The EOFY season can be mentally taxing for many business owners. From compiling records to lodgment, there’s a lot of work that needs to be done. But there are ways to lessen the stress during this time.
The start of the new financial year is the best time to look into systems that can be improved, assess old practices that no longer work, and apply new practices to refine business processes. To help you get started, we put together 6 resolutions you can apply to the 2022-23 financial year.
Assess your business finances and profitability
Doing a financial health check and assessing business profitability is a good practice to assess if there are improvements to make. Reviewing your finances, and comparing with to your previous annual reports, allows you to identify your strengths, weak areas in your business, and potential threats.
For example, it might be best to stop selling a particular product. You can instead invest more in your most profitable product to increase business profitability.
Review your strategic plan
When reviewing your strategic plan, you should assess if certain adjustments to the action plan are necessary. It involves identifying opportunities to improve your business. Remember that your strategic plan must reflect your objectives and address any business loophole.
In case you are coming up with a new plan, remember to include:
- Your business objectives
- SWOT analysis
- Responsibilities for persons or departments involved
- Due dates
- Budget to accomplish your action plans
Secure your IT systems
The ATO has released a notice to warn business owners regarding the new email scam about the 2022 tax lodgment. It is not the first time that email scams and cybersecurity attacks occurred. There will be more cyber threats that can happen in the future.
It is important to equip your business with secured IT systems – or at least have policies to protect your business data and customer information. For example, you can add an extra layer of protection to your data by setting up two-factor authentication. Consider setting up strong passwords to protect your system.
You may go to the ATO website to report a scam.
Prepare a budget for the new financial year
Budgeting for the financial year is a great way to stay on top of your business cash flow. This practice enables you to:
- Have a better view and understanding of your financial situation
- Allocate resources more effectively
- Seek more resources, whenever necessary, to achieve an objective
- Modify your strategic plan
Regularly monitor your budget to avoid possible cash flow problems in the future.
Avoid record-keeping mistakes
Be cautious of these common record-keeping mistakes as advised by the ATO:
- Include cash income and expenditure
- Account for personal drawings
- Record goods for personal use
- Separate business expenses from personal expenses
- Keep valid tax invoices for creditable acquisitions when registered for GST
- Keep adequate stock records
- Keep records to substantiate motor vehicle claims
Listen to your business advisers
They include your bookkeeper, BAS agent, accountant, and tax agent. Listen to their advice to improve your business flow. Their industry experiences give them the credibility to provide recommendations to refine some business practices that no longer work. It may be costly for some business owners. But it is always better to engage with a professional with deep knowledge in their respective fields of expertise.
Find someone who takes the time to fully understand what your business is about, as well as your business objective.
Need help from a qualified bookkeeper?
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Fabiana Silva is a qualified bookkeeper and a registered BAS agent with over 20 years of experience in bookkeeping and business administration.
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