How to Prepare your Business for the 2024/25 Financial Year
RESET Time!
As we head into the new financial year it is a perfect time to review, reflect and reset the financial foundations of your business. In this article we will discuss who could be on your financial team to help you with important financial decisions on your business journey.
- Your Bookkeeper
Your bookkeeper, whether they are internal or an external contractor, is required to provide you and your management team with clear and current reporting to help you review the past and prepare for the future. Ensure that your bookkeeper understands the importance of being able to support you with:
- accurate monthly financials by at least the middle of the following month, if not before
- data entry of income and expenses at least weekly
- preparing future cash flow forecasts
- lodgement dates and lodging PAYG and BAS
- payroll and superannuation payments
Many businesses fall behind in tax payments due to ill-prepared reports and miscommunication around tax obligations.
- Your Accountant
Ensure that your accountant is aligned with your business goals and then you set the expectations of the relationships. You are investing in a service, and this time of year is the opportunity to review whether you are receiving what you expect.
Your bookkeeper and accountant should have a clear line of communication, with the bookkeeper providing your accountant with accurate and current reporting.
A great accountant will also conduct a review of your financials and do some basic calculations on liquidity, solvency, profitability, and return on investment – and explain this to you in a way that you can confidently understand!
Your accountant is the ‘go to’ for all tax reduction opportunities, as well as providing guidance on the timing of end of financial year purchase/payment options.
If would like to speak with one of our recommended accounting partners go to https://www.protradeunited.com.au/services-directory/#accounting and arrange a ‘no obligation’ conversation to explore how they may be able to assist you and your business.
- Financial Advisor
A quality financial advisor can assist you with investing your profits wisely and help you create a financially independent future. You may want to get a holistic financial plan of your personal situation and/or get specific advice (maximising your retirement planning, protecting your family with insurance, estate planning, etc).
They can also help you maximise the use of your profits with external investment opportunities outside your business. Go to https://moneysmart.gov.au/ to find a recommended independent financial advisor.
We suggest interviewing 2 - 3 advisors and select one you feel most comfortable with. Some important questions to ask are:
- What are the main types of clients you deal with? (The best answer is ‘people in your situation’.)
- How do you charge for your advice? (You want a fully transparent schedule/example.)
- Ask them about their own personal portfolio.
The most sought financial advisors hold an educational approach, taking the time to explain and ensure all parties understand matters without the jargon, as well as asking lots of questions, and speaking equally to the queries of all partners.
Remember, no one cares more about your money than YOU do.
- Your Finance Broker/Banker
Your business may need finance to fund ongoing operations and growth. Finance can be provided from debt, equity and internally generated cash flow. It may also be an idea to set up a line of credit or overdraft when your business ‘doesn’t’ need it, to cover business contingencies including taking advantage of new opportunities.
Review all your current loans, particularly large ones such as your home loan. Higher interest rates are still persisting and while your interest rate is important, there are a number of other factors that can affect the total cost of your loan. Hidden fees, inefficient loan structures and lenders not experienced in trade/construction finance can all add costs, so start with these to take a holistic view of all your loans and assess them accurately.
If you would like any support in the above, please connect with the team at PROTRADE United.
Written by Jon Mailer
CEO Of PROTRADE United
