Business and Finance

How does the cash rate impact (or not) the banks interest rates? The RBA conducts Australia’s monetary policy which includes setting the cash rate on overnight loans in the money market. The cash rate influences the banks’ interest rates, however there are many other factors which also affect rates including overall cost of funds, lending risks, competition etc. In June 2019, the RBA announced a 0.25% (25 basis points) cut to the cash rate to a historical low of 1.25%. Not all banks followed suit which provoked the usual media outcry. Closer analysis would have revealed that the bank which...

Corporate Scorecard: What it is and how it may affect you Corporate Scorecard is a subsidiary of Equifax that assists with the assessment of the financial capacity of organisations including for pre-qualification, pre-contract award and post contract award monitoring for contracts. This assessment has been around for several years and many of our clients, who are contracted to work for government organisations, are being presented with this as a mandatory procedure to complete (and pass) prior to contract approval. A Corporate Scorecard assessment is mandatory to all Public Authorities in the Perth Region and customers in Regional Areas and other...

When setting up a business, many prospective owners will be advised by their Accountants to operate through a discretionary trust structure as this allows flexibility in income splitting whilst also providing asset protection. Whilst this is a common strategy for family run businesses, it is important to be aware of the complications that may arise. If you are involved in a business structure, which has as part of that structure a discretionary trust, you should be aware of the possible issues relating to the structure of that trust. These could include: 1. Your trust should reflect the succession planning Whether...

Single Touch Payroll Extended to all Employers from 1 July 2019 Single Touch Payroll (STP) is currently only required for employers who have twenty or more staff, however from 1 July 2019 it will apply to all Australian employers – even those with only one staff member. This will be a gradual process and there are flexible options available. So, what is STP? STP is a reporting system that sends tax and super information from your payroll or accounting software to the ATO every time you pay an employee, effectively reporting year to date information to the ATO in real...

With the cost of installing high quality solar systems decreasing and energy prices continuing to rise, there has never been a better time to install solar. If your business either operates seven days a week, uses a lot of refrigeration (cold storage, supermarkets, hotels/pubs) or you are in the manufacturing, medical or primary industries you may find that your energy consumption is on the higher end of the scale. Investing in solar for your business has many benefits including: General payback period of between 3 to 5 years depending on the size and usage; Reduced power bills; and Environmentally friendly....

Ernst & Young (EY) hosted a webcast on Tuesday February 26th titled Financial Crime which discussed the importance of effective Transaction Monitoring (TM) as well as TM system implementation. If you were unable to listen to the webcast, we have summarised the key points from the webcast below. EY Transaction Monitoring survey The EY TM survey found large Financial Institutions follow a common journey as the Anti-money laundering (AML) TM capability evolves over time. This journey typically has two big cost humps and a long cycle of efficiency, broken up into six stages: 1. Introducing and AML TM solution, 2. Stabilisation...

Using the PPSA to Protect your Business Many businesses believe the PPSA to be an onerous obligation, only relevant if you hire out equipment, completely missing the very significant benefits the PPSA provides for any business selling goods on credit. One of its principal goals is to help protect you from the insolvency of your customers. It doesn’t matter what you sell, the PPSA is here to help you.  A simple rule of thumb – if you have retention of title (ROT) in your terms of trade you should be complying with the PPSA.  If you don’t, you should now...

Finance Solutions for Energy Efficient Assets Have you ever thought of investing in solar PV and energy efficient assets but thought there is too much cost involved and you just can’t fathom getting started? The good news is there are finance solutions available which allow you to acquire these types of assets sooner rather than later. Any purchase of energy efficient assets over $10,000 is eligible for asset finance and you can either use the finance to rent or purchase the assets. How financing energy efficient assets can assist you: Improve cash flow by avoiding large upfront costs and rather...