Understanding working capital to maintain business success

If cashflow keeps your business moving, working capital is the regular check you should undertake to ensure stability. It is important to understand your working capital position to maintain business success. Regularly checking working capital plays an essential part in protecting your business, particularly in periods of economic uncertainty, rising operating costs and shifting payment cycles.

What is working capital?

Working capital is your current assets minus your current liabilities. It measures the surplus or deficit you have available to meet short term commitments without needing to sell assets, borrow additional funds, or inject your own money into the business. The more working capital you have, the easier it is to fund growth, manage seasonal fluctuations and respond to unexpected expenses.

To calculate your working capital:

Cash + debtors + stock + work in progress minus creditors minus GST and PAYG owing minus superannuation payable

For example, if your business had the following balances:

Cash 150,000 Debtors 120,000 Stock 100,000 Creditors 45,000 Taxes owing 25,000

Then your working capital would be 300,000.

If the business had an overdraft of 150,000 rather than a positive cash balance, the working capital would fall significantly. This means the business would have little or no buffer to cover any slowdown in debtor payments or a downturn in sales. In more serious cases, the business could face risks associated with trading while insolvent.

Working capital pressure today is more commonly caused by rising supplier costs, wage increases, extended debtor terms and higher compliance obligations. Now is the time to review your processes, reporting and payment systems to strengthen your working capital position.

Consider the following strategies:

Build up enough cash to cover at least 2 months’ sales value

Use the average sales value for the last six months as a starting point, but also review your fixed monthly commitments including wages, superannuation, rent, loan repayments and subscriptions. Accurate monthly reporting ensures this calculation reflects your real cost base. First Class Accounts Ovens & Murray can help you determine the correct buffer amount based on reliable data.

Renegotiate your debt

If your business has an overdraft, consider whether the core debt should be structured as a term loan. Structured debt aligned to long term assets can reduce short term working capital pressure. Clear, up to date financial reporting strengthens conversations with lenders.

Negotiate with suppliers

Speak to your suppliers about payment terms that align with your cash inflows. Extended terms or structured payment arrangements may improve your working capital position. Consistent bookkeeping ensures these arrangements are tracked accurately.

Set aside money for taxes

Calculate the percentage of sales required to cover GST, PAYG and superannuation and transfer this regularly into a separate account. Automated systems can support this process when configured correctly. This protects your working capital and ensures compliance obligations are met on time.

Inject sufficient funds

If these strategies do not sufficiently improve your working capital, you may need to inject additional funds or secure structured finance. Decisions should be supported by cash flow forecasting and accurate reporting.

Working capital management

Undertaking regular working capital management is an effective way to strengthen your cash flow management. It should form part of your monthly review process rather than an occasional calculation.

First Class Accounts Ovens & Murray can help you calculate your working capital requirements, implement reliable systems and improve your reporting so you can make informed decisions with confidence.

Talk to us about strengthening your working capital management.

What is working capital?

Working capital is the difference between current assets and current liabilities. It shows whether a business can meet short term obligations.

How do you calculate working capital?

Working capital is calculated by subtracting current liabilities from current assets such as cash, debtors and stock.

Why is working capital management important?

Working capital management ensures wages, suppliers and tax obligations can be paid on time without creating cash flow pressure.

How often should working capital be reviewed?

Working capital should be reviewed monthly alongside regular financial reporting.

What causes working capital problems?

Delayed debtor payments, rising costs, high stock levels and poor reporting can all reduce working capital.

Managing cashflow

and accessing funding when you need it

Working capital is one of the most important parts of running a stable business. It is the liquid cash available to cover wages, supplier payments, tax obligations and everyday operating costs.

When working capital tightens, pressure builds quickly. Payroll dates do not move. BAS lodgements still fall due. Suppliers still expect payment.

The solution is rarely panic borrowing. It is structured cash flow management, accurate reporting, and knowing what funding options are available before the pressure becomes urgent.

At First Class Accounts Ovens & Murray, this is where we step in. We help business owners understand their cash position clearly, plan ahead, and access funding in a practical and informed way.

Helping you understand your cash requirements

The starting point of any funding decision is understanding exactly what your current cash requirements are. That means sitting down and reviewing your full financial position in detail.

We look at your current bank balances, outstanding invoices, upcoming supplier payments, payroll commitments, superannuation liabilities, and GST or PAYG obligations. We also review your short term forecasts so you can see what is due over the next one to three months.

With accurate, up to date bookkeeping and reconciled accounts, you can clearly see whether there is a genuine funding gap or simply a timing issue between money coming in and money going out.

Armed with this information, you can make a considered decision about how much funding is actually required, if any. Borrowing without this clarity often leads to taking on more debt than necessary.

Understanding your true cash requirements puts you back in control and reduces uncertainty.

Liaising with banks and lenders

We can support you in conversations with banks, lenders and alternative funding providers by ensuring your financial information is accurate and up to date.

You may need to discuss extending an overdraft facility, increasing a line of credit, restructuring repayments, or exploring short term working capital finance.

Having clear and current financial reports gives you a stronger position when having these discussions. Lenders in 2026 expect reliable bookkeeping and realistic cashflow forecasts. If your numbers are current and reconciled, the conversation becomes far more straightforward.

Preparing financial information for lenders

Any lender will require detailed and accurate financial reporting to support a funding application.

We prepare up to date accounts, cashflow statements and forward projections so banks and finance providers can clearly assess your financial position.

This includes reconciled balance sheets, profit and loss reports, aged debtor listings and evidence of compliance with BAS, payroll and superannuation obligations.

Accurate reporting not only supports approval, it can also influence the terms offered.

Accessing government assistance

There are government grants, industry incentives and state based support programs available to businesses in 2026.

Depending on your industry, size and location, you may be eligible for small business grants, wage subsidies, training incentives, energy efficiency programs or regional development support.

We can help you identify what may apply to your business and ensure your financial records are accurate and up to date before submitting any application.

Clear reporting and compliant bookkeeping improve your chances of approval and reduce delays in the process.

Improving your debtor tracking

Outstanding customer invoices are often one of the main causes of cashflow pressure.

We can help you review your aged receivables report and identify which invoices require immediate attention.

From there, you can prioritise follow ups, clarify payment terms and, where necessary, negotiate realistic repayment arrangements.

Clear and consistent debtor management reduces reliance on external funding and improves working capital over time.

Extending credit from suppliers

Open and honest communication with suppliers remains important when managing short term cashflow pressure.

Where appropriate, you may be able to negotiate extended payment terms, part payments or structured repayment arrangements.

Having clear cashflow forecasts allows you to approach these conversations with confidence and provide realistic timeframes, rather than uncertain promises.

Maintaining control and stability

Cashflow pressure can happen at any stage of business growth. The key is identifying issues early and responding with clear information and practical action.

If you would like to strengthen your cashflow management, understand your working capital position or explore appropriate funding options, First Class Accounts Ovens & Murray can provide practical support.

We help you review your numbers, prepare accurate reports and make informed decisions so your business remains stable and well managed.

Talk to First Class Accounts Ovens & Murray about getting on top of your cashflow.

FAQs about working capital and managing cashflow

What is cash flow management?

Cash flow management is tracking, forecasting and controlling the money coming into and leaving your business to ensure you can meet short-term obligations.

How do I improve cash flow in my business?

Improve invoicing speed, follow up overdue accounts, review payment terms, forecast upcoming expenses and maintain accurate bookkeeping.

When should a business apply for funding?

Funding should be considered when cash flow forecasts show a shortfall that cannot be managed through improved collections or expense adjustments.

What documents do lenders require for business funding?

Lenders typically require up-to-date profit and loss reports, balance sheets, cash flow forecasts, aged receivables reports and compliance history.

Can better bookkeeping reduce the need for funding?

Yes. Accurate bookkeeping and forecasting often identify timing gaps that can be resolved internally without external borrowing.

Digital payroll and small business payroll software

Why payroll systems still cause problems for business owners

Many businesses still rely on paper based employee records or basic spreadsheets to manage payroll. These methods are time consuming and often lead to incomplete or inaccurate records. For business owners juggling staff, clients, suppliers, and compliance, payroll can quickly become a source of stress.

In 2026, payroll expectations are higher than ever. Accurate records, timely payments, and correct reporting are no longer optional. Businesses need systems that support compliance while also providing clarity around wage costs and cash flow.

Payroll compliance is still a risk for small businesses

The Australian Taxation Office and the Fair Work Ombudsman continue to monitor payroll practices closely, particularly within small and medium sized businesses. Common issues include incorrect pay rates, missed superannuation payments, and incomplete records. These problems rarely appear overnight. They tend to build up quietly over time.

Payroll rules in Australia change regularly. Updates to modern awards, superannuation obligations, and reporting requirements mean that payroll needs ongoing attention. For business owners, keeping up with these changes manually is difficult and often unrealistic.

Digital payroll systems, including small business payroll software, are designed to manage this complexity.

Modern payroll platforms integrate directly with accounting software, apply rule updates automatically, and streamline reporting to the ATO. This reduces the risk of errors while saving time each pay run.

Payroll setup and ongoing payroll services

Payroll software on its own does not guarantee accurate or compliant payroll. The system still needs to be set up correctly, maintained properly, and used consistently each pay run.

First Class Accounts Ovens & Murray provides end to end payroll services for business owners who want payroll handled properly, without having to manage it themselves. This includes payroll setup, ongoing payroll processing, and compliance support.

Payroll is processed accurately and on time, with pay rates, leave entitlements, superannuation, and reporting obligations handled correctly. This reduces risk and removes the pressure of managing payroll internally, while giving business owners confidence that payroll is covered every pay cycle.

Reliable payroll services you can depend on

If your payroll systems feel outdated or unreliable, it may be time to review how payroll is managed in your business. The right system, combined with experienced support, can remove stress and create clarity.

We can advise on small business payroll software that suits how your team actually works, then manage payroll for you ongoing.

Contact us today to discuss payroll services for your business.

What is small business payroll software?

Small business payroll software is a digital system used to calculate wages, manage leave and superannuation, and meet reporting requirements such as Single Touch Payroll, with records stored securely and updated in line with current rules.

How does digital payroll help with compliance?

Digital payroll systems apply current tax rates, superannuation rules, and reporting requirements automatically, reducing the risk of errors.

Can a bookkeeper manage payroll for my business?

Yes. A qualified bookkeeper can set up payroll systems, process payroll, manage reporting, and ensure records are accurate and compliant.

Finding balance in business without burning out

Work life balance is talked about constantly, yet many business owners feel further away from it than ever. When you are managing staff, cash flow, systems, compliance, and customer expectations, balance can feel unrealistic.

For many established businesses, the issue is not a lack of effort. It is that too much sits with the owner, and too many decisions rely on them being available at all times. This is where structure, systems, and reliable support start to matter.

This article looks at practical ways to create balance that actually works in a real business environment, not quick fixes or lifestyle tips that ignore commercial reality.

Prioritise what actually needs your attention

In many businesses, everything feels urgent. That is usually a sign that priorities are unclear, not that everything genuinely requires immediate attention.

Start by separating work that only you can do from work that simply needs to be done. Strategy, key decisions, and leadership often sit with the owner. Day to day administration, data processing, and routine tasks do not.

Using task and project management tools can help, but only if they reflect how your business actually runs. For some businesses, simple task lists work. For others, job based or workflow tools are more effective. The goal is not more technology, but clearer visibility of what matters most and what can wait.

When priorities are clearer, pressure reduces. You stop reacting constantly and start working with intent.

Delegate and remove single points of pressure

Delegation is not about losing control. It is about removing bottlenecks.

When one person holds all the knowledge or approvals, work slows down and stress increases. This applies just as much to bookkeeping, payroll, and compliance as it does to operations.

Many business owners delay delegating financial tasks because they worry about accuracy or compliance. In reality, keeping these tasks in house without the right expertise often increases risk. Errors in payroll, super, or reporting usually cost more time and money to fix later.

Engaging a reliable bookkeeping partner means key tasks are handled accurately and consistently, without relying on one internal person being available. It also creates breathing space for you, as the owner, to focus on running your business rather than chasing paperwork.

Protect time by planning for it properly

Time off rarely happens by accident. If it is not planned, work will always fill the space.

This includes time away from the business, but also time to review numbers, plan cash flow, and check that systems are working as they should. When business owners only look at financial data under pressure, stress increases and decision making suffers.

Regular reporting, scheduled payroll, and clear payment planning reduce the mental load. When you know staff, suppliers, and the ATO are covered, it becomes easier to step away without worrying about what might go wrong.

Use technology that genuinely reduces work

Technology should reduce effort, not add complexity.

In 2026, most businesses are using cloud accounting software, but many are not using it well. Manual work still exists because systems are not set up correctly or apps are not integrated properly.

Choosing the right tools for your industry and workflow makes a significant difference. Automated bank feeds, payroll systems, and document capture tools reduce data entry and errors. When information flows correctly between systems, reporting becomes more reliable and decisions easier.

First Class Accounts Ovens & Murray supports businesses by recommending and implementing apps that actually suit how they operate. The focus is always on accuracy, efficiency, and clarity, not technology for its own sake.

Use trusted support, not just peer advice

Peer support is valuable, but it should not replace professional advice.

Talking with other business owners can provide perspective, but every business has different cash flow pressures, staffing structures, and compliance obligations. What works for one business may not suit another.

Having a bookkeeper who understands your business, works alongside your accountant, and provides clear explanations gives you reliable input when decisions need to be made. This removes guesswork and reduces reliance on informal advice.

Build a business that supports your life

Enjoying your work is important, but enjoyment often disappears when pressure builds and systems fail.

Balance comes from knowing the foundations are solid. Payroll is processed correctly. Cash flow is visible. Compliance is handled. Systems support the business rather than slowing it down.

If you want to create more balance without risking accuracy or control, First Class Accounts Ovens & Murray can help. Through reliable bookkeeping, payroll support, and practical app advice, we remove the load that sits quietly in the background of many businesses.

Get in touch to talk about how better systems and support could free up time and reduce stress in your business.

How can bookkeeping help with work life balance?

Reliable bookkeeping improves cash flow visibility, reduces compliance stress, and removes routine tasks from the owner.

Does outsourcing payroll reduce stress?

Yes. Outsourcing payroll ensures staff are paid correctly and on time, reducing risk and mental load for business owners.

Can business apps really save time?

When chosen and set up correctly, business apps reduce manual work and errors, freeing up time for more important tasks.

When should a business owner get bookkeeping support?

When accuracy, cash flow clarity, and time pressure start affecting decision making, it is time to seek support.

Employing casual workers and managing payroll correctly in 2026

Employing casual workers means taking on payroll risk that must be managed correctly from day one.

Casual employees are often where payroll mistakes happen. Incorrect pay rates, missed super, inconsistent records, and poor Single Touch Payroll reporting are common issues, particularly in small and growing businesses. These mistakes rarely show up immediately, but when they do, they are expensive and time consuming to fix.

This is why casual employee payroll needs clear systems, accurate processing, and consistent oversight. First Class Accounts Ovens & Murray supports businesses by managing casual payroll properly, so employees are paid correctly and compliance is not left to chance.

Why casual payroll is more complex than it looks

Casual employees often include students, parents returning to work, or people balancing multiple roles. These employees rely on accurate and timely payroll just as much as permanent staff.

From a payroll perspective, casual staff introduce complexity. Hours vary. Awards differ. Casual loading must be applied correctly. Super eligibility must be tracked. Payroll systems must be able to handle these variables without error.

This is where many businesses struggle, particularly when payroll is handled manually or by someone who is not across current requirements.

Payroll accuracy and your reputation as an employer

Payroll accuracy directly affects your reputation as an employer. Casual employees talk. Underpayments, late pays, or incorrect super damage trust quickly.

When payroll is handled properly, casual employees are more likely to stay, pick up additional shifts, and transition into long term roles. Consistent payroll builds confidence for employees and stability for the business.

What is a casual employee and why it matters for payroll

A casual employee does not have a firm advance commitment to ongoing work. There is no guarantee of hours or duration of employment, and shifts can usually be accepted or declined.

However, payroll data tells the real story. If a casual employee works regular, predictable hours over time, this can trigger additional obligations, including conversion rights. Accurate payroll records are essential to identify this early and act before compliance issues arise.

Casual employees, casual loading, and award compliance

Casual employees receive a higher hourly rate to compensate for not receiving paid leave. This casual loading must be applied correctly under the relevant award every pay run.

Payroll errors often occur when loading is missed, awards are misapplied, or hours are not recorded accurately. These issues compound over time and frequently surface during audits or employee queries.

Payroll responsibilities when employing casual workers

Employers must ensure casual employees are paid correctly every pay run. This includes applying the correct award rate and casual loading.

Superannuation must be calculated accurately and paid on time. Super obligations now apply broadly, with stricter enforcement and limited tolerance for late payments.

Single Touch Payroll reporting is mandatory. Each pay run must be reported accurately to the ATO, including wages, tax withheld, and super information. Incorrect STP reporting creates flow on issues with the ATO and employees.

Payroll records must be complete and up to date. Hours worked, pay rates, and changes to employment arrangements must be captured correctly. Payroll systems should provide visibility so risks are identified early.

This level of accuracy requires more than basic software. It requires proper setup, ongoing checks, and experienced oversight.

How First Class Accounts Ovens & Murray supports casual payroll

First Class Accounts Ovens & Murray provides reliable, fully contracted payroll services for businesses employing casual staff.

Payroll is processed accurately and on time. Pay rates, casual loading, super, and STP reporting are handled correctly. Payroll systems are set up properly and monitored to ensure ongoing compliance.

Businesses gain confidence knowing their payroll is handled by professionals who understand the rules and apply them consistently. Employees are paid correctly. Records are accurate. Risks are identified early.

If you employ casual workers and want payroll handled properly, First Class Accounts Ovens & Murray provides the structure, systems, and reliability to support your business.

Common questions about casual employee payroll Australia

What is a casual employee in Australia?

A casual employee has no firm advance commitment to ongoing work and can usually accept or decline shifts. Payroll records must reflect how the role operates in practice.

Do casual employees get super?

Yes. Casual employees are generally entitled to superannuation, and employers must calculate and pay it correctly and on time.

What is casual loading?

Casual loading is an additional amount paid to casual employees instead of paid leave entitlements. It must be applied correctly under the relevant award.

Why is payroll important for casual staff?

Payroll accuracy affects compliance, employee trust, and cash flow. Errors can lead to penalties, underpayments, and disputes.

How can First Class Accounts Ovens & Murray help with payroll?

First Class Accounts Ovens & Murray manages payroll end to end, ensuring pay, super, and STP reporting are completed accurately and on time, without gaps or stress.

Automation can ease your business workload

Small and medium-sized businesses are spending on average 120 hours a year on admin tasks, according to recent research into productivity at UK SMBs.

If your people are spending 120 hours wading through tedious and unproductive admin, that’s bad for the business and for your overall efficiency. Fortunately, technology and software automation can go a long way towards automating the low-level admin tasks.

While this research is now several years old, the underlying issue remains relevant in 2025. Many small businesses still spend significant time on manual administration, particularly around bookkeeping, invoicing, payroll processing, and reporting.

What has changed is the availability and maturity of automation tools. Businesses now have access to more connected systems than ever before. The challenge is no longer whether automation exists, but whether it has been implemented in a way that actually reduces workload without creating new problems around accuracy and compliance.

This is where structured processes and reliable bookkeeping support become critical.

Better productivity through automation

Automation is an important way to ease your business workload, with a host of different business apps and cloud solutions offering ways to automate your admin.

With ‘smart business tools’ increasing in number and choice, software is utilising automation algorithms, artificial intelligence (AI), machine learning and cognitive solutions to help remove the mundane admin tasks from your workflows.

In 2025, most businesses already use some level of automation, often without realising it. Bank feeds, invoice reminders, payroll calculations, and reporting dashboards are now standard in many systems.

However, more automation does not automatically mean better outcomes. Poorly connected apps, incorrect setup, or lack of oversight can result in duplicated data, incorrect reporting, or compliance issues that only surface later.

Productivity gains come from using the right automation in the right places, supported by regular reconciliation and review. This ensures automation reduces workload rather than shifting the work elsewhere.

Core processes that will benefit from automation

Automated bookkeeping

Just take a photo of your receipts, expenses and invoices and ‘optical character recognition’ (OCR) technology will digitise the output and pull it through into your accounts software. No data entry, no human error and no lost receipts! We can do the rest to ensure your records are accurate.

Receipt capture and OCR technology have continued to improve, making it easier for businesses to collect source documents and reduce manual data entry. This supports better record keeping and faster processing.

What automation does not remove is the need to check that receipts are valid, correctly coded, and meet ATO requirements. A bank transaction alone is still not a source document. Without proper review, automated bookkeeping can give a false sense of accuracy.

First Class Accounts Ovens & Murray supports businesses by reviewing automated data, reconciling transactions, and ensuring records are accurate, complete, and compliant. This is what turns automation into something you can actually rely on.

Automated credit control 

Chasing up debts and late-paying customers takes time. Automated credit control apps track your debtor numbers and automatically sends out customised chaser emails as soon as an invoice is late. This reduces your credit control time, speeds up cash collection and cuts your aged debtor figure.

In 2025, cash flow pressure remains one of the biggest risks for small businesses. Automated reminders can help maintain consistency and reduce the emotional load of chasing payments.

For these tools to work effectively, invoices must be issued correctly and debtor balances must be accurate. If bookkeeping is behind or reconciliations are incomplete, automation may chase the wrong amounts or miss overdue invoices entirely.

When supported by regular bookkeeping, automated credit control becomes a practical way to improve cash flow confidence and reduce late payments.

Automated payment collection

The easier it is to pay you, the faster your customers will pay. Automated card payments and cloud-based Direct Debit solutions allow you to automatically take payment from a customer as soon as an invoice is due. Some solutions will even automate the invoice matching and bank reconciliation process.

Payment automation continues to be one of the most effective ways to reduce debtor days. Direct debit and card payment integrations reduce friction for customers and support more predictable cash inflows.

When implemented properly, some systems assist with payment matching, but this still requires review. Automation supports the process, it does not replace accountability.

Automated reporting and forecasting 

The better your reporting and business intelligence, the easier it is to make informed decisions about your company strategy. Accounting platforms and fintech tools now offer automatic, real-time reporting and forecasting, giving you access to the important numbers and metrics, fast.

Access to real time reports is now common, but confidence in those reports is not. Automated reporting only works when the underlying data is accurate and up to date.

Businesses often have dashboards showing cash flow, profit, and forecasts, yet still feel unsure because transactions have not been reconciled or payroll and super obligations have not been allowed for correctly.

Reliable bookkeeping turns automated reports into decision making tools rather than guesswork. This is where automation and human oversight work together.

Talk to us about embracing the power of automation

If your admin is starting to hold you back, come and talk to us about how automation can pick up some of the heavy lifting as well as giving you the metrics you need for decision making. 

We can review you business processes and identify the automation opportunities, helping you choose the best apps to drive your business efficiently.

In 2025, automation works best when it is paired with structure, consistency, and accountability. Adding more apps without reviewing processes often increases workload rather than reducing it.

First Class Accounts Ovens & Murray works with business owners to review existing systems, clean up data, and ensure automation is supporting accurate bookkeeping, reliable payroll, and clear reporting. The focus is on fewer errors, better cash flow visibility, and less time spent fixing issues later.

If your systems feel messy, unclear, or unreliable, it may be time to review how automation is being used rather than adding more of it.

Contact us to discuss your automation opportunities. 

Answering questions about bookkeeping automation

What is business automation in bookkeeping?

Business automation uses software to reduce manual tasks such as data entry, invoicing, payment reminders, and reporting.

Does automation replace the need for a bookkeeper?

No. Automation supports bookkeeping but still requires oversight to ensure accuracy, compliance, and correct reporting.

Can automation improve cash flow?

Yes, when combined with accurate invoicing, credit control, and reconciliation, automation helps identify issues earlier and improve payment timing.

What should be automated first in a small business?

Bookkeeping processes, invoicing, payment collection, and reporting usually deliver the most practical benefits.

Who should help set up automation tools?

A bookkeeper with business app advisory experience can ensure tools are integrated properly and supported by accurate processes.

Planning a financially stress-free holiday period

Holiday breaks are a chance to recharge for the year ahead. For business owners, though, the lead up to Christmas and the summer shutdown period can be one of the most financially stressful times of the year.

Warmer weather and an out of office email are appealing, but reduced trading days, delayed customer payments, higher wage costs, and public holidays can quickly put pressure on cash flow if they are not planned for properly.

The strategies below are practical and based on common issues we see every year. They are general in nature, but they highlight where planning makes the biggest difference.

If you need help preparing a cash flow forecast that reflects your business, First Class Accounts Ovens & Murray can support you.

Decide your Christmas and holiday break dates

Deciding when to take Christmas and holiday breaks is an important decision for businesses.

First, you need to consider your staffing and resourcing needs; how many people will be taking leave over the break period and who will be covering for those employees that take annual leave? Can your business afford to close entirely or run with a smaller team?

Once you have decided on your dates, share them with staff, customers and suppliers. It can provide peace of mind for customers; if they know how long you will be closed they can plan their spending accordingly. This will help ensure that your business runs smoothly during this time and that your customers are taken care of.

Budget and plan for annual leave

One of the most important aspects of budgeting and planning for annual leave is to factor in the pay rates for staff. At Christmas time, in most cases, these rates will be higher than standard hourly rates, so it's important to take this into account when creating your budget. Additionally, you must also take into account statutory public holidays. These days must be accounted for when calculating annual leave entitlements, and they cannot be carried over or swapped for another day.

Another thing to consider when budgeting and planning for employee annual leave is leave loading or long service leave. Staff may be entitled to receive this type of payment, which can add up to a significant amount of money depending on how long an employee has been working for your business.

By using software such as Xero, you can forecast your annual leave accrual and plan ahead. This will help ensure that you have enough money budgeted for staff wages during the holiday season. If you need help with this process, get in touch with us. We can provide you support to make sure that your annual leave planning is as accurate as possible.

Decide leave payments

There are many things to consider when deciding how and when to pay out your employees' leave payments during the Christmas break. For example, you may want to consider their preferences and travel needs, as well as any other financial factors that may impact your decision.

When it comes to making this decision, it is important to keep in mind the needs of both your employees and your business. Ultimately, the choice that works best for everyone will depend on a variety of factors, such as employee preferences, budget constraints, and company policies.

If you are unsure about what to do in this situation, it may be helpful to speak with your staff or consult with an HR professional for guidance. Whatever you decide, it is important to communicate clearly with your team and ensure that everyone feels supported throughout this process.

Overall, there are many things to consider when deciding how and when to pay out your employees' leave payments during the Christmas break. However, by carefully weighing all the different factors involved, you can make a decision that works well for both your employees and your business.

Review your work in progress (WIP)

Plan to complete jobs or services that can be invoiced and paid before Christmas (remember if you don’t invoice and get paid before Christmas, you may not see the money until mid to late January).

1. Send out invoices as soon as the job is complete. This will ensure that your clients have the invoice and can make payment in a timely manner.
2. If you haven't already, sign up for online invoicing and payments. This will make it easier for your clients to pay you, and they can do it from the comfort of their own homes.
3. Follow up with clients who haven't paid yet. A gentle reminder can go a long way in getting those payments in before the holidays.
4. If all else fails, consider offering a discount for early payment. This may incentivize your clients to pay sooner rather than later.

Stocktake

Do you need to order in goods now to be able to complete your work in progress? Check that there is stock on hand available. If there is going to be a partial stocktake at the end of this financial year, now could be the time to get some extra stock in to make sure that you can complete orders.

If you are planning a stocktake for your business, it's important to prepare well in advance and make sure that you have all the necessary equipment, staff, and resources to complete the task effectively. This may include getting the help of a third party stocktaking company or enlisting your suppliers or distributors to provide you with any stock data they have on hand.

You should also communicate clearly with your team about what will be involved in the stocktake process and make sure that they are aware of any changes to your usual operations, such as working hours or product handling procedures. By planning ahead and taking the time to prepare for a stocktake, you can ensure that it runs smoothly and gives you the accurate data you need to make informed business decisions.

Capacity planning

It can be difficult to find the time and resources to complete a project before Christmas, but with careful planning, you can ensure that everything is done in plenty of time.

Start by prioritising which tasks need to be completed first, and make sure you have the necessary staff or equipment to get the job done. If possible, try to avoid taking on new projects or clients during this busy period, as your focus and energy will be elsewhere.

At the end of the day, it's important to remember that you can't do everything yourself, so delegate tasks where necessary and ask for help from colleagues or family members if you need it. With a little bit of planning and flexibility, you'll be able to make the most of the festive season and complete all your projects on time.

So if you're looking for a stress-free Christmas, take some time now to plan out your capacity and resources so that you can focus on what really matters this holiday season – spending quality time with friends and family.

Making an arrangement with the Tax Office

If your budget forecast indicates you won't be able to meet your tax obligations, it is possible to apply for an instalment arrangement. There are costs associated with this, however it may provide a solution that gets you through the holiday period. Talk to us, we can help.

Plan for the new year

In addition to the tasks above, having a solid plan for getting your cash-flow back in shape after the break is essential. To help you with this, look at reviewing your forecasts and budgets (including debtors), ensuring you have good management information available, and checking that all your key operational systems are running smoothly.

If short term support is needed, organise it early. Accurate forecasts make these conversations easier and more effective.

FAQs

How do I plan cash flow for the Christmas shutdown period

Start with a cash flow forecast that includes reduced income, higher wages, public holidays, and delayed payments.

Should I pay employee leave before Christmas

It depends on cash flow capacity and business policy. The timing affects cash reserves and super obligations.

Why is January cash flow often tight for businesses

Invoices issued late, delayed customer payments, and holiday shutdowns commonly push income into late January.

How can First Class Accounts Ovens & Murray help during holiday planning

They support cash flow forecasting, payroll planning, compliance, and system reviews to reduce stress and improve clarity.

Five benefits of outsourcing your payroll

When it comes to running a business, time is an irreplaceable commodity and we are seeing more and more businesses start to outsource specialist or essential services. If you employ people, then payroll is both a specialist and essential service.

Why?

Because outsourcing payroll allows business owners to focus on their strengths and core business, leaving the complexities of systems and compliance to experts.

With the right team behind you, the benefits of outsourcing your payroll can be realised almost immediately. 

For many small and medium businesses, outsourcing payroll has also become more relevant with changes to superannuation rules, Single Touch Payroll updates, new reporting requirements, and higher expectations from employees. 

A reliable contract service such as First Class Accounts Ovens & Murray helps you stay on top of these changes and maintain accuracy every pay cycle.

Here are five benefits of outsourcing your payroll.

1. Save time

By outsourcing your payroll, time spent on compliance, regulations, and training staff on using internal systems is eliminated. 

Cloud-based payroll services can also eliminate time spent by HR updating entitlements, leave and benefits. This now includes Single Touch Payroll reporting, superannuation checking tools, and digital employee onboarding, which have added extra steps for employers.

First Class Accounts Ovens & Murray manages these tasks for you through a structured weekly or fortnightly process. You no longer need to pause your day for payroll questions, software issues, award reviews, or chasing paperwork. This saves time and reduces interruptions across your business.

If payroll takes too much of your week, outsourcing to First Class Accounts Ovens & Murray keeps everything running on time.

2. Save money

Having fewer full-time employees can cause a ripple effect on cost savings throughout an organisation, from HR and IT through to office space and utilities. Outsourcing to payroll services providers reduces the cost of hiring and retaining specialised staff – two activities that are expensive and increasingly seen as unnecessary.

Payroll software, compliance requirements, and employer obligations continue to grow, which makes it more costly to train internal staff or correct mistakes.

Outsourcing removes the need for internal payroll training, specialised systems knowledge, or paying someone to troubleshoot awards or prepare STP corrections.

With First Class Accounts Ovens & Murray, you pay for the service you need and avoid the ongoing cost of an in-house payroll role.

Outsourced payroll can reduce unnecessary overheads. If you want predictable monthly costs, we can help.

3. Compliance

For many small business owners payroll isn’t a core competency. And that means the complexity of work place agreements and EBAs increases the risk of costly errors. Keeping up with the Australian Government’s National Employee Standards (NES) requires vigilance and expertise to remain compliant.

Penalties for incorrect payroll, superannuation underpayments, and late lodgements continue to increase, and compliance checks are now more detailed across most industries.

Superannuation is now monitored more closely through digital reporting, and award changes occur more frequently. Outsourcing to a specialist payroll provider ensures that the minimum standards are adhered to and helps reduce the risk of incorrect classifications and missed entitlements.

First Class Accounts Ovens & Murray manages compliance as part of your payroll service, including employee setup, leave accruals, superannuation calculations, and STP submissions.

4. Simplified reporting

Outsourcing payroll provides complete transparency and access to accurate information that doesn’t need to be verified. Simplified reporting means, as a business owner, you can more effectively plan for growth and predict changes to your staffing needs.

Over the past few years, payroll reporting has expanded to include STP, clearer breakdowns of pay categories, and more detailed leave reporting. Accurate information helps with cash flow planning, preparing for superannuation payments, and understanding the real cost of employing staff.

First Class Accounts Ovens & Murray provides clear payroll reports and explains what the information means in practical terms so you can make informed decisions.

If you want reporting that is easy to understand, we can prepare the information you need.

5. Avoid losing payroll expertise

Outsourcing your payroll means your business maintains a consistent approach to payroll management. There’s no need to induct employees and role transfer can be reduced to the functions and outputs of the payroll service.

This has become even more important as many businesses now operate with smaller teams or experience turnover in administration roles. When payroll knowledge sits with one internal person, the risk of errors and missed deadlines increases if they are away or move to a different role.

First Class Accounts Ovens & Murray provides a documented, reliable process that continues no matter what is happening inside your business.

At the end of the day outsourcing payroll services allows you to focus on the aspects of your business that generate revenue. It also removes the stress of keeping up with award changes, system updates, and reporting deadlines.

Talk to us today about outsourcing your payroll so you can invest in strategic resources that increase value and drive the growth of your business. First Class Accounts Ovens & Murray provides a reliable contract service that continues regardless of staff changes, holidays, or internal pressures.

Common questions about outsourcing payroll

What does outsourcing payroll include?

It usually includes processing wages, superannuation, leave, onboarding, and STP reporting. First Class Accounts Ovens & Murray manages these tasks for you.

Is outsourcing payroll cost effective?

It reduces employment costs, software costs, and time spent managing compliance. Many small businesses find outsourced payroll more predictable than an in-house role.

How does outsourcing help with compliance?

A payroll provider stays across award changes, National Employment Standards (NES) requirements, and superannuation rules. First Class Accounts Ovens & Murray ensures payroll is processed accurately and on time.

How healthy is your working capital?

We all know that cash is king when it comes to business success, but what exactly is ‘working capital’ and how does this financial metric help measure the health of your business?

Working capital is made up of the cash and assets that are available in the business to fund your operations and keep you trading. It is worked out by taking your current assets (the things you own) away from your current liabilities (the things you owe to other people).

If your working capital is strong, you have enough on hand to pay your team, your suppliers and the ATO on time and still have room to move. If it is weak, even a small bump in expenses or a delay in customer payments can cause stress.

In 2025, with increasing costs and tighter margins for many Australian businesses, keeping an eye on working capital is more important than ever. First Class Accounts Ovens and Murray helps by keeping your bookkeeping up to date, so you always have a clear picture of your numbers instead of guessing.

Why working capital matters

So, why is working capital such a critical metric?

Having the liquid capital needed to trade It’s possible for your business to be busy, successful and profitable, but for your cash position to still be in poor health and that can have a serious impact.

If you can’t readily convert your assets into liquid cash, it’s a struggle to meet your cashflow goals, pay your bills and fund your day to day operations. But with the optimum level of working capital, you strengthen your balance sheet and put the company in a solid financial position.

Healthy working capital gives you breathing space. You can pay people on time, take up good opportunities when they arise and sleep better knowing what is coming in and what is going out.

This is where cash flow confidence becomes practical. When First Class Accounts Ovens and Murray is managing your day to day bookkeeping and people payments, you can see your true position more clearly and make decisions based on real numbers, not gut feel.

How to achieve a healthy level of working capital

To achieve a healthy level of working capital you will need to:

Proactively manage your cashflow

Cashflow feeds your working capital by pumping liquid cash into the company and keeping the balance between assets and liabilities in a strong position. But to achieve this, it’s vital to achieve a positive cashflow position, where your cash inflows are greater than your cash outflows. This means getting paid on time, lowering your outgoings and keeping a close eye on your ongoing cash position.

In real terms, this might look like tightening up your debtor follow up, reviewing your payment terms, spreading larger bills over a realistic period and planning for regular commitments such as wages, super and GST so they do not come as a surprise.

First Class Accounts Ovens and Murray can help you put simple, practical systems in place to support this. That might include regular cashflow reports, payment scheduling, and clearer visibility of who you need to pay and when. The aim is to make your cashflow more predictable, which improves your working capital and reduces stress.

Monitor and forecast your financial position

Running regular financial reports helps you stay in control of your finances. With careful monitoring and forecasting of your cash position, you can ensure you don’t end up in a negative cashflow position, without the requisite working capital to trade and fund the next stage in your business plan. 

Cloud accounting software and business intelligence apps have made it easier than ever to create up to date, real time reports and run dashboards that show your key metrics.

In 2025, there is a wide range of connected apps that integrate with platforms such as Xero to give you clearer insights. These tools can help you track cashflow, see upcoming payroll, GST and PAYG obligations, and spot trends before they turn into problems.

First Class Accounts Ovens and Murray offers business app advisory to help you choose and set up the right tools for your business. We then use those tools to give you regular, easy to understand reports and forecasts, so you know how healthy your working capital is and what is coming up over the next few weeks and months.

Use additional finance when required

If working capital is looking thin on the ground, then additional funding may be needed to bolster your balance sheet. Short term finance options, such as overdraft extensions or invoice finance, and longer term business loans can be needed to keep working capital on an equilibrium.

Before taking on any extra finance, it is important to understand why your working capital is under pressure and whether it is a temporary issue or an ongoing pattern. That way you can choose the most suitable type of funding and avoid simply masking a deeper problem with more debt.

By keeping your books current and providing clear reports, First Class Accounts Ovens and Murray can help you and your accountant or finance provider see the full picture. This makes it easier to have informed conversations about what kind of funding, if any, is appropriate for your situation.

Support to keep your working capital healthy

Working closely with your accountant and bookkeeping team is vital if you want to promote the ideal level of working capital in the business. Together, they can help manage your cashflow, monitor your financial metrics and support you to access additional finance and funding when your capital needs a boost.

First Class Accounts Ovens and Murray focuses on reliable, done for you bookkeeping, cashflow confidence and real world advice. We become part of your team, keeping your numbers accurate and your reports clear, so you can make better decisions about working capital.

If you would like to understand how healthy your working capital really is, and what you can do to improve it, talk to First Class Accounts Ovens and Murray about reviewing your current position and setting up better support around your cashflow.

What is working capital in a business?

Working capital is the difference between your current assets and current liabilities. It shows whether you have enough available resources to pay your short term commitments.

How does working capital affect cashflow

Working capital affects how easily you can pay suppliers, wages and tax on time. Strong working capital supports smoother cashflow and reduces day to day financial pressure.

How can I improve my working capital

You can improve working capital by tightening debtor collection, managing expenses, planning for regular commitments, using helpful apps and keeping your bookkeeping up to date.

Do I need extra finance to fix working capital problems

Sometimes extra finance is useful, but it should be based on clear reports and an understanding of why your working capital is under pressure, not used to cover ongoing problems.

How can First Class Accounts Ovens and Murray help with working capital

First Class Accounts Ovens and Murray keeps your books accurate, helps you monitor cashflow and working capital, and provides real world advice so you can make better decisions.