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.

How to Measure Business Performance

Running a business means juggling a lot of moving parts. You’re focused on customers, staff, suppliers, and the daily to-do list. But if you’re not keeping an eye on the right numbers, it’s hard to know whether all that effort is actually paying off.

Knowing which numbers really matter, your critical numbers, helps you see what’s working, what needs attention, and where to focus your time. They’re the indicators that show whether your business is healthy, sustainable, and heading in the right direction.

At First Class Accounts Ovens & Murray, we help business owners make sense of their numbers. Because when you understand what to measure, you can make decisions that improve performance, strengthen cash flow, and take the stress out of running your business.

Why knowing your numbers matters

It goes without saying that business success needs to be measured. But it’s equally important to know what to measure. The numbers that matter most, often called your critical numbers, act as the levers that directly influence performance and outcomes.

Focus on four or five key metrics that provide genuine insight into your business health. 

These vary depending on your industry and goals, but most businesses should know their minimum viable sales figure per day or week to maintain operations. 

Understanding your gross margin (the percentage of sales revenue that remains after deducting direct costs) is also essential. It helps ensure you’re covering overheads, meeting personal income needs, and sustaining profitability.

In 2025, many businesses are also tracking non-financial performance indicators alongside their financial data. For example, customer satisfaction scores, staff retention rates, and workflow efficiency can all help identify where improvements will make the biggest difference to your results.

Choosing the right critical numbers for your business

Some examples of tailored critical numbers include:

• Return on investment (ROI) by team member: understanding how each employee contributes to overall business outcomes.

• Average value of proposals or quotes won: helps you refine your pricing strategy and identify where higher-value opportunities exist.

• Number of new client enquiries, networking calls, or meetings: provides insight into how well your business development efforts are performing.

• Average debtor days (the time it takes customers to pay): a critical indicator of cash flow health. If payments are delayed, it can quickly impact your ability to pay suppliers, employees, or the ATO.

At First Class Accounts Ovens & Murray, we often help clients set up real-time debtor tracking and cash flow forecasting tools using Xero and add-on apps like Calxa or Dext, so they can see exactly where delays are happening and take action early.

How to measure your numbers accurately

Once you’ve identified your key numbers, the next step is to determine how you’ll measure them. 

Real-time, cloud-based data has become the standard for smart business management in 2025. With the right software, you can access accurate, up-to-date information anytime, no more waiting for end-of-month reports to know how your business is performing.

Setting up your reporting structure properly from the start makes all the difference. You may need to adjust your chart of accounts, change how income or expenses are coded, or introduce tracking categories to separate revenue by product, service type, or location. These small adjustments create visibility and clarity, allowing you to make better-informed decisions.

Tools like Xero, ApprovalMax, and Calxa can automate much of this process, providing dashboards and reports that highlight performance in real time. 

At First Class Accounts Ovens & Murray, we can help you select, set up, and manage the right systems to suit your business so you always know exactly where you stand.

Turning measurement into improvement

As management expert James Harrington said, “Measurement is the first step that leads to control and eventually to improvement.” When you track the right metrics, you gain control over your business, identify potential risks early, and set the foundation for long-term improvement.

Reliable bookkeeping and accurate reporting give you peace of mind that your business is running as it should. When you understand your numbers, you can move from reacting to problems to proactively managing growth.

Understanding your numbers

If you’re unsure what to measure or how to track it effectively, First Class Accounts Ovens & Murray can help. From setting up cloud-based bookkeeping systems to creating customised management reports, we’ll make sure your critical numbers are clear, accurate, and always available when you need them.

Get in touch today to discover how we can help you take control of your business performance and build lasting confidence in your numbers.

Common questions business owners ask about measuring performance

What are critical numbers in business?

Critical numbers are the key metrics that have the greatest impact on your business performance. They help track financial health, efficiency, and growth.

How often should I review my business metrics?

Ideally, review them weekly or monthly using real-time reports from your bookkeeping or accounting software.

What software can help me track my business performance?

Tools like Xero, Calxa, Dext, and ApprovalMax can automate reporting and provide real-time visibility of your key business numbers.

Can a bookkeeper help me identify my critical numbers?

Yes. At First Class Accounts Ovens & Murray, we help you pinpoint, measure, and understand the numbers that matter most so you can make confident business decisions.

4 Tips to help your debtor management in 2025

Asking customers for payment isn’t always easy, but keeping money flowing into your business is essential. Without consistent cash flow, it becomes harder to pay wages, suppliers, or tax obligations on time.

When it comes to collecting what’s owed, communication, empathy, and smart systems go a long way. Managing your debtors well doesn’t just protect your bank balance, it helps maintain strong relationships and keeps your business steady.

Here are four simple ways to improve debtor management in 2025.

1. Communicate Early and Personally

Good communication is one of the most effective debtor management tools you have. Try to connect personally rather than relying on a generic email or automated message.

A friendly phone call or a short, personalised email to check if an invoice has been received can make a big difference. It shows you care about your customer and gives them a chance to raise any issues early.

Be proactive rather than reactive. Following up before payments are overdue helps you stay in control of your cash flow and avoids last-minute surprises.

If you’re unsure when to follow up, set clear payment terms on your invoices and send polite reminders a few days before the due date. Consistent communication shows professionalism and keeps payments front of mind.

If you find debtor management stressful or time-consuming, First Class Accounts Ovens & Murray can support you with simple systems that help you stay on top of cash flow and payments.

2. Add Value to Your Customer Relationships

Adding value to your customer relationships helps build trust and encourages timely payments. Think about how you can make it easier or more worthwhile for customers to pay you.

This might mean including a thank-you note with your invoice, sharing a quick update about your products or services, or offering a small loyalty reward for clients who always pay on time.

Small gestures go a long way. They show that you value your customers and appreciate their business. The more positive your relationship, the more likely clients are to prioritise your payment.

And if managing debtor relationships is taking up too much of your time, First Class Accounts Ovens & Murray can help you put the right systems in place to keep things running smoothly.

3. Offer Flexible Payment Options

The easier you make it for customers to pay you, the faster you’ll get paid.

If some clients are struggling with cash flow, consider breaking larger invoices into smaller instalments or extending the payment period slightly. You could also offer payment options such as bank transfer, BPAY, or credit card to suit their preferences.

Some businesses also find success offering a small discount for early payment, even 2–5% can be enough to encourage faster turnaround.

Being flexible doesn’t mean being taken advantage of. It’s about finding solutions that work for both sides while maintaining a consistent flow of income.

If you’re unsure what flexibility looks like for your business, First Class Accounts Ovens & Murray can help you review your payment terms and make sure they align with your cash flow needs.

4. Use Tools to Streamline Debtor Management

You don’t need to chase every invoice manually. There are affordable tools that automate reminders, track overdue accounts, and keep your records organised.

If you’re using cloud accounting software like Xero, you can set up automatic payment reminders or generate reports showing who owes what and when.

There are also simple add-ons that can help with cash flow forecasting and debtor tracking, giving you a clear picture of what’s coming in and going out each month.

Using technology doesn’t replace personal communication, but it can save hours of admin time and help prevent invoices slipping through the cracks.

If you’d like to explore how to make your debtor management more efficient, First Class Accounts Ovens & Murray can show you easy ways to automate reminders and track payments, without losing the personal touch.

Keep the Cash Flow Moving

Managing debtors well is part of running a healthy business. The more proactive you are with communication, the more predictable your cash flow becomes.

Even small changes, like setting clear terms, sending early reminders, and maintaining good relationships, can make a big difference to how quickly you get paid.

If you’re ready to improve how your business handles debtors and protect your cash flow, contact First Class Accounts Ovens & Murray today. We’ll help you put systems in place that save time, reduce stress, and keep your money moving.

Get Paid Faster: Your Debtor Management Questions Answered

How can I improve my debtor management quickly?

Start by reviewing outstanding invoices weekly, following up before payments are overdue, and using polite reminders.

What’s the best way to handle overdue accounts?

Stay calm and professional. Reach out early, understand the reason for delay, and agree on a payment plan that works for both parties.

What’s the most common debtor management mistake?

Waiting too long to follow up. Early and consistent communication makes a huge difference in getting paid faster.

Can a bookkeeper help improve my debtor management?

Yes. First Class Accounts Ovens & Murray can help set up systems that keep your debtor process simple, organised, and consistent.

Talk to us about ways to improve your debtor management.

How to create a cash flow forecast for your business

A cash flow forecast is one of the most important tools you can use for business planning. In 2025, with rising costs and tighter compliance deadlines, understanding exactly what cash is coming in and going out of your business is essential.

A forecast gives you a clear picture of how long your business can continue to operate at current sales levels by showing how much money you’ll have in the bank at the end of a given period. It’s not just about survival — it’s about building confidence in your numbers so you can make informed decisions about growth, payroll, tax obligations, and investment.

At First Class Accounts Ovens & Murray, we help business owners build reliable forecasts that take the stress out of cash flow management.

Why a cash flow forecast matters

A cash flow forecast gives you a clearer understanding of what’s driving revenue in your business and visibility over your expenses. With this knowledge, you can identify which costs are essential, which are flexible, and where you can make changes to improve your position.

Forecasting also allows you to model different scenarios, helping you see the outcomes of decisions before you make them. For example:

• What happens if sales dip for three months?

• How would expanding into a new channel impact your outgoings?

• Can you afford to bring on another employee, and when?

In 2025, lenders, investors, and government support programs increasingly expect to see detailed cash flow forecasts as part of their approval process. A strong plan demonstrates that you understand your numbers and have a strategy to deal with uncertainty.

If you’re applying for funding or looking to expand, First Class Accounts Ovens & Murray can help you prepare accurate forecasts that meet lender requirements.

What information do you need?

The accuracy of your cash flow forecast depends on the quality of the data you put in. While accounting software like Xero, MYOB or QuickBooks can automate parts of the process, you still need to ensure your records are up to date and accurate.

Here’s the key information to gather before you start building a forecast:

Understanding where your cash is coming from

Start with revenue from sales. Break your figures down by product or service line and across sales channels. This helps you identify your biggest income drivers. Ask yourself questions like:

• Does 80% of your revenue come from just 20% of your products or services?

• Which sales channels are the most profitable?

• Do you have a healthy balance of high-value/low-volume and low-value/high-volume sales?

Don’t forget to include other sources of income, such as government grants, tax refunds, or business investments. In 2025, many businesses are also earning income through digital platforms or subscription models. It’s important to make sure these are captured as well.

Understanding expenses, ie where is the cash going?

Your forecast should also capture all outgoing costs, such as rent, wages, supplier payments, bank fees and loan repayments, tax liabilities, utilities, and insurance. If you have a business loan, note down the repayment schedule, interest, and when the debt will be cleared.

It’s also important to include:

• Tax obligations (GST, PAYG, superannuation, company tax)

• Capital expenses (equipment, vehicles, or major purchases)

• Variable costs such as freight, raw materials, or commissions

Separating fixed and variable costs will help you understand which expenses can be adjusted if your income changes. For example, rent is fixed, but travel, marketing spend, or director’s drawings can usually be reduced if needed.

First Class Accounts Ovens & Murray can help you set up a clear expense structure so you always know what’s fixed, what’s flexible, and how to plan for tax payments on time.

Making informed decisions in your business

A reliable cash flow forecast brings all of your financial data together in one place. It shows you not only how long your business can continue at current income levels, but also gives you the confidence to make big decisions. For example, it can help you determine when to:

• Hire additional staff

• Purchase inventory or equipment

• Take advantage of a supplier discount

• Invest in marketing or expansion

Remember, a cash flow forecast is different to a budget. A budget projects income and expenses, but a forecast focuses on the timing of cash movements. For example, you may record a sale in your budget, but if the customer pays on 30-day terms, the cash may not hit your bank account until the following month.

Building confidence with cash flow

If cash flow forecasting feels overwhelming, you don’t have to manage it alone. With the right setup, you can use your accounting software alongside forecasting tools to get accurate, real-time insights.

At First Class Accounts Ovens & Murray, we work with you to create forecasts that not only show where your business stands today, but also help you plan ahead for payroll, tax, supplier payments, and growth opportunities.

Contact us today to start building a cash flow forecast that gives you clarity and confidence in your business decisions.

Forecasting FAQs

Q: What is the main purpose of a cash flow forecast?

A cash flow forecast helps you predict the money coming in and going out of your business so you can plan for expenses, payroll, and growth.

Q: How often should I update my cash flow forecast?

It’s best to update your forecast monthly. Regular updates ensure you capture seasonal income dips, upcoming tax payments, and changes in expenses.

Q: What’s the difference between a budget and a cash flow forecast?

A budget estimates income and expenses, while a cash flow forecast focuses on when money will move in and out of your bank account.

Contact us today to start building a cash flow forecast that gives you clarity and confidence in your business decisions.

6 secrets to getting prompt payment

Late payments continue to be one of the biggest challenges for small businesses. 

In 2025, reports show businesses are still experiencing delays that impact cash flow and create unnecessary stress. If this sounds familiar, the good news is there are simple, practical steps you can take to improve how quickly you get paid.

At First Class Accounts Ovens & Murray, we know that healthy cash flow is the backbone of a successful business. Here are six secrets you can put into action right now to help get paid faster.

1. Invoice without delay

Your customer can’t pay until they receive your invoice, so don’t put it off. Send invoices as soon as work is complete or goods are delivered. Customers are most open to paying while the job is fresh in their mind, and it shows you’re organised and professional.

In 2025, many accounting systems, such as Xero, allow you to set up automated invoicing. That means invoices are created and sent without delay, removing the risk of human error or forgetfulness.

Pro tip: Automating your invoicing through the right software not only saves time but also improves cash flow consistency. Talk to us about which option best suits your business.

2. Include all the information

An invoice missing key details is one of the most common reasons payments are delayed. Always include:

• a clear description of the work or product

• the date it was delivered

• the agreed price and tax details

• purchase order numbers (if required)

• your payment terms and methods

• the due date, clearly displayed

Some clients, especially larger organisations, have very strict invoicing requirements. If your invoice doesn’t meet them, payment can be held up for weeks. By checking in advance what information they need, you reduce unnecessary delays.

Pro tip: Using bookkeeping software can help you create invoice templates that meet your customers’ requirements every time. First Class Accounts Ovens & Murray can set these up for you so you’re confident every invoice is correct.

3. Ask for prompt payment

Long payment terms are no longer the norm. Many businesses now set 7–14 day payment terms, and some industries even expect payment within 48 hours. By clearly setting your terms up front, you set the standard for how quickly clients should pay.

In 2025, with faster payment technology available, there’s little reason to offer 30-day terms unless your industry requires it. Shorter terms not only speed up cash flow but also reduce the need for chasing overdue invoices.

Pro tip: Review your payment terms today. Even shifting from 30 days to 14 days can make a big difference to your cash flow over the year.

4. Be easy to pay

Customers pay faster when the process is simple. The more payment options you offer, the easier it is for them to clear your invoice quickly. In 2025, this includes:

• credit card payments

• direct debit or bank transfer

• PayPal, Stripe, or similar payment gateways

• instant pay links embedded in invoices

When your invoice lands in their inbox with a clickable “Pay Now” button, there’s no excuse for delay.

Pro tip: Many modern accounting platforms integrate payment options directly into invoices. First Class Accounts Ovens & Murray can help set this up so your clients can pay you with one click.

5. Chase payments

Sending an invoice is just the first step. Following up is essential. Most businesses don’t mean to pay late, invoices often simply get lost or forgotten in busy workflows.

In 2025, automated reminders can help reduce the awkwardness of chasing payments. You can set polite reminder emails to go out before the due date, on the due date, and if payment is overdue. If the invoice still isn’t paid, a personal phone call is often the fastest way to resolve it.

Pro tip: First Class Accounts Ovens & Murray can set up reminder systems tailored to your clients and industry so chasing payments becomes part of your process, not an afterthought.

6. Talk to us about your invoicing system

Managing invoices and cash flow doesn’t need to be stressful or time-consuming. At First Class Accounts Ovens & Murray, we specialise in helping businesses streamline their bookkeeping processes, set up automated invoicing systems, and stay on top of payments.

If late payments are keeping you up at night, let’s fix it. 

Contact First Class Accounts Ovens & Murray today and find out how we can help you get paid faster and keep your cash flow healthy.

FAQs about getting paid faster

Q: What is the fastest way to get paid by clients?
The fastest way to get paid is to send invoices immediately, make it easy for clients to pay with multiple payment options, and set shorter payment terms such as 7–14 days.

Q: How can I reduce late payments in my business?
You can reduce late payments by automating invoicing, including all required details on invoices, sending payment reminders, and following up quickly when invoices become overdue.

Q: What payment terms should small businesses use in 2025?
Many small businesses are now using 7–14 day payment terms instead of the traditional 30 days. Shorter terms encourage prompt payment and improve cash flow.

Q: How do bookkeeping systems help with getting paid faster?
Modern bookkeeping systems like Xero, MYOB, or QuickBooks can automate invoicing, add “Pay Now” buttons to invoices, and send automatic payment reminders, making it easier for clients to pay on time.

Yes. First Class Accounts Ovens & Murray can help you set up automated invoicing and reminders tailored to your business so you get paid faster and improve your cash flow.

The Fundamentals of a Business Budget

If you want to take control of your business finances and set your sights on growth, you need a budget. It’s one of the most useful tools for staying on track and making smart, informed decisions.

Put simply, your business budget shows what you plan to do with your cash over the next 12 months. It helps you stay clear on where the money is coming from, where it’s going, and what you want the future to look like.

At First Class Accounts Ovens & Murray, we help business owners turn their budgets into practical tools using real-time data and industry-leading apps like Calxa, Futrli and Spotlight. 

So, you’re not just making plans, you’re actively managing your business with clarity and confidence.

What a budget tells you

Your budget is just one part of your financial toolkit. When you look at it alongside your profit and loss statement, balance sheet and cashflow forecast, you get a complete view of your business health. Together, these reports help you plan, monitor performance, and adjust as needed.

A budget gives you a forward-looking lens. It helps you forecast income and expenses, spot seasonal trends, and set targets that are grounded in data—not guesswork.

By comparing your actual results to your budget, you can quickly see where things are going to plan and where they’re not. That gives you time to act—before small issues become major problems.

Why budgeting makes a difference

Creating and using a budget gives you more than just a spreadsheet of numbers. It helps you:

• Understand how your income and expenses change throughout the year

• Set realistic financial goals and track your progress

• Spot cash shortfalls or unexpected costs early

• Stay motivated and focused on what matters most

• Make confident, informed decisions at the right time

And once your budget is in place, it becomes a reference point for everything else. From managing day-to-day operations to planning for bigger moves like hiring staff or investing in new equipment.

We regularly support clients to build and refine budgets in platforms like Calxa, Futrli and Spotlight. These tools are powerful, visual, and designed to work with your accounting software. They help bring your numbers to life, so you can see what’s possible and take action faster.

Where to begin

Every budget starts with what you know: your regular income and expenses. From there, we work with you to add in assumptions about timing, growth, pricing, and planned costs.

Most businesses start with a single budget, but over time, you might develop a few different versions. For example, you might have:

• A business-as-usual version, based on past results with minor adjustments

• A worst-case version, to plan for lower-than-expected sales or higher costs

• A best-case version, where you aim higher and prepare for growth

These versions can help you stress-test your business model and prepare for different outcomes, without the panic. First Class Accounts Ovens & Murray can guide you through each stage, setting up your budgets and tracking them monthly against your actual results.

And if you want to project out beyond the next 12 months, we can build multi-year budgets that support longer-term planning and investment.

Keeping it useful

A budget isn’t something you set and forget. It should evolve with your business.

We run monthly financial reports for our clients and compare them against their budgets. That way, they can make timely, informed decisions and adjust their plans based on what’s really happening, not what they hoped would happen.

Apps like Calxa, Futrli and Spotlight make it easy to track and visualise this performance over time. Whether you prefer a dashboard view, a simple graph, or a detailed breakdown, we help you get the insights in the format that works best for you.

Ready to start?

It’s never too late to build a budget that works. Whether you’re brand new to budgeting or looking to improve what you’ve already got, we can help you create a plan that’s relevant, practical, and aligned with your business goals.

Book a time with First Class Accounts Ovens & Murray and let’s set up a budget in your accounting software that gives you more control, more insight, and a clearer path forward.

Dealing with uncertainty – tips for business owners

Whether you’re facing changing market conditions, supply chain disruptions, or other challenges, there’s still real uncertainty for business owners. We’re trading in challenging times at present. 

And knowing what step to take next is a key worry. We know that you invest more than simply time and money into your business. It is more than a job but part of your identity.

So, how do you get more clarity around your future plans? And how do you work on the short-term future of the business, when sales, income and cash are in short supply?

Focusing your efforts in the right places

Planning the next business move is difficult at the best of times, but it’s doubly problematic when we have so little clear idea of what a post-COVID19 business world will look like.

It's difficult to plan when we don't know what will be possible. What regulations will be in place once you can begin trading? Will the market have changed dramatically? Will you be able to trade over borders and continue to be an international operation? Will you have enough cash to actually operate?

As a business owner, you’ll be continually thinking of new business-critical issues to add to this list – but the reality is that you CAN’T control all these elements. This sense of mounting uncertainty is likely to raise your stress levels and make you more anxious.

So, how do you overcome these worries and find a practical solution?

Try to focus on the things you can control:

• Identify the things that matter to the short and long-term success of the business

• Find the things you can control and over which you have some influence.

It's too overwhelming to try and work on everything at the same time. Instead, try to focus on the one thing you can achieve each day.

At First Class Accounts Ovens & Murray, we can help you identify and prioritize these elements through detailed management accounting and cashflow forecasting. These tools empower you to make informed, confident decisions, even when navigating uncertain times.

Review your overheads and costs

One way to reduce your cashflow worries is to reduce your spending. Look at your controllable overheads and see if there are ways to negotiate better terms with suppliers, cut down on expenses or pause any subscriptions.

Our team can assist by reviewing your financial data and providing insights into where savings can be made without sacrificing operational efficiency. With First Class Accounts Ovens & Murray managing your accounts, you’ll save time and gain clarity.

Talk to debtors and creditors

If you can bring down your aged debt, that will help your overall financial health. Set up automatic reminders for any overdue payments. Also, talk to any late-paying customers and agree when these debts will be paid. And talk to suppliers about extending payment terms, if possible.

First Class Accounts Ovens & Murray can streamline your debtor management process by setting up automated payment reminders using integrated apps like Xero. These tools ensure your customers receive consistent, professional reminders about outstanding invoices, helping you reduce late payments and improve cashflow.

Our expertise extends to configuring these apps to suit your business, saving you time and ensuring payments are followed up efficiently. We can also assist with tracking your accounts payable, giving you better visibility and helping you negotiate extended payment terms with suppliers when needed.

Consider alternative revenue streams 

If your current business model doesn’t work well in lockdown, are there other online services that you could diversify into? Any new revenue streams will help to bolster your income and cash position.

Update your website and marketing

Having a great online presence is vital during this crisis, when most goods and services will be purchased online. Give your website a refresh and make it easy for potential customers to find and buy your services.

Catch up with your team

Maintaining contact with your employees is vital if you’re going to nurture team spirit. The more engaged your team is, the easier it will be to embrace change together.

Reach out for tailored support

First Class Accounts Ovens & Murray offers flexible, 100% contract-based bookkeeping services. This means no interruptions due to staffing gaps—your accounts will always be managed on time, accurately, and with efficiency. By partnering with us, you can focus on growing your business while we handle the financial details.

Take control of what you can today by seeking expert advice and support. With First Class Accounts Ovens & Murray, you’ll gain access to expert bookkeeping, process improvement, and cashflow solutions to help you stay ahead, no matter the challenges.

Cashflow and cost control

More than ever, cashflow is a vital part of staying afloat, whether your business is in recovery or growth mode.

Revenue, profit, and your bottom line are always important, and in 2024, maintaining steady cashflow remains the foundation for keeping your business running smoothly and adapting to challenges as they arise.

Regular cashflow forecasts will help you keep that in focus. Here’s why:

Cost control  

If you can't reach your targets for income, reining in your costs may give you a little extra head room to manage cashflow while you plan your next move.

At First Class Accounts Ovens & Murray, our team provides detailed cashflow analysis and forecasting services, ensuring you have a clear picture of your financial position. With actionable insights, we help you identify areas where costs can be reduced without compromising business quality.

Visibility on outgoings 

Cost control can be a challenge when it’s hard to pinpoint hidden costs or where established ways of doing things cost more money than they should. You may also have been coping with unexpected expenses, as you’ve adapted your business for unplanned circumstances.

We can your financial systems and processes to identify inefficiencies. Our expertise in management accounting ensures your data is not only accurate but also timely, so you’re never left guessing where your money is going.

Improving business practice

It's more than just keeping an eye on outgoings (though that's important). It's about looking at each aspect of your business and business systems (or the gaps where there should be business systems) to see if poor practice is driving costs up unnecessarily.

Streamlining your processes can drastically improve your cost control. We work with you to implement appropriate apps to improve efficiencies, save time and money, and reduce costly errors.

It can be useful to break it down  

You can look at cost centres such as office supplies or freight. Or you can look at what those costs do for your business.

It can help to analyse costs in terms of cost of sale and overheads.

Cost of sale and overheads

Cost of sale (also known as Cost of Goods Sold or CoGS) is how much it costs you to make a sale. In a business which sells products, CoGS is based on the price paid for the product, plus any costs necessary to put the merchandise into inventory and make it ready for sale, including shipping and handling. You can even break it down to calculate the cost of sale of individual units.

Overheads are general business expenses. They can’t be tracked directly to sales. Overheads are what it costs you to open your doors (whether online or actual) every morning.

What’s your plan?

1. Reduce unnecessary expenses
   Now might be the time to trim every expense that’s not related to your core product or service.
2. Suppliers
   Are you able to work with your providers to ask for discounts or more favourable payment terms on either cost of sale or overhead expenses?
3. Talk to the team
   Analyse your costs and involve your team, including frontline sales staff.
4. Advertising
   It might be a false economy to cut back on advertising, as customers are online looking for bargains and price-checking alternatives. Targeted campaigns might work better.
5. Prioritise
   Can you pinpoint the products most likely to bring the fastest or best return and hold back on products that are a slower sell?
6. Promote or discount
   If you have old or slow-moving stock, can you discount it and convert old stock to cash? If you can attract customers now, you may be able to use it to spotlight your other products.

Making managing cashflow easier

Every dollar you can pull back from your costs can go straight into cashflow. Whether your sales are booming or slow, keeping your costs under control is key to sustaining growth and stability.

At First Class Accounts Ovens & Murray, we understand the importance of managing your cashflow effectively. From cashflow forecasts to systems that streamline your operations, we partner with you to ensure your business has the financial stability it needs.

Want to get a handle on cash flow in your business?

Whether your sales are boom or bust, you want to make sure that your costs aren't holding you back. We can help.

Talk to us if you'd like to review your costs and your systems to keep costs under control. .

Reduce your debtor days and improve cashflow

Managing the gap between the receiving money into your business and paying money out of your business is vital for sustaining viability.

So, how do you reduce your debtor days and improve your cashflow? Let's start with understanding debtor days. 

Debtor days is the average number of days taken for a business to receive payment for goods or services. Keeping track of the average number of days for a business to receive payment is important in understanding the cashflow gap you might experience and the impact on cashflow planning and budgets.

How to calculate debtor days

(Year-end receivables amount ÷ annual sales) x 365 days = average debtor days.

Here's an example: An IT consultant has in her terms and conditions that payment is due 21 days after invoice date. But she is interested to know what the actual average payment time is.

Trade debtors at 30 June 2019 = $35,000

Annual sales for 2019 = $478,000

(35,000 ÷ 478,000) x 365 = 26.7 days

With this information, she can either alter her cashflow planning according to the actual time-frame or take steps to reduce the average number of debtor days.

Here are ten things you can do to reduce the payment times?

1. Update your payment terms

Make sure the terms are clear on every invoice issued. Don’t forget to include bank details on the invoice!

First Class Accounts Ovens & Murray can assist in reviewing your payment terms and help integrate them into your invoicing software, ensuring consistent communication.

2. Regular admin

Schedule a regular time for your own administration and get your invoices out promptly.

3. Send to the right person

When you send invoices, make sure you address the email personally to your contact. Send the invoice to multiple addresses if possible, for example, your contact and the accounts department.

We can assist in setting up automated systems to manage your contact database, minimising errors in invoice distribution.

4. Use technology to your advantage

Use automated invoice reminders to notify customers when an invoice is about to be due and then when it is overdue. Do not wait to send notifications manually, let the software do it as soon as the invoice is a day overdue.

We can help implement the latest accounting software that includes automated reminder features, keeping your invoicing on track.

5. Make it easy for your customers

List the payment terms, for example, due in 14 days, as well as the actual due date.

6. Provide incentives for early payment 

For example, a 5% discount if paid within five days.

7. Offer several payment methods for clients

Adding options like credit card payments or online gateways such as PayPal makes it easier for clients to pay promptly.

We can advise on and set up various payment methods, ensuring integration with your existing systems.

8. Offer instalment payment plans over a mutually agreed period. 

This allows you to plan for part payments, rather than being inconvenienced by the whole invoice being paid late.

9. Do not offer unlimited credit to customers

Make sure your terms and conditions include the right to refuse further supply if invoices are outstanding. Request part or full payment before supplying more goods or services.

10. Talk to your suppliers

Maintain good relationships and clear communications so they are more likely to help you if you need an extension on your bills. If possible, renegotiate supplier terms that suit your business cashflow.

Take Advantage of Low-Activity Phases

During periods of lower business activity, take the time to:

• Update Terms and Conditions: Make sure they reflect your current business needs.
• Implement Alternative Payment Options: The more ways customers can pay, the fewer barriers there are to timely payment.
• Refine Business Systems: Use this time to review processes and find ways to improve them.
• Revamp Your Website: Ensure payment information and terms are clearly displayed.

First Class Accounts Ovens & Murray can support you in enhancing your business systems with app integration. We offer tailored advice on selecting and implementing the right apps for payment processing, invoicing, and cashflow management. Our services include ensuring seamless integration with existing systems to improve efficiency. We can also conduct cashflow analysis using app-based tools to compare your debtor days with industry standards, pinpointing areas where technology can help reduce payment times and optimise cashflow.

Talk to us about adding payment options, updating your software and improving business systems to assist in reducing the number of debtor days to improve your cashflow.

We can also look at average debtor days of your business compared to industry averages and discuss ways of managing cashflow during difficult periods.