Cashflow vs profit: what’s the difference and why does it matter?

Understanding cashflow is an important part of understanding how your business is performing.

Having enough cash available means you can meet your commitments when they fall due, including wages, supplier payments, GST, PAYG withholding, super, loan repayments and other operating costs. A business can be performing well and still find itself short of cash if the timing of money coming in does not match the timing of payments going out.

That is why cashflow forecasting is useful.

A cashflow forecast estimates the money you expect to receive and pay over a future period. It can help you identify potential shortages or periods where more cash may be available, giving you time to plan before payments fall due.

A useful forecast should draw on accurate, current bookkeeping information, including sales, customer invoices, supplier bills, payroll commitments, tax payments, loan repayments and regular business expenses. It should also take into account what you already know about the months ahead, such as seasonal changes, planned purchases, expected changes in sales and unusual expenses.

This is where keeping your books current becomes particularly important. If invoices have not been entered, bank transactions have not been reconciled or bills are missing, the information you are using to plan cashflow may not reflect what is actually happening in the business.

First Class Accounts Ovens & Murray can help keep that information current and accurate, so you have a better view of what is coming in, what needs to go out and when.

Cashflow vs profit: what’s the difference?

Having positive cashflow is different from making a profit.

Cashflow tracks the movement of money into and out of your business. Positive cashflow means more cash has come into the business than has gone out during the period you are looking at.

Profit shows whether the business has earned more revenue than the expenses associated with operating it over a particular period.

Timing is one of the main reasons profit and cashflow can look very different.

You may raise an invoice this month and record the sale, but the customer might not pay for another 30 days. In the meantime, you may already have paid wages, supplier bills, rent and other costs associated with running the business.

The opposite can happen as well. You may receive a large customer payment this week, making the bank balance look healthy, while several supplier bills, payroll, GST or super payments are due shortly afterwards.

This is why looking at your sales, profit or bank balance on their own can give you an incomplete picture.

Good bookkeeping helps connect those pieces. When invoices, bills, payroll and bank transactions are recorded properly and kept up to date, it is much easier to understand why the cash sitting in the bank looks different from the profit the business is showing.

A simple cashflow vs profit example

If you sell $1,000 of goods during the month and the expenses associated with those sales are $500, the simplified result is a $500 profit.

Now look at the timing of the cash.

If you have already paid the $500 to your suppliers during the month, but your customer has not yet paid the $1,000 they owe you, those transactions have created a $500 cash outflow during that month.

The business can therefore show a $500 profit from those transactions while the cash movement for the same period is negative $500.

When the customer pays the $1,000 the following month, the cash position changes again.

This is a simple example, but it shows why looking only at sales or profit can make it difficult to understand why the amount sitting in the bank looks different.

For a service business, the same issue can occur when work is invoiced this month but payment terms mean the cash will not arrive for another 14, 30 or 60 days. Payroll, software subscriptions, rent and supplier bills still need to be paid while the business waits for that money to arrive.

Why it’s important to understand both

Understanding the difference between cashflow and profit helps explain why a business can be making money and still have difficulty meeting upcoming payments.

Your bank balance is useful, but it does not show everything that still needs to be paid.

There may be $50,000 sitting in the business bank account today, but some of that money may already be needed for GST, PAYG withholding, wages, super, supplier invoices, loan repayments or other bills.

This is where accurate bookkeeping becomes important.

If customer invoices are up to date, you can see what money is still owing to the business. If supplier bills are entered correctly, you have a better view of what needs to be paid. If payroll, GST, PAYG withholding and super are current, you can see the commitments that will affect cash in the weeks ahead.

Bank reconciliations also matter. Keeping them current helps make sure the transactions in your bookkeeping system match what has actually happened in your bank accounts, which gives you a more reliable base for cashflow planning.

Payroll needs particular attention in 2026. Since 1 July 2026, Payday Super means super is paid more frequently, with contributions generally required to reach an employee’s super fund within seven business days of payday. That means super needs to be factored into cashflow more regularly than under the previous quarterly payment cycle.

When your bookkeeping is current, these payments are easier to see before they fall due.

If your business appears profitable but the available cash does not seem to reflect it, First Class Accounts Ovens & Murray can help you look at what is outstanding, what is coming up and whether your bookkeeping is giving you the information you need.

Using cashflow forecasting to plan ahead

Cashflow forecasting helps you look beyond the amount currently sitting in the bank.

A forecast maps expected money coming in against the payments you know are coming out. This may include customer receipts, payroll, super, supplier bills, BAS payments, loan repayments, rent and other operating costs.

It also allows you to include what you already know about the business.

You may know that sales are usually lower at a particular time of year, that an annual insurance bill is due next month, that a large supplier payment is coming up or that some customers regularly take longer to pay than their invoice terms suggest.

The more current your bookkeeping is, the easier it is to include these commitments accurately.

Forecasting software can also help, including tools such as Futrli. Like any business app, its usefulness depends on the quality of the information going into it.

If invoices, supplier bills, payroll information or bank transactions are missing or out of date, the forecast can quickly become less useful.

This is also where the right business apps and processes can make a difference. When your accounting software, payroll system and other business tools are set up properly and working together, there is less double handling and it becomes easier to keep your records current.

First Class Accounts Ovens & Murray can help keep your bookkeeping up to date, review the information you are using for cashflow planning and identify where your systems or processes could be working better.

If you want to understand where your cash is going, what payments are coming up or why the cash in the bank does not seem to match the way the business is performing, get in touch.

Frequently asked questions about cashflow vs profit

What is the difference between cashflow and profit?

Profit shows whether your business earned more revenue than it spent over a particular period. cashflow shows when money actually comes into and leaves the business. Because customers may pay after you have already paid wages, suppliers and other expenses, a business can make a profit and still experience cashflow pressure.

Can a profitable business have cashflow problems?

Yes. A business can be profitable while still being short of cash if customers have not yet paid, supplier bills are due or payments such as payroll, super, GST, PAYG withholding and loan repayments need to be made before enough money has come in.

How can bookkeeping help with cashflow forecasting?

Current bookkeeping helps you see what customers owe you, what supplier bills need to be paid, what payroll commitments are coming up and what other payments are due. Keeping this information accurate and up to date gives you a much better base for planning cashflow. First Class Accounts Ovens & Murray can help make sure your bookkeeping provides the information you need to do that.

Using business technology to improve your business systems

The decisions you make in your business are only as good as the data you use to make them. The more accurate and up to date your data is, the better informed those decisions can be. Using the right technology can give you access to current financial and operational information, making it easier to understand what is happening in the business and respond sooner.

Processes and systems drive your business, so it’s worth reviewing whether they’re documented, current and still working the way you need them to. Some processes may still be followed simply because they’ve always been done that way. Others may have changed over time while the written procedure, app setup or approval process has stayed the same.

Business technology now covers far more than accounting software. Payroll, expense capture, approvals, inventory, job management, customer systems and team communication can all form part of the way your business operates. When the right apps are connected properly, information can move between systems with less manual entry and fewer opportunities for mistakes.

This is where the setup matters. Adding another app doesn’t automatically improve a process. The app needs to suit the way your business works, connect with the systems you already use and give the right people access to the information they need.

First Class Accounts Ovens & Murray works with business owners to review business apps, identify unnecessary manual work and duplicate data entry, and help set up systems that support accurate bookkeeping, reliable payroll and useful business information.

Ten ways technology can improve your business

Using technology well can help you to:

1. Make your business data accessible from the cloud

Cloud accounting gives authorised users access to current financial information from wherever they’re working. This can make it easier to check bank balances, outstanding invoices, bills, payroll information and reports without waiting for files to be sent or manually updated.

Examples include Xero, MYOB Business and QuickBooks Online.

Access to current data also supports better cash flow management. When your bookkeeping is up to date, you have a better view of what is due to come in, what needs to be paid and where cash may be under pressure.

2. Reduce manual work and repetitive tasks

Repetitive administration can take up a surprising amount of time. Workflow tools can help assign tasks, track progress, create recurring processes and automate routine steps. Approval apps can also reduce manual follow up by giving businesses a set process for reviewing and approving bills or purchases.

Examples include Asana for task workflows and ApprovalMax for financial approval workflows.

The aim is to remove unnecessary steps while keeping the controls your business needs. Before automating a process, it’s worth checking that the process itself still makes sense.

3. Capture receipts and expenses more efficiently

Taking a photo of a receipt or forwarding an invoice to an expense capture app can reduce manual data entry and help keep source documents connected to the relevant transaction.

Dext can capture information from receipts, bills and invoices and send that information through to compatible accounting software.

Reducing manual entry can save time for the business and your bookkeeper while giving you better records to support reconciliations, BAS preparation and reporting.

4. Connect your apps to reduce double handling

When systems are disconnected, the same information may be entered more than once. Integrating compatible apps can allow data to move between your accounting software and other systems such as inventory, payroll, point of sale, job management or expense capture.

The Xero App Store includes apps covering areas such as inventory, reporting, payroll, time tracking, ecommerce and bills, giving businesses the option to connect software that suits the way they operate.

The value comes from choosing integrations that suit your actual process. First Class Accounts Ovens & Murray can help review how your current apps work together and where a better connection could reduce administration or improve the quality of your bookkeeping data.

5. Collaborate with your team across different locations

Shared communication and document tools make it easier for teams to work from the same information, whether they’re in the same office or spread across different locations. They can also reduce long email chains and help keep project conversations, files and decisions together.

The important part is deciding where information should live and how each system should be used. Adding more communication channels without agreed processes can simply move the administration somewhere else.

6. Use online meetings when they make practical sense

Online meetings are useful for working with advisers, suppliers, clients and team members when meeting in person would add unnecessary travel or delay. They can also make regular check-ins easier to schedule when people are working from different locations.

They are now a normal part of business operations and can be particularly useful when a business works across multiple locations or needs regular contact with external advisers.

7. Improve employee onboarding and payroll information

Digital onboarding can help collect employee details, bank information, tax information, super details and employment documents in a more structured way. When the information flowing into payroll is complete and accurate, there is less risk of having to correct details later.

Payroll technology has become even more important in 2026. Since 1 July 2026, Payday Super requires employers to pay super with each pay cycle, with contributions generally needing to reach an employee’s super fund within seven business days of payday.

Your payroll system, onboarding process and bookkeeping records therefore need to work together so employees are paid correctly, super is processed within the required timeframe and business records remain current.

First Class Accounts Ovens & Murray can also help businesses review payroll processes and the systems supporting them, particularly where information is being transferred manually between different platforms.

8. Monitor inventory and the cash tied up in stock

Inventory software can show what is in stock, what has been committed, what is on order and where stock is located. Better inventory information can help a business make more informed purchasing decisions and reduce the amount of cash sitting in stock that is moving slowly.

For businesses carrying inventory, this information also affects bookkeeping and reporting. Connecting inventory systems with accounting software can reduce rekeying and help keep sales, purchases and stock values aligned.

This creates an important link between business technology and cash flow. Accurate inventory information can help you understand where money is tied up and make purchasing decisions using current data.

9. Keep useful customer information in one system

Point of sale and customer management systems can store purchase history, contact details and other information that helps staff provide a more consistent customer experience. They can also connect sales activity with inventory and accounting systems, giving the business a more complete view of what is happening.

Depending on the business, a point of sale or customer system may also feed sales, payments, inventory and other information into accounting software, reducing the amount of information that needs to be entered separately.

10. Build systems that can support business growth

As a business grows, the volume of transactions, payroll, customers, suppliers and internal tasks usually grows with it. Documented processes and well connected systems can make it easier to handle that extra activity without relying on one person to remember each step.

Technology should support the process you want the business to follow. The right setup may include accounting software, payroll, expense capture, approvals, inventory, job management or other industry specific apps, depending on how the business operates.

First Class Accounts Ovens & Murray can help assess the apps you’re using, identify where processes can be improved and support the setup and integration of tools that suit your business.

Make your technology work with your business

Using technology well can improve how your business operates, from the accuracy of your bookkeeping data to the way payroll, expenses, approvals, inventory and reporting are handled. The harder part is often choosing which systems are worth using, deciding how they should connect and making sure the setup matches the way your business actually works.

It’s also worth reviewing your technology regularly. Businesses change, staff responsibilities change and software features change. An app that suited the business two years ago may still be the right choice, although the way it’s configured or used may need attention.

If you’re spending too much time entering the same information twice, chasing approvals, fixing data problems or working around systems that no longer suit the business, First Class Accounts Ovens & Murray can help review your current setup and identify practical improvements.

Talk to First Class Accounts Ovens & Murray about the business apps, bookkeeping systems and processes you’re using, and where technology could save time, reduce errors and give you more useful information.

Frequently asked questions

What business technology should a small business use?

The right technology depends on how the business operates. A useful starting point is accounting software, then adding apps for areas such as expense capture, payroll, approvals, inventory, job management or point of sale where they solve a specific process problem. The systems should suit the business and connect properly wherever possible.

How can business apps improve bookkeeping?

Connected business apps can reduce duplicate data entry and move information from operational systems into accounting software more efficiently. This can improve the quality and timeliness of bookkeeping data, provided the integrations are set up correctly and the information is reviewed regularly.

Can a bookkeeper help choose and set up business apps?

Yes. A bookkeeper who understands your day to day processes can help identify where an app may save time, reduce manual work or improve the flow of information into your accounting system. First Class Accounts Ovens & Murray provides business app advisory, setup, integration and support alongside bookkeeping and payroll services.

10 business improvement strategies to build a better business

What are you doing to build a better business?

Running a business takes commitment, and being good at what you do is only part of it. You might be excellent at your trade, profession or service, while running the business around that expertise requires a completely different set of skills.

Building a better business usually comes from making practical improvements over time. You need to know what you want to achieve, understand where the business is now, have reliable information available and make sure your systems support the way you want to operate.

Your bookkeeping plays an important part in this. Current, accurate records help you understand what is coming in, what is going out, what needs to be paid and what your numbers are showing you.

When that information is supported by efficient processes and suitable business apps, you have a stronger base for deciding what needs attention and where improvements could be made.

Keep developing the way you run the business 

You are likely an expert in what you do. That does not automatically make you an expert in payroll, cash flow, bookkeeping systems, business apps, people management or the other areas involved in running a business.

Taking time to work on those areas matters.

Think about where your time is being spent and where problems regularly occur. You may be entering the same information into several systems, spending too long preparing payroll information, waiting for approvals before invoices can be paid, or relying on manual processes that were suitable when the business was smaller.

Learning where the business could work better is part of running it well.

Sometimes the answer is a better process. Sometimes an existing app needs to be set up differently. In other cases, the business may have outgrown the software it currently uses.

First Class Accounts Ovens & Murray can help review how your bookkeeping and business apps work together, identify unnecessary manual processes and help implement systems that better suit the way your business operates. This fits directly with its focus on improving processes and helping businesses choose and use technology that suits their workflow.

So, what can you do to build a better business?

These ten steps give you practical areas to review in your business and identify where improvements could be made.

1. Get specific about what you want

Understanding what you want from the business gives you something meaningful to work towards.

Your goals might include increasing revenue, improving profit, strengthening cash flow, employing another person, reducing the amount of administration you personally handle or creating more time for family and life outside the business.

Make those goals specific enough that you can measure whether things are changing.

If you want to increase revenue, determine what increase you are aiming for and over what period. If cash flow is the issue, identify what needs to improve. You might need customers to pay sooner, invoices to be raised more quickly, supplier payments to be planned differently or upcoming tax and super commitments to be allowed for earlier.

Your bookkeeping needs to support those goals. Reliable financial information gives you a starting point, allows you to measure progress and helps you see when actual results differ from what you expected.

2. Be open to changing the way things are done

Businesses change, and the systems that worked when you started may become less suitable as your team, customer base and workload grow.

Review how work actually moves through the business.

Look at where information is entered more than once, where staff are relying on spreadsheets to make different systems work together, where approvals regularly cause delays and where manual administration is taking more time than it should.

Business apps can improve these processes when they are chosen and implemented properly. The right solution depends on your industry, workflow, existing software and what you are trying to fix.

Adding more software without first understanding the problem can create another layer of work.

First Class Accounts Ovens & Murray provides business app advice based on how a business actually operates. This can include reviewing existing apps, identifying suitable alternatives, integrating systems and helping your team understand how to use them properly.

If a process in your business seems to take far longer than it should, it is worth looking at the process before accepting that this is simply how the task has to be done.

3. Define where the business is now

Before deciding what needs to improve, establish where the business is now.

A SWOT analysis can still be useful for looking at strengths, weaknesses, opportunities and threats, although your financial information should form part of the assessment as well.

Look at revenue, expenses, profit, cash available, outstanding customer invoices and upcoming supplier payments. Include payroll, super and tax commitments so you have a realistic picture of what the business needs to fund.

This is also a good point to ask whether your bookkeeping is current enough to give you information you can use.

Profit alone does not tell you whether there is enough money available to meet upcoming payments. A business can be profitable while experiencing cash flow pressure because of the timing between money coming in and payments going out.

Accurate bookkeeping helps you see those timing issues. It also gives you and your accountant better information to work with when reviewing performance, planning ahead or making decisions about the business.

4. Make a practical plan

Once you know what you want and where the business currently stands, decide what needs to happen next.

Your plan needs to identify what you are trying to achieve, the actions required, who is responsible and how you will measure progress.

Financial planning needs to sit alongside the operational plan.

A budget helps establish how you intend to use the money available to the business. Forecasting helps you look ahead using current information and what you know about future activity. Cash flow forecasting helps you understand when money is expected to arrive and when payments are due.

This becomes particularly useful when planning payroll, supplier payments, tax obligations, equipment purchases or periods where income regularly changes.

The quality of that planning depends on the quality of the information underneath it. If transactions have not been reconciled, expenses are incorrectly coded or outstanding invoices are not being monitored, the numbers you are using may give you an incomplete picture.

Keeping the books current means your plans can be compared with what is actually happening.

5. Get your roles, responsibilities and processes right

People need to understand what they are responsible for and how their work connects with the rest of the business.

This includes financial administration.

Someone needs to be responsible for invoicing, approving purchases, providing payroll information, following up outstanding accounts and making sure records reach the right person when they are needed.

Documenting these processes reduces reliance on knowledge held by one person. It also helps identify where responsibilities overlap or where an important task has no clear owner.

Payroll deserves particular attention.

Since 1 July 2026, employers generally need super guarantee contributions to reach an employee's super fund within seven business days of payday, with extended timeframes applying in some circumstances. This means payroll information, software and processes need to support faster identification and correction of errors.

First Class Accounts Ovens & Murray provides payroll support as part of its bookkeeping services, helping businesses manage payroll and super accurately and on time. Its 100 per cent contract service model also means agreed work is covered without relying on one individual being available

6. Be a better leader

Good leadership includes giving people the information, systems and support they need to do their jobs properly.

Make responsibilities clear, communicate expectations and look at whether the processes around your team are helping or hindering them.

Paying employees accurately and on time is one practical example. Providing systems that reduce unnecessary administration is another.

Leadership also means recognising where your own time is best spent.

Doing everything yourself can become expensive when your time is being taken away from customers, employees, business development or the work only you can do.

The right person doing the right job generally gives the business a better result. That may mean delegating internally, working with an external specialist or using technology to remove administration that no longer needs to be completed manually.

7. Have someone independent keep you accountable

Work inside the business can easily take priority over improvements you intended to make to the business.

Having someone independent involved can help keep those actions moving.

Depending on what you are working on, that person might be a mentor, business adviser, accountant, bookkeeper or another experienced business owner.

Different advisers also have different roles.

Your accountant may be helping with tax planning, business structure and broader financial matters. Your bookkeeper is working much closer to the daily financial information that feeds into those conversations.

When the bookkeeping is current and accurate, your accountant has better information available and you have a better understanding of what has been happening between meetings.

First Class Accounts Ovens & Murray can help you understand what your bookkeeping reports are showing, identify information that needs attention and make sure your accountant receives accurate records when they need them. Supporting business owners to understand their numbers and work effectively with their accountant is one of its core content areas.

8. Build useful business relationships

Strong business relationships give you access to experience, specialist knowledge, referrals and people you can turn to when you need another perspective.

Build relationships with people in your industry, other business owners and the advisers who support your business.

Your bookkeeper, accountant, insurance adviser, solicitor and other specialists each bring different knowledge. Having these relationships established before you need help can make it easier to deal with an issue when it arises.

Community involvement can also be part of building those relationships. Contributing your knowledge, time or support to organisations you care about connects you with people outside your immediate business circle and keeps your business connected to the community around it.

Useful networks develop over time. Focus on genuine relationships where people know what you do, understand your business and are willing to share knowledge and experience.

9. Monitor what is actually happening

Setting goals has limited value if you do not check what happens afterwards.

Choose measures that tell you something useful about your business.

Revenue may be important, although looking at revenue by itself can hide changes in margins, expenses or cash flow. Depending on the business, you might also track gross profit, expenses, cash available, outstanding invoices, debtor days, payroll costs, job profitability or performance against budget.

Regular bookkeeping makes this possible.

When bank accounts are reconciled, transactions are coded correctly and outstanding invoices are being monitored, you can review current information instead of waiting until months later to see what changed.

This also makes conversations with your accountant more useful because both of you are working from reliable figures.

First Class Accounts Ovens & Murray provides regular bookkeeping and reporting support so business owners can see what their numbers are showing and identify areas that may need further investigation. Reliable bookkeeping, reconciliations and end of month reporting are central to this service.

10. Make sure the business leaves room for life outside it

One of the reasons people start a business is often to have more control over how they work and what the business allows them to do outside work.

It is worth checking whether that is still happening.

If evenings and weekends are regularly spent catching up on administration, fixing payroll problems, chasing information or manually transferring data between systems, there may be a process that needs attention.

Look at what genuinely requires your involvement and what could be handled more efficiently by another person or through a better system.

Your time outside the business matters as well. Family, community commitments and personal interests should not continually be pushed aside because administration is taking longer than it should.

Getting the right people, processes and systems in place can help the business operate more efficiently while giving you more control over where your own time goes.

Keep improving how the business works

Building a better business is an ongoing process. Goals change, teams grow, technology changes and processes that once worked well may eventually need another look.

The important part is having reliable information and systems that help you see what is happening.

Accurate bookkeeping gives you current financial data. Cash flow forecasting helps you plan upcoming commitments. Reliable payroll processes help make sure your employees and their super are paid correctly and on time. Suitable business apps can reduce unnecessary administration and improve how information moves through the business.

These areas work together. When the underlying information is accurate and the processes around it are efficient, you are in a better position to decide what should happen next.

First Class Accounts Ovens & Murray works with business owners across bookkeeping, payroll, reporting and business app advice, helping make sure the information and systems behind the business are working as they should.

If your bookkeeping, payroll, reporting or business systems are taking more time than they should, contact First Class Accounts Ovens & Murray to talk about where the problems are occurring and what could work better.

Frequently asked questions

How can I improve the way my business operates?

Start by identifying where time, money or information is being lost. Review your financial data, cash flow, responsibilities, processes and business apps, then identify specific improvements you can measure. Working on one problem at a time also makes it easier to see whether the change is producing the result you expected.

Why is bookkeeping important when building a better business?

Accurate bookkeeping gives you current information about revenue, expenses, cash flow, outstanding invoices and upcoming commitments. This information helps you measure performance, prepare forecasts, work effectively with your accountant and make informed decisions about what needs attention.

How can business apps improve business processes?

Suitable business apps can reduce manual data entry, improve workflows and help information move between different parts of your business. The app needs to suit your industry, work with your existing systems and solve a specific problem. First Class Accounts Ovens & Murray can help review, select, implement and integrate business apps so they support the way your business actually works.

How to set sales targets using accurate bookkeeping data

Setting sales targets gives your business something measurable to work towards. It can help you plan sales activity and give you a benchmark against which actual results can be reviewed.

The quality of the information you use to set those targets matters.

If your bookkeeping is current, you can see what the business has actually sold, when sales occurred, which periods were stronger or quieter and how much money is still owing from customers.

This gives you a more reliable starting point than choosing a percentage increase from last year and hoping the numbers work.

Regular bookkeeping and reporting also mean you can review your actual sales against your targets throughout the year rather than waiting until much later to discover the result was different from what you expected.

Review your sales targets as your business changes

Sales targets may need to change as the business changes.

Your sales can be affected by seasonal demand, customer changes, staffing levels, pricing changes or simply a stronger or quieter period than expected.

This is where current bookkeeping becomes useful.

Rather than relying on what you think has happened, your accounting records can show actual sales for the period and how they compare with previous months or years.

Regular reporting gives you the opportunity to compare those results against your sales targets and identify differences earlier. You can then decide whether the target still makes sense or whether there are other areas of the business that need further investigation.

First Class Accounts Ovens & Murray helps keep this information current so you are reviewing actual business numbers rather than working from incomplete records.

Understand the numbers behind your sales

Before setting a sales target, it helps to understand what has already been happening in the business.

Your bookkeeping records can show previous sales, monthly or seasonal patterns, outstanding customer invoices and changes in revenue over time.

Depending on your accounting system and the information being recorded, you may also be able to review sales by customer, product, service or another category that is useful to your business.

This information gives you a factual starting point for setting future targets.

It also gives your accountant, business adviser or internal management team better information to work with when broader planning decisions need to be made.

The role of First Class Accounts Ovens & Murray is to make sure the underlying bookkeeping is accurate, current and structured in a way that gives you useful information from your accounts.

Important steps for setting sales targets

Sales targets are more useful when the information behind them is reliable.

Before setting or reviewing your targets, make sure your bookkeeping is current, bank accounts are reconciled and sales have been recorded correctly.

You can then use that information to look at previous performance and compare future targets against actual results.

Understand what your sales numbers are showing you

Turnover is one of the figures you may use when setting sales targets, but it should be viewed alongside the rest of your financial information.

Current bookkeeping allows you to see the sales that have been recorded for a particular month, quarter or year and compare them with previous periods.

Your profit and loss report can then provide additional information about income and expenses for the same period.

First Class Accounts Ovens & Murray can make sure transactions are recorded correctly and reports are kept current so you have accurate information available when reviewing sales performance.

Where more detailed advice is required around profit targets, margins, pricing or broader financial strategy, those current records also give your accountant reliable figures to work from.

Make your targets SMART

Sales targets should be SMART: Specific, Measurable, Achievable, Relevant and Time bound.

Once a target has been set, your bookkeeping and reporting can help you measure progress against it.

Rather than waiting until the end of the financial year, you may choose to review sales monthly or quarterly depending on how your business operates.

For example, if you have set a monthly sales target, regular reporting can show the sales recorded for that month and how the result compares with your target.

The important part from a bookkeeping perspective is having current records available when you need them.

If several months of transactions are still waiting to be entered or reconciled, it becomes much harder to know whether the business is tracking as expected.

Track the sales information available in your systems

Your accounting records can provide more information than a single total sales figure.

Depending on the way your accounting system has been set up, you may be able to review sales by customer, service, product, location or another category relevant to your business.

You can also review outstanding invoices and customer payment patterns.

This information can help you understand where recorded revenue is coming from and whether customers are paying within expected timeframes.

Good system setup matters here. First Class Accounts Ovens & Murray works with accounting platforms and connected business apps, helping businesses establish processes that reduce duplicated work and improve the quality of the information being recorded.

When systems are connected properly, it becomes easier to access useful information without manually piecing it together from different places.

Use historical information when forecasting sales

Previous sales data can provide a useful starting point when preparing a sales forecast.

Current bookkeeping allows you to compare sales across different periods and identify patterns that may be relevant when looking ahead.

You might compare this month with the same month last year, review quarterly results or look at how sales changed during particular seasonal periods.

The figures can then be used as part of your forecasting process alongside other information you know about the business.

First Class Accounts Ovens & Murray can help make sure the historical information you are using is complete and current. If the bookkeeping is behind or transactions have been recorded inconsistently, your historical comparisons may be less useful.

Fill the gaps in your financial information

Before relying on your sales figures, check that the underlying bookkeeping is complete.

Are all sales entered? Have bank accounts been reconciled? Are customer payments allocated correctly? Are outstanding invoices genuinely still outstanding?

Small gaps in the records can change what your reports are telling you.

For example, an invoice may appear overdue because a payment has not yet been allocated correctly. Sales may appear lower because transactions are still waiting to be entered.

Keeping the accounts current helps reduce these gaps and gives you better information when reviewing your sales targets.

This is a core part of reliable bookkeeping. First Class Accounts Ovens & Murray keeps the day to day financial records up to date so business owners do not have to spend time trying to work out whether the figures in front of them are complete.

Connect sales targets to cashflow

Reaching a sales target does not necessarily mean the same amount of money has arrived in your bank account.

If customers are invoiced on payment terms, there can be a delay between recording the sale and receiving the money.

Your bookkeeping records can help you see both sides of this.

Sales reports show the revenue being recorded, while your accounts receivable information shows what customers still owe and when those invoices are due.

At the same time, payroll, super, suppliers, GST, PAYG and other commitments continue to fall due.

This is why sales information and cashflow should be reviewed together.

First Class Accounts Ovens & Murray helps maintain accurate debtor records, payment information and bookkeeping reports so you have a better picture of what has been sold, what has been paid and what is still outstanding.

Review targets using current bookkeeping data

Sales targets become much easier to monitor when your bookkeeping is up to date.

You can compare current sales against previous periods, review outstanding invoices and access reports without first having to catch up months of transactions.

This also means information is available when you need to speak with your accountant, review your budget or make other business decisions.

Reliable bookkeeping is the foundation underneath that reporting.

With First Class Accounts Ovens & Murray managing the day to day bookkeeping, reconciliations and reporting, you have current financial information available throughout the year rather than having to reconstruct it later.

Keep the numbers behind your sales targets current

You can set the sales target yourself. The important part is having accurate information available to measure what actually happens.

First Class Accounts Ovens & Murray can help keep your bookkeeping current, reconcile your accounts, maintain debtor information and provide regular reporting so you can see how sales are tracking over time.

If your financial records are behind or your reports are difficult to rely on, talk to us about improving the bookkeeping and reporting behind your sales targets.

Frequently asked questions

How can a bookkeeper help with sales targets?

A bookkeeper can make sure the financial information used to review sales targets is current and accurate. This includes recording sales, reconciling accounts, maintaining debtor information and producing regular reports that show actual business performance.

What bookkeeping reports are useful when reviewing sales targets?

Sales reports, profit and loss reports and accounts receivable reports can all provide useful information. The reports that matter most will depend on how your business operates and what information is being recorded in your accounting system.

Why should sales targets be reviewed alongside cashflow?

A sale may be recorded before the customer actually pays. Reviewing sales alongside accounts receivable and cashflow information helps you see how much has been sold, how much money has been received and what is still outstanding.

Why accurate financial data matters for your business

Cloud accounting software such as Xero has reduced much of the manual work involved in bookkeeping. Bank feeds can bring transactions directly into the accounting system, software can suggest matches during reconciliation, and digital document capture can reduce the amount of information that needs to be typed in manually.

That makes it easier to keep business records current, but there is still one point of weakness: the quality of the data going into the system.

Some information still needs to be entered, coded, checked or approved by a person. Even when information moves automatically between systems, it still needs to be allocated correctly. A supplier bill can be captured automatically and still be coded to the wrong account. A bank transaction can be imported correctly but remain unreconciled. An invoice can exist in the system but have the wrong due date.

If information is missing, incorrect or out of date, the reports produced from it will reflect those problems.

This is why accurate financial data starts with reliable bookkeeping. Software can make the process faster and reduce repetitive work, but the records still need to be reviewed and maintained properly.

Accurate data supports better business decisions

When you are making decisions about the future of your business, you need the full financial picture. That means working with records that are current, complete and accurate.

Forecasts are a good example. A cashflow forecast is only useful when the information behind it reflects what is actually happening in the business.

If supplier bills have not been entered, the forecast may overstate the cash you have available. If invoices are raised late, expected cash coming into the business may be missing. If payroll liabilities, leave, super or tax obligations are incomplete, future outgoings can be understated. Even a group of small coding errors can change the way expenses, margins or particular parts of the business appear in a report.

Accurate forecasts can help you plan payment dates, prepare for quieter periods, decide when the business can afford new equipment or additional staff, and make sure there is enough cash available for wages, suppliers and ATO obligations.

It is also important to understand that profit and cashflow tell you different things. Your profit and loss report may show a healthy result while cash is tied up in unpaid invoices, stock or upcoming commitments. Current bookkeeping data helps you see those issues earlier and respond while there are still options available.

Businesses that make decisions using incomplete or outdated information can find themselves dealing with a cash shortage that was visible in the numbers earlier, but was hidden by missing or inaccurate data.

There is a direct relationship between accurate, current financial data and better business decisions. Reliable bookkeeping gives you numbers you can use, rather than figures that need to be questioned or corrected before they become useful.

Use automation to improve data accuracy

One way to improve data accuracy is to automate appropriate parts of the bookkeeping process. The aim is to reduce repeated manual entry, move information between systems more efficiently and make it easier to keep records current.

Xero is one example. Bank feeds can bring transaction data directly into the accounting system, while reconciliation tools can help match transactions against the records already entered. Connected apps can then extend that process into areas such as document capture, approvals, job management, inventory, payments and forecasting.

Dext Prepare can capture information from receipts and invoices and send that data through to accounting software such as Xero. This reduces manual entry and keeps the source document with the transaction for future reference.

You can photograph or upload receipts and invoices rather than relying on a paper filing system. In many cases, original paper receipts do not need to be retained when the electronic copy is a true and clear reproduction and satisfies the relevant ATO record keeping requirements. Business records still need to be stored for the required period and remain accessible if they are needed later.

For forecasting and reporting, Futrli remains available and can connect with accounting platforms including Xero. It can use accounting data to support cashflow forecasts, budgets, scenario planning and financial reporting.

The important part is how these tools work together. Adding apps without reviewing the underlying process can create duplicated work, inconsistent information or gaps between systems. The right setup should reduce manual handling, give your bookkeeper the information they need and make the data in your accounting system more reliable.

This is where business app advisory becomes useful. First Class Accounts Ovens & Murray can review the way information currently moves through your business, identify where manual processes are creating errors or delays, and recommend apps that suit the way you work. We can also help with setup, integration and ongoing bookkeeping so the systems continue to produce useful information.

If you are making decisions from reports but are unsure whether the underlying data is current and accurate, talk to First Class Accounts Ovens & Murray about reviewing your bookkeeping processes and connected apps.

FAQs about accurate financial data

Why is accurate financial data important for a business?

Accurate financial data gives you reliable information about income, expenses, cashflow, liabilities and business performance. It supports better budgeting, forecasting and day to day decisions because you are working from figures that reflect what is actually happening in the business.

Can bookkeeping automation improve data accuracy?

Yes, when it is set up and reviewed properly. Automation can reduce repeated manual entry, bring transactions into your accounting system, capture invoices and receipts, and move information between connected apps. Human review is still important to make sure transactions are coded correctly and missing or unusual items are identified.

What causes inaccurate bookkeeping data?

Common causes include missing supplier bills, late sales invoices, unreconciled bank transactions, duplicate entries, incorrect coding, incomplete payroll information and apps that are poorly integrated. Regular bookkeeping and properly configured systems help reduce these problems.

Sources

Xero Australia bank feeds and reconciliation

Dext 

Futrli forecasting and reporting platform

ATO guidance on electronic receipt records

Closing a business: what you need to do

Closing a business involves a number of financial, payroll, tax and administrative steps that need to be completed before everything can be wrapped up.

You may have decided to close because you are retiring, changing direction or simply no longer want to operate the business. You may have sold the business to someone else. In other situations, the decision may be driven by financial pressure.

Whatever the reason, stopping work does not automatically bring your business obligations to an end.

Your bookkeeping needs to be brought up to date, employees need to receive their correct entitlements, tax and reporting obligations need to be completed and registrations may need to be cancelled.

The exact process will depend on your business structure and whether you are closing, selling or dealing with financial difficulty, so it is worth involving your bookkeeper and accountant early.

Get your bookkeeping up to date 

If you are closing your business or the business has been sold, you need to get all your bookkeeping up to date so your accountant has accurate information to prepare the final accounts and deal with your tax obligations.

This includes reconciling bank accounts, credit cards and loan accounts, reviewing outstanding invoices and bills, recording any remaining transactions and making sure assets and liabilities are properly reflected in your accounting system.

Outstanding customer invoices also need attention. You need to know what money is still expected to come in, which bills remain unpaid and whether there is enough cash available to meet the final commitments of the business.

Accurate bookkeeping becomes particularly important at this point because your accountant will be relying on those records to determine what still needs to be reported, paid or addressed before the business is closed.

If your bookkeeping has fallen behind, getting the records caught up before registrations and accounts start being cancelled can make the closing process considerably easier.

Give your accountant the information about the sale 

If you have sold the business, your accountant will also need the relevant information about the sale.

This can include the sale contract, settlement documents and details about assets, stock or other items included in the transaction. Your accountant can then determine how the sale needs to be treated for tax purposes, including whether GST or capital gains tax may apply.

Your bookkeeping records should support the information contained in the sale documents so there is a reliable financial record of what happened before and at settlement.

If there are unreconciled accounts, missing transactions or outstanding invoices sitting in the accounting system, dealing with them before the final accounts are prepared can save a great deal of unnecessary backtracking.

Finalise employee payments and payroll 

If you have employees, payroll needs particular attention when closing a business.

Employees need to receive their final pay, including any outstanding wages and applicable entitlements. Depending on the employee and their circumstances, this may include unused annual leave, payment in lieu of notice, redundancy pay and certain long service leave entitlements.

Closing a business can also trigger redundancy obligations. Awards and enterprise agreements may contain consultation requirements, so employers should check the requirements that apply to their employees before employment ends.

Payroll reporting also needs to be finalised correctly through Single Touch Payroll.

Super needs to be included in the process as well. From 1 July 2026, Payday Super requires employers to pay super in connection with each payday, with contributions generally needing to reach the employee's super fund within seven business days. This makes accurate payroll and super processing particularly important during the final weeks of a business.

Payroll should be completed before access to payroll software, banking arrangements and other systems is removed.

Work through your registrations and final obligations 

Your bookkeeper and accountant can help you work through the registrations and reporting obligations that need attention when a business closes.

Depending on the structure and circumstances of your business, this may include:

• Completing outstanding BAS, PAYG withholding and other reporting obligations.
• Cancelling PAYG withholding when it is no longer required.
• Cancelling GST registration. If you have sold or permanently closed the business, GST registration generally needs to be cancelled within 21 days.
• Completing the final BAS and making any required GST adjustments, including adjustments relating to business assets that are retained after GST registration ends.
• Cancelling your Australian Business Number. The ABN generally needs to be cancelled within 28 days of permanently stopping business activities, although outstanding reporting and payment obligations should be dealt with first.
• Cancelling a registered business name with the Australian Securities and Investments Commission if it is no longer required.
• Deregistering a company where appropriate. A company continues to have legal obligations while it remains registered with ASIC, including its annual review obligations.
• Lodging final tax returns and dealing with remaining tax liabilities.
• Cancelling licences, permits, subscriptions and other services associated with the business.
• Reviewing insurance requirements, including whether run off insurance may be needed to cover claims made after the business has closed.

The order matters. Cancelling registrations or access to systems too early can make it more difficult to complete outstanding lodgements and reporting.

Before cancelling your ABN, GST registration or company registration, check what still needs to be completed with your accountant or other relevant adviser.

If you are preparing to close or sell your business and need help getting your bookkeeping, payroll and financial records up to date, First Class Accounts Ovens & Murray can help you work through what needs to be completed before your accountant finalises the business. Get in touch.

Keep the records you still need 

Closing the business does not mean the records can be deleted.

Business owners still have record keeping obligations after the business stops operating. Most business and tax records generally need to be kept for at least five years, although some records may need to be retained longer depending on what they relate to.

Employment records also have separate requirements. Employers generally need to retain time and wage records for seven years.

Before closing accounting software, payroll systems, document storage or other business apps, make sure the records you are legally required to retain have been exported or stored somewhere secure and accessible.

This is also a good opportunity to review who still has access to your systems and remove access that is no longer required.

When a business is in financial difficulty 

Sometimes a business reaches a point where cashflow, debt or ongoing losses make it difficult to continue.

Good financial records can help identify warning signs earlier. If reconciliations, accounts payable, accounts receivable and reporting are current, you and your advisers have more reliable information about what the business owes, what it is owed and whether upcoming commitments can be met.

If the business is struggling to pay debts when they fall due, professional advice should be sought as early as possible.

The options available depend on your business structure and financial position. For a company, these can include restructuring, voluntary administration or liquidation. Some eligible companies with debts of less than $1 million may be able to use the small business restructuring process.

A sole trader does not enter company liquidation. Because the individual and the business are legally connected, personal insolvency processes such as bankruptcy may apply instead.

Your accountant, lawyer or registered insolvency practitioner can advise on which options are appropriate for your circumstances.

What happens if a company enters liquidation 

If a company enters liquidation, a registered liquidator takes control of the company and its affairs are wound up.

The liquidator may need access to financial records, accounting software and information held by the company's bookkeeper and accountant. Having complete and current records can make it easier to provide the information required.

Any request for information should be verified before access or confidential records are provided. ASIC maintains company information and published insolvency notices that can be used to confirm whether an external administrator has been appointed. The correct company identifier is the Australian Company Number, or ACN.

Once a liquidator has been appointed, they control the liquidation process. Any further bookkeeping or accounting work associated with the company may therefore need to be discussed with and authorised by the liquidator.

The earlier accurate financial information is available, the easier it is for the business owner and their professional advisers to understand the position and respond to what is required.

Getting the financial side of closing a business in order 

Closing or selling a business involves a lot of moving parts, and the bookkeeping needs to stay accurate right through to the final transactions.

Getting the accounts reconciled, payroll completed, outstanding invoices and bills reviewed, records retained and final information prepared for your accountant gives everyone involved reliable information to work from.

First Class Accounts Ovens & Murray can help make sure your bookkeeping and payroll records are in order and work with your accountant as the business is wound down. If you are closing or selling a business and need support getting the financial side organised, get in touch.

Frequently asked questions about closing a business

What do I need to do when closing a business in Australia?

You generally need to finalise your bookkeeping, pay outstanding employee entitlements, complete tax and reporting obligations, cancel relevant registrations, deal with business assets and liabilities, and retain the records you are required to keep. The steps will vary depending on your business structure and circumstances.

When should I cancel my ABN when closing a business?

An ABN generally needs to be cancelled within 28 days of permanently stopping business activities. Before cancelling it, make sure outstanding lodgements, reporting and payment obligations have been completed. PAYG withholding should also be cancelled before the ABN if it applies to your business.

Do I need to cancel GST when I close my business?

If you permanently close or sell your business, your GST registration generally needs to be cancelled within 21 days. You may also need to complete a final BAS and make GST adjustments for business assets.

What happens to employees when a business closes?

Employees need to receive their final pay and applicable entitlements. Depending on the circumstances, this can include outstanding wages, unused annual leave, notice, redundancy pay and certain long service leave entitlements. Employers also need to complete payroll reporting and super obligations.

How long do I need to keep business records after closing?

Most business and tax records generally need to be retained for at least five years. Employee time and wage records generally need to be retained for seven years. Some records may need to be kept for longer depending on the circumstances.

Is closing an insolvent company the same as closing a solvent business?

No. If a company cannot pay its debts when they are due, insolvency rules apply and professional advice should be sought promptly. Depending on the company's circumstances, options may include small business restructuring, voluntary administration or liquidation.

Card Surcharge Ban

What businesses need to know before 1 October 2026 

What's happening

From 1 October 2026, the way Australian businesses recover the cost of accepting card payments is changing.

Businesses will no longer be able to apply a surcharge to debit, prepaid and credit card payments on designated eftpos, Mastercard and Visa networks.

For businesses that currently add a card surcharge at the point of payment, there is more to review than the wording on a payment terminal. Merchant fees still need to be paid, so businesses need to understand what those fees currently cost, whether pricing needs to change and how any adjustment could affect margins and cashflow.

If you are unsure what your business currently pays in merchant fees, First Class Accounts Ovens & Murray can help you review the figures in your bookkeeping records and merchant statements before you make changes.

Surcharging explained 

A card surcharge is an additional amount charged to a customer because they choose to pay using a particular card. Businesses have used surcharging as one way to recover some or all of the cost of accepting card payments.

As a basic example, say you order a $5 cup of coffee and pay by card. While the advertised price is $5, a 2 per cent card surcharge would add 10 cents, bringing the amount paid to $5.10.

Applying a surcharge is optional, but around 16% of Australian businesses currently collect card surcharges. What’s more, the RBA estimates that Australians pay around $1.6 billion of card surcharges every year, which is no small change. 

For a business, the percentage charged to a customer is only one part of the picture. Merchant service fees, terminal charges and other payment costs can sit across different statements and accounts. Having these expenses recorded accurately makes it easier to see the actual cost of accepting card payments and assess whether your current payment arrangement still makes sense. 

What’s changing? 

From 1 October 2026, businesses will no longer be able to apply card surcharges to debit, prepaid and credit card payments made on designated eftpos, Mastercard and Visa networks.

According to the Reserve Bank of Australia’s research, the current surcharging system is no longer working as intended. Both consumers and businesses have reported finding the rules complex and confusing, while surcharges are not always clearly disclosed.

The changes form part of a broader package of payment reforms. These include:

• Lower maximum interchange fees for domestic debit, prepaid and consumer credit card transactions from 1 October 2026.

• A new cap on interchange fees for foreign issued card transactions from 1 April 2027.

• Greater publication of fee information by card networks and large payment acquirers so businesses have more information available when comparing payment providers.

Interchange fees are one component of the cost of accepting a card payment. A reduction in the interchange cap does not necessarily mean the total merchant fee charged by a payment provider will fall by the same amount. Payment providers can also charge for transaction processing, terminal rental and other payment services.

This is one reason businesses should review their own statements and actual costs before making decisions about pricing or changing payment providers.

Does this mean that all card payment fees will go away? 

No. Businesses will continue to incur costs when customers pay by card. Payment providers may charge for processing transactions, terminal rental and other payment services, and these charges are separate from the surcharge a business may currently add to a customer’s transaction.

From 1 October 2026, businesses that currently recover those costs through card surcharges will need to decide how they will manage the expense. The RBA notes that card acceptance costs can be reflected in a business’s overall pricing. Businesses can also continue to offer discounts for particular payment methods where appropriate.

The RBA does not currently regulate surcharges on non card payment methods. Other payment methods can have different provider rules and pricing requirements, so businesses using services such as PayPal or buy now pay later should check the terms that apply to those services rather than assume the new card rules apply in the same way.

This makes a review of your payment costs useful even if your business does not currently surcharge. If merchant fees are increasing, your bookkeeping data should show what those costs are doing over time and whether they are having a material effect on margins or cashflow.

First Class Accounts Ovens & Murray can help you identify these costs in your accounts and understand what your bookkeeping data is showing before you make decisions about pricing or payment providers.

Prepare early 

Businesses that currently surcharge should review their payment arrangements before 1 October rather than waiting until the change takes effect.

A practical review can include:

• Review your most recent merchant statements. Identify the total fees you pay to accept card payments. Look beyond the headline transaction percentage and include terminal fees and other payment service charges where relevant.
• Confirm where surcharging is currently switched on. This could include payment terminals, online payment systems, invoicing software and any payment apps connected to your accounting system.
• Ask your payment provider what will change on 1 October 2026. Some providers have indicated they may disable surcharging functionality from that date, so find out whether your settings will change automatically and whether you need to take action yourself.
• Review your pricing and margins. If you currently rely on surcharges to recover card acceptance costs, work out the annual value of those costs and assess whether they need to be reflected in your overall pricing.
• Consider the cashflow impact. A relatively small payment fee can become a meaningful business expense when it is applied across a large volume of transactions. Reviewing the annual cost gives you a stronger basis for deciding how to manage it.
• Compare payment providers and plans. The RBA is introducing measures intended to make payment fees easier to compare, and there may be lower cost arrangements available that better suit your transaction mix.
• Review invoices that may be paid after 1 October. The RBA advises that if a card payment is made on or after 1 October 2026, surcharging may no longer be available even if the invoice was issued before that date. Check with your payment provider and make sure your invoicing process is ready for the change.
• Update staff procedures and customer information. Anyone taking payments should know what is changing, when it applies and what customers will see at the point of payment.

Your bookkeeping records can help with several of these decisions. First Class Accounts Ovens & Murray can help you identify merchant fees in your accounts, review how those costs are being recorded and provide the figures you need to assess pricing and cashflow before the new rules begin.

If your payment systems are connected to your accounting software, it is also worth checking that any changes to surcharging or payment settings continue to flow through correctly. A change at the checkout can create reconciliation problems if the payment system and bookkeeping records no longer match.

If you would like help reviewing your merchant fees, bookkeeping records or payment processes ahead of 1 October 2026, speak with First Class Accounts Ovens & Murray.

Frequently asked questions

When does the card surcharge ban start in Australia?

The new rules take effect from 1 October 2026 for designated eftpos, Mastercard and Visa card transactions. American Express has also decided to remove surcharging from the same date.

Will businesses still have to pay merchant fees after 1 October 2026?

Yes. Businesses will still pay the costs charged by their payment provider for accepting card transactions. The change affects the ability to add a separate card surcharge to eligible card payments. Businesses may need to review their overall pricing, merchant plan and payment provider to decide how those costs will be managed.

Can I surcharge an invoice issued before 1 October 2026 if the customer pays after that date?

The RBA advises that if the card payment is made on or after 1 October 2026, surcharging may no longer be available even where the invoice was issued earlier. Businesses should check with their payment provider and update invoicing and payment settings before the change takes effect.

6 ways to get paid faster

FAQs about invoice payment terms

What are invoice payment terms?

Invoice payment terms explain when a customer is required to pay, which payment methods are accepted and any conditions that apply to the payment. They may include upfront payments, instalments, payment on delivery or payment within an agreed number of days. Clear terms can reduce misunderstandings and make it easier for both the business and the customer to know what is expected.

How can a business get invoices paid faster?

Businesses can reduce payment delays by sending invoices promptly, setting clear due dates, offering suitable payment options, using deposits or progress payments where appropriate and following up consistently. Accounting software, automated reminders and eInvoicing may also reduce manual processing and delays.

Can Australian businesses charge late payment fees?

Late payment fees can form part of business payment terms, but they should be agreed in advance and documented appropriately. Contract terms must also comply with applicable Australian laws, including protections relating to unfair contract terms. Businesses changing their contractual terms should obtain legal advice where required.