CLIENT PORTAL
Paul Martin Chartered Accountant Ltd :: Accounting, Taxation and Business Advisory :: Auckland, New Zealand
CLIENT PORTAL

Tips For Sorting Finances For Small Businesses

Paul Martin • January 22, 2017

Sorting your financesUltimately business owners want to earn more and spend less to maximize their business profit. This is achievable if you know how to handle your finances and follow these simple tips.

1. Be honest and realistic when analysing your finances

Examine the funds in your business closely. Do you have enough money to sustain your operations for the next 3 or 6 months or the whole year? What is the status of your cashflow? Is money regularly coming in? Are you aware of your outgoings? Last year or in past years, were you spending more and gaining less?

Answer these questions as honestly as possible without any bias. Then, analyse your business finances. If you are spending more and gaining less, admit it. Be realistic about your finances. Track down the problems. And once you do, focus on how to solve them.

If your business expenses are increasing, maybe it is time to cut things that are unnecessary or think of more ways to gain or attract more clients or customers. Or sell more to your current clients or customers.

2. Avoid making illogical decisions

People sometimes have the tendency to rationalise illogical decisions. According to studies, if we think that Plans A and B are good plans, we make up convenient "facts" to back up these plans neglecting all the other things that make these plans bad. We have an innate bias to things that we think are good decisions.

Being biased and illogical are not good things when it comes to dealing with your finances. Thus, to know if your plans or decisions are logical or rational, you need to ask for advice or consult an expert instead of assuming or relying on the "facts" that you may have conveniently created.

As a trusted business advisor and chartered accountant in Auckland , we talk one on one with our clients and help them to create effective business and financial plans Our clients can talk with us anytime they need assistance.

3. Settle debts with HIGH interest

Loans are good to help you get started. But debts with high interest are like an anchor that will drag you and your business down.

If you have debt, repay the debt with the highest interest first and make sure to make it a priority

4. Think of other ways to generate more money

The best way to get more money is to create another source. Why not think of expanding your business? Or adding more products and services? Or creating a new business venture?

When clients think of expanding or adding more services or products to their current business, they call us and talk to us about their plans. As their trusted business advisor, we help them with business planning and assist them every step of the way to make sure that they are making the right decisions.

5. Record, record, record

Record your finances. Record everything. Keeping records will help you effectively manage your finances. It can also make your life easier when it comes to handling your annual accounts, tax returns and GST, among others.

Many business people ask their accountant to do their business book keeping for them As a dedicated chartered accountant in Auckland, we have a team of accountants who are ready to assist you manage your financial records. We use the best accounting software in NZ to ensure that your records are accurate and up to date.

Contrary to popular belief that managing finances is a nuisance, it is actually quite straightforward when you have a plan and an expert partner to help you.

More than just an accounting firm in Auckland, at Paul Martin Chartered Accountant we have helped many business owners to create their business strategy and help them stay on track with their business financial goals.

If you want to get started sorting your business finances, please request an online appointment or call us on (09) 576 4166.

Are you heading away for a break from the business this year?

By Paul Martin • December 16, 2024
This time of year can be hard on small business. Your expenses continue and your cashflow can suffer when your debtors go on holiday.

Dealing with uncertainty - tips for business owners

By Paul Martin • November 5, 2024
Inflation may be down but there’s still real uncertainty for business owners.

How the new Government and coalition agreements might affect owners of residential rental properties

By Paul Martin • December 4, 2023
There were some key takeouts of interest to many of our clients from the recently signed coalition agreements between National, ACT and New Zealand First and the formation of the new Government. In particular there are a number of policies which will likely benefit landlord clients who own residential rentals. I have summarised some of these below. 1. Return of Interest deductibility for residential rental properties Interest deductibility for residential rental property owners will return. It will be phased back in over three tax years: • 2023/24 tax year: 60% of interest cost will be deductible. • 2024/25 tax year: 80% of interest cost will be deductible. • 2025/26 tax year: 100% of interest cost will be deductible. 2. Reduction in bright-line period National signalled in their pre-election campaign that the bright-line period for residential rental property sales would reduce from 10-years to 2-years. While the exact implementation of this policy is not yet known, it is good news on the horizon for residential property investors. 3. Reinstatement of 90-day no-cause termination notices The new government will reinstate 90-day no-cause tenancy termination notices. This will avoid many unnecessary disputes in the Tenancy Tribunal and gives landlords more confidence in letting to possibly “marginal tenants". Many landlords have avoided what they considered to be risky tenants because eviction for anti-social behaviour was so difficult. With this reinstatement, landlords might be more inclined to give a marginal tenant a chance because they know that if the tenant misbehaves, they won’t be stuck with them. If you would like more information on how these changes might affect your personal circumstances, please feel free to contact us to discuss further.
More Posts
Share by: