Dec
10
Just how much do you know about your business? No, not about what you sell, or how you make or deliver your products and services, I mean the really important things that determine whether you’re going to make it through to retirement or maybe even successfully selling your business.
These are my top eight favourite things each and every one of us business owners should know about our businesses: Read More
Nov
10
At A+BAC we make life easier for you.
Accounts and Tax Returns.
Making it easy for you by getting it right on time, every time. No fuss or drama and more advice for your hard-earned money. Contact us today: www.abac.co.nz or 0800 ASK NICK
Aug
11
When it comes to running your own business, keeping your accounting in-order must be an achievable goal. That said, there are times where a little lack of discipline can cause some headaches down the track. Rather than getting yourself in a bind later, let’s have a look at some simple steps you can take to help keep your accounting organised.
Jul
21
In the world of large-scale capitalism, corporate accountants shoulder huge responsibilities: They must monitor, analyze, and report the financial health of their organizations to both owners and stakeholders alike.
These reports, when positive, can be the catalyst for investments. For investors, supplying capital or purchasing stock in a business involves careful assessment of risk and benefit, of loss and gain. This insecurity is something that can be measured and analyzed.
But when a corporation provides false information – manipulated earnings, inaccurate invoices, or other misleading financial statements – investors have no idea what they’re getting into. And sometimes, with so much on the line, it can be tempting for accountants to make a business appear more financially sound than it actually is.
From accelerated revenues and shifting liabilities to Ponzi and pyramid schemes, we’ve compiled an overview of misleading accounting plots and provided insight on how you can identify them.
Jul
21
Trying to reduce your outgoings can be a daunting prospect when you’re stressed by falling turnover and running out of cash. Hindsight being such a wonderful thing, you probably realise by now that you should have put the equivalent of three months overheads aside for that rainy day, arranged for the preparation of monthly financials and prepared a budget and cash flow forecast to predict your current predicament but what can you do now to alleviate the pressure?
Follow these tips to alleviate cash flow pressure
May
13
ACC is a major business cost, especially for those in trades or lines of business where accident rates are high, yet many business owners just pay ACC bills willy-nilly without checking their correctness or looking for the many ways to reduce ACC. Here are some pointers to get you thinking.
Don’t take excessive ACC bills for granted or be put off by the complexity of ACC; seek advice and treat yourself with the savings made! Read the full article on ACC here.
Apr
30
For new businesses in that critical early period, cashflow is a vital part of staying afloat to establish and grow the business. Established businesses also know the importance of cashflow to help you keep everything running while you grow the business. If you can’t reach your targets for income, reining in your costs can help give you a little extra head room to manage cashflow while you’re planning your next move.
Cost control can contribute to business success or failure but it can be hard to get a handle on it as your business costs can work on a number of levels. It can be a challenge to pinpoint hidden costs or where your established ways of doing things cost you more money than they should.
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 all your business systems (or the gaps where there should be business systems) to see if poor practice is driving costs up unnecessarily.
It can be helpful to break it down a little. You can look at it in terms of cost centres such as power or office supplies. 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 (see the article on this page).
Every dollar you can pull back from your costs can go straight onto your bottom line.
Get in touch and chat to us if you’d like to review your costs and your systems to keep costs under control. Whether your sales are booming or busting, you want to make sure that while you’re focused on revenue, your costs aren’t ballooning and you’re still delivering on your bottom line.
Email nick@abac.co.nz or phone 0800 ASK NICK
Jan
13
Every business owner needs reliable figures to regularly check on business performance. Collecting data is useful in setting realistic targets towards increasing your profitability in 2015, and gives a baseline for monitoring your business throughout the year.
Types of measurement data to collect:
In a retail store, for example, (although this exercise is appropriate for other businesses), you need to collect the following data from the previous year:
By multiplying the figures, x * y * z, you can calculate the business’ annual turnover. Ensure this figure equals the total sales for the year.
The next step is to use these figures to set specific targets for the following year and record this data in your business plan, for example:
Increasing your turnover
Small increases can make a significant difference to your turnover. The question is: HOW do you make those increases?
That’s where you need to think about implementing marketing strategies to increase your total number of customers, or to increase the number of transactions made by existing customers.
For example, you could: reward existing customers for referring new people to your business; encourage add-on sales; directly target your customers to inform them of special offers or new products/services soon to be available, or even to inform them of other products and services offered by your business that they may not be aware of.
Maybe your focus for one year will be to increase your customer base; the next, to increase the amount each customer spends on each visit; and so on. Whichever way you plan to raise the figures, the basic measurement data will help you determine the targeted, annual sales figures for the current year.
Converting prospects to customers
Recording the number of enquiries you get each day or week and comparing this to the number of sales made in the same period provides your sales conversion rate and is useful in monitoring your targeted annual sales for the year. In a retail business for example, record the number of people who enter the store (prospects), and the number of sales made each day. Then calculate the percentage of sales to prospects. Record this figure and make it available to your team on a regular basis.
If you make a conscious effort to improve on the conversion factor each day, i.e., increasing the number of prospects who buy, it could significantly enhance the bottom line performance of your business.
Apr
24
Can keeping good books make you rich? Well, maybe not by itself, but it’s what you can do with the information in your books that just might, especially if you use modern and flexible accounting software. Here are five ways you can use MYOB accounting solutions to succeed in business.
Mar
25
It costs a few hundred dollars to form a limited company but despite that, many thousands of Kiwi’s continue to start businesses as sole traders or even worse, partnerships. In more than 30 years of looking after small businesses I’ve seen so many unfortunate and unnecessary situations and countless examples continue to crop up, so here are a few I’ve seen in the last year or so.
1. Outstanding GST. It’s a fact that the IRD in NZ are rubbish at collecting tax, so much so that many business owners use the IRD as a source of finance. Take a new client of mine in Hawkes Bay, a husband and wife partnership who now owe $85,000 in GST. Their business is failing but guess what – as a partnership they are fully liable personally for ALL the GST. If they were a limited company they could have walked away. Bankruptcy and ruin beckon……………
2. Accounts Receivable. Another husband and wife partnership client has received a demand for $175,000 from the liquidator of one of their former customers, who says they have to repay the money they legitimately received for sales made. Ridiculous maybe, but as a partnership they are fully liable and needless to say, they haven’t got $175,000 sitting around!
3. Legal Claim. Another client, a sole trader, was on the receiving end of a totally unexpected claim of $260,000, and guess what, his insurance company refused to pay up! Bye-bye house!
4. Partner’s Debt’s. Another client was in a two-man partnership. His business partner ran up debts willy-nilly and then cleared off. Guess who had to pick up the tab for the partner’s debts?
And it’s not just debt or financial ruin that makes a limited company so valuable:
5. Self–Employed Status. We are very lucky in NZ. You can trade as a limited company yet still retain your self-employed status so it’s crazy not to take advantage of this.
6. Tax. Both sole traders and partnerships are pretty useless for income-splitting to minimise tax. A company, on the other hand, is far more flexible.
7. Ease of Ownership Transfer. It’s so much easier to transfer wealth or assets when you have a limited company. No legal fees or tax issues to worry about!
Business is risky, so why take any more risk than you need to? If you need help with your business contact Nick on 0800 ASK NICK or email nick@abac.co.nz.
Find out more about Nick, the accountant with a difference.
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