Our Kids Charity Golf Day 2019

It's that time of the year for the annual Our Kids Charity Golf Day

Last year the funds raised helped purchase a new Ultrasound Machine for the Women's Care Unit. 

Our Kids Charity Golf DayOver the past eleven years the Our Kids Charity Golf Days have been a great success and so far have been able to fund the purchase of over $165,000 worth of equipment for the Special Care Nursery.

This year's fundraising will help purchase a Giraffe Resuscitaire, an intensive care open crib to resuscitate newborn and babies. It provides open access for the paediatric medical team while resuscitating the sick little one. This equipment is to go in the ED at Lismore Base Hospital with an estimated cost of $19,200. 

This year, fundraising efforts will be combined with the Local Government Golf Day, run by Anthony McGarry from Lismore Workers Golf Club to make sure this equipment can be obtained as soon as possible.

The primary rule of the day is to have fun and raise money for a good cause.

And there are always some golf bragging rights to play for again. Can the team from SolarHart defend the trophy?

The Key Facts

  • Donation of $400 per team which will allow a team of four golfer's
  • 11am start for a noon (shot-gun) tee-off
  • BBQ lunch provided before tee-off
  • Drink Vouchers for all groups
  • Snacks provided prior to presentation
  • Great prizes, with complimentary tickets for the Sponsor in our Golfing Getaway raffle
  • As always, the game will be a four-person Ambrose, with golfers and non golfers most welcome

This year the number of teams will be limited to 36 so if you're keen to take part please contact Ray at r_clindwall@hotmail.com. Tax invoices are available upon request.

Collins Hume Lending Specialist David Seymour (pictured right) has been one of the key drivers behind Our Kids Charity Golf Day since day one. Read more about David here.

Collins Hume partners with you to achieve greater business and lifestyle success as your trusted advisers. Call us in Ballina or Byron Bay on 02 6686 3000.

Collins Hume named NSW Northern Rivers Business Awards Finalists

2019 Northern Rivers Regional Business Awards Finalists

The NSW Business Chamber has announced its finalists for the 2019 Northern Rivers Regional Business Awards.

regional finalistsCollins Hume is thrilled to have been shortlisted as finalists in three Northern Rivers categories – Outstanding Employer of Choice, Outstanding Business Leader and Excellence in Business.

"Collins Hume is one of our region's high performing financial advice businesses, offering a range of services in business, financial, tax and accounting consultancy," said Partner Peter Fowler. "With offices in Ballina and Byron Bay, it's high praise to be recognised for our ongoing endeavour with our clients and our team in the Northern Rivers region."

Being Small Business Month, the awards make time to celebrate the success of small businesses and the role we play in our communities.

The Employer of Choice award recognises businesses with strategies and initiatives that create stimulating and supportive workplace environments that positively impact employees and the organisation as a whole.

The Excellence in Business award recognises businesses that have achieved significant growth and demonstrate strategies and processes to sustain growth.

The Outstanding Business Leader award distinguishes the positive contribution made by business people by recognising those who demonstrate outstanding entrepreneurial spirit, strategic business direction and innovative ideas, whilst providing inspiration to a new generation of upcoming business leaders. 

"2019 has seen a range of very high calibre businesses participate in the awards program, which has made it even more exciting to take part," Peter added.

"We wish to congratulate all finalists on their achievements and look forward to joining them at the Awards Gala event later this month."

Winners will be announced at a gala evening on Saturday 19 October at the Ballina RSL Club. Northern Rivers winners will then automatically proceed as category finalists into the State Business Awards, which will be held in Sydney on Friday 22 November at the International Convention Centre. See the full list of categories and finalists here.

Copyright 2019. @CollinsHume Accountants Business Advisers Ballina & Byron Bay NSW #nswbusinessawards

SMSF asset diversity scrutiny

Are all your SMSF eggs in one basket?

The investment strategies of Self Managed Superannuation Funds (SMSFs) are under scrutiny with the Australian Taxation Office (ATO) contacting 17,700 trustees about a lack of asset diversity.

nest eggThe ATO is concerned that, "a lack of diversification or concentration risk, can expose the SMSF and its members to unnecessary risk if a significant investment fails."

This does not mean that you must have diversity in your fund. A lack of diversity might be a strategic decision by the trustees but you need to be able to prove that the strategy was an active decision. Section 4.09 of the Superannuation Industry (Supervision) Regulations require that trustees "formulate, review regularly and give effect to an investment strategy that has regard to the whole of the circumstances of the entity." 

To do that you need to:

  • Recognise the risk involved in the investment, its objectives and the cash flow of the fund
  • Review the diversity of the investment strategy (or otherwise) and the exposure of a lack of diversity
  • Assess the liquidity of the investment and cashflow requirements of the fund 
  • Assess the ability of the fund to discharge its liabilities, and 
  • Review and have in place appropriate insurance cover for members and assets

Importantly, you need to be able to justify how you formulated your strategy if the ATO asks. 
The 17,700 people being contacted by the ATO hold 90% or more of the fund's assets in a single asset or single asset class. 

Property is one of the problem areas the ATO is looking at. With property prices at a low point, the asset value of many funds has diminished.

In addition, debt taken on by SMSFs has significantly increased. The number of SMSFs using Limited Recourse Borrowing Arrangements (LRBAs) to purchase property has increased significantly from 13,929 (or 2.9% of all SMSFs) in 2013, to 42,102 (or 8.9% of all SMSFs) in 2017. For SMSFs that have purchased property through an LRBAs, on average, these LRBAs represent 68% of total assets of the funds.

LRBAs are most common in SMSFs with a net fund size (total assets excluding the value of the amount borrowed) of between $200,000 and $500,000. In 2017, the average borrowing under a LRBA was $380,000 and the average value of assets was $768,600.

Collins Hume partners with you to achieve greater business and lifestyle success as your trusted advisers. Call us in Ballina or Byron Bay on 02 6686 3000.

General Advice Warning: This communication has been prepared on a general advice basis only. The information has not been prepared to take into account your specific objectives, needs and financial situation. The information may not be appropriate to your individual needs and you should seek advice from your financial adviser before making any investment decisions.

Business Management Accounts

How Management Accounts give you more information

Why not ask for them?

management accountsKey points

  1. Have you ever had a critical look at the financial accounting information that your financial controller is providing to you or that your accounting system is delivering to you?
  2. If you are running a number of business activities within your business structure, does this set of financial accounts assist you to determine which section of your business is causing the problems and losing money?
  3. Do your Financial Accounts give you the information that you need to be able to effectively manage your business and add value to your business?

If not, why not ask your accountant to provide you with "Management Accounts" rather than a consolidated set of financial information that has probably been prepared as part of your business' Income Tax Return supporting data.  (TIP: That type of approach does not give you management information that you can use to help you run your business!)  

The Tax Office is happy with a total income figure for a business but you should not be happy with consolidated financial information if you have individual departments or activities operating within your business! You need information pertaining to an individual department or activity to effectively manage that department or activity.

Let us look at what you are probably receiving at present – a consolidated set of Financial Accounts irrespective of the number of business departments or activities that you are conducting within your business.

Does the Profit & Loss Account that you are currently receiving look something like the following:

 

If you are running a number of business activities within your business structure does this set of financial accounts assist you to determine which section of your business is causing the problems and losing money?

 

Would it help you if you received a Financial Report for each individual department or activity within your business which might then tell you meaningful information on what is actually occurring within your business?

 

Would access to an individual department or activity Profit & Loss Report help the person who is directly responsible for the management of that department or activity by giving that management person some meaningful information on the financial performance of the department or activity that they are responsible for?

 

A detailed Profit & Loss Account for each individual department or activity would disclose the following information:

Income

 

$3,200,000

Less

 

 

Opening stock

$ 70,000

 

Purchases

$1,300,000

 

Freight

$ 45,000

 

Sub Total

$1,415,000

 

Less

 

 

Closing Stock

$ 72,000

 

Sub Total

 

$1,343,000

Gross Profit

 

$1,857,000

Less

 

 

Overhead Expenses (with details provided)

 

$1,900,000

Nett Loss

 

$ 43,000

Name of department or activity
Income for this department or activity
Sales of labour
Sales of materials
Total income

Less cost of goods sold for this department or activity
Opening work in progress
Opening stock
Materials purchased
Freight
Labour
Labour on costs
Subcontractor costs
Subtotal of direct costs

Less
Closing work in progress
Closing stock
Subtotal

Cost of goods sold
Gross profit for this department or activity
You could then have calculations prepared of Key Performance Indicators that are relative to the individual departments or activities.

For example:

  • Materials percentage of income for the Department
  • Subcontractor percentage of income for the Department
  • Labour percentage of income for the Department
  • Labour on costs percentage of income for the Department
  • Gross profit percentage of income for the Department

Financial accounts presented in this manner are referred to as "Management Accounts". Why – because they supply some meaningful information to management.

Big businesses prepare their individual activity Financial Accounts in this manner. Indeed, most big businesses operate as a series of individual businesses that are supervised by a regional manager but they have deliberately downsized the business unit so that it can be more effectively managed. Big businesses then make sure that that individual manager receives meaningful Key Performance Indicators and other information to assist that manager to effectively manage that business department/ activity.

Is this the type of information that you would like to be receiving from your accounting system/accountant on a monthly basis? Would this type of accounting information assist you to identify problem areas within your business?

Management Accounts prepared in this manner will also assist in a benchmarking analysis being prepared on the individual departments within your business when those individual departments could be compared to similar businesses or departments from other businesses. When the financial data is prepared all within one Profit & Loss Account it does not enable meaningful financial data to be prepared for management to make decisions on future activities or even what is going to happen tomorrow within the business.

Do you think that receiving Management Accounts and having the ability to sit down and talk to your accountant about what those individual departmentalised accounts are saying about the performance of the individual departments would help you to run a better business?

If so, our suggestion is that you have a conversation with us to organise your accounting system so that management accounts together with Key Performance Indicator information and periodic benchmarking analysis is prepared for your business.

You could then sit down with your team and ours at a periodic business improvement meeting on a monthly or quarterly basis to review the individual department or activity performance.

Would you like to know more?

By making accounting easy, we empower business owners to focus on scaling and doing purposeful business. Call Collins Hume in Ballina or Byron Bay on 02 6686 3000 today.

Collins Hume
is a CPA Business