Phone: 0437 336 574

What’s my password? I can’t find it.

 

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Who knows?

I've lost count of the number of times clients ring or email and ask me for their passwords. To their own data files. I have yet to craft an appropriate response to this that adequately covers all the thoughts that come to mind when asked this question. Partially because it could be misunderstood – my response that is. And partially because – well, the question genuinely shocks me. We are living in the digital age, after all. Have been for quite a few years now. I'm not talking about people who are retired, who don't generally engage in use of software, I'm talking about business owners. Can you please tell me what my password is? The truth? No, of course I can’t. I don’t know my own passwords half the time – but I have systems in place to help me remember them. I am a modern-day business owner whose business depends on my being able to access my data. So, why do they ask me? Well, possibly because as their bookkeeper I’ve become valuable to them in terms of reminders, hints, tips etc. Also, possibly, they think I know everything 😊 If you’re having trouble keeping up with all the passwords we’re supposed to have memorised (not allowed to record it anywhere – security don’t you know?) then, I recommend that you obtain a copy of an app that remembers passwords for you. They are inexpensive, some have an annual fee, some are a once-off cost. I use Keypass. There are others on the market. But do use one. I promise, I wasn’t there when you logged into your accounting package software and set up your account. That’s when your username and password need to be recorded somewhere safe!! And if you’re anything like me, that’s not inside your memory 😉

Accountants ain’t necessarily accountants…..

Analyzing numbers and doing calculations at the office

Analyzing numbers and doing calculations at the office

I have a client who has a small construction-industry related company.  He and his partner had started up the company in small way, from home.  He’d met an accountant at a community group he was involved with.  He seemed a good bloke, so he trusted him.

Engagement…

The business grew steadily and Sam wanted to learn how to use the bookkeeping software.  This is how I met him.  My task was to teach him how to set up and use Quickbooks Online to manage his business.  Not to do it for him, to teach him how to do it.  He wanted to know and understand everything about the business, and needed to control costs too.

For a person qualified in another area altogether, Sam was a good learner bookkeeper.  Though he did tend to do things the way he thought he should do them – which inevitably meant more time to undo things.   We were going well, Sam was entering his transactions under guidance and I would reconcile his bank accounts and help him prepare his BAS.

 

At Tax Time, it should have been easy and quick….

Enter this “accountant” at tax time.  Well, perhaps the inverted commas are a bit of overkill on my part, he did do the accountant tasks for tax time.  He did them by essentially undoing everything that had already been done, and did it all “his” way.  But I’m a record-keeper from way back, and when I started to suspect things were being changed, I could go back to confirm. 

He created his own accounts and changed transactions that were already classified properly.  He created separate income accounts for interest from two different bank accounts.  He separated the bookkeeping fees from the Accounting fees.  He changed the names of accounts.  The worst thing he did, though, was to create new GST tax codes, because he didn’t understand the report that the software prepared.  He changed every single supplier card to his new tax codes. 

He did this all himself, in the name of calculating the client’s tax obligations.  Messed up the software’s system for calculating BAS.  He was surprised about that, though.

As I was discovering each of these innovations, I would let the client know that there seemed to be a lot of unnecessary change being made to the data file.  At first Sam was interested, but not particularly concerned, but over time he became very concerned about what was happening.

 In my educated, qualified experienced opinion, not one of the changes was warranted.

Now I may be operating a business as a bookkeeper (the basis of accounting, by the way) but I have years of experience coming off a 30-year career in finance and accounting including supervising graduate accountants so I know when what I’m looking at is wrong.

So what happened next…

The kicker came when it was time for him to write his invoice.  Strangely, his fee was almost the exact amount of profit they’d declared.  More than 3 times what other accountants would charge for the same work.  He’d spent hours and hours doing things to the client’s file that was completely unnecessary. 

But most clients wouldn’t have known that.  Boy, was he rude when told he wouldn’t continue as their accountant.   

The moral of this story is don’t just blindly trust a professional without really understanding their advice, the value-add they provide and the general business guidance you get from them.  They are not all the same.  They are not always right, and sadly some of them you shouldn’t feed.  If you don’t understand something, ask.

Call to action!!

If you want real help and advice, you can Ask Valerie too, call me on 0437 336 574 or email me at valerie@absolutelyadmin.com.au

 

A professional bookkeeper can always tell who’s been doing your books.

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Who knows?

That’s not necessarily a bad thing – it’s just that folk who are keeping their own books usually have their own style of “accounting policies” that are different to the legal set published by the governing bodies.

I’ve been in business for myself for a few years now.  I’ve been into many businesses, both in my employed days and since starting up for myself.

I’ve seen many ledgers in that time – some are a work of art, some are, shall we say, less than accurate, and sadly some (a goodly proportion, if I’m honest) have been almost criminal.

I was invited into one business to be told that the bookkeeper that they’d had for years had walked out, leaving them in the lurch, so the business owner’s wife had been doing the books.  She’s really too busy for that, so would I please take over the task.

They had three ABNs, and transactions that were intermingled between the three.  There were many robbing Peter to pay Paul transfers, but one of the biggest issues for me was that there had not been one bank reconciliation ever done.  They were operating out of multiple bank accounts, both personal and business, 3 ABNs, and not one bank reconciliation had every touched their data files.

Unconscious Incompetence. My newly-minted “business-person” heart sank.  These people (lovely people, by the way) patently did not know what they did not know.  Before we (inevitably) parted ways about three months later, the business owner objected to my requests for bank statements and proper procedures, told me that no-one else had ever had a problem with his books, so why should I? His mother had kept this books immaculately for years, then they got in the erstwhile Bev.  Those ladies had never had an issue.  He went on to inform me that the reason the “Cheque Account” in the ledger was minus $10,000 was because he’d told Bev to enter payments that had to be made.  And the wife was costing Bank Account fees to Accountant. 

As I left them to their fate I didn’t bother attempting to explain that bills don’t affect the Cheque Account before they’re paid, but rather Accounts Payable.  He wouldn’t have wanted to know.

Not sure really why he hired a professional.  Not sure whether they’re still in business either.

The End is Nigh!!!

The End of the Financial Year, that is…

Call me to discuss your particular situation and we'll get some ideas that suit your business needs! 0437 336 574

Since it's almost June 30, here are some timely tips and reminders:

The small business concession instant asset write off has rules.  Fixed Assets - Ring Binder on Office Desktop with Office Supplies. Business Concept on Blurred Background. Toned Illustration.

  • It doesn't apply to all purchases, around the $20,000 area, it must be below $20,000.  Oh, and it will be gone this time next year.  If you were planning on purchasing a significant asset (up to $20,000) and you have the resources, consider doing it this week so that you can claim it in your 2016 tax return.

 

 

 

Motor vehicle claimsTirekicker

  • If you claim use of your motor vehicle in your tax return, be sure to record the odometer reading at the end of Thursday.  You should always be claiming use of your motor vehicle, it can be a significant claim.

 

 

 

Payments received in advance of work done?

  • Has someone paid you unexpectedly? If you haven't earned the payment yet, and they've just paid you early to maximise their own tax deduction, don't worry.  It's really a prepayment (unearned income) not on the profit and loss so doesn't get taken up into this year's profit figures.  Likewise, if you have invoices going out to clients for July subscriptions, classify them as unearned income.  You do have to do a journal in July to move them into income, but that's ok.  Make sure your bookkeeper knows which transactions fall into this category.

Last minute suggestions if you have some cash to spendBucket-of-cash.png

  • A contribution into your superannuation fund (if it's not at the limit)
  • Get the car serviced
  • Purchase some stationery (paper, toner) stocks
  • Pay your July rent early

One MP I heard recently suggested that, if you have made a profit, then keep your cash to pay your tax 🙂

Of course you would have your tax savings planted in a high-yielding cash management account.  But in all seriousness, we are not being asked to pay our taxes right now, just account for them.  It's a little different, and something to be considered in decision-making.

 

Cheers, Valerie 0437 336 574

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