SMSF – True Crime Story

One trustee of a SMSF takes the assets, the remaining trustee is left with a penalty tax bill

A husband and wife are trustees of a self-managed superannuation fund. Unbeknown to the wife, the husband illegally withdraws all the assets, some $3.4 million, and leaves the country.

The ATO assesses the fund as non-complying, and hits the wife with tax and penalties of $3 million. Although it acknowledged that she was not complicit in the fraud, the Administrative Affairs Tribunal confirmed the tax assessment.

This is a true story.

Lesson: a super fund trustee cannot dodge responsibility by leaving all decisions to the other trustee.

January 20, 2012 at 2:03 pm | Uncategorized | | 1 comment

Investing In Your Own Business – Q&A

Q. Is now a good time to start or rejuvenate a business?

A. We could say that anytime is a fair time to develop a business, but only if you’re fit and ready. However it is interesting to note that many well known companies were started in recessionary conditions – General Electric, IBM, Hyatt, Apple, Fedex, Microsoft, Hewlett Packard, Twitter, Zynga, Groupon – to name just a few. There are logical reasons for this, here’s 7 -

• Good investors recognize (and any business operator is essentially an investor) the need to be counter intuitive in order to obtain an edge. They know that recessionary conditions can offer significant opportunities: assets are cheaper; cycles change and longer term planning carries increased rewards.
• When times are bad, large businesses usually react by cutting variable costs; leaving potential openings for more nimble players.
• Competition reduces and established businesses look for new suppliers.
• Purchasers tend to look for value (not necessarily price driven) and reliability during recessions.
• Service standards are better regarded. Good staff are easier to find.
• Suppliers tend to offer better credit terms once you have a record as a good payer.
• If the recession is partly based on structural grounds, opportunities are available in new industries.

You will need a smart business plan and definite sources of capital to avoid becoming a recession victim.

Q. How does  Investing In Your Own Business  help my business?

A. This ebook reviews the strategies and positioning needed in  order to develop and grow a successful business. It doesn’t offer a magic formula for guaranteed success (there are none) but does take readers through the major factors putting the odds of success in their favour.

Q. Is  Investing In Your Own Business  a business school style textbook, full of accounting and business jargon?

A. No – we have kept the jargon to the minimum. The ebook is as clear & concise as we can make it (in our opinion).

Q. What do you know anyway?

A. We have started, operated and managed several businesses in our time. For 15 years now we have operated Andersen Bowe, an accounting – business – tax consultancy. Over this time we have dealt with dozens of businesses and shared in their mistakes and successes. And also noticed the common threads with both.

Q. Why do you use the word ‘investing’?

A.  Developing a business successfully partly requires an ‘investment’ in capital, commitment, longer term planning and effective positioning.

 

 

 

January 9, 2012 at 2:37 pm | Uncategorized | | 1 comment

it’s complicated

Australia’ s economic landscape continues to give mixed signals. Not analysis, just brief comments.

Positive

• Capital investment continues to power along : mining + 60% last 12 months; manufacturing +29% last 12 months; other industries + 10% last 12 months. These figures are impressive and should lead to profit and productivity growth over the medium term (2-5 years).
• We’re gradually moving away from an unsustainable consumption and residential property boom to a more  sustainable production and export orientated economy.
• Debt levels of large companies have declined significantly; improving potential financial capacity in the medium term.

Negative

• Employment conditions look set to deteriorate over 2012; with unemployment passing 6% +.
• For whatever reason, people are feeling worse off than they really are. Maybe just a phase!
• In contrast to the big end of town, small and medium enterprises (as a group) haven’t reduced debt levels, increasing vulnerability should a severe domestic downturn develop.

 

December 7, 2011 at 11:30 am | Uncategorized | | No comment

paraprosdokians

Definition of a paraprosdokian – a figure of speech where the latter part of a sentence or phrase is unexpected. Very useful in business. Some examples:

Do not argue with an idiot. He will drag you down to his level and beat you with experience.

Knowledge is knowing a tomato is a fruit. Wisdom is not putting it in a fruit salad.

To steal ideas from one person is plagiarism. To steal from many is research.

I didn’t say it was your fault, I said I was blaming you.

Women will never be equal to men until they can walk down the street with a bald head and beergut and still think they are sexy.

You don’t need a parachute to skydive. You only need one to skydive twice.

Going to church doesn’t make you religious any more than standing in a garage makes you a car.

When tempted to fight fire with fire, remember that fire departments usually use water.

December 3, 2011 at 1:18 pm | Uncategorized | | 1 comment

Retail Rebellion

Retailers are going through difficult times at present and much is made of the online threat to bricks & mortar traders. However online threats run third when compared to the 2 major issues directly threatening Australian retailers.

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September 15, 2011 at 5:47 am | Uncategorized | | 2 comments