Blog / Time Management
Chris Mercer, Kick off 2012 EOFY Professional and Practical
I'm often asked by business owners what they should be doing at the End of Financial Year (EOFY), so to help you let’s look at 5 simple ideas to address at the EOFY.
1. Speak to yo ur Tax Accountant
For so many small business owners, a tax accountant could be called a "psychic". I hope you have a strong Tax Advisor, but they only can assist you based on the information you supply them. May and June is a good time.
It helps if you’re prepared for your meetings and know the points you want to cover. Your accountant will help to the best of their abilities, but only based on the information you have supplied them; they are professionals, not psychics.
2. Complete your Financial Budget
You need to have a budget, but is your budget signed off? Does it include your costs as well? Does it take into account growth? Once it has been finalised, has it been entered into your accounting software? If not, make sure it is otherwise it will be forgotten.
The budgeting process is a wonderful exercise to facilitate a review of all people, events, agreements and investments you have in place in your business.
3. Address agent and staff packages
EOFY is a good time to look at all of your team’s packages. If you strive to be an employer of choice, how you handle your team’s career paths is a very strong determining factor. For many business owners saying nothing and dealing with it on a case by case basis is the rule, but leadership requires direction, and efficiency requires process. Great businesses do this because it’s healthy for both parties to know where they stand.
4. Initiate supplier reviews
Have you put in place an efficient review of trusted suppliers? Often savings in themselves are not the sole reason for making a decision; you have to consider the associated costs of transitioning to a new supplier.
The secret to reviewing suppliers is taking an incremental approach. Start with your top five suppliers first, then the next five and so on. Remember for every dollar of overhead you save, it has a multiple effect in reducing your breakeven point.
5. Review your Chart of Accounts
The most commonly neglected aspect of business management in my opinion is the state of the financial chart of accounts. EOFY is a good time to make these changes because accounting software rolls forward on the 1st of July which provides a clean slate.
Don't make changes without consulting a suitable professional advisor, or qualified Bookkeeper. I’ve seen many business owners stunned by the impact these changes make. If you are serious about your business, you need to get serious about your financial scoreboard.
I hope you find these simple ideas useful. If you need help to get started, contact your financial advisor, or feel free call us at Live Business Services any time. Happy EOFY.
For more information or to read our blog visit www.livebusinessservices.com.au.
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