Author: Consolid8 Team Date Posted: 4 January 2016
Let’s start the New Year with a financial resolution (or five). Whether it’s trimming your waistline or becoming fiscally fit, the challenge isn’t making a list … it’s sticking with it. Here are Tanya’s five tips to getting your business finances in...
Let’s start the New Year with a financial resolution (or five). Whether it’s trimming your waistline or becoming fiscally fit, the challenge isn’t making a list … it’s sticking with it. Here are Tanya’s five tips to getting your business finances in shape.
Develop a budget (and stick to it!)
Budgets are brilliant - they help track cash on hand, expenses plus how much revenue you need to keep your business growing. A good budget can anticipate future business needs and highlight problems before they take hold. A budget should have specific targets or KPI’s. If your business fails to meet the desired targets, don’t despair, look for reasons why and then implement activities to address the problem.
Stay on top of your cash flow
Each quarter business owners get hit with a triple whammy – payment of GST, PAYG and Superannuation. We recommend opening a separate bank account and automatically transferring money to cover GST, PAYG payments and staff superannuation. This helps with managing your cash flow and ensures you can meet your tax obligations.
Move to the cloud and automate
If you haven’t already, make 2016 the year you move to a cloud based accounting solution like Xero. In addition to giving you access to your businesses financial data 24/7 from any internet enabled device, Xero allows you to automate manual activities and achieve greater efficiencies.
Balance Personal vs Business Debt
Most businesses will at some time need to borrow funds. This can be for a short period (to help fund a temporary cash flow shortage) or for longer periods (to purchase a business premises). There is a golden rule with it comes to debt, always pay off personal (or non-deductible) debt before business debt. We can help restructure your business and personal debt to improve your financial position.
We believe in the power of improving your “financial literacy”. Many business owners operate with a limited understanding of their numbers. They make crucial decisions based on how much money is in their bank account. We believe in educating our clients about their true financial position. When you understand your businesses finances you can make informed, strategic decisions.