Accountants Minute Issue 335

Accounting News

The Axe falls sharply on errant Tax Agents

The Tax Practitioners Board is getting tough with tax agents who overstep the line.

Two agents have just been banned over falsifying SMSF audits.

It’s now a case of “no more Mr Nice Guy” when it comes to tax agents defrauding the ATO or their clients over SMSFs audits.

The TPB has terminated the registration of two tax agents after they falsely claimed that SMSF audits had been completed when they had not.

One of the now-banned tax agents lodged over 90 SMSF annual returns for more than 20 clients claiming that their funds had been audited.

In addition, the tax agent had defrauded his clients by charging them for those non-existent audits.

The TPB and the ATO worked closely together to discover the extent of the tax agents’ behaviour.

TPB Chair Ian Klug says it’s essential for the Board to uphold the integrity of the nation’s tax and superannuation systems.

The Virtual CFO Role: it’s a sell, but it’s worthwhile.

By Peter Towers, Managing Director, ESS BIZTOOLS

Why would any small company ever want to take on a Virtual CFO?

Can’t you hear them saying “Oh my God, just think of the cost!”

Most businesses look at fees they have to pay out for any service as a cost, and as we know, business people hate costs.

So if you’re serious about offering your services and expertise as a Virtual CFO, you have to be prepared to face some objections before they finally say “yes”.

Recent American experience has shown that once you overcome those initial objections by showing that a Virtual CFO is an investment and not a cost, then both you and your clients will benefit greatly.

As it stands now, many of your SME clients may not even know they need someone to fill that role, even though they want to expand.

They’re likely to have a full or part-time bookkeeper on staff, and they think that’s all they need when it comes to the money side of their business.

But, as accountants, we know that to successfully grow a business, the directors and management teams of small and medium sized companies need sound financial advice.

Financial Forecasting is becoming more important than ever.

The range of compliant documents required for capital raising, such as Crowd Sourced Funding Equity Raising, or to support any other business development, are well beyond bookkeepers or business executives to produce.

Most SMEs simply can’t afford to have a full-time CFO on staff - not when their salaries now top $200k a year. In most companies, there’s simply not enough work for them to do fulltime.

That’s why US accountants began offering Virtual CFO services to their clients several years ago. 

Providing these services allows you, as an accountant, to work closer with your clients to help build the value of their businesses. The best part is that because you’re “virtual”, you’re available when they need you, but not on their payroll, when they don’t.

This “investment” in a Virtual CFO makes good sense from both sides.

From your accounting practice’s perspective, being a Virtual CFO doesn’t mean you have to do all the work yourself, as you would on staff.

While you may be the go-to person in your daily dealings with the client, the work that needs to be done can be performed by your in-house teams.

Virtual CFO work is more varied and interesting than run-of-the-mill tax compliance and lets your talent get their teeth into tackling challenging issues.

Is it any wonder that many US Virtual CFO practices are reporting that with more interesting work, their talent stays with them for far longer?

Most Virtual CFOs don’t work on-site at the client’s offices, except perhaps on rare occasions.

They stay working from their accountancy practices where they have all their resources at hand.

As mentioned earlier, a key benefit of taking on the Virtual CFO role is that it’s not fulltime.

This is great financially for the individual client, but it also gives you the freedom to become a Virtual CFO to multiple companies, each of them getting on-demand access to the benefits of your experience and expertise and the back-up resources of your team.

When you understand this, convincing your SME clients of the benefits becomes a lot easier.

To successfully take on the Virtual CFO role, you do need to be prepared.

There are many documents and professional software that you’ll need to make sure the process rolls out smoothly.

Fortunately, at ESS BIZTOOLS, we’re able to help you there.

Check out our website www.essbiztools.com.au and get ready to make a decision that could take your accounting firm to the next level.

Company Liquidator in the Hot Seat

A voluntary liquidator is facing charges of dishonestly using his position as a company officer.

ASIC alleges that, while acting in his official capacity, he allegedly withdrew more than $150,000 of the company’s funds for personal use.

NSW Voluntary Liquidator Robert Cardwell was appointed as the member's voluntary liquidator of Loch-Co No 6 Pty Ltd in 2013.

ASIC alleges that, between May 2015 and March 2016, Mr Cardwell made 12 withdrawals from the company’s liquidation account for his own benefit.

The corporate regulator also alleges that he failed to respond to notices to produce books and records. 

Cardwell has been charged with violating Sections 184(2)(a) and 63(1) of the Corporations Act, each section punishable by fines and imprisonment.

The case has been adjourned to the Parramatta Court on 16 December 2022.

In 2016, the NSW Supreme Court appointed Hall Chadwick as the company’s new liquidators to replace Mr Cardwell.

Congratulations to our Holiday Accommodation Package Winner!

We would like to congratulate Michael McCarthy from Michael McCarthy Chartered Accountant in Scoresby VIC on winning the Holiday Accommodation Package! We hope you enjoy your well-deserved holiday.

We’re giving away another holiday accommodation package! Click here to enter.

The next winner will be announced on Wednesday 2nd November 2022 at 9.30am AEST/10.30am AEDT. Good luck!

Accountants striving to save their flooded communities

Some regional accountancy practices have become victims of the horrendous flooding in Victoria and New South Wales.

Despite their offices being inundated by floodwaters, accountants and their staff have donned their work-gear to help get their communities through these troubling times.

Businesses in the main streets of many regional communities are often heavily exposed when floodwaters start to rise and flow into town, and accountants are no exception.

When rural towns like Rochester, Echuca or Deniliquin are inundated with “one in 100-year” floods, it’s time to drop the calculator, pick up a shovel and start filling sandbags.

This past week, many local accountants have pitched in alongside other volunteers to help build levy banks to protect their communities. 

A number of accountancy practices in regional Victoria and the New South Wales Riverina have their front doors sandbagged this week, in an attempt to hold back rising floodwaters.  

Sometimes, it’s been in vain.

Before the Murray and other rivers rose, many accountants moved their clients’ records to higher ground or to the highest shelf in their offices, but given the unexpected size of the flood, in some cases that just hasn’t been enough.

Like other businesses, accountancy practices will face a big clean up.

CPA Australia has demanded that the Federal Government introduce standardised scalable natural disaster support in this month’s coming budget.

Union Bargaining Plan may crush smaller businesses

An expansion of “multi-party bargaining” risks damaging both the economy and workplaces.

This frank warning comes from a detailed report by the Productivity Commission, which finds itself under fire from the union movement.

Federal Treasurer Jim Chalmers says he expects an increase in real wage growth to result from his October Budget.

Treasurer Chalmers announcement comes in the wake of union calls for multi-sector bargaining to be extended to industries, like road transport.

However, employer bodies, including Ai Group, believe if the union movement gets its way, already stressed supply chains will face increased industrial action.

Ai Group’s Chief Executive, Innes Willox, says the Productivity Commission’s latest report sends a very clear signal.

Mr Willow says the report highlights that increased union power for multi-party bargaining would impact heavily on businesses that are already under increasing pressure from inflation and increased operating costs.

The ACTU disagrees, claiming that the Productivity Commission’s report is an attack on workers.

Treasurer Chalmers says he doesn’t believe increasing wages will have a big inflationary impact.

How these angel investors turned $440k into $11m

When the founders of Clipchamp first approached Brisbane Angels – a group of Queensland investors – asking for investment in the video editing software company, they were turned away.

“When they first pitched to us, there wasn’t that much interest,” said John Mactaggart, chairman of Brisbane Angels and a director of ASX-listed technology company TechnologyOne. “We kind of said no.”

Click here to read more from Australian Financial Review.

You might never have to file a tax return again

Taxpayers and business owners would be spared the task of filing lengthy tax returns every year if the Tax Office moved to a system of automatic data exchange under a bold proposal which could end the annual lodgement scramble.

Click here to read more from Australian Financial Review.

Will your accounting firm survive the downturn?

Could you handle more business this year?

Well, whether you could or couldn’t, chances are pretty high that you probably wouldn’t like the idea of handling less. Yet, for many businesses, “less” could be the reality over the next year.

It’s often hard to tell businesspeople, who have been operating successful businesses for many years, that they need to start keeping in touch with their client base.

That message doesn’t always sink in.

It’s especially true for accountants who expect their clients to just keep coming back automatically year after year.

With tough times ahead, you need to get talking to your clients before your competitors get in their ear.

Accountancy could soon become a price-based dog-eat-dog world, unless you can convince your clients that you have something special to offer them.

A simple way to start the conversation is with an e-newsletter – it’s basic, it can be personal and it’s inexpensive to produce.

There are many more sophisticated and expensive ways of communicating with your clients and potential clients …. but an e-newsletter is a good way to dip your toe in the water.

If you don’t believe that then you should take note of the 83% of American businesses that are already using e-newsletters rather than plain text.

Do yourself a favour. Click here to download the brochure now. It makes good reading and you may find that it could work for you.

How Financial Forecasting Adds Value – Business Plus+ Newsletter

ESS BIZTOOLS’ Business Plus+ newsletter is prepared on a monthly basis, for subscribers to badge with their own name and send to the SME clients and prospects.

One of the articles from our recent edition of Business Plus+, “How Financial Forecasting Adds Value”, is available for you to use. Click here to access the article. You’re most welcome to utilise this article for your firm.

Grants Update

There are number of grants for which your SME clients might be eligible.

Want to know what they are? Click here for a list of new grants, prepared by ESS BIZTOOLS.

ESS BIZTOOLS - New Subscriber Benefit

For a limited time, ESS BIZTOOLS is offering you a complimentary holiday accommodation package.  

You can enjoy a 4-day/3-night stay in a wide range of idyllic destinations throughout Australia. Simply subscribe to one of our packages (paid 12 months upfront or in 4 equal monthly installments) to claim.

Click here to find out more.

ESS BIZTOOLS - Feature Product Package

This week’s feature product package is the Business Advisory Services Starter Package.

Click here to see what’s included within this package.

Latest Social Media Posts

Free Webinars

You are invited to participate in the following webinars, free of charge. Click on your preferred event to register your attendance.

ESS BIZTOOLS Starter Package – Wednesday 2nd November 2022 at 11.30am AEST (12.30pm AEDT)

ESS BIZTOOLS Financial Forecasting Package – Wednesday 9th November 2022 at 11.30am AEST (12.30pm AEDT)

ESS BIZTOOLS Advanced Package – Thursday 17th November 2022 at 11.30am AEST (12.30pm AEDT)

Previous Webinar – Biggest Risk – Talent Attraction and Retention Do You Have Strategies?

Want to know more?

Visit www.essbiztools.com.au. You are also welcome to visit www.essbizgrants.com.au, a website that can assist in the identification of government grant(s) suitable for your clients.

If you would like to have a discussion about how this concept of virtual CFO services can be supplied by Australian accounting firms please ring our Managing Director, Peter Towers, on 1800 232 088 and we will arrange a complimentary 45 minute Zoom meeting to discuss your firm’s position and to give you our advice.

We believe that this is the blueprint for the delivery of an enhanced range of services by Australian accounting firms to assist SME businesses to add value to their businesses and to assist accountants not only to attract but to retain outstanding talent who want to be involved in the delivery of “real accounting services”.