4
May

Do You Need A Self Managed Super Fund?

Top 4 Advantages To Having A Self Managed Super Fund!

Do You Need A Self Managed Super Fund?

A Self-Managed Superfund (SMSF) has been one of the most talked about items in discussions
surrounding tax, due to the numerous tax advantages it brings, both from the tax and investment point
of view.

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12
Jan

3 Ways For Accountants To Value Add

3 Ways Accountants Can Value Add & Create A Competitive Advantage!

The role of the accountant has evolved and value adding is crucial. What was once the ‘traditional accountant’ has now become the ‘outsourced CFO’ as businesses now turn to their accountant for strategic advice. Below outline three basic methods accountants can value add and ultimately create a competitive advantage.

1. Working Capital Management

Managing cash and the levers that optimise an organisation’s liquidity is critical to its success. The administration of these components is known as working capital management. A business without sufficient cash to be able to pay their debts will fail. Conversely a business with too much cash available will endure an opportunity cost from investments not taken up.

Finding the right balance is key. One measurement of working capital is Inventory plus Accounts Receivables less Accounts Payables. To decrease working capital, an organisation can reduce the amount of inventory it holds, reduce debtor levels, or increase trade creditor levels – ultimately increasing cash flow.

Accountants play a critical role in being able to advise what the optimal level should be and provide methods of achieving this, examples include:

  • Reorder point model – i.e. when to order inventory
  • Obtaining credit facilities – e.g. From the ATO
  • Providing key financial ratios with comparisons to industry averages – e.g. debtor days

2. Performance Reporting

Without measures to assess organisational goals, businesses will be unaware if targets are met, they will remain static, and will not find areas of improvement. Accountants can provide these measures through various means – for example:

  • Dashboard reporting – providing a visual snapshot of financial performance and KPIs
  • Financial ratios – e.g. return on investment
  • Non-financial measures – e.g. staff turnover

One valuable measurement tool is the balanced scorecard (BSC). The BSC provides a framework for developing financial and non-financial measures to monitor the achievement of an organisation’s strategic objectives.

It takes a wholistic approach and breaks down the organisation into four perspectives: financial, customer, internal process, and learning and growth.

Goals are determined for each quadrant with accompanying KPI’s used to measure performance.

3. Product Costing

Traditional costing methods allocate overhead costs to products or services based on a single organisation-wide measure.

This can spell a recipe for disaster, for example:

  • Products can be determined to cost less than they should – therefore a business might persist with the product when in fact it is not profitable
  • Products can be determined to cost more than they should – therefore a business might cease production/sales of the product when in fact it is profitable

Fortunately, todays accountant has an accurate solution – Activity-based Costing (ABC). ABC allocates overhead costs based on the amount of activity required to produce the product or service. Through the use of such techniques accountants can better position their clients to maximise wealth.

Businesses can now assess their core competencies and create competitive advantages. These value adding techniques are only a few of many available, and are necessities to obtaining success in a highly competitive world.

By Adam Jacobson

Contacts us for a complimentary review of your current business structure

11
Jan

Why Aged Care Matters & What You Need To Know!

What You Need To Consider When It Comes To Aged Care!

Aged care is a complex area that often requires careful consideration and advice from a suitably qualified expert with relevant skills and knowledge.

Whether you are considering aged care for yourself or for someone else your trusted advisor can provide you with some basic understanding when it comes to making an informed decision.

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13
Dec

Check The Temperature Of Your Business Accounts!

Call The Dr Now! 7 Crucial Steps To Your Business Accounts Health Check!

Are you feeling unwell? (cough, cough) How do you know when to visit the doctor? How do you know when your business accounts aren’t feeling well?

Then it is time to discuss the 7 crucial processes to review your business accounts for any hidden issues.

1. Bank Accounts

It is important to reconcile your business bank accounts regularly. Reconciling your business accounts regularly avoids any documents being misplaced before reconciling and it also detects potentially fraudulent entries early. Whilst your bank account now reconciles to your statement ensuring you review the un-presented items on your bank reconciliation report and you can also investigate any long outstanding transactions or unusual items that you know have occurred. Keeping in mind that these transactions may be duplicates.

2. Creditors

Always remember to review the creditor’s detailed report and if an invoice appears that you’ve already paid, then it is possible that the payment may have been allocated incorrectly and require appropriate action or the invoice could possibly be a duplicate.

Also, ensure that you have not forgotten to pay a supplier. Whilst these things can happen and a supplier might not have contacted you for the payment it doesn’t mean they’re not grumbling about it.

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5
Dec

When & Why You Need To Review Your Personal Insurance!

4 Reasons Why You Need To Review Personal Insurance

As accountants, we come across many instances where clients either do not have any personal insurance cover at all or insufficient cover to meet their needs in the event of serious injury or illness.

Most people don’t think twice about whether to insure their car or their home, but often don’t consider the importance of life insurance. Personal Insurance cover will enable you and your family to maintain the same standard of living by providing payments to cover any outstanding debts and everyday expenses.

By making sure you have the right cover and with the right terms is crucial. We recommend reviewing your policies on a regular basis.

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30
Nov

Key Performance Indicators For Business Success

4 Steps To Building Key Performance Indicators!

Key Performance Indicators (KPI’s) are measures that a business uses to track performance and measure outcomes.

A Key Performance Indicators quantifies how successful an organisation is in achieving its objectives. No two organisations would utilise the exact same set of KPI’s to assess performance, even if they are direct competitors in the same industry.

Factors To Determine Prior To Developing Your KPI’s

Prior to developing a Key Performance Indicators, there are a number of factors that need to be taken into account. These include understanding what is being measured, and ensuring that what is being measured is useful and quantifiable in terms of determining whether an objective has been achieved.

The trouble is that there are thousands of KPI’s to choose from and companies often struggle to select the right ones for their business. The wrong KPI’s bring the danger of pointing people in the wrong direction and even encouraging them to deliver the wrong things.

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7
Nov

How Will Budget Changes For Rental Properties Affect Me?

Budget Changes For Rental Properties! How does it affect me?

In the May Budget, the government introduced some changes in an attempt to reduce the pressure on housing affordability. Here is what you need to know about how these changes will affect you?

Travel Expenses

For a long time now deducting travel expenses for traveling to a property you own for rental purposes was the norm, whether it be in your state or interstate.

As per the 2017/18 budget, the government intends to disallow all travel expenses relating to inspecting, maintaining, or collecting rent for a residential investment property from 1 July 2017.

So, what does that mean for every couple or individual who may own a residential property in their personal name(s)? From the 1 July 2017 you will not be able to claim expenditure from traveling by car, plane or any other way to your residential rental property as a tax deduction against rental income. Furthermore, as per current legislation, the expenditure cannot be added to the cost base of your rental property for capital gains purposes. Read more

2
Nov

What Is The Real Value Of Your Business

How Much Is Your Business Really Worth?

Most business owners invest a lot of time, effort and money into their commercial babies. Hoping that years, and in some cases decades, of hard work will mean that one day they will be able to sell and enjoy a comfortable retirement.

Unfortunately, there is a common misconception among business owners about the dollar value of their business. This stems from the unquantifiable emotional investment that is rarely reflected in the ventures dollar value.

Read More, for 3 main drivers and other factors that impact the value of an enterprise!

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26
Oct

Save Time And Move To The Cloud Now

Move To The Cloud It’s The Right Choice!

First of all, Aston Martin are designing a personal submarine, Elon Musk is touting the use of the BFR to reduce intercontinental flights to 30 minutes and we live in a world where you turn on your home lights and heating with the use of your smartphone! So moving your business to the cloud is absolutely the right choice!

We live in an ever-changing world of technology and it seems like we are always eager to be hooked on the next new gadget and smart device apps!

At AS Partners we have noticed that technology has advanced further in the last five years, then in the twenty years before that and furthermore, we have advised and supported numerous businesses when it comes to moving into the cloud. As a result, these business clients with annual revenues of up to $15M have experienced strategic advantages! Read on for the top 4 reasons why you should move your business to the cloud too!

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23
Oct

Learn More On How to Boost Your Business Cash Flow

6 Steps To Improve Business Cash Flow

Cash flow is an important aspect of every business. So it is important to know that bad cash flow management can lead to businesses going belly up. But it is not only businesses on struggle street that can have cash flow problems. In fact, quite often it is that growing business’s when moving into their next growth spurt that often experience cash flow problems. So, if you want to boost and improve your business cash flow then check out these 6 steps that will surely get you on your way!!

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