Any employer (and bookkeeper) will tell you that processing payroll is a complicated task. It’s subject to many variances brought on by both individual employee requirements and state-based payroll laws. Something else that can affect payroll is public holidays and as Easter is fast approaching, we thought it timely to bring this topic to the fore. Here are 10 facts about public holidays that can impact your payroll:
There are only 16 short weeks until the end of the financial year (freak out!). If you haven’t yet recorded a vehicle logbook for tax purposes for the 2016 tax year, you need to start now. This is because a logbook must be kept for 12 continuous weeks. So what is a vehicle logbook and how does it relate to expense claims?
Sometimes business owners are required to create tax invoices on behalf of their suppliers. This type of tax invoice is known as a recipient created tax invoice (RCTI). For more specific information about the RCTI, go to our blog here – there’s a free fact sheet to download! The main thing about the RCTI is that you must ensure the information you are using to create them is current and correct. The ATO has an updated template for you to download. This template will help you create the perfect RCTI!
At this time of year we’re all thinking about Christmas and one of the best songs for the festive season is “The 12 Days of Christmas”. In keeping with this theme, this week we’re bringing you our 12 very best bookkeeping tips – it’s our gift to you! These tips will suit business owners at every stage, from start ups to old hands. Enjoy!
This week we want to bring a very serious issue to your attention. There are scammers out there calling people under the guise of being employees from the Australian Tax Office (ATO) and demanding money from innocent tax payers in an intimidating & threatening manner.
The Goods and Services Tax which we now call “GST” for short, is a complicated and convoluted tax, I’m sure you’ll all agree. The system is fraught with rules with which even the most experienced BAS or Tax Agents struggle to understand. At its core, one of the most difficult aspects of the GST is its own language (yes it has its own language!). The terms used by the ATO to describe even the simplest concept can be confusing and this is why we have supplied a graphic below which explains what some of these terms mean. We hope you find it helpful.
This week’s blog is another in our IMHO series and is about an issue I believe has the potential to become a big problem in the bookkeeping world.
YOU: So what is this issue?
Well, lately I’ve started to think that perhaps all of this automation currently occurring within our client’s online bookkeeping files is not such a great thing.
YOU: What? Are you kidding?
Yeah, I hear you – I kind of can’t believe I’m writing this myself!
For the uninitiated, by “automation” I’m talking about cloud-based bookkeeping software that is enhanced by “addons”. So basically, you have the original accounting program and a bunch of other programs integrated with that accounting file. The idea is that these “addons” will make the accounting file perform better but more than that, remove the need for users to have to do many tasks manually, thereby saving them time (and sanity).
YOU: Well, that’s a good thing right?
Yep, bloody fantastic…………. WHEN THE WHOLE SYSTEM IS WORKING CORRECTLY! (yes, I’m shouting ?)
YOU: Doesn’t it save users time?
Absolutely.
YOU: Doesn’t it help us to remember to do tasks and thereby stop things from falling through the cracks?
Oh yeah, you bet it does!
YOU: So what’s the problem?
Glad you asked. ? ?
This is going in caps because yes, I am shouting…….again!
AUTOMATION THAT IS NOT REGULARLY CHECKED BY AN ACTUAL HUMAN BEING WILL LEAD TO A BOOKKEEPING DISASTER!
YOU: But isn’t automation set and forget?
No, I hope not! (The work still needs to be checked on a regular basis)
YOU: So, are you saying that automation can cause errors to occur?
Exactly. Why? Because users think automation = perfection i.e. what could possibly go wrong?
THIS IS NOT THE CASE!
The work still needs to be checked and reviewed regularly by a human being, preferably by your bookkeeper (or other accounting professional).
I’m not against automation, far from it! It does reduce the workload and makes the accounting process a real pleasure……..if it is set up correctly and is monitored regularly.
For medium to large operators, it’s a god-send – 100’s of transactions being created daily without having to touch a computer. Imagine what they can do with the time instead? Go on a holiday, go to the movies, go out for tea or even just get on with running the business itself! Heaven!
You get the picture – automation removes the need to spend hours doing manual bookkeeping.
I LIKE IT!
However, what I don’t like is a fully automated accounting file that:
Is not checked by a human being on a regular basis
Has not been set up by an experienced, “accredited” user of the addons being utilised
Is transacted upon by users who do not understand the addon software or the effect/s it has on the general ledger
All of these things = one thing ⇒ an accounting file that is progressively being destroyed by backend software on an hourly or daily basis.
YOU: What does this mean for users of the file?
For bookkeepers , it means hours of repair work. For business owners it means a nervous breakdown followed by a very large bookkeeping bill!
YAY!
NOT!
Honestly, as a bookkeeper of nearly 17 years, I would rather do the hard yards and do the manual data entry than have to spend hours fixing accounts that have been mutilated by addons which haven’t been regularly monitored.
YOU: What a waste of time! Manual data entry? Are you crazy? She’s obviously one of those old fashioned bookkeepers!
You called it – it’s true, I am! But at least the accounts would be done correctly, first time, every time.
Do you think things will come full circle and we will return to the “good old days” of manual data entry?
Well that last comment was tongue-in-cheek of course………….
I don’t think anyone wants to return to those days……EVER!
But you know what? Given the choice between doing manual data entry or repairing an accounting file that is full of erroneous data due to over-automation, I know which one I’d choose any day!
YOU: So has bookkeeping become over-automated?
Perhaps.
YOU: Do you dislike automation?
Yes, if it causes more problems than it solves! But no, if it’s set up correctly and is regularly transacted on by experienced and trained users.
So it’s your turn now. What do you reckon?
Is automation going to end up causing major bookkeeping headaches in the future?
Are we headed for a bookkeeping Armageddon?
Is it a mistake to completely turn our backs on manual data entry?
Are we complicating the accounting process by automating everything?
A feature I’ve been waiting for in Saasu (and other online accounting software products) has finally arrived! Saasu has introduced header accounts. Header accounts are used to group like-accounts together so that they are grouped on the profit and loss report with a total amount showing for each group. This is very useful and makes reading (and understanding) the profit and loss report much easier!
Towards the end of each financial year, many business owners review their expenses and pinpoint which ones can be prepaid before June 30 in order to obtain a substantial tax deduction. Typically, expenses such as office rent and insurance are paid 12 months in advance and are then classified as prepayments. This is particularly useful if the profit margin is high and the business owner wishes to reduce tax payable (and who doesn’t!). But how do you enter these transactions into your accounts and how is GST affected? Let’s review this now.
After the coldest winter in 26 years in Australia, I for one am very happy that today is the first day of Spring! Spring time, along with its welcome warmer temperatures and longer days, is renowned as being the time for cleaning, hence the phrase “spring cleaning”. As I no longer need to worry about house cleaning since employing a cleaner earlier this year, the only “cleaning” I need to concern myself with these days is within my business itself. So how on earth is a bookkeeping business cleaned? What does this actually mean and how is it done? Read on to find out more!
