Podcast highlights to help you prepare for the end of the financial year

At The Business Behind Your Business, we try to cover topics that matter most to you as business owners. A common question we hear as accountants is, ‘What do I need to be doing for my business at the end of the financial year?’ We have a number of episodes that answer this crucial question.

Here are some of the highlights from these episodes:

Strategic Insights: Unveiling the Power of 3-Way Forecasting (Ep 133)

Forecasting is an essential tool for business owners who want to gain a clear picture of what is happening in their business. It helps with planning and allows you to be financially prepared for the highs and lows of running a business.

As Paul Sweeney says, “If we look at your profit figures, we can actually plan your tax commitments. What’s the impact on your income tax? And that’s a big thing as well. So we’ve got a lot of businesses now returning to profitability after a number of years of, you know, break even or even loss making. So we can actually identify, you know, what’s the taxation impact and how’s that going to affect your cash flow going forward.

Because tax is a big leakage from your cash flow. And a lot of businesses don’t plan for those tax commitments, those timings.”

Learn about the tools and resources available to simplify the forecasting process, and understand the importance of regular reviews and updates.

By embracing Three-Way Forecasting and integrating it into your business strategy, you can unlock new opportunities and navigate challenges with confidence. Listen here

Revitalise Your Business with a Health Check (Ep 126)

“49 percent of small business owners are making less than the average weekly wage. Now that’s not a great thing and look, it’s not an isolated statistic. If you’re a business owner and you’re earning less than what you could get as an average wage employee, it’s not a great thing. So we need to address that,” says Paul Sweeney in this important episode.

A business health check can be a vital tool for transforming a struggling venture into a profitable, successful enterprise. Business owners often grapple with the question of how to enhance their operations and boost profitability.

If you are worried about the health of your business, the first crucial step is to thoroughly understand its current state and pinpoint any existing issues. Engaging a business adviser can be instrumental in this process, as they provide expert insights and practical strategies tailored to your specific needs. By diagnosing and addressing the root causes of problems, a business health check helps set the stage for sustainable growth and long-term success. Listen here

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Preparing for a New Business Year (Ep 117)

As the financial year draws to a close, it’s essential for business owners to engage in comprehensive planning to ensure a strong start in the new financial year. Two critical aspects of this planning are tax planning and strategic planning. Tax planning involves identifying and implementing strategies to minimise your tax liability, such as utilising available deductions, credits, and exemptions. This can also improve your cash flow management.

Additionally, strategic planning is crucial for setting and achieving your business goals. Reflect on where you want your business to be in 12 months, the actions needed to reach those goals, and the resources required. By addressing these questions and incorporating cash flow forecasting, you lay the groundwork for a successful year. Remember to establish systems to hold yourself accountable and measure your progress against your action plan.

Paul Sweeney shares this insight, “Remember, these changes, they’re not going to happen by themselves. So they’re not going to happen just by saying, “I need to make a change and I’m going to increase my sales, or I’m going to pay off some debt, or I’m going to be more efficient.” You need to identify what are the steps that you need to take to make sure that at the end of the next year, in 12 months time, that your business, your financial position, is at the place you need it to be.” Listen here

Traps to Avoid this End Of Financial Year (Ep 85)

As the financial year comes to a close, it’s essential to engage in effective tax planning while being mindful of common traps to avoid (like getting caught up in EOFY sales hype!) Effective EOFY activities should also include broader strategic planning to set your business up for success in the new financial year.

Paul Sweeney offers this tip, “Overspending is one of the key causes of cash flow difficulty for a business owner, okay, so we want to avoid that. So you’ll be caught up in a lot of the sales talk about buy now, get this discount. It’s not always a bargain. And one of the things we see is people buying too much stock… There are end-of-financial-year sales  and suppliers will offer discounts, incentives for you to buy more.

“The problem is you’ve got to outlay that cash. You’ve got to outlay that cash to get that stock. Now, can you sell it straight away? If you can sell it next week? That’s great. You’ve got a very quick turnaround, but in most cases, you’re not going to have that quick a turnaround. You are going to be paying for that stock. You’re going to be holding it. You will have spent the cash…

“Cash will be tied up in your stock, your inventory and the quicker you sell it, the better off you’ll be. But a lot of the times when you are buying stock in bulk, you are you’re building up stock just to get it at a bulk discount. You don’t always get to sell the stock quickly. So you are tying up your cash flow and that’s something we want to avoid.” Listen here

7 Steps to Take Now to Make Your Next Financial Year Better (Ep 45)

Are you ready to elevate your business performance in the upcoming financial year? Discover seven essential steps that will set you on the path to success. Find out how you can gain clarity in your business, set achievable goals, and develop actionable strategies to drive your business forward. Make the next financial year your best one yet!

Paul Sweeney says, “So one of the first things we need to do to move forward is to actually assess where we are now. So often when you, when you want to go and start a program, say a fitness program or a health plan that you get an assessment of where you’re at now. So you need to know where you’re at now. And so the first thing we need to do is get on top of our numbers.

“And that means making sure our accounts… our accounting system Xero, QuickBooks, whatever it is you’re using are up-to-date, reconciled. And you’re able to prepare your end of year financial statements. And that will give you a true picture of exactly what happened in the year that’s just gone, where you ended up. So what sort of results you had? What was your profit like? That’d be good to compare that to previous years’ performances. It also gives you an idea of sort of where your cash position is, which is quite helpful to know because, often we need to know how much we need to borrow, how much we’re spending, what our cash flow is, how quickly we’re getting paid.

“And a lot of that information you can get from your end of year accounts. So it’s important to get those wrapped up quickly and close to the end of the year as possible.” Listen here

We hope you have found these summaries helpful in planning your own end-of-financial-year strategies. It’s easy to get caught up in the EOFY sales fever and to feel confused about what activities will benefit your business. Hopefully this information has clarified your path forward. Happy listening!

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