In our blog post this week, we continue a series looking at the three key steps that businesses need to tackle to get their business finances sorted. And our focus this week is on how to improve your business operations.
Step 3 – How to integrate your accounting with your business operations?
So you now have an accounting system in place and want to look at improvements to your business operations. Here are some questions you should be asking:
- Sales – how are you pricing your product / service. Do you have low sales $ yet you’re always busy- there’s a problem!
- Composition of sales / How is each product performing? Are some product lines not making you any sales? Do you have product lines where you are making a million sales? They could both be as bad as each as as they’re unprofitable (we’ll look at this in Gross Profit as well)
- Look at trends across months – helps in forecasting. Busier months? What can you do to pick up business in quieter months.
What could you change in your monthly management report. Consider a breakdown of sales data so you understand where your sales are coming from and which product lines. Continue reading “Getting your business finances sorted. Improve your business operations…”
In our blog post this week, we continue a series looking at the three key steps that businesses need to tackle to get their business finances sorted. And our focus in this blog post is on accounting software and managing your finances.
Step 2 – How to use an accounting software to track your performance
The first thing you need is an accounting software for your business. Some of the key things you should think about when looking at accounting software are:
- Cloud v desktop. Do you need access on the go and have multiple users or want to share data with your bookkeeper and accountant in real time, than a cloud based accounting software package is probably more suitable for you.
- Do you invoice and need unlimited invoicing? Accounting software has a strong focus on invoicing and should be able to help you manage this function.
- Do you track inventory? Make sure that your accounting software has this functionality so you don’t need to worry about costly addons.
- Do you have overseas sales and need to consider other currencies. It will often be an additional cost but it is so important in tracking things effectively.
Continue reading “Getting your business finances sorted. We look at accounting software…”
Startup Daily today interviewed Xero about how its customers use its accounting software. And Emma Petroulas from Nudge Accounting gave her views in the article on how accounting software, including Xero, can help startups and small businesses.
So what were some of the things that Emma had to say about Xero and accounting numbers for businesses:
- “The thing about numbers is that they don’t lie,” she says. “What we generally find with startups is that they tend to overstate the financial health of their business, but when they have their numbers in front of them it forces them to make some difficult decisions.”
- When a client knows their numbers, they can make the best decisions for their business. Nudge Accounting says that they use Xero to process clients’ numbers each month, which means that they have almost real time financials at their fingertips.
- Many of our small business clients have found it difficult to use Xero payroll,” she says.“Setting up payroll in Xero is easy when clients have staff who are on annual salaries, but when our clients have lots of casual staff working different shifts or irregular hours, they find it hard to navigate their way around the different payroll calendars.” In saying this, Petroulas says that they still use Xero and “love it”.
- This is a vital tool in the startup environment and could very well prove an early indicator for founders that things are going pear-shaped long before that ‘closing down’ sign rears its head. Based on the numbers in a management report, clients can recognise inefficiencies in their business and improve many parts of their operations process.
- “Using the tracking function in Xero, they have also been able to isolate and understand the most profitable product lines of their business, and change their strategic direction based on this,” adds Petroulas.
When it comes to small business tax, there are often many areas that small business fall short. So in this blog post for SecurePay, a division of Australia Post, Emma Petroulas talks about some of the key things that small businesses should be aware of when doing their tax this financial year.
1. DO keep track of your figures
Numbers might not be your “thing”, but knowing exactly how your business is performing is vital and is the most important, year-round accounting habit for SMBs. You need to know how much comes in and how much has gone out as the more you know how the business is going, the better your decision-making will be.”
Plus, when it comes to submitting your tax returns to the Australian Taxation Office (ATO), business owners are responsible for their figures, even if an outsourced accounting company has prepared the return.
2. DO know what is tax deductible
If you think you can wine and dine your clients and simply claim those expenses as a tax deduction, think again.
Processing restaurant expenses though the business will attract a fringe benefit tax. It depends on what the expenses are, but you need to be very clear on who was at the meeting, what was discussed – and remember, alcohol is not tax deductible.
If it is a personal expense, don’t put it through the business as well. And if you have a motor vehicle, which is used for both business and personal reasons, only claim deductions for the business use. Continue reading “Tax dos and don’ts for small business”
Turn your Business Story into Numbers (+ A touch of tax tips for End of Financial Year)
Accounting Essentials for Small Businesses and Startups
Time: 04:00 pm
Location: The HUB Melbourne, 673 Bourke St Melbourne VIC 3000
As small business owners, we’ve all been told how important our numbers are. Some of us have spent hours trying to pull them together. Some of us have never understood where to start when it comes to the numbers. But when you turn your business story into numbers, it can really help set your business up for success.
Every small business has its own unique story, so the question is, how can you turn your business story into numbers?
If you are a small business owner who is number-phobic, this is a must attend event! We’ll help you love the numbers and understand how you can use them to make better business decisions.
Being end of June, we’ll also be chatting through our Nudge Essential End of Financial Year Tax tips for startups and small business owners.
During this interactive one hour session you will learn
- 3 reasons why numbers help you run a better business
- 6 key steps to preparing and forecasting your numbers
- How to make sense of your numbers
- Essential end of year tax tips for End of Financial Year
About the presenter
Mark Veran is co-founder and Head of Tax at Nudge Accounting. Nudge is all about giving small businesses their numbers each month so they can make better business decisions. A Chartered Accountant, Mark has 15 years’ experience in the accounting industry, his most recent as an Associate Partner at a Big 5 firm.
When Mark isn’t chatting to startups and small businesses, he can be found at his son’s soccer matches, or cheering on Liverpool Football Club (from home).
We reflect often in Nudge on why we have made the decisions we have. And one of the biggest decisions we had to make was to use Xero accounting software. As a Gold Partner and one of the largest Xero accounting partners in Australia, we thought about what makes our small business and startup clients happy. And here are some of the reasons we think we have made the right choice to use Xero with our great clients!
Nothing beats getting a top quality looking invoice out to a client and feeling a rush when you see your logo on the top and the dollars owing down the page. That’s what our startup clients tell us when they make their first sale or send an invoice as they are receiving a grant! And the recurring invoicing function is a nifty feature that many of our subscription based clients use as well.
A simple to use employee portal that takes a combination of timesheets, leave and hours worked and can calculate pay easily is what our clients love about Xero. When we educate our clients on payroll and they understand how the system works, you know that it must be ticking all the right boxes. Plus the recent addition that allows our clients to lodge TFN declarations for their staff online through Xero is just another time saver that we love.
One of the questions StartUp businesses often ask is how do they know what accounting package is right for them. At Nudge we use both MYOB and Xero (for more about why we chose these packages, read Aaron’s blog post “Why MYOB and Xero. Why not MYOB or Xero?”).
This week I wrote an article for Shoe String StartUps on how to choose the right accounting package for your Startup. In deciding which accounting package to use, it’s really important to understand whether the accounting package has features which your StartUp needs.
Steps to choosing the right package for your startup, involves asking questions such as:
- Do you want your package to be in the cloud or do you prefer desktop software?
- Do you have staff, so need a payroll feature?
- Do you need unlimited invoicing?
- Do you keep stock and want to record the stock inside your accounting package?
- Do you sell to overseas customers, so need mult-currency features?
- How much do you want to spend on software?
If you want to have a read through the article on Shoe String, it is available here.
Cheers and enjoy your weekend!
Bon voyage anyone?
The alluring manifestation of increasing hospitality services in today’s era is evident. The plethora of small bed and breakfast studios or immense multi-star hotel complexes are multiplying erratically. A resilient accounting team is always a preference since, fluctuating exchange rates, tight margins and increased regulation across the sector all have a significant impact on your business. Tourism tends to be a “hit-and-miss” industry. Exceptionally for small to medium enterprises. A wide range of accounting services are required to harmoniously blend in order to propel your hospitality business. Auditing, tax compliance, mergers & acquisitions, industry bench-marking analysis and many more…
Hospitality is by far one of the world’s most exciting and rewarding industries. Many a person tend to divert their career towards a path in hospitality. Lucrative yet delicate, the hospitality industry requires firm and versatile accounting knowledge! Nudge Accounting provide a solid accounting backbone to assist and organise the financial sectors of any tourism or hospitality business. Obtaining a formulated structure will help you improve the operating effectiveness of any restaurant, hotel, club, bar, or institutional facility you manage. Just as you learned in elementary school about the rule that says 1 + 1 always equals 2, accountants found in hospitality business have developed their own specialised rules and procedures that govern counting, recording, and summarizing financial transactions as well as analyzing and reporting them.
However, let’s not confuse managing and accounting. Accounting is a tool used by good managers! It is vital to remain organised and stable in the hospitality realm. One false maneuver could send you back to the drawing board! Whenever a guest purchases a beverage, a meal or even a souvenir from your hotel you must have acquired the suitable team to document and organise listings, audits and weekly reports on all expenses and many more. Nudge Accounting are capable of reinvigorating your hospitality business providing performance management reporting, annual tax preparation and lodgements, monthly KPI’s, strategic tax and managerial approaching to cover a small spectrum of our immaculate services!
Wrapping up, the importance of a structured and systemised accounting backbone is essential for the blossoming of a business in the hospitality region. Dealing with a numerous amount of clients in such a vigourous environment can be a daunting task. Nevertheless, Nudge Accounting is here to enlighten you on how to manage and arrange your business without missing a penny!