James Solomons

Accounting, Business & Technology; Advocate, Entrepreneur & Educator


August 2011

Government support for small businesses

The Federal Government and the States and Territories are all keen to support the establishment and growth of small businesses in Australia. A robust small business environment has strong flow on effects for the rest of the economy and as such, encouraging investment and training as well as providing grants to budding entrepreneurs are important aspects of government support for small business.
The difficulty for many small businesses is finding finance to bring their ideas to reality. Many of the best business concepts don’t come to fruition due to the lack of funding available. Fortunately, there are grant programs available through government agencies to support small businesses in finding adequate funds to start up a new business or grow their existing venture. For example, the Repayable Contributions Program offers various avenues of access to funds for small businesses. Some programs take the form of interest-free, unsecured repayable loan, where all or part of the loan is repayable or conditionally repayable depending on the terms and conditions of the contribution agreement. Please see for more information on grant programs.
Training Programs
Training assistance programs are another incentive tool that governments have up their sleeves to encourage investment in small business. Some programs provide financial funding to encourage business owners to create long-term employment opportunities, especially with regards to unemployed individuals and post-secondary graduates. Other programs offer wage subsidies to eligible employers in exchange for employers providing job experiences to post-secondary graduates or unemployed individuals.
In addition to money, the government provides a number of programs which offer valuable services and resources. These might include skills training programs, consulting services, mentorship programs, the opportunity to attend trade fairs abroad and introductions to potential suppliers, partners and customers. In many cases, these services would normally bear a substantial cost, so you’re not only getting the business building value of the service, but you’re saving money, too!
Helpful Government Links


Did you know that billions of dollars is sitting in lost superannuation accounts waiting for Australians to claim?

Lost super is a special term used to describe superannuation benefits that are recorded in the Lost Members Register. Your super benefits may be recorded as lost if your super fund cannot contact you due to changes in your member details or similar events. You may also have lost super if your account has not received any contributions in the past 5 years.
If you change jobs regularly or you have had part-time jobs while at school or university, then it is highly likely that you have more than one super account. On average, every working Australian has three super accounts.

Should I be concerned if I think I have lost superannuation?

Don’t worry if you haven’t kept track of your multiple accounts. It’s never too late, but you must locate your super accounts before you can roll them over into one super account.Generally, your super fund/s sends you a statement each year reporting your account balance and fund returns. If you’re not receiving these statements and/or don’t know which super funds that you belong to, then you have access to plenty of services to help you find your lost accounts, and increase your super benefits instantly.






How can I find out if I have lost superannuation?

  • Use the ATO’s SuperSeeker service ( which searches the Lost Members Register and other ATO records, such as unclaimed super money, for your lost super accounts. You can also contact them on the phone for advice and information ( 13 28 65).
  • Try AUSfund ( which looks after the lost super of millions of Australians for some of the largest super funds in Australia. If they have your super, they will find it free.
  • Ask your current super fund if they offer a service for finding your lost super.
  • Ask your previous employers for the names of the super funds that received contributions on your behalf

Why cash flow controls are so important in busines…….

Picture a scenario where all of your customers decided to delay payment of your invoices by 30 days. How long could your business survive without this cash inflow? How would you pay your staff, meet your overheads and pay your creditors?
If you don’t know the answer to these questions then careful cash flow management is essential to not only your business’ success but to its very existence.
Cash flow management involves carefully planning your business’ cash flow needs via the formulation of cash flow budgets and developing policies and controls around its cash inflows and cash outflows. Here we focus on how to manage a business’ cash inflows.
According to Dun & Bradstreet cash flow troubles account for approximately 80% – 90% of business failures, and more specifically latest research links a 25% increase in business failures with a similar increase in the number of days a business’ customers took to pay their invoices.
On average invoice payment time is 53 days and for many businesses this is almost twice as long as the standard 30 day payment terms that they want to be paid within. And with trading conditions becoming tougher for most SMEs this average is expected to continue to increase.
So how do you keep the cash flowing into your business bank account in this current trading climate? The key is to have both preventative measures in place to ensure customer pay you within your payment terms to begin with as well as effective and efficient measures to reel in those customers who do stretch the friendship.
Below are the solutions we provide to our clients to assist them with developing their invoice collection policies.
Preventative Measures:-
·         Credit & reference check all new customers. This is a simple and cheap process to undertake because you don’t want to provide credit to a new customer who already has a history of slow or non payment
·         Set specific credit limits for all customers. As an internal control this ensures you do not extend credit beyond what a customer has been ascertained as being able to pay
·         Outline and agree upon payment terms up front and on a regular basis. Communication of these terms is the key to ensure customers can’t use the excuse, ‘sorry, I didn’t know they were your payment terms’
·         Make sure these payment terms are clearly displayed on your invoices. This is another way to remind your customers of the agreed upon payment terms.
·         Credit check existing customers. Much like the checking of new customers, this control ensures existing customers have not fallen into trading difficulties with other suppliers
·         Offer as many payment types as practical to your customers. Cash, Cheque, Credit Card, PayPal, EFT or even Direct Debit……make it as easy as possible for customers to pay you so that they have less reason for delaying payment
·         Send out the invoice as soon as possible. As soon as the service is provided or the goods are delivered ensure the invoice is issued. If you don’t issue the invoices promptly you can’t expect to be paid on time.
·         Consider offering discounts for early payment. Business owners love discounts so if planned carefully, this can encourage faster payment of your invoices
·         Depending on your business, ask for a deposit up front before proceeding and considering progress invoicing for longer type jobs or projects. This can assist your customers with their cash flow needs and reduces the chance of a large invoice remaining unpaid for a significant period of time.
·         Ensure you have received written confirmation (i.e. a purchase order) for every order, especially if a customer requires their own purchase order number to be displayed on your invoice. This can reduce the risk of a customer delaying payment because of their own internal authorisation issues.
·         Develop a strong working relationship with your customers and encourage them to contact you if they need extra time to pay before the due date. This is just good business sense and ensures you aren’t just an anonymous creditor.
·         Ensure you have a complete and concise accounts receivable invoicing and tracking system in place and review your aged debtors regularly. If you can’t track when an invoice was issued and how long it is overdue, how can you expect to identify those invoices that need chasing up
·         Consider the use of debtor factoring or debtor finance. In come instances, the use of debtor finance can free up much needed working capital to allow your business to operate and grow, however the downside with any finance is that it comes at a cost.
Collection Measures:-
·         Follow up initial overdue payments promptly. As soon as an account is overdue, follow it up with either an email or phone call reminding your customer that they have exceeding their payment terms.
·         Continue with regular follow ups for longer overdue accounts. For longer overdue accounts, keep up the pressure with regular phone calls as well as emailing monthly or fortnightly statements
·         Make the customer commit to a payment date. Whenever direct contact is made with the customer, get them to commit to a payment date rather than a ‘sorry, cheque is in the mail’ response.
·         Offer repayment schedules. When you know that a customer is having trading difficulties, offer to assist them by agreeing to a repayment plan to clear the debt. Whether you charge interest on the overdue amount is at your discretion and may be dependent on your initial agreement.
·         Document all attempts to recover the debt. For legal reasons, make sure all the details of attempts to chase long overdue accounts are recorded as you may need these if the matter proceeds to mediation or court.
·         Use the services of a debt collection agency. If the customer is no longer going to be using your business and they refuse to pay your invoice consider passing on the debt to a reputable debt collection service.
·         Use the services of a solicitor. Much like a debt collection agency, the use of a solicitor is a last resort and should be used for larger debts owed by customers. The main reason for this is due to the costs involved in going down this path.
In summary when it comes to managing your customers and their payment of your invoices, prevention is always better than cure. So, the key is to do as much as you can initially to avoid having to waste time and money on chasing up bad debts.

Australian Market Outlook

Even though economists are positive on the outlook of the Australian share market for the remainder of 2011, there are still some concerning factors which have kept average returns in the red over the past 11 months. The European debt crisis, which began as concerns around Greece and its debt servicing ability seem to have spread further in the European Union, with Ireland and Portugal looking increasingly unstable. Further market instability has been seen with increasing oil prices a result of political instability in the Middle East and North Africa. These factors have kept the Australian market quiet on trade and discouraged investment over the past year. Looking forward we should see some of these issues regarding EU debt ease, although not quickly, as the global economy continues to recover post GFC. China’s economic growth has continued and this has benefitted Australia’s large resource companies as strong demand for its products continues. There may be a slight dampening of such demand as the Chinese government attempts to curb inflation on the back of fast economic growth.
The first six months of 2011 has seen the share market fall short of expectations due to events and concerns beyond our shores. Even so, our economy and the businesses that operate within it continue to grow and rebuild, albeit slowly, from the repercussions of the GFC. The forecast for the Australian economy is very strong for the next couple of years. This view is underpinned by the expectation that unemployment will continue to decline and stabilise around 4-5% as more labour resources are required. This is particularly true for the mining and resource service sectors.
Australia’s terms of trade have recently been upgraded creating an income surge which will quickly flow throughout the entire economy with workers, corporations and the government all benefiting.  Recent concerns regarding US debt have also had a negative effect on the All Ordinaries. However, recent developments suggest this too is improving with retail sales and production figures up and a trillion dollars’ worth of government spending cuts agreed upon in principle by the US government.
The mood across global markets appears to be decidedly downbeat and the reality is that 2011 was always going to be a tough year. In the short term at least it appears the australian market will continue to respond to poor global conditions and fears of another GFC.  However the outlook for the Australian economy is improving and we would expect this economic strength to be reflected in the market movements hopefully toward the end of this year and into 2012.
*The advice provided is of a general nature only. Everyone’s financial situation varies so please contact a financial planner at EFS on (02) 9868 3900 for a financial plan that meets your needs.

Elite Financial Solutions ABN 32 077 847 486 provides its financial planning services as an Authorised Representative of Count. ‘Count’ and Count Wealth Accountants® are the trading names of Count Financial Limited, ABN 19 001 974 625. AFS Licence Number 227232. Principal Member of the Financial Planning Association of Australia Limited.


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