Renae Pitargue, Author at BUSY01 and First Class Accounts Ovens and Murray - Page 16 of 17

All Posts by Renae Pitargue

Teaching your kids about money

Teaching kids about money

Teaching your kids about money is all about finding the right moments to have a conversation. Each time this happens, you’ll be helping to strengthen their financial literacy and build their ability to make good decisions with money.

The money we spend each day tends to be invisible. When was the last time you withdrew your cash for the week and used it to make purchases? Rather than dealing in notes and coins, we tend to reach for our cards or shop seamlessly online. It’s entirely possible to spend money without even reaching for your wallet.

This can give kids some confusing messages about how money is spent. The danger here is that they won’t develop financial literacy and will struggle to manage their own money later on. One way to help them to build their financial management skills is to choose moments to talk to them about money and why you’re making certain decisions.

These moments could include:

Shopping a​​​​t the supermarket

If you’re taking your kids on the weekly shop, get them involved in the process. Involve them in drawing up your shopping list and talk through your budget. Have them help you to find items, and weigh up differently-priced options. As a bonus, helping them to understand how a food budget works might just cut down on all those requests for treats!

Withdrawing money from the ATM 

Getting out money does seem a little magical. So it’s important that kids can make the connection between the money you go to work for, and what they see coming out of the wall. Talk to them about where the money you’re withdrawing will go and help to understand the importance of knowing what’s in your bank account.

Letting them make choices 

When it comes to pocket money or money from a birthday or Christmas, it can be helpful to let your children experience the consequences of their financial decisions. It’s tempting to tell them what to do with their money, but once they discover that they can only spend their precious cash once, take the time to talk with them about what they are feeling and how they might use their money differently in the future.

Choosing activities 

When you choose what to do as a family, don’t forget to talk through the costs of different options. Kids will appreciate balancing an expensive trip to the movies with a free picnic in the park or will be amazed when they compare the cost of an icecream at a parlor versus a whole tub at the supermarket. Encourage them to brainstorm and research low-cost ideas and get creative!

Casual Workers

Employing casual workers

Employing casual workers

Having access to a casual workforce can be a great way for your business to manage busy periods while keeping ongoing costs low. Before you jump at the opportunity, it is important to understand the rules.

With the increasing casualisation of the workforce in Australia, there is a large and accessible pool of eager workers. Many students and those re-entering the workforce are looking to fill a gap in their employment or gain valuable experience.

If you want to attract strong candidates to roles in the future, gaining a good reputation for treating your casual workers properly can set you up for success in the future. The right casual employee may even become an invaluable part of your business and be a great fit for a permanent role.

What is a casual employee?

The Fairwork Ombudsman defines a casual employee as an employee who

…does not have a firm commitment in advance from an employer about how long they will be employed for, or the days (or hours) they will work.

This also means that they are not obligated to commit to all work on offer from the employer.

How is a casual employee different from a part-time employee?

Unlike casual employees, your part-time and full-time employees have fixed contracts or guarantees of ongoing employment. This means they can expect to work regular hours. They also have entitlements, such as leave and must give or receive notice to end the employment.

Casual employees have no guaranteed hours of work. They usually work irregular hours, don’t get annual leave and can end employment without notice.

What are the employers’ responsibilities?

  • To ensure employees are paid the correct rate. This may include an additional casual loading that replaces leave entitlements
  • To pay superannuation if required. You can find out more about your obligations here.
  • To follow the Fairwork Ombudsman guidelines if you make any changes to the terms of the employment. Examples would be requiring an employee to work for fixed hours or a fixed term
  • Recognise that employees can ask for flexible work arrangements and paid parental leave after 12 months of ongoing employment.

Contact us to find out how we can help you set up the right structure for casual employees and look after your payroll needs.

Is your small business ready for Single Touch Payroll?

Is your small business ready for Single Touch Payroll?

For employers with 19 or fewer employees, single touch payroll (STP) legislation will be coming into effect on the 1st of July 2019. Are you ready? Because it’s important to start preparing now.

You need to know what Single Touch Payroll is, what the changes mean for your business and who it affects. And more importantly, you need to know what to do to prepare, so that you will be compliant.

What is Single Touch Payroll?

For employers with 20 or more employees, you will already be familiar with STP, but if you are unaware, STP is the mechanism for sending tax and super information to the ATO directly from your payroll or accounting software every time you pay your employees. The legislation was passed in February this year to extend this to employers with 19 or fewer employees.

How to prepare your small business for STP and ensure compliance

Most popular payroll software companies will have the correct facilities ready to go, such as Xero and MYOB. We will have spoken to many of our clients already about STP, however, if you are unsure, talk to us.

There are a few things to be aware of you as you get ready to use STP reporting.

  1. Check your software – you may need a software update or additional step added to your process
  2. Ensure you have factored STP into your payroll process
  3. Ensure your payroll compliance is up-to-date generally, including employee benefit, wage and super entitlements and maintaining accurate records

The first year of using STP reporting is a transition year and there will be assistance from the ATO. That means penalties for errors will not generally apply.

If you don’t think you will be ready by the 1st of July, you can apply for a deferral through the ATO. The ATO gives a list of possible reasons for deferring, including lack of internet coverage, or if further development of software is needed.

If you haven't already done so, talk to us about doing your preparation now to ensure you are ready by the 1st of July.

Home Office

Do you have a home office?

Do you have a home office?

If you have a home office for your business, you should be able to claim some of the costs involved in maintaining, owning and using your home.

It’s important to be aware of what you can and can’t claim, and the record-keeping involved in making a claim.

How does it work?

In order to claim, the space you use must be used primarily for your business.

This doesn’t mean setting up at the kitchen table from time to time, it means having a dedicated space that you work from.

If you are selling online and storing stock, you may also be using other spaces in your house for storage or stock maintenance. Or, if you are making or creating products, you may be using other areas like your kitchen or workshop.

Costs that you might be able to claim include:

  • home office equipment
  • repairs to the home office or work-related furniture and equipment
  • cleaning expenses
  • any other day-to-day running expenses for your home office.

You may also be able to claim the costs of some trips in your car if these are from your home office to other locations where you are carrying out business.

The ATO has developed a calculator tool, to help you better understand what you might be able to claim. View the tool here.

Keeping track of your costs

Make sure you keep a record of all your expenses. It’s important to keep your personal and business expenses separate. Consider using online accounting software so the paperwork is kept in good order.

We can help you review your home office expenses to make sure these are included when you claim.

Talk to us, we can help.

grow your profitability

Make your business more profitable

Make your business more profitable

Is profitability a key business goal for this year?

Making a profit isn’t something that happens overnight. To create a good return from your business you need a clear focus and a well thought-out strategy for increasing profitability.

This means reviewing your business model and looking at every area of the business, to see where you can cut costs, increase margins and maximise revenue.

grow your profitability

Focus on your key drivers

Having surplus cash at the end of the year allows you to invest back into the business, fund your growth plans and increase the size of your own dividends and drawings as the owner.

To achieve these profits, it’s important to focus on the key financial drivers in your business.

To drive profits:

  • Boost sales. The more sales you make, the bigger your net revenue. So, investing in marketing, sales activity and business development will be key to a better bottom line.
  • Increase prices. By setting a higher price point, and keeping your ‘cost of goods sold’ number low, you create a larger profit margin on each sale. And this improves your profitability.
  • Cut costs. Operational costs and overheads eat into your potential profits. Spend management and cost reduction are vital to creating a more profitable model.
  • Reduce taxes. Tax liabilities will be one of your biggest costs. Sensible tax planning and use of tax reliefs will help to reduce your taxes and ramp up your end profit.

Talk to us about boosting your profits

If your business goal is to increase profitability, we’ll help you:

  • review your business model
  • identify your key financial drivers
  • proactively drive your profit performance.

Get in touch and let’s start boosting your profits.

strategy

Get strategy at the heart of your successful business

Get strategy at the heart of your successful business

Putting strategy at the heart of your business activity should give you greater direction and focus and lead to stimulating, profitable fee opportunities.

strategy


Businesses that have clear objectives or goals, robust accountability and a shared sense of purpose should always outperform those that just show up and go through the motions.

Strategy lies at the heart of most successful businesses. To achieve this you need to resource and execute with purpose. Few businesses have a strategic plan or a robust planning process. Changing this situation should be a top priority!

Here are two top tips for business owners.

1. Process Creates the Plan

Getting strategy at the heart of your success will require you to carve out some time, get a process started, and shake things up. There’s no better time to review and tweak your business model, future-proof compelling services, and to get your strategic building blocks in place.

Just as every good strategy has key elements, every good plan needs a step-by-step process. In fact, the process is often just as important as the plan itself. A strategic planning retreat with your core team is a great way to start the process – find a spot offsite to get the creative juices flowing such as a beach, a park, or vineyard, and set an agenda.

2. Key elements of an effective strategy

The key elements in a good strategy normally incorporate:

  • Vision – this is a statement that identifies what a company would like to achieve or accomplish.
  • Values – these are the fundamental beliefs upon which your business and its behaviour are based. They are the guiding principles that your business uses to manage its internal affairs as well as its relationship with customers.
  • Objectives – short term, long term. These should be SMART (specific, measurable, achievable, realistic and timebound)
  • KPIs – stands for Key Performance Indicators. These are measurable values that demonstrate how effectively a company is achieving key business objectives.
  • Actions – what needs to be done to meet the objectives? Make this simple and clear.
  • Owners – delegating tasks to specific owners to ensure follow through and accountability.
  • Deadlines – when your actions will be complete to ensure you make progress.

It doesn’t need to be much more complicated than that, but do invest the time and effort in doing this right. A proactive, value-add strategic model will need fresh thinking, debate, research, and open conversations. Enjoy and embrace the process and you should end up with a good outcome.

Great planning requires a guide, facilitator, and/or professional expertise to be as robust as possible. We can help your business and guide you through the steps.

Putting strategy at the heart of your business activity should not only give your business greater direction and focus but lead to stimulating, profitable opportunities too. It’s time to get started!

business structure

Set your business up for success with the right structure

Set your business up with the right structure

Before you start a new business it’s essential to make sure you’re choosing the right structure for the long term. 

The business structure you choose can have big implications down the track, so it’s best to set up for success from the beginning.

The structure of your new business has repercussions in terms of tax, costs and the protection of your assets. When you decide on what structure you’ll use, keep in mind your future plans, because this may impact your decision.

business structure

There are three main structures you could consider.

Sole Trader

If you’re operating on your own, this may seem an obvious choice. It’s a quick one to set up and incurs minimal costs. Bear in mind that a sole trading business can be trickier to sell, and you are taking on greater personal risk in establishing the business. It may be worth looking into how you can protect your personal assets, should anything go wrong.

Partnership

If you’re working with a partner, you could consider this option. It lets you share the load, along with the costs of getting a business established. You’re also sharing the risk and potential liabilities.

Company

Setting up a company means more admin and higher costs to get going. You’ll become a ‘director’ as the person who runs the company, and a ‘shareholder’ as a part-owner. Companies have additional reporting duties, but you assume less personal risk. Also, the clear structure and reporting involved, may set you up for an easier sale when the time comes.

You could also consider setting up a trust, but as this is a relatively expensive and complex undertaking, it’s less likely you’ll go this way initially. You can change the structure as your business develops, but it’s important to consult with your accountant, lawyer or advisor as you go.

Before Deciding

Before deciding, think ahead to the future you want for your business. Ask yourself:

How am I hoping to grow the business? 

If you plan to bring on additional people to run the business alongside you, a company or partnership arrangement may suit.

When do I want to sell the business? 

Again, while selling any kind of business is possible, the clarity provided by a company may be an advantage and make your business more attractive to a buyer.

How sure am I that this business will succeed? 

It may be that you are setting out to prove a concept or explore a business idea. If this is the case, you may not look to incur too many costs up-front, and a sole-trader or partnership model may appeal.

Whatever you decide, make sure you understand the tax implications. Talk to us before setting out on your new venture.

Profit Vs Cash

Profit Vs Cash

Profit Vs Cash

Did you know that there’s a massive difference between profit and cash?

Profit Vs Cash

Here, we explore the differences across five areas of your business to help you make a better plan to increase both.

1. Sales

​Profit increases when you increase sales; cash increases when you collect the money from customers. To increase both your profit and cash from sales:

  • Delight your customers
  • Generate more leads and referrals
  • Convert a higher number of quotes or proposals
  • Increase transaction frequency
  • Increase transaction value
2. Invoicing

Profit increases when you send an invoice to a customer; cash increases when you collect the invoiced amount. To increase both your profit and cash:

  • Set clear Terms of Trade
  • Offer a small discount for early payment
  • Agree the price in advance
  • Stick to your payment terms
  • Don’t do work for people who have overdue payments
3. Margins

Increasing your margins will increase your profit; collecting the increased margin will increase your cash. To increase both your profit and cash:

  • Increase your prices
  • Invoice faster
  • Negotiate better payment terms with suppliers
  • Reduce errors and rework
  • Train and empower your team
  • Increase your efficiency
4. Financing

Reduce your finance costs to increase your profit; borrow money for assets to increase your cash. To increase your profit and cash through financing:

  • Spread the costs of assets over 3-5 years instead of buying them outright (e.g. vehicles)
  • Borrow from a bank instead of a finance company
  • Secure the asset purchases over ‘bricks and mortar’ (if possible)
5. Overheads

Reducing your overheads will increase both your profit and cash. To reduce your overheads:

  • Negotiate with suppliers
  • Measure your return on your spend (e.g. advertising, accounting fees, etc.)
  • Review your subscriptions
  • Go paperless

This is not an exhaustive list of ways to increase your profit and cash. We can help you identify specific areas of improvement in your business to increase both profit and cash. Contact us to find out how

"Never take your eyes off the cashflow because it’s the lifeblood of the business."

Sir Richard Branson

Keeping your tax and expenses in check

Keeping your tax and expenses in check when you are self-employed

Running your own business requires you to wear a lot of hats. Relationship-building, keeping track of your time, marketing your skills and actually doing the work. But one of your priorities should also be establishing how you handle your money and setting the groundwork for good habits.

Understand your deductions

Before you start, it’s essential to understand what expenses you can and can’t claim. This means you’ll keep the right receipts and track the right expenses. Figuring out what’s what can be a little confusing as everyone has a different working set up and what you can claim for can vary between industries and occupations. Talk to us about your business expenses from the beginning. This will also help you plan for any bigger work-related purchases that you may need to make.

Get a system sorted

You’ll thank yourself later for setting up a good system now. Getting your expenses recorded and your invoices collated means you’ll be able to spend more time doing the important stuff in your business. It’s not just about saving time - keeping on top of your cash means you’re more likely to succeed. Do your research and choose a system that will work for you. Consider choosing a software platform which allows you to record your time spent on projects, it’ll make sending those invoices that much easier!

Stash that cash

When you’re running your own business or working for yourself, it’s important to always keep your tax obligations top of mind. Make sure you have money set aside in a separate account or consider entering into voluntary instalments.

One way to budget and keep on top of your business tax is to pay yourself a wage. Keeping your accounts separate also prevents you from thinking of all your business income as spending cash! Remember to also put aside a little extra to cover your holidays and any quiet periods.

Talk to us about setting up a system that takes the headache out of your finances. We can help make the process easier.