Issue 105 - April 2016
Advisory Boards - The Saviour For Family Businesses
Family businesses are often run by one or two people at the head of the family and have an informal decision making process. While this can be fine for small businesses at first, more mature and growing family businesses can benefit from a more formal board structure.
Board meetings may sound tedious, but structured get-togethers can make the difference between success and failure in a family business and ensure that all major decisions are based on informed data/analytics and receive due scrutiny.
Having family members, key personnel, advisors or trusted business associates partake in regular advisory board meetings reduces the load on the key decision makers, assists with intergenerational involvement, and reduces resentment if things don't go to plan. All board members get to have their say and 'buy-in' to key decisions, giving them a greater chance of success.
Regular board meetings cover many aspects of business management including:
- Strategic planning
- Financial management
- Business improvement
- Human resources management
- Policies & procedures establishment
- Risk management
The outcomes of advisory boards include:
- Designing a profitable business model that is robust enough to sustain adversity and capitalise on opportunities.
- Focusing on entrepreneurial business development that addresses weaknesses and positions the business to capitalise on opportunities.
- Quarantining time for working on the business instead of continually being dragged into the day-to-day operations.
- Developing a governance culture where business policy is developed and compliance obligations are achieved.
- Developing a marketing and branding strategy for the business.
- Developing and continuously review the business plan.
- Becoming an Employer of Choice by designing and implementing human resource plans that attract and retain employees.
- Increasing the professionalism and accountability of the business.
- Implementing business case methodologies that scopes tangible and intangible benefits of an investment.
- Implementing performance measures including key performance indicators.
Advisory Boards tend to meet quarterly with structured annual plans, standard agendas, action lists to govern outcomes and follow up. They should also annually review their performance and achievements.
If you are interested in establishing an advisory board, please contact our office for further details.
From 1 July 2015, if an employer pays staff a car allowance and that amount is more than 66 cents per kilometre, they need to withhold tax on this amount. Not doing so, could result in a tax debt for their employees.
If you have any pre-existing car allowance arrangements for this financial year that have remained unchanged, it is a good time to consider whether you will need to withhold tax on these amounts. Employers should discuss with relevant employees as to whether they would prefer to increase the withholding amount for the remainder of the financial year so as to cover any shortfalls that may occur.
The changes to these allowances are in line with the changes to car expense deductions from 1 July 2015. Prior to this, there were four methods which could be used when calculating a deduction for work related vehicle use (cents per kilometre, log book, 12% of original value and one-third actual expenses method).
From 1 July 2015, the government has abolished two of these methods, leaving only the cents per kilometre method (still with a 5,000km cap) and the logbook method (this remains with unlimited kilometres). If you have previously used the 12% or one-third method, you may want to keep a log book to increase your claim for 2016. Log books must be kept for 12 weeks and be representative of your usual use. Log books can be used for a period up to 5 years.
There has been no change to the principle that work related car expenses are deductible as well as no impact on salary packaged cars.
Please contact your Brentnalls SA team member if you have any queries relating to the above.
The worst part about bad habits picked up at the office is the fact that many employees don't even realise they are doing them.
Work life can often introduce a range of bad habits that can take a serious toll on a person's health, but it is never too late to change. Being aware of what these habits are and thinking of ways to avoid them can improve a person's mental and physical health. Here are some common mindless habits that many employees may have without even realising.
Leaning Your Face In Your Hands
Even though it may be a comfortable position, touching your face excessively is an enemy to good skin care and hygiene. Regularly touching your face can make you skin more likely to break out since you are spreading germs or other bacteria from your hands. Always try to sit up straight to avoid the temptation to do this. If that's too hard, make sure you keep your hands clean by washing them regularly.
Bad posture can result in bad health. Having poor posture while staring at some form of technology can strain your upper body, which can lead to neck and shoulder pain. Slouching can also negatively influence your mood. Just like the point above, make a mental note to always try and sit up straight.
Sitting All Day
If you haven't already heard, sitting is considered to be 'the new smoking'. This isn't that great for those who work at a desk for eight hours a day. Sedentary lifestyles increase the risk of having diabetes and heart disease, and it can also hurt your back. Try and move around as often as you can in the office. Perhaps go for a short walk every so often, use a standing desk if possible, or engage in some yoga to undo any damage received from sitting at a desk all day.
Accelerating Commercialisation offers eligible small and medium businesses, entrepreneurs, and researchers access to Commercialisation Advisers with experience and connections to address the challenges associated with commercialising novel products, processes and services. If successful, you can receive access to industry experts, exposure to investors and networks as well as access to grant funding (which matches your eligible expenditure) up to a maximum of $1 million.
There are three stages to the grant:
- Commercialisation Guidance available for companies to commercialise and trade to customers external to the state or territory of the applicant's place of business;
- Portfolio Services including
- inclusion on a publicly available database for introductions, supply chain and investment opportunities;
- specialist guidance from Commercialisation Advisers;
- introductions (via a Commercialisation Adviser) to relevant members of the Expert Network;
- access to networking and promotion opportunities
- Grant funding for 50% of eligible expenditure up to $1 million.
To apply for the grant you must meet the following eligibility criteria:
- a combined annual turnover of less than $20 million for each of the previous three years; and
- a novel product, process or service that you're looking to commercialise and trade outside of the state or territory of your principal place of business.
The grant is offered to selected companies based on competitive criteria including:
- market opportunity
- value proposition
- management capability
- execution plan, and
- national benefit
If you have a novel product, process or service which you would like assistance with taking to market, please contact our office to discuss your eligibility further.
The Government has now passed legislation to provide roll-over relief for small businesses that change their legal structure. These measures were announced in the 2015-2016 Federal Budget, and will apply to the transfers of assets occurring on or after 1 July 2016.
The measures provide an optional roll-over where a small business entity transfers a business asset to another small business entity without changing the ultimate economic ownership of the asset. The roll-over can also apply to affiliates or entities connected with the small business entity for assets they hold that are used by the small business entity.
The roll-over will apply to gains and losses arising from the transfer of capital assets, depreciating assets, trading stock or revenue assets between entities as part of a small business restructure. Discretionary trusts may be able to access the roll-over if the assets continue to be held for the benefit of the same family group.
The proposed new roll-over is in addition to roll-overs currently available where a sole trader or partner in a partnership transfers assets to, or creates assets in, a company in the course of a business restructure. Note that, as with any tax relief, the devil is in the detail. Please contact our office to see if the rollover is suitable for your business.
In our February newsletter, our article "Turnover Is Vanity, Profit Is Sanity… But Cash Is Reality" highlighted the importance of cash flow. There are a number of software applications which allows you to take payments from your customers, improving your debtor days and therefore your cash flow.
What are they?
This software allows you to take payments from your customer whilst mobile and embed payment links into any online invoicing. There are many applications available, including MYOB Pay Direct and eWay.
Who can they help?
This software is likely to suit to those in industries where you do multiple small one-off jobs (e.g. plumbers, gardeners) or you are always on the move.
MYOB Pay Direct
This is a small card reader device which, along with a smart phone, will allow you to receive credit/debit card payments (Visa and MasterCard only) from your customers. Once received, receipts can be emailed or sent by SMS to that customer. If using MYOB Essentials or AccountRight, it will automatically allocate and reconcile this payment in your accounting software. You can still use the product even if not a MYOB customer.
eWAY offers a number of ways you can be paid by your customers. The online payment collection can be accessed via a link on your invoices and provides customers an easy way to pay your invoices. The software can collect payment from all major credit cards and some digital wallets. They also offer a card reader product which they call SmartPOS. Again this is used in conjunction with your smart phone to collect payment. It currently syncs with Xero and Sage One accounting software but can still be used by those on other software.
MYOB Pay Direct
1.77% Credit card feeIt costs $225 per reader, there is no monthly fee and cost per transaction is:
$0.27 Eftpos fee
All prices exclude GST
The reader has no up front costs, bar a $25 P&H fee, but there is a monthly fee of $17 or $21 (pay wave enabled) and cost per transaction is:
1.95% Credit card fee
$0.30 EFTPOS fee
2.6% Online payments fee
All prices include GST
Congratulations to Matthew Holden and his wife Makella on the birth of their daughter Maisie Violet Anne, a baby sister for Isla and Nate.
Congratulations to Jerome Steele and Shantelle Brumby who have recently become engaged.
Congratulations to Leanne Schuppan on completing her Diploma of Financial Planning.
Congratulations to Thomas Clift and Alex Sacca on passing their most recent Chartered Accountant topics.
Congratulations to Heidi Dow on recently completing her Masters of Professional Accounting.
We farewell David Adamson who is moving overseas. We take this opportunity to say thank you for all your good work.
We farewell Bradley Truscott who has gone back to full-time study and wish him well for the future.
We farewell Catherine Maguire and wish her all the best for the future.
We welcome back Andrew Danvers from his 6 month university secondment in England.
This month we are proud to be supporting Hutt St Centre, a place of hope and opportunity, helping people facing homelessness to rebuild their lives, without judgement.
Each year, Hutt St Centre serves around 50,000 meals and offers social work and support services to nearly 2,000 people. Showers, laundry facilities, visiting health professionals, an aged city living program for older clients, recreation activities, education and training, legal aid and assistance with finding housing are all services provided to the 200 plus homeless people who visit Hutt St Centre each day.
Congratulations to Broomfield owners Brett and Jennifer Graham and family for winning the recent 2016 ANZ Heifer Challenge across all breeds for their Angus stud. The Yorke Peninsula based stud won from 25 entries in the competition.
I grew up in Mount Gambier and several years ago my partner and I decided it was time for a change. After making the big move to Adelaide, I started working for Brentnalls SA in April 2012 and have really enjoyed the continual learning and training over the last four years.
I also like to take part in the fun activities the social club organise in particular the wine tours, to explore more of the beautiful regions surrounding Adelaide, and the Fringe Festival events.
Outside of work, I enjoy a mixture of spending time at home with my husband Brad, catching up with friends and family who always seem to be planning something fun, and in the last 8 months or so trying to do anything to wear out our 14 month old Hungarian Vizsla 'Bruce' who has boundless energy.
On 30th April 2016 I am joining my friends team 'The Old Sticks' in the Relay For Life at the Royal Adelaide Showgrounds. Funds raised go towards the Cancer Council Australia and if you would like to support my team please go to the link below:
'The Old Sticks' Relay For Life