Hi there. Welcome to Better Business Insights. My name is Liz Jarvis. And today we're going to be talking about one of my passions. “Your chart of accounts.” Now the chart of accounts is simply the list of names and numbers, the words that make up the story of your business! The words that end up printed on your profit and loss statement and your balance sheet. Now the problem is if those words are not meaningful to you, how the hell are you supposed to interpret them? How are you supposed to use that information for better business decisions? I’ve realised in some of the research that I've done. In trying to work out how it is that business owners got so behind. In my passion that I want to] find the way to get business owners back to good relationships with their numbers. I worked out that one of the problems is these standard charts of accounts. Now ages ago, cash books were written up and the business owner was the one that decided what the label on the top of that column might've been. So they decided: What things they wanted to track in their business. They wrote that into their cash book and their accountant then took that information and converted it into words that the tax office wanted to know about and produced financial statements that way so that they could fill the 10 or 15 or so fields in the tax return. Then we had all this, “do it yourself, accounting” came in. Then we started to get some standard charts of accounts. But those charts of accounts might not be right for you. It's your story. You can change the words to be meaningful to you. Let me give you an example from farming, in the standard chart of accounts, that seems to be used all the time. Here is a code for seed fodder and fertiliser, one code for those three things. And if you look at how detailed that can be for some farmers, the Dairy Australia standard chart of accounts is actually a good example. There could be up to 20 different categories that should be used for what is often one line, because we need more detail to make decisions. We probably need to know how much the seed was, compared to the fodder, compared to the fertiliser. And yet they're generally lumped into one line. So I won't go into great amounts of detail here, but I want you to have some curiosity. Profit and Loss and your Balance Sheet. What do those words mean? How are those things being described? Does it mean anything to you? and if it doesn't, can you just change the names of those accounts? It's good to talk to your professional about whether or not that's okay. But I can guarantee you, if you use words that are meaningful to you in your chart of accounts, suddenly the story becomes clearer, your curiosity is more confident and you'll start to enjoy looking behind the scenes of what's going on in your business. Now you can have more or less detail depending on how you like to work. I have clients that work with masses of detail. It works for them. It works with their brain and how it works. Sometimes we summarize that up for other analysis. I have clients that don't want much detail at all. There's no right. There's no wrong. It's not black and white - It's all a bit grey; But that's what we're here for to help you get good relationships with your financial information so that you can read it and find out your own story and then take your business to where you want it to be. Thanks for joining me today. See you next time.
Welcome to Better Business Insights. I'm Liz Jarvis. Today we’re going to talk about curiosity and discovery and why it takes practise. Now you may have heard me before talk about the need for curiosity, when getting into your numbers and getting to understand your business. But it's not that simple, is it? If you've not been encouraged to be curious, if you're scared of numbers or have been judged about those numbers, then you're going to find that you don't want to look at them, let alone get curious about them, but modern accounting systems are actually pretty cool for being curious. If you can pull your balance sheet or your P and L up - so profit and loss statement, is the story of your business for a period of time, about what came in and what went out. Your balance sheet is the story of your business at a point in time, not over, but at the balances at 30th of June, for example. If you can pull either of those two reports up on your screen in MYOB, Xero, QuickBooks - any of those - you can actually drill down. It's pretty cool. You can drill down into those numbers and see what makes them up. You can't really break it while you're just drilling down. You're not going to change any transactions. Don't let your Bookkeeper tell you that you shouldn't touch it. You should be curious. Curiosity and discovery takes a bit of practise, but you've got to start somewhere. And the more you do it, the more you review your financial statements, the more you dig into things, the better you're going to understand whether those numbers are right or wrong. They say numbers don't lie and that's fine. They don't really, however, sometimes they're wrong and sometimes things are allocated to the wrong place. And, unfortunately, in this day and age without computers and everything being automated, they're quite often wrong because, you know, QuickBooks decided where to put that particular expense and the Bookkeeper didn't think that that was wrong, so off it goes into this corner or that corner. So, it's more important than ever that we review our financial statements. And that's why you got to be curious. So have a go. Check some things out. Start to get curious, start to discover everything behind your financials. And if you come across any problems, reach out to us. We'd love to help or reach out to your Accountant or your Bookkeeper that you already have. If they're not giving you the answers you need, come and see us. We're an additional service. You don't have to change Bookkeepers or Accountants to have a chat with me about what your financial statements mean. So I hope that's been a little bit helpful. I hope you'll get curious, share your stories with me about what you've discovered. See you next time.
To make more money, find out more about how to read your Profit and Loss Statement and Balance Sheet. Numbers can lie if the decisions made about how they are allocated are misguided. Luckily you can drill down into your information to see what's behind it and get a feel for whether it's being correctly allocated. All it takes is a little curiosity - let me support you and show you the way with a free strategy session.
Hi, there I'm Liz Jarvis. Welcome to Better Business Insights. At our business, Better Business Decisions, we work with clients one-on-one to unpack all sorts of things that are going on in their business, and we apply our accounting knowledge to help them. Now, today I'm going to talk about “doing the books”. I mean, what does it mean anyway? For some of you youngsters, it must make no sense at all. Why is it called “doing the books”? Well, not that long ago, when I started, PCs were only just happening. Not that long ago, Business Owners hand-wrote their books. They had cheque-books and cheque-butts, which they wrote on the butt of what that cheque was for. And the cheque went off in the mail and eventually got to where it was supposed to be, eventually got banked in the bank. And then, it would show up on your bank statement. “Doing the books” was writing up into a book, what your money had been spent on, what money had come in. And so “doing the books” was the label that we had for getting your accounting information ready. Also, from that book's idea comes “cooking the books”. “Cooking the books” is about actually recording the information incorrectly, that might involve stealing money out of that business. Unfortunately, I've heard of a number of Bookkeepers that have stolen money from Business Owners, without them realising they're “cooking the books”. It doesn't matter whether it's handwritten or into our modern computers, doing the bookkeeping is a very important part of a business. The Business Owner needs to check over the books, properties. It was easy when I was a ledger book and you could just look at it, make sense of it and say, “yep, that looks good enough”. Now you've got to look inside the computer. How do you do that? It's confused a lot of people and it's made a lot of people scared. And a lot of Business Owners, abdicate that. They're like, ”Whoa, that's someone else's job. I don't understand it. It's got nothing to do with me.”. It's got everything to do with you. The books tell the story of your business and no matter how they're getting into the computer and no matter what reports are coming out of the computer, that is a wealth of information for you. So, be careful. Like I said earlier, I'm from the time when there were books and even then, back in the fifties, sixties….Actually I finished school in the eighties, I'm not that old. There was a saying about computers when, when computers took up the whole room. - they said “to err is human, but to really foul things up, takes a computer”. Now I think these days we use a different F word, but it can get really fouled up, really fouled up in your computer because things happen these days. It's fantastic. It's all automated. And the bank feed comes in and the software decides based on all sorts of statistical observation. The fuel docket comes in - no, I'll rephrase that.. Something comes in from Smith Proprietary Limited, and the computer might assume that’s for petrol because there's this other Smith Pty Ltd that everybody has stuff for that's for petrol, but maybe it's marketing, maybe it's for something else. Maybe the interface between that data coming in automatically, and the way it's recorded in your business books, isn't being properly observed. I mean, if you've just, offshored your bookkeeping - who set the rules? Who decided what goes where? Back when we had cheque butts, we decided: this is for fuel, this is for dog food, whatever. Now that interface isn't so much there and a business owner, more than ever, needs to look at the output of the books. The output is your profit and loss statement, your balance sheet. It's really important to get to understand them and look at them regularly, which is another topic on one of my other Better Business Insights. Reach out if we can help in any way. Reach out through our social media, through our website. We'd love to hear from you because we want Business Owners to be able to make better business decisions using their financial information. Have a fantastic day. See you next time!
Are you a business owner that isn't really sure about bookkeeping? Well you certainly are not alone. The problem is without a base understanding of what " doing the books" is all about you may be leaving money on the table! To help you to understand, I explore some of the terminology of the past and the transformation to the tools we have now. Be sure you are protected from unscrupulous people stealing form your business by having a better understanding of how that could happen.
Hi there. Welcome to Better Business Insights. I'm Liz Jarvis and in my business, I help take the stress out of the numbers for Business Owners. Sometimes that's just about the numbers. Sometimes it's about relationships. And today I'm going to talk about judgement because judgement can prevent you from getting the best result. In our business, we try always to use a non-judgemental curiosity in our business to get curious about who you are, what you do, what you want to achieve. And today I want to talk about your judgement and how that might be getting in the way of some of the things that you could do to make your business better for you. I'm going to actually read something for a second because I listen to this meditation from Deepak Chopra. It's helped me a lot. And in amongst it, there's this beautiful thing about judgement. He says, “Judge not today. Judgement creates turbulence in our mind and when there is turbulence in our minds, then it interferes with the creativity of our soul. Creativity and judgement don’t go together. Judgement also means letting go of the need to classify things, to call them either right or wrong to label, to define, to describe, to evaluate, to analyse. Let go today. Judge not today because consider what happens when you judge someone, it makes another person wrong. Someone else's wrong to feel a certain thing, to look a certain way, to hold certain feelings. Judgement immediately creates separation and any person who is wrong then becomes them. So the need to judge arises from the need to be isolated, and that is the ego's form of defence.” Now there's a little bit more to go on with, but the funny thing about all of that is in accounting, we actually do need to do this; label, define, evaluate, and analyse. That's something we definitely need to do in accounting, but don't do it about people. Sometimes people feel judged by their accountant or by other people around them, when they don't feel confident with their numbers. I want you to let go of that potential to be judged and just ask questions because in accounting, there are lots of questions to be asked so that you can get it right. And getting it right is actually about getting it right for you - for you, the Business Owner. We want you to be able to read the story of your business, you to be able to interpret, analyse, understand what is going on in that financial information. Because it's through that, that you are able to tweak it and improve your business. And the more you improve your business, the better for everyone around you. So, I hope this little foray into judgement helps you to think a little bit differently about accounting and many other things. Reach out to us through any of our channels. And I hope to see you on another one of these and perhaps meet you one day in person or on zoom. Have a fantastic day!
To better understand our business we need to get our numbers and Judge them - we label, define, evaluate and analyse to get better results. However, if we do that to the people in our lives, our relationships suffer and in turn our business often suffers. Let these tips make your business life better!
Hi there. Welcome to Better Business Decisions. Today I'm going to explore a concept I really love. The concept of synergy. Stephen Covey, who you probably have heard of, you'd have to be under a rock if you’ve never heard of Stephen Covey, rest his soul. He talks about synergy. Synergy being the idea that when two people come together, and think and work together then the outcomes are more, much more, than each of them could have made on their own and added together. So, one plus one equals three, not just two. Synergy is a really important thing to get into for your business, whether it's your Business Coach, marketing person, Accountant, Bookkeeper, your staff. If you bring to your workplace or your business, the concept of synergy and meet with like-minded people to strategise around things happening in your business, then you're more likely to increase your curiosity, increase your ability to pivot or iterate. This Lean Startup book, which is pretty famous and helpful, it really talks about iterating. Iterating is the gradual improvement of your business, adjusting your product offering for your clients or adjusting your actual overheads and things like that. There are many opportunities to improve your business and bring the synergies that those discussions have, into your business. So, to find out more about synergy, check out Stephen Covey. To have some synergy, I'd be happy to work with you, look at your numbers, help you to take the stress out of them. Just give you a fresh perspective - any time - just reach out. Hope to see you on another episode of Better Business Insights.
Business is so much better when you get two or more heads together to curiously explore. That's called synergy! Let me help you to get more out of your days with these tips.
Hi there. Welcome to Better Business Insights. I'm Liz Jarvis and today we're going to be talking about the accuracy of your financial statements. As a Business Owner, if you're not reading those financial statements, how do you know whether they're accurate? I know we have some great gut feelings about how our business is going, and perhaps we measure it by the bank account, but, it's important to understand whether the financial statements are accurate. I've had a few experiences of late, where the financial statements were quite inaccurate. In fact, sometimes people manipulate those financial statements to meet the targets that are set for them, or to meet the budgets they set for themselves, or to keep the Bank Manager happy, perhaps. So, taking an interest in your financial statements is essential to being certain that your business is running the way that you think it is. Ways to make sure that the accounts are accurate, is first of all, to approach those financial statements as the business story. The story book of the business, the profit and loss is the story of your business from one point in time to another. So that might be a year or a quarter or a month. And then the balance sheet is a snapshot of your business, at a point in time. The balance sheet is often ignored and it's in the balance sheet that fudges hide. And inaccuracies hide. And incomplete things happen. But it is, as I said, often ignored. And it is important for you to look at the balance sheet of your business, your entity, or you may have multiple entities. Don't just ignore it and accept that it's right, because the Accountant has done it. Have a good read of it. What's in there. Is it right? Is it incomplete? There are so many things that I've seen pop up over the years, as I've worked with clients and always walked them through those financial statements that were missing in one way or another, or were incomplete, impacting their profitability. So, I hope you've enjoyed this little session on accuracy of financial statements. Get your financial statements out now and start to have a look at whether or not you think they're accurate. And if you're not sure, or you'd like some non-judgemental help from me, reach out and I'll do my best to help you. Have a fantastic day. See you next time.
I’ve found that time and time again, business owners who don’t necessarily feel in control of their finances DO in fact have a strong gut instinct when something isn’t right. Having a clear understanding of some key areas of your finances can help you replace this feeling of general unease with the ability to detect where something is amiss and take action. I believe every Small Business Owner has the ability to check their own Balance Sheet for accuracy. Ideally, it shows the Big Picture of your business's financial position at the chosen point of time. It's the tool you use to be sure your accounts are in balance. You can save heaps of time and money by checking a few key things! This video will give you some insight and if you'd like some further support or guidance.
Hi there. Welcome to Better Business Insights. I'm Liz Jarvis and today we're going to talk about what do we measure? It might sound dumb, like a dumb question, but there are no dumb questions in accounting. I encourage Business Owners to just get in there, get curious, ask anything. And if you're asking your Accountant and they put you down, find a new one. Sometimes Business Owners think they measure their success of their business by the amount of money in the bank. But that's not the whole story because we don't…… maybe we put a whole lot of money in before we started the business, and that money is still there. Maybe we have a lot of customers that owe us money. Maybe we have a lot of bills, unpaid. Maybe we invested all the money we had in something very important, like stock or a truck to do our deliveries or something like that. So, we don't just measure cash. We also don't just measure sales, because you might have that six figure business or that seven figure business. That is not the measure that we use to see if you're doing well. Profit. Profit is the measure that we need to look at regularly, very regularly. Now, there's net profit and there's gross profit, but we're talking net profit before tax. Some things can confuse that profit. These days, we can immediately write off our computers, our…. in fact, at the moment, we're in 2020, you can write off any business asset up to $150,000, straight away. You don't want that sitting on your profit and loss statement, showing that you've potentially lost money. We pop that on our balance sheet and gradually pass the cost of that, over into our profit and loss statement. So, measuring in our businesses is very, very important. And the success of your business is measured by your profit. And don't kid yourself if you're not making profit and you just think you’ve got to keep at it a bit longer. Depending on what business you're in and what industry you're in, sometimes you do have to not make a profit for a few years. If you're in a volume game, something like fashion then you probably can't make profit until the volume of sales that you get, the number of pieces that you sell, gets to a level where it can cover your overheads. So, these things are just an illustration of how important it is to choose the right things to measure. When you're interpreting your financial information, which I encourage you to do on a very regular basis, you need to have an understanding of which measures, which measurements are the right ones for you. Now we can have a look at that with you, if you like. Our services are on top of the ones that your Accountants offer. So, if you'd like to know more about what you should measure in your own business, or whether or not you're really making a profit or how big that profit is, reach out to us. Ask a question in the chat or book in for a free Discovery Call with us. Hope to see you on the next Better Business Insights. Have a fantastic day.
The success of business is not measured by sales or turnover. It is measured by Profit. Sometimes the profit isn't clear either - Liz unpacks some of the things to consider when working out your true profit to see if your business is successful - by your definition!
Hi there and welcome to Better Business Insights. I'm Liz, Jarvis and today we're going to talk about sucking the scare out of accounting. For any of you that have known me for a while, you'd know that I crowdfunded back in 2016 for a pilot program to suck the scare out of accounting. Boy, we learn a lot. My 10 participants, ran through our pilot program and we learnt heaps of things from that. And in the future, we're going to have more online learning relating to that. At present, we don't. At present, we offer one-to-one. But why did I want to go and suck the scare out of accounting? It's because I've discovered that business owners everywhere really don't want to deal with their numbers. So, I've made it my business to help people get over that scare, help people understand better. I've invested a lot of time and energy in working out what your perspective is, where you're coming from when you come to your numbers. And I want to reassure you that we can suck the scare out of it, pretty fast. All you need to do is look at your numbers as the story of your business. Your business is unique and you, the Business Owner, you know - you know, deep down in your soul, what your business is all about. You know the story. So, you're actually really well-placed to look at those reports and see if they're right. And as you get them tidied up and accurate, you will also be able to look at them and see opportunities. Opportunities to do better, to make more profit because more profit gives you more choices, more time with the family, more activities, less stress. All of that profit is important. Profit is important for everyone. We don't have to be…. some people exploit others in order to get profit. That's not the profit that I'm supporting. I'm supporting the profit that comes from you doing your thing to help others and being paid appropriately for it. So, does that suck the scare out of accounting? Have you got a little bit more confidence? I encourage you. Go and get out your financial information and have a look at it with a fresh set of eyes. Don't let that lizard-brain fear overcome you. Believe in yourself. I know you can do it. Let me know how you go in the comments. Have a great day.
Are you one of the many business owners that is a bit scared of your Accountant, Bookkeeper, Financial information etc? Well you are certainly not alone. Let me assure you with the tips in this video and a little belief in your self you will be on the way to using all this information to make more profit!
This topic is accountability. Now, accountability is so important. In today's busy world, though, we are often letting ourselves down, letting other people down. Our staff might be letting us down. Working out who's accountable for what, in your business and how often, is really, really important. So, I'll stay on the topic of accounting. Even though there are so many other accountabilities in your business, the bookkeeping and the accounting, the preparation of financial information, that is all really important. And we tend to leave it till last, especially if it's our job, we just don't get around to it. It doesn't feel important. It's not as important as looking after the customer. It's not as important as getting home for dinner on time or it's not as important as the glass of wine after dinner, maybe. But by setting up some accountability around all of your financial information, you will have it more accurate, more often, and that will enable you to see what opportunities there are in your business to improve. It will also help you to feel on top and it will just make your life so much easier. Because, from personal experience, among other things, the more you get behind, the harder it is to get in front. The more unfinished business that you have, the more likely you are going to miss something, or someone is going to take advantage of you. So, I would suggest you have some accountability in your business. How often is the processing going to be done on your business records? The more often the better, because if you've got a bookkeeper doing your things and they perhaps do it quarterly, and there's a bit of complexity in your business, you're not going to remember when they finally get to doing the BAS. What happened on this day or that day, what this might've been. By having it done regularly, in some kind of accountability matrix that you set up for your bookkeeping and your accounting, then you'll stay on top. They'll stay on top. Their bills will be cheaper. They'll be happier. And you'll be also, well set to ask more questions about your financial information. The other thing about having everything up-to-date is that you're ready when it's time to have the tax done. You can jump in before other clients, after the 30th of June, get your taxes sorted early. The earlier you get it done- in fact, the more your accountant will like you as a client. You'll become one of the “A"clients. The ones they've got time to look after. The ones they've got time to chat to. If you're completely up to date, when tax planning time comes around in March, especially if you're making lots of money and you want to minimise your tax, your three quarters of the year information will be ready at the fingertips of them - will be ready for you to have a conversation with them about what's best for you. So, the accountability within getting your stuff done and keeping on top of it, keeping your bookkeeper accountable to actually do reconciliations, reading the financial statements, when they're ready. You could have them printed out for you. It's nothing to be ashamed of. Paper is good for reviewing financial information. Have that accountability. I want this by this day of the month. I want that by done by the quarter. I don't want my BAS lodged late. I want my tax done on time. Hold your team or yourself, if it has to be you, accountable, for getting that done, keeping you on top. So, you're well-informed and you are in control of your business profitability. Hope that helps. Stay accountable. Most people need help to stay accountable. It surprises me in all of these books that we read, even very, very successful people sometimes need an accountability, buddy. I'd be happy to be yours, too. Have a good day. Reach out if you've got any questions, I'll be happy to help. Take care.
For small business owners, understanding who's accountable for what tasks and outcomes in producing timely and accurate financial information is key to maximising your profits. That financial information tells the story of what's going on in your business. It's no good to you if it's incomplete, not read or just plain wrong. To help you, I share some insight into how to start to take control of this area so you don't miss opportunities to have a better business life. Reach for a free strategy session and I can look over it with you.
Hi there. I'm Liz Jarvis, and this is Better Business Insights. In today's episode, we're going to talk about the GST. Now there's so much confusion for new Business Owners, in particular, about the GST. What is it? Why do we have it? Do I need to register? All those are questions that get quite confused. When I'm in the various business groups that I'm in and I see questions around the GST put out there, I'm quietly terrified about some of the answers that come from other Business Owners. Now, the reason for that, is that each Business Owner’s situation is unique, and for various reasons they might register or not register. They might set their prices at a level that includes GST or at a level to get a foot into the market without GST. When they register, they might add GST or they might have to cop it without putting up their price. The GST is - it stands for Goods and Services Tax. It's our Government's way of taxing the end user. So, it's about capturing some tax every time you spend money. It's partly designed to get rid of the black market of the people that are doing everything for cash and never paying anything in tax. So, we need to remember that it's a tax that helps our Government pay for things for us. We, the Business Owner, if we're registered for GST, we're a tax collector. So, we're required, unless you're in one of the carve out areas, like medicine or something, we're required to add some GST onto the top of what we're selling our customer, on to the top of the price and collect it on behalf of the Government. On the other side of things, we're not the end user of the things that we're paying for in our business. So, we're allowed to claim the GST. So, when we buy a computer, it's got GST on it and we can claim that GST. And the two things together, the GST we've charged and the GST we've claimed they come together through our BAS statement, our Business Activity Statement. If we have collected more than what we have been able to claim, then we need to pay GST on our BAS. And that's actually a good thing. It's a sign that you're probably making a profit. For some businesses, they have some big setup costs before they get going, and they might want to register for GST, early. For other small businesses, they may not want to register for GST until they hit that $75,000 threshold. But this is a question for tax professionals. They will take into account the context of your business. The goals and plans you have for your business, the timing of various things, the nature of what you are selling, whether it's services or goods. So, it's very important that you seek advice from the right place about anything related to GST. I hope that helps in your understanding. Obviously, it's just a little tiny slice of what the GST is all about, but I hope it helps you. Thanks for watching Better Business Insights and I hope I can be of service to your business one day. Reach out to us through all our social media and through our website. Or give us a call in the office. Have a fantastic day.
GST is a confusing subject for many business owners. Every business is unique so the rules must be applied carefully. As a business owner you only need to understand the way it applies to your business. Don't be distracted by how it works in someone else's business ! To help you I have outlined how it works and why there is so much variation. Reach for a free strategy session and I can look over it with you.
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