For the 2011 financial year, the Federal Government will match contributions that individuals make to their super fund, as long as that individual meets the income test.

From 1st July 2010, an individual must earn less than $31,920 to qualify for the maximum co – contribution of $1,000. For every dollar earned over this threshold, the co-contribution reduces by 3.35 cents until it cuts out completely at the upper income threshold of $61,920.

What has changed is that reportable employer super contributions (ie those contributions above 9%) are included in earnings for the co-contribution benefit as is fringe benefits.

Small business owners need to consider their total income, as defined by the co-contribution benefit – when looking at the tax efficient way to extract money form their private businesses.

If you need to discuss these changes, please call Mike on 0401 631 904

For Accounting advice, call Mike Harding on 0401 631 904

• stand out from the crowd – if you are a plumber what is going to make you different from all of the other plumbers. You need to think outside the square. Not all ideas will be good ones…but some will be.
• Website. All businesses these days need a website. Think about your own way of doing business – If you want to buy a new piece of equipment, do you research it on the web? Of course you do and your customers will be no different. The Website is your brochure. If you don’t have one, speak with Mighty Media (you’ll find them through Google!)
• Sometimes you need a hook to get your potential client to contact you. If you are a plumber it may be something along the lines of a free 1/2 hour – where most plumbers may charge a $100 call out fee you will immediately get customers to call you. When you are running at full capacity, then will be the time to reappraise that offer.
• Honesty – In business, honesty goes a long long way. Be honest when you are starting out, and say you are just setting up. New businesses are hungry, and people know you will go that extra mile. Provide as good a service for a small leaking tap fix as you do for a new house plumbing job.
• Value for money. If you give value for money, people will recommend you. If you don’t, they will tell people not to use you. Price for the value of the job – don’t blindly follow how much time you spent!

At Harding & Co we charge by value of the job. Clients do not pay if I am inefficient and spend more time than it should normally take!

Call Mike on 0401 631 904 to discuss your accounting needs.

Where does this leave you?

If you have a debt with the ATO contact them now to take advantage of the offer by the ATO to not charge interest on the debt outstanding – See http://www.ato.gov.au/businesses/content.asp?doc=/content/00196536.htm for further information. This offer expires on 30th June 2010.

If you have a debt with your bankers talk to them – but be prepared! Show them your business plan – including cash flows – and explain how the business will progress over the next twelve months. If they agree to a proposal, keep them informed on a monthly basis  as to how you are travelling against your forecast that you provided – irrespective of good or bad monthly results.

Cash-flow is critical as we come out of a downturn – update your cash-flow forecast at least monthly – if cash flow is critical you need to do this for a rolling 7 day period.

If you need assistance call Mike Harding now on 0401 63 904. As an elderly partner once said to me a few weeks after I started my accountancy training with one of the big 4 practices – ‘Don’t kick a client when he is down…..He may well get up again!’ We are here to help.

An accountant was overheard in a pub dressing down one of his employees about his inability to complete tax returns and financial accounts efficiently and without errors.

‘But he has been qualified for 3 years and is still making mistakes – you just can’t get newly qualified staff these days to do the job’ he was heard to say…….

Another accountant who had known him for a number of years pointed out that he has 30 years of experience……and his member of staff has 3 years…….experience is not something you can buy….you have to earn it!

Why am I telling you this story, about the inefficiency of newly qualified staff you may wonder. For two reasons:

1. Use your own experience in your business the best way you can. Guide and mentor your staff, whilst at the same time give them enough room to learn – pass on your experience where you are able. Point out to your customers that you have experience in your industry and that you understand their needs.
2. I have over 25 years experience in dealing with SMB’s – not just as an adviser but at the coal face in industry as CFO. I understand what it is like for an accountant to tell you that you have missed to claim $10 extra gst – does it matter? Experience teaches you to focus on the key points that matter – if you want to discuss how Mike can help you in your business call me now on 0401 631 904 and I will give you a free copy of ‘The E Myth’ – a must read book for all entrepreneurs!

• If you don’t have one then the answer will be no……
• If you do have one but it is set up badly, then you may be making decisions on inaccurate or out of date data….

If you don’t have a company dashboard, read on……

A dashboard gives you up to date data in the key areas of your business. For small businesses it may be something as simple as:

• Up to date cash at bank figure
• Total receivables and details of those overdue – Do they need chasing and by who
• What quotes need to be done today!
• What quotes need to be chased today
• Sales this month to date versus same month last year versus budget

These are just examples of key information that you need, but it must be visual. How many of you look at a page of numbers and come away not knowing whether they are showing a good or bad picture. My dashboards always use graphs – you get the picture straight away!

Most modern accounting packages have a dashboard facility – but is it set up for your use? The best one that I have found is from the new accounting software supplier XERO – Not only does the accounting process save you time, it is built around a dashboard that will give you key accounting information.

The dashboard has to focus on both what motivates you – how many orders have you received this month? – and on the important issues currently affecting your business – cashflow?

If you dont currently use a dashboard – call Mike Harding now on 0401 631 904 to discuss how it can help you.

What kind of work is keeping you busy?

It’s a question we hear all the time from our clients. It doesn’t matter if you’re a retail store owner, a doctor, an IT professional or a contractor; everybody, it seems, is fighting the clock.

With the intention of freeing yourself from the technical work, in this process we take a look at how you’re spending your time to accurately determine how much of your time is spent on productive activities that directly contribute to the results you want, and how much of your time is spent unproductively. This is a  revealing process, and we usually identify areas for improvement very quickly.

Another thing we explore in our Time Management process is what we call “Time Bandits.” You know, those pesky “time stealers” and distractions that take attention away from strategic work—email, a talkative vendor, the telephone, your mother-in-law, broken office equipment… The list goes on.

Finding the discipline to eliminate Time Bandits is an important part of getting to the strategic work you need to do. Below are five Time Bandit Busters  that might instigate a change in how you approach time management.

5 Time Bandit Busting Tips

1. Prioritize and Stay Focused Evaluate your daily tasks and prioritize. If nothing else gets done today, what are the one or two items that absolutely must be done? The most successful CEOs of Fortune 500 companies only focus on one or two priorities for a given day.
2. Delegate as much as you can. Let go of the idea that nobody can do what you do the way that you do it! With the right systems in place, you can properly delegate the tactical work that keeps you from working on your business. There is critical distinction however, between delegating and abdicating.
3. Set and meet deadlines for yourself and your employees. Set reasonable deadlines for all jobs and stick to them. Hold yourself accountable just as you would an employee. It’s true; work expands to fill the available time so set expectations.
4. Don’t postpone unpleasant tasks. Those “bitter pills” that you put off can come back to haunt you in so many ways. A situation may become more acute with time, not to mention the fact that it will be sitting in the back of your mind (or somebody else’s mind) becoming a distraction. It’s best to take care of important matters that are unpleasant immediately. Resolution is so much better than wasting precious time wondering “what if…”
5. Learn to say “No.” Beware of over commitment! You are the only one who can truly protect your time. Learn the art of saying “no” politely. If this seems daunting, try this: when confronted with an opportunity, don’t commit immediately. Take a moment to listen to your intuition and refer to your schedule; you may find that declining is the reasonable answer. People know you’re busy, it’s okay to set boundaries.

Building a successful business requires the ability to see the big picture while immersed in the details, the hundreds of decisions and activities that command your attention from minute to minute, day to day. Imagine the impact it will have if you can effectively establish priorities and focus your attention so your everyday decision-making becomes aligned with your big-picture vision. Eliminate the Time Bandits that take your focus away from the strategic work of the business and you will begin to work on your business rather than in it.

If you want help with regaining focus on your business, call Mike Harding now on 0401 631 904.

All business owners, whether you are new or think you know everything there is to know about your business should take the time to review your skills and identify areas that need improvement. Remember, standing still means you will be going backwards…….

The Small Business Tool Kit can help you:

• check whether you are ready for business
• test your business knowledge on a variety of topics including marketing, finance, exporting and employment
• create business, marketing and exporting plans.

To use the Small Business Toolkit, visit the NSW Department of Industry & Investment website.

If after looking at this, you find you would like to talk some issues through, or want some assistance, call Mike Harding on 0401 631 904.

The fee for the accounting system is bundled into our fixed fee quote, and we, as your advisers will have access to the accounts for review prior to lodging BAS returns and to conduct our monthly review of the business. The beauty of the accounting system is that it downloads your banking information from your bank, allowing you to code the transactions to the correct account online. The more you use it, the quicker the process becomes as it learns what are the common postings.

The whole system is accessed online making it easy to work away from the office. Furthermore your data is secure – no more lost data when your office PC crashes or is stolen!

If you would like to discuss more benefits of Xero, and how we can bundle the cost into an effective annual accounting fee, call Mike Harding now on 0401 631 904.

No matter what sector your business is in, there will be a number of key ratios that you can focus on to keep track of your business performance. These numbers should be available either weekly or monthly, depending on the business. In tough times, you need to be able to see the warning signs early.

When you are running your business you do not want to be Flying Blind! If the following apply, address the problems now.

1. Don’t have the information needed to make key decisions?
2. Don’t know how the business is travelling?
3. Management Reports produced too late to be useful?
4. No way of checking if your strategies are actually working?
5. Always reacting to market changes?
6. Working off lag rather than lead indicators?

What you need to do:

1. Identify the key indicators in your business – and get historical information. Undertake a review of past performance to see the trends.
2. Run a set of ‘what if…’ scenarios to demonstrate how changes will affect your business. Small changes can sometimes have big effects
3. Set realistic new performance goals
4. If required, meet with your accountant on a regular basis and track the business.
5. Implement any changes required

Mike Harding at Harding & Co, Chartered Accounts is available for a free initial meeting to discuss any business accounting issues. Phone 0401 631 904.