Cash flow is the amount of money that goes in and out of your business; that is, income and expenses.
Having enough cash at the right time will make it easier for your business to pay bills and other expenses and meet your tax, superannuation and employer obligations.
Paying regular attention to your record-keeping and reporting tasks will help you better manage your cash flow. Managing your cash flow allows you to plan for the future, for example, prepare for large expenses or expand your business.
Prepare a cash flow budget or projection
The best way to make sure you have enough cash available to meet your tax and other obligations is to do a cash flow budget or projection. This information will help you to:
see your likely cash position at any time
identify any fluctuations that may lead to potential cash shortages
plan for your tax payments
plan for any major expenses
provide lenders with additional information.
Accounting for income and expenses can help keep your business running smoothly – by giving you an overview of when you can expect money to come in and when it may go out and highlighting where you may need to direct your money.
There are three main things to consider when creating your cash flow budget:
1. Timing
A cash flow budget isn’t ‘set and forget’. You can choose to work out your budget on a monthly, quarterly or yearly basis, depending on what you need or works for you.
As your business grows or your situation changes, keep monitoring your budget to see how you’re tracking and update it if needed.
Watch out for things such as significant differences between your budgeted amounts and your actual results.
2. Costs
Try to include all of your fixed costs and expected variable costs, for example, rent, insurance, utilities, advertising, internet, wages, equipment and taxes such as pay as you go (PAYG) instalments and goods and services tax.
3. Income
If you’re just starting out, estimate your expected income and you can continue to update your cash flow budget to help you keep track of income versus expenses.
Once your business has been running for a while, you’ll be able to get a better idea of the business income you may be able to expect.
Being more conservative with this amount may help give you some flexibility if unexpected, more costly expenses come up.
Your budget results will help you with your business decisions.
Budget planning
Do you know how to create a budget for your business? A budget is simply an estimate of income and expenditure for a set period of time.
Creating a budget will help you plan the future of your business, most especially your profits.
The professionals at Notch Above Bookkeeping have the skills and expertise to help you set a realistic budget as well as advice on how to stick to it. Call our business bookkeepers Australia-wide on 1300 015 130.
Small business owners: Don’t wait to prepare for the holiday season
The holiday season is normally one of the busiest times of year for small business owners in the retail space and this year will prove no different.
In fact, due to continued supply chain challenges like bad weather, container shortages, product shortages and continued port closures due to the pandemic, business owners all over the world should start holiday preparations even earlier this year.
Consumers have also been warned about shipping delays for this upcoming season. As such, many are getting a head start on holiday shopping. Fortunately, there are many things that small businesses can begin doing now to prepare. Here are some tips to get ahead of the holiday rush.
Ensure you have the right tech stack
A comprehensive tech stack can be your secret weapon as a small business owner.
The right technology and partners can help you seamlessly manage cash flow, inventory and staff – all important variables around the holiday season and especially during times of crisis. For example, a reliable POS (point-of-sale) system can help with efficiencies, inventory management and cost savings.
Working with cloud technology platforms like Xero and those offered in Xero’s app ecosystem to support back-office and bookkeeping can save you valuable time better spent handling inventory, marketing plans and other tasks to run your business.
Get your funds in order
There’s no time like before the holiday rush to make sure your finances are totally in order before your attention shifts to focus heavily on inventory and deliveries. It’s important to have an accurate, up-to-date view of how much cash you’re going to need as well as account for any spikes or dips you expect to see over the next few months.
Small businesses that still operate on paper or within Excel can easily misplace or miscalculate important figures. If you’re having trouble on your own, partner with a bookkeeper to make sure you don’t miss a beat. We can advise and help with all finance functions for the business.
Doing the pre-work will pay off. When year-end sneaks up on you right after the holidays, you’ll enter the New Year organized and ready to hit the ground running.
Double down on your online presence
In the age of lockdowns and continued uncertainty, an online presence has never been more important.
Brick and mortar retailers are not only competing against Amazon and other eCommerce websites but other digitally-savvy small businesses.
Consider the end-to-end customer experience for a hypothetical customer across the country. How easily can they find information about your business? How can they place an order or get in touch with your team?
Also consider how new customers find you. Can you beef up your presence on social media? Boost your marketing with targeted advertising? These are all tactics that can positively impact customer experience and your bottom line around the holidays.
Play up the benefits of being a small business
There are many traits that make big business different from small business that you can take advantage of during the busy holiday season.
For example, make sure your seasonal staff understands the ongoing flexibility available to them. If you don’t need their hand in the store or onsite, consider how they can help in other ways.
For shoppers who need more personal attention, play up the one-on-one in-store shopping experience to help people find the perfect gifts for their loved ones. Use the ability to personalize to your advantage. Playing up the personalization now within your orders and shipping will keep shoppers coming back.
In addition, to battle supply chain issues, diversify shipping options and utilize different carriers to fulfil orders.
During the holidays, it’s important to remember to stay nimble and flexible as things change because, of course, even the best-laid plans can always be disrupted during unexpected periods. Despite ongoing challenges and lots of change, you can prevent disorganization and feeling unprepared for the busy period by doing a little bit of advanced planning to make sure your customers have the most seamless experience.
For more tips, advice and bookkeeping essentials for your business, visit How We Help You and get started today with Notch Above Bookkeeping, Australia-wide.
Source: Xero
https://notchabove.com.au/wp-content/uploads/2021/02/masked-shopper.jpg12602240Notch Above Bookkeepinghttps://notchabove.com.au/wp-content/uploads/2017/09/Notch-Above-Bookkeeping-Service-Brisbane-Logo-300x136.jpgNotch Above Bookkeeping2021-11-15 07:36:112021-11-09 07:50:17Preparing for the holiday season
Fresh support announced as NSW gets back to business
As part of the Economic Recovery Strategy, the NSW Government has committed to providing a Summer Holiday Stock Guarantee grant for Small and Medium Enterprises.
What is the SME summer holiday stock guarantee grant?
Under the SME Summer Holiday Stock Guarantee, hospitality and retail businesses will be able to apply for a grant of up to $20,000 to compensate for loss of perishable stock, or claim $10,000 for reduced capacity to sell non-perishable items, if they’re forced to close their doors between 1 December 2021 to 31 January 2022, due to a public health order.
What businesses are eligible?
Hospitality and retail businesses with an annual turnover between $75,000 and $50 million.
How do businesses apply?
Businesses will be able to apply via the Service NSW website. More information will be made available shortly.
In the meantime, contact Notch Above’s team of Xero certified cloud business bookkeepers Australia-wide on 1300 015 130.
As part of the agreement, the casual weekend penalty rates will increase in five instalments starting from 31 January 2022 and finishing on 31 December 2023. From 3 November 2021 to 30 January 2022, casuals will continue to be paid their usual weekend penalty rate.
Currently, under the Hair and Beauty Award, a casual’s weekend penalty rate doesn’t include their 25% casual loading. This is changing so that casuals who work weekends are now entitled to be paid a weekend penalty rate that also includes their casual loading to compensate for permanent entitlements like sick and annual leave.
The announcement follows a decision made by the Fair Work Commissioner back in October after a process involving unions and industry associations.
Back in January 2020, Fair Work invited the Australian Workers’ Union (the AWU), the Shop, Distributive and Allied Employees Association (the SDA) and Hair and Beauty Australia (HABA) to provide notice as to whether they wished to provide further materials in relation to the Saturday and Sunday penalty rates applicable to casual employees covered by the Hair and Beauty Award.
In July, Hair Stylists Australia (which is powered by the AWU) announced an agreement had been reached between themselves, the SDA and HABA which they would put forward to the Fair Work Commission.
HSA said a total of around $5.75 per hour will be added to weekend casual rates, and at the end of the phasing-in period, this means a casual hair stylist working a full eight-hour day over the weekend would take home an extra $92.
Meanwhile, the Hair and Beauty Award has already increased by 2.5% from 1 November alongside a whole bundle of industry awards as part of its Annual Wage Review 2021, as announced back in June.
Notch Above Bookkeeping are Xero business bookkeepers and Certified Xero Platinum Partners Australia-wide, specialising in cloud bookkeeping setup, training and ongoing support. Call us on 1300 015 130.
Source: mybusiness
https://notchabove.com.au/wp-content/uploads/2021/11/fringe-cut-hair.png788940Notch Above Bookkeepinghttps://notchabove.com.au/wp-content/uploads/2017/09/Notch-Above-Bookkeeping-Service-Brisbane-Logo-300x136.jpgNotch Above Bookkeeping2021-11-05 08:06:472021-11-05 08:06:47Increased penalty rates for casual hair and beauty weekend workers
From 1 November 2021, if you have new employees start, you may have an extra step to take to comply with choice of fund rules if they don’t choose a super fund. You may now need to request their ‘stapled super fund’ details from the ATO.
A stapled super fund is an existing super account that is linked, or ‘stapled’, to an individual employee so that it follows them as they change jobs.
If you don’t meet your choice of super fund obligations, additional penalties may apply.
The change aims to reduce account fees by stopping new super accounts from being opened every time an employee starts a new job.
Get ready
To make sure you’re ready to request stapled super fund details, check and update the access levels of your authorised representatives in ATO online services.
If an authorised representative doesn’t:
have full access to ATO online services, they will need to have the ‘Employee Commencement Form’ permission in order to request a stapled super fund
need to access this service, you should remove this permission for them to protect your employees’ personal information.
What employers need to do from 1 November 2021
You may need to request stapled super fund details when:
your new employee starts on or after 1 November 2021
you need to make super guarantee payments for that employee, and
your employee is eligible to choose a super fund but doesn’t.
You don’t need to offer a choice of super fund to some employees, but you may still need to request their stapled super fund details. This includes employees that are either:
temporary residents
covered by an enterprise agreement or workplace determination made before 1 January 2021.
To review each itemised step of the stapled super fund process, visit the ATO website or contact Notch Above’s team of Xero certified cloud business bookkeepers Australia-wide on 1300 015 130.
Source: ATO
https://notchabove.com.au/wp-content/uploads/2018/10/Notch-Above-Brisbane-Bookkeeping.jpg30003263Notch Above Bookkeepinghttps://notchabove.com.au/wp-content/uploads/2017/09/Notch-Above-Bookkeeping-Service-Brisbane-Logo-300x136.jpgNotch Above Bookkeeping2021-11-01 08:16:282021-11-05 08:27:08Stapled super funds start this month
Small businesses falling short in data privacy obligations
The vast majority of Australia’s 2.4 million small businesses are inadequately prepared for sweeping changes to the Commonwealth Privacy Act, according to new research from leading global technology platform, Zoho, which found that only one-third of small businesses currently have a defined and documented data privacy policy.
The research found that one in every four businesses (27 per cent) either do not have a data privacy policy or are unsure if they do. The remaining 38 per cent have an informal policy, an unenforced policy, or have not read their policy.
“Data privacy is one of the defining issues for the business community today. Unfortunately, confusion and uncertainty reign supreme amongst Australia’s small businesses,” said Vijay Sundaram, Zoho’s Chief Strategy Officer.
“Many of those who must comply with proposed legislative changes are woefully unprepared, while the vast majority – whether the Privacy Act applies to them or not – are highly exposed to a breach with serious implications.
“It’s still too easy for small businesses to overlook their responsibilities when it comes to data privacy, but the threat and the potential cost is real.”
He added that the technology sector and regulators must prioritise awareness, among small businesses.
“Small businesses cannot be expected to become privacy and cybersecurity experts, so the technology industry and policymakers must make awareness, education and action amongst these businesses a top priority.
“Otherwise, with regulation becoming more stringent, penalties more severe and attacks more prevalent and damaging, small businesses will be unfairly and disproportionately impacted. For them, a breach could be catastrophic,” Mr Sundaram said.
Credit: Zoho
What is the Commonwealth legislation for privacy?
As per the Office of Australian information Centre (OAIC), the Privacy Act was enacted to promote and safeguard individuals’ privacy and to govern how Australian Government agencies and organisations with annual revenues of more than $3 million, as well as some other organisations, handle personal information.
What are the suggested changes to the legislation?
Currently, the majority of Australian businesses are exempt from compliance with the Privacy Act because of the small business exemption. The small business exemption is a monetary threshold that exempts businesses with annual revenue of less than $3 million from the Privacy Act. The OAIC has proposed that the exception be repealed as part of Australia’s various privacy reforms.
Employers who handle employee records are also exempt from the Privacy Act. The OAIC has proposed that this exception be also deleted.
Third-party persistent cookies
Third-party persistent cookies, often known as tracking cookies, are saved in the memory of your device and have an expiration date.
Third-party persistent cookies, on the other hand, are accessed on websites that did not create them. This enables the cookie’s creator to gather and receive data whenever the user visits a page containing a resource that belongs to them.
Credit: Zoho
Slightly less than half (43%) are either uncomfortable or very uncomfortable with their customers’ data being used by companies with which they have no direct contact, 32% are ambivalent, and 25% are either comfortable or very comfortable with their customers’ data being accessed.
The fact that one in three were unsure highlights the importance of education and awareness. This, however, is lacking.
Only 20% of small businesses say third-party providers have done a good job of clarifying how their data is utilised. In comparison, 31% say suppliers have done a poor or inadequate job, and another 31% haven’t even explored the topic, indicating that basic awareness is lacking.
“Australia is a nation of entrepreneurs, and while running a small business should be celebrated and encouraged, there are critical data requirements,” Sundaram continued.
“Operating a business – no matter the industry – in a COVID-19 -the normal world will be dependent on collecting more data – for health and safety measures and as a competitive advantage – than ever before.
“The reforms are designed to protect, but they must allow adequate time to, first, educate small businesses about their requirements and then ensure that they’re compliant.”
Almost half (44%) of the businesses allow tracking on their website to share content on social media sites – some of which have been involved in well-documented privacy breaches. Almost a quarter (21%) use third parties to track advertising activity.
Google (30%) and Facebook (25%) are the dominant platforms, garnering over half of all small business advertising activity.
Support needed for education, retail
According to the Office of the Australian Information Commissioner (OAIC), the three most common industries to experience and report a data breach are financial services, healthcare and education.
While almost half of the financial services and healthcare bodies have strong policies and practices, only 22% of educational institutions have a defined, documented and enforced data privacy policy.
Credit: Zoho
Few industries have changed more drastically in the wake of the pandemic than education, with millions of students participating in remote education. Not only do the majority of education providers not have a defined, documented and enforced policy, but they are also three times more likely to say technology vendors had done a bad or unsatisfactory job of explaining data tracking (39%) than those who had done a good job (14%).
With lockdowns closing highstreets for prolonged periods, eCommerce sales have reached new heights over the last 18 months. Despite their reliance on online channels, fewer than one in three retailers (31%) have a defined, documented and enforced data privacy policy; a grave figure as the busy retail season approaches.
“The nature of our business means that we handle incredibly personal, private information. We’re required to obtain 100 points of identification – including a passport, driver’s licence, date of birth – from every client and store information in an incredibly discreet, circumspect and sensitive way.
“We have to demonstrate to the regulator that we can keep our client’s data safe, and a strictly enforced privacy policy that we communicate to our clients,” said Ray Trevisan, Fund manager/Director at OTG Capital.
“We use multi-factor authentication, secure blockchain signed documents, password protection and generator tools, so we’re comfortable that we have the systems in place to provide the safety and security that our clients deserve.
“However, hackers are becoming more aggressive and sophisticated, so we have to be smarter and more diligent in safeguarding our business. The safety of our clients and the reputation of our business depends on it.”
Most Australian businesses use invoices in some form, either sending them to their customers or to receive bills.
The way they do so, though, can soon change with e-invoicing, the latest government initiative to improve digitisation by equipping small businesses with a new tool to streamline their operations.
E-invoicing is a way to exchange invoices with other businesses that removes the hard parts and makes the whole process faster, more secure and more efficient.
Businesses that adopt e-invoicing can save, too. Each time an e-invoice replaces a paper or PDF invoice, it can save a business up to $20. This can add up fast for the 89 per cent of Australian small businesses (and their bookkeepers) still processing paper or PDF invoices manually.
We know it’s a challenging time for many small businesses right now without adding more to the mix. Since e-invoicing is just starting to roll out in Australia, you won’t see any big changes yet.
Instead, now is the time to register so you can easily get started when it’s ready for wider use – and don’t worry, it only takes a few minutes. With more big businesses and government departments getting on board, take a moment to get familiar with e-invoicing and prepare for the future.
So, what exactly is e-invoicing and how is it different to what I already do?
E-invoicing is a new addition to the toolkit of how Australian small businesses send and receive invoices and bills. Normally, invoices are created in accounting software or manually in a word processor and sent via insecure email or printed and posted. Businesses, or their advisors, then enter the data into their system, manually or with the help of automation tools like Hubdoc, before making payment. E-invoicing, on the other hand, is a way for businesses to exchange invoices directly between accounting systems, removing manual data entry.
What are the benefits of e-invoicing?
E-invoicing promises to make life easier for small business owners and bookkeepers who spend time managing invoices and bills. And since most small businesses trade with each other, they’ll feel the effects fast. For businesses that work with larger organisations or government agencies, they will find it easier to handle the payments process.
Other benefits also include:
Speedy payment times: Paying invoices is faster since they arrive as a pre-populated bill, ready to be approved. This reduces the need to manually extract information saving on the admin time. Plus, some government agencies are already committing to faster payment times.
Reduced errors: Less manual input reduces the risk of errors being made as well as minimise the likelihood of invoices getting lost in transit.
Increased efficiency and accuracy: Standard fields ensure all data is exchanged from ‘machine to machine’. This means invoices pass through fewer hands to get to their destination, so there’s less chance of human error or something going wrong.
Greater security: Invoices are exchanged through a secure e-invoicing network, with no human intervention, reducing the risk of fraud. This gives you peace of mind that an invoice will reach the right customer safely.
Cash flow visibility: Sending and receiving e-invoices gives a more accurate, complete and timely picture of your cash flow. With all your invoices and bills stored in a single ledger, you can see how your business is performing at any given time and use this to make informed decisions.
What if I already manage invoices electronically, such as in Xero?
E-invoicing differs from other ways of sending invoices as it is software-to-software using the secure, global Peppol network. Think of this as a custom-built way of exchanging invoices when compared to email or the post.
If you already use Xero, sending e-invoices won’t be too different from your usual process. Rather than pushing a button and generating an email, it’ll instead send the e-invoice straight to the recipient’s e-invoicing compatible accounting software (this means it can also access the Peppol network). It will, however, make it easier to know if something’s gone wrong – like if it can’t be delivered to the recipient.
What will change is how you receive invoices. Incoming e-invoices show up automatically in Xero as a draft bill to be approved – no more digging through emails and entering details one-by-one. This will all be included within your Xero subscription.
Can I start using e-invoicing right away?
E-invoicing is a little like sending an email. For it to work, both parties need to be signed up to a provider and connected to the internet. Instead of an email address, however, you will use your ABN. Yes, the same one that’s on all your invoices already. Since it’s early days for e-invoicing, you’ll need to wait until other businesses register to the Peppol network before being able to send or receive invoices with your usual business contacts.
Tell me, why should I register now?
Each business that joins the network means you’re one step closer to accessing the many benefits of e-invoicing. Register now and join the growing number of Xero customers that are already connected. Once your suppliers are on board, you can sit back and watch the bills roll in.
What if I work with government agencies?
Australian businesses that work with certain government agencies can get started right away. Why’s that? Some departments of the Australian government are already using e-invoicing and have committed to paying invoices within five days – much faster than the current average payment times of 23.3 days. The largest federal government agencies can already receive invoices electronically (the smaller ones need to transition by 1 July 2022) and government agencies in New South Wales (NSW) must make the switch by 1 January 2022. So, reach out to your government customers to see whether they’re ready to receive e-invoices.
How do I sign up for e-invoicing?
Registering for e-invoicing is quick, easy and free within Xero – you can do it in just a few minutes. The one registration is required to make sure your incoming e-invoices are delivered to Xero as a draft bill.
Is there anything else I should know?
Xero is working with government agencies and large companies to bring important partners onto the network and improve the benefits for small businesses. Expect to see some familiar names being able to send monthly accounts via e-invoice soon, straight into your draft bills in Xero.
Take a moment now to familiarise yourself with e-invoicing and set your business up so you’re ready to go as the network grows.
Get onto Xero
Xero is Australia’s most popular cloud-based bookkeeping and accounting software. Transform your business with real-time financial reports by making the switch to Xero. Join the Xero tribe today!
Source: Xero
https://notchabove.com.au/wp-content/uploads/2021/03/slide-jac-gallagher-2021.jpg7241920Notch Above Bookkeepinghttps://notchabove.com.au/wp-content/uploads/2017/09/Notch-Above-Bookkeeping-Service-Brisbane-Logo-300x136.jpgNotch Above Bookkeeping2021-10-18 09:17:372021-10-12 18:26:40E-invoicing an easier way to invoice
Director identification numbers (director ID) are a new requirement for all company directors, designed to help combat illegal activity by making it easier to trace directors’ relationships with companies.
Company directors have been given 12 months to apply for an ID.
A director ID is a unique identifier you need to apply for once and will keep forever. It will help prevent the use of false or fraudulent director identities.
Australian company directors have one year to apply for their unique director identification number before fines of over $1.1 million are issued for non-compliance.
All directors of a company, registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will need a director ID.
How to apply for your director ID
Directors can apply for a director ID from November 2021 on the new Australian Business Registry Services (ABRS), a single platform administered by the Commissioner of Taxation that brings together ASIC’s 31 business registers and the Australian Business Register.
The fastest way to get a director ID is to apply online. It’s free to apply and you only need to apply once. Directors must apply for a director ID themselves and will be required to produce myGovID along with two identity documents from a list, including their bank account details, super account details, ATO notice of assessment, dividend statement, Centrelink payment summary and PAYG payment summary.
While existing directors will have a year to apply for their director ID, new directors appointed between 1 November 2021 and 4 April 2022 will have just 28 days after appointment to apply for their director ID.
New directors who are appointed from 5 April 2022 will be required to apply for their director ID before appointment.
The director ID will be attached to a director permanently, even if you cease to be a director, change your name, or move interstate or overseas.
Once you have obtained your director ID, there are important steps you can take to help you use, view and update your details.
How we help you
Looking for a Xero Certified Bookkeeper for your business? Are you drowning in paperwork? Cash flow problems keeping you awake at night? Learn how Notch Above Bookkeeping can solve all these problems here or call our business bookkeeping team Australia-wide on 1300 015 130.
Most new employees are eligible to choose the super fund into which employers pay their super guarantee contributions.
Currently, when a new employee doesn’t choose their own super fund, the employer must pay super contributions into their default fund.
From 1 November, if any new employees start, the employer may have an extra step to comply with the choice of fund rules.
If a new employee doesn’t choose a super fund, the employer may need to request their ‘stapled super fund’ details from the ATO.
A stapled super fund is an existing super account that is linked, or ‘stapled’, to an individual employee so that it follows them as they change jobs.
The change aims to reduce account fees by stopping new super accounts from being opened each time they start a new job.
From 1 November, employers will be able to request stapled super fund details for new employees using Online services for business.
What employers can do now
To make sure you’re ready when the time comes, check and update the access levels of your authorised representatives using Online services on behalf of your business. This will also protect the personal information of your employees.
Please contact Notch Above’s Business Bookkeepers Australia-wide on 1300 015 130 if you have any queries about stapled super funds prior to 1 November. We are Xero Platinum Certified bookkeepers operating via Xero cloud bookkeeping.
Source: ATO
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2020 Notch Above Bookkeeping
2020 Notch Above Bookkeeping