
leesa@samsabc.com.au
p: (02) 9532 1302
m: 0412 635 559

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End Of Financial Year Tips For MYOB Users

bookkeeping services brisbane sydney

need a bookkeeper?

A simple guide and reminder for some of the things you will need to do at the end of the financial year, if using MYOB as provided by MYOB. However, these are a general guide only. If you want any further information or clarification on any of these please give us a call.

Remember to backup before you do anything! (Note: Payroll details are at the bottom of this note)

Step 1 Enter all transactions for the financial year

Step 2 Backup the company file

Step 3 Do a stocktake

Step 4 Reconcile your bank accounts

Step 5 Reconcile your accounts receivable

Step 6 Reconcile your accounts payable

Step 7 Reconcile your inventory

Step 8 Reconcile GST control accounts

Step 9 Review accounts and reports

Step 10 Provide information to your accountant

Step 11 Enter end-of-year adjustments provided by your accountant, and only then

Step 12 Start a new financial year

N.B. IF YOU USE PAYROLL THESE EXTRA STEPS ARE NEEDED

Step 1 Process the last paycheques for the year

Step 2 Make sure all employees have a Tax File Number entered on their card

Step 3 Make sure workers under labour hire arrangements have been identified

Step 4 Print Payroll Reports

Step 5 Balance PAYG (Pay As You Go) Tax

Step 6 Print PAYG Payment Summaries (Individual Non-business). We recommend printing/saving them to Microsoft Office Document Image Writer or a similar package so that future copies can be printed if required

Step 7 Make two backups

Step 8 Start a New Payroll Year.

If you need any help with these steps – remember we are just an email or phonecall away

Sydney – 0412 63 5559 |  leesa@samsabc.com.au

Brisbane – 0424 190 448 | samantha@samsabc.com.au

www.samsabc.com.au

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The Importance of being Market Savvy

Bookkeeping & Marketing

Samantha Monahan & Megan Walker from Market Savvy

Recently I was lucky enough to attend a Business Luncheon held by the Wynnum and Districts Chamber of Commerce. It was during this luncheon that I listened to Megan Walker, from Market Savvy, wrap up in just 30 minutes, the ten very important steps one must consider when starting a new business.

Now, call me biased, but Megan was very quick to point out the importance of consulting qualified accountants during the Business Planning phase (step 1)(thanks for the plug Megan!). She expressed how crucial it is for a new business to get the right professional help about various aspects of finance, and to have it all set up correctly right from the START.

Now this wasn’t the only thing I picked up from Megan’s speech. Megan ran through nine other steps, viz;

1. Business Planning (mentioned above)

2. Research – is your product desired by a market?

3. Goals – who is your target market…not everyone, we are not McDonalds!

4. Strategies – how do we attract our market

5. Skills – do we have the skills to get the market? If not, get them (eg outsource).

6. Branding – what you want to be known for

7. Key Messages – words of value for your customers (not what you think is valuable)

8. Marketing Materials – what type? what is relevant to your business?

9. Promotional Activities

10. Sales – this is last!!

She also said to “Resonate” (the desire for your product), “Differentiate” (what’s unique about your product/service, what makes it the best), and “Substantiate” (generate a trust in your product).

I found this luncheon particularly worthwhile, and with the tools Megan provided us with, I am sure we can all become more “Market Savvy!”.

Thanks Megan!

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