Financial Accounting

Doing what accountants do...

​With information from your financial reports, we can give you practical advice that you can understand and use to improve your business. A lot of the following may not be relevant for many small and medium businesses who only need annual accounts with tax minimisation!

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This may include strategies for:
* Profit improvement

(e.g. If Gross Profits are low: Are cash, credit and stock being controlled? Are sales prices and mark-ups being set correctly? Are direct labour costs blowing out? Can overheads be reduced?)

* Working capital improvement

(Is cash being drawn out by owners or used in the business? Are Creditors being paid on time or building up? Are you settling your GST and PAYE liabilities? Are you overinvesting in plant? Making too much use of high-interest debt?)

* Cash control

(Are Debtors being quickly converted to cash? Who has control over receipts and payments? Are all sales being banked? Are tills - and the bank account - being reconciled? Is Stock being turned over for cash or building up? Do you have favourable credit terms from suppliers so payments are deferred?)

​​​You may need to learn about the benefits of debt or equity financing, when to declare dividends from retained earnings, how to structure assets sales to save tax, and more.

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But first things first:

Before we can formulate the right financial strategy for your business, you need to have timely and accurate accounting reports. These are essential for tax purposes, good management, efficient planning and to secure bank finance for growth. We'll ensure you get those. 

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If you are a new business, you may need advice on the accounting systems and correct structure to adopt (be it company, partnership, sole-trader or Trust, for instance). We assist with company formations, subscriptions to Xero and more.

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We will produce the monthly or annual trading report: the Statement of Financial Performance (the Profit & Loss Statement). ​​This is part of good governance so you can check at a glance your turnover, gross profit, expenses and net profit before taxation. Comparatives with previous years will show trends that will be helpful for planning and budgeting.

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Next, the Statement of Financial Position (the Balance Sheet), Fixed Assets Schedule and Cashflow Statement are prepared to show your business' Net Worth, Working Capital, Sources and Applications of Cash and Book-Values of Plant employed in the business.

These can be also used to check financial ratios to track Key Performance Indicators (KPIs) and to value shareholdings.

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