Talbots Chartered Accountants, Audit, Business Advisory, Sydney

What's In Store For 2011?       Various forecasts have been made on Australia's likely economic performance through 2011 including: Reserve Bank of Australia cash rate of around 5%, currently 4.75%.Growth to be around 2.6% (just under 3% last year). Retail sales are expected to be a little stronger. Unemployment rate is expected to be as high as 6%. Currency fluctuations are expected during 2011, but $US to $AU is expected to be around 90 cents, as compared to last year's range of 87 cents to $1.02.  Although the Gold Coast has escaped floods and the effects of the cyclones, international tourism will probably still suffer from the high $AU and the effects of the Queensland floods and Cyclone Yasi.  Added to this mix are the significant economic costs and strains from floods, cyclones and bush fires which have affected virtually every part of Australia, with the Queensland economy suffering a severe blow from the central and south Queensland floods and the effects of Cyclone Yasi on North Queensland?  Government assistance packages, including grants and loans, have been announced for small business and primary producers for which, if your business is in a declared disaster area and you are eligible, we recommend that you lodge an application.  On the world scene, China is still very strong and continues to be a major customer for many Australian minerals.  High debt nations are expected to continue to be a drag on confidence during 2011.  Many other countries around the world will continue with weak economic activities.  Small business operators need to be vigilant in the monitoring of debtors, investment in stock and work in progress, continually reviewing their business' economic performance.  This can be enhanced by preparing regular budgets and cash flow forecasts, preparing regular financial accounts and benchmarking your business' performance against other similar businesses to identify strengths and weaknesses as compared to your counterparts.We can assist you with a wide range of business development activities, including applications for government assistance; preparation and monitoring of budgets and cash flow forecasts; review of periodic financial accounts and analysing benchmark comparisons of your business against other similar businesses.  Please do not hesitate to contact us if you wish to discuss any aspects of your business' performance.

GST - Are You Managing It Effectively? The Australian Taxation Office has issued a report which indicates that outdated or unreliable business systems could be costing small businesses time and money due to incorrectly reporting GST.  The report indicates that last year the Australian Taxation Office identified $21M in unreported GST liabilities after contacting 503 small and medium enterprise (SME) taxpayers who were at risk for incorrectly reporting the GST.  SMEs need to manage cash flow and reflect the correct financial position so that GST can be recorded correctly in the Business Activity Statement.  The system needs to accurately track the GST paid and charged, for both electronic and paper based transactions. If you would like to have a discussion relative to the GST management systems implemented in your business, please do not hesitate to contact us.

Introducing complimentary service provider   As mentioned in previous E-Newsletters, Talbots is endeavouring to provide a total financial solution to your business and personal needs to help with your success and wealth creation. To achieve this we not only provide accounting, business and taxation advice and assistance, but will also act to introduce our clients to a variety of businesses that we believe can deliver benefits with their different fields of expertise. Firstly, we would like to introduce a service provider within the property and mortgage finance area. The provider is not a typical real estate agent but acts as a nationwide property buyer’s agent. Some points offered below on how this service provider may be in a position to assist you:   Owner Occupied Source property for the clients in and around the area(s) you want to live Act as the buyer’s agent for the client without the client paying for services; and Service provider paid by the vendor and therefore saves you time and money.   Investment Property Find the best property to suit each individual client(s) needs Put a proposal to the client that includes a property profile (rent, capital growth, demographics of the area, infrastructure, tax benefits) Resources available to ensure properties can be acquired nationally Act as the buyer’s agent for the client without the client paying for services; and Service provider paid by the vendor and therefore saves you time and money.   Borrowing and Financing Solutions Refund 80% of the upfront commission received back to the client; and Therefore save you money.   Finance options available Home Purchases Refinances Investment Loans Commercial Loans Business Loans Self employed Development Funding  To take advatage of this service, please contact us for further information.

Business Plans - Questions to Consider Benchmarking - is very important to enable the small business to compare its business operation with other similar businesses.  Does the business have its performance figures compared to other businesses?

Key performance indicators including: imcome per employee wages cost percentage to turnover gross profit percentage net profit percentage sources of income key expenses for the business rent percentage of income advertising percentage of income investment in working capital items debtors stock work in progress  Key business ratio analysis calculations: debtors' days outstanding stock turnover.  ATO - Step up action on Director Penalty Notices  Recent changes have been made to Director Penalty Notices (DPN).  These are notices served by the Tax Office to a company director which set out obligations of the director in relation to certain outstanding tax debts of the company.  If appropriate action is not taken by the director or the company, the tax, which is the subject of the DPN, will become a personal liability of the directors. When a DPN is received, the director has 21 days from the date of issue to comply with either of the following: Have the company pay the amounts to which the DPN relates; or Ensure the company either: enters into administration pursuant to the Corporations Act 2001; or winds up pursuant to the Corporations Act 2001. There are defences available to directors which have been reduced under these recent changes.  The onus of proof relies on the director to prove that they did not take part in the management of the company because of illness or some other good reason at the time the company incurred the tax debts which are the subject of a DPN and that it was unreasonable to expect the director to take part in the management of the company at the time. DPNs are one of many tools available for use by the ATO, but they are effective in that they make directors liable for company debts. If a DPN is received and the company is unable to meet its obligations with the ATO, we recommend that you seek advice immediately.