Superannuation

The superannuation contribution levels are:

From the 1st July 2012 a taxpayer aged over 50, who has a superannuation fund balance of less than $500,000, can contribute $50,000 per annum to superannuation. 

The Government has announced, following the release of the Henry Review that the superannuation guarantee contributions will increase from 9% to 12% of employees' wages and salaries from 2013/14 to 2019/20.

The increase in 2013/14 will be 0.25%; in 2014/15 another 0.25% and will continue to increase 0.5% in each subsequent year until 2019/20 when the superannuation guarantee will have reached 12%.

Article provided by Acclipse Business Advisor and ESS BIZTOOLS Pty Ltd.

Understanding Financial Statements

Understanding financial statements is a task that many business owners often put aside to concentrate on something more interesting.  This results in many business owners not really knowing what is going on with their business, especially the cashflow control within the business.  Cash is the lifeblood of any business and it is the fuel that keeps the engine running.  It is vital that business owners understand all there is to know about the flow of cash into their business and the flow of cash out of their business.  The movement of cash is recorded within the financial statements.  Financial statements are very useful as a tool to help in the management of the business.  Financial statements are required by the business owners to understand how the business is performing.  As well, there is normally a requirement to produce them for banks and investors.  Preparing financial statements for taxation purposes should not be the priority - being of assistance in business growth is more important!

Financial statements concentrate on measuring profit or loss.  They may then facilitate the preparation of cashflow reporting and Key Performance Indicators (KPIs) that enable meaningful management information for your business.  The key components of financial statements are:-

• Departmentalised Trading Profit and Loss accounts with gross profit percentage calculations for each department
• Balance Sheet
• Supporting verification workpapers for each item in the Balance Sheet
• Source and Application of Funds Statement
• Debtors’ Aged Analysis
• Stock on Hand Analysis
• Work-in-Progress Analysis
• Creditors’ Aged Analysis
• Capital Expenditure Summary
• Bank Account Analysis   

Preparation of financial statements on a regular periodic basis can contribute greatly to the management of a business.  Some businesses find it very useful to produce a weekly performance report and detailed monthly financial accounts.

If you have any queries on any aspect of the interpretation of your financial statements, please do not hesitate to contact us.

For more information contact us for a copy of the paper “Interpretation Of Financial Accounts”.

Article provided by Acclipse Business Advisor and ESS BIZTOOLS Pty Ltd.