Is Outsourcing right for your business?
There are many different aspects and considerations when running a business, many of which take you away from the core reason why you got into business in the first place. If you find you are spending precious time and energy on tasks that take you away from what you want or need to be doing, you may wish to consider outsourcing.
Why Outsource?
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Financial
Outsourcing time-consuming tasks to a service provider who can perform those tasks more efficiently than yourself can actually save you money in the long run. When you factor in the lost opportunity to earn while your business is completing those tasks it often makes more financial sense to outsource. For example, consider a task that usually takes you 6 hours to complete, what if that same task could be completed in just 3 hours by an experienced professional? Yes, you need to pay for that 3 hours but can you earn more in the 6 hours you have freed up to make that worthwhile?
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Workforce
Many small businesses run on minimal staff. If you lack the manpower to get essential tasks completed, outsourcing is a great way to fill the gap without needing to commit to another permanent staff member. This is especially true when considering temporary or inconsistent tasks.
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Time
Time is one of the most valuable resources you have as a small business owner. Outsourcing can free up your time so you can focus on the more important tasks within your business. Often service providers can provide the service you require quicker than you would be able to do it in-house.
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Sanity
We all have our preferences when it comes to how we spend our time. Outsourcing can allow you to pass on tasks that frustrate you so you can spend more time doing the things you love.
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Increase Strategic Reach
Outsourcing can give you access to networks or customers that you may not be able to access on your own.
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Risk Reduction
Outsourcing can shift legal or technical risk from your business across to the service provider.
Choosing a partner to outsource to
All service providers are not created equal and there are some important aspects to consider when you are considering outsourcing
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Expertise and Reputation
Do they know what they are doing? Checking credentials and how many years of experience the provider has working with similar businesses to yours can give you some peace of mind. Checking reviews and case studies will offer insight into what the service provider is like to work with and where their strengths lie. You may also wish to speak directly to an existing client or two in order to get a good feel for what to expect.
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Pricing
How much and how often does the service provider charge? If your business has a consistent workload and steady income then a subscription model or retainer may work for you, allowing you to have certainty over how much outsourcing will cost each month. If like most small businesses, your workload fluctuates week to week or month to month it often makes more financial sense to “pay as you go” and only engage the services when you need them.
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Approach and Values
A good provider will act as an extension of your business and be invested in your goals and values. If they are customer-facing, they should represent your company to the same standard as you would. Again, reviews can be helpful here to determine if they are the right fit for you. Also, consider what their communication and support are like and what will happen if a problem does arise.
Spectrum Accounting has over 40 years of experience providing bookkeeping services to small and medium enterprise and self-employed contractors like Paula Apparel 2020 Limited. We know what we are doing, and we do it well. If you are considering outsourcing your bookkeeping, get in touch with us today.
Holistic Accounting and Bookkeeping
What is Holistic Accounting and is it right for your business?
Holistic is defined in the Cambridge Dictionary as “dealing with or treating the whole of something or someone and not just a part”. It’s a term most often associated with holistic medicine, the practice of improving overall health by going beyond treating just the symptoms and instead considering a person’s entire wellbeing. Likewise, holistic accounting and bookkeeping aims to improve the overall financial health for a business by looking at the big picture. Rather than focusing on a few individual aspects and how they affect the bottom line, a holistic approach takes the wider systems and operations of a business into account to help create a stronger overall business strategy.
Many small businesses scatter financial operations, with different parties handling bookkeeping, payroll and tax obligations. A holistic approach takes all the aspects into account and ensures communication across all parties so that all are working towards the same goal. Good holistic accounting and bookkeeping prioritises the overall growth of a business alongside compliance obligations.
What does the Holistic approach look like with Spectrum Accounting?
Communication and Alignment
Two of the pillars of holistic accounting and bookkeeping are communication and alignment. For Spectrum Accounting, this means taking the time to really understand what your business does and what you want to achieve. We’ll work with you to align all your financial operations to achieve your wider business goals while meeting your compliance obligations along the way. We’ll keep in regular contact with you and any other parties involved in your financial operations to help ensure everyone is working towards the same end results.
Compliance and Knowledge
Compliance can be frustrating, and some might even say ‘boring’ at times, but it is of utmost importance – getting it wrong can be catastrophic for your business and land you in hot water with the authorities. Out team are experts in the bookkeeping field and up to date with all the latest tax information in New Zealand. We’ll share our knowledge and expertise with you and help ensure that all your compliance obligations are met.
Technology
Great tech makes keeping across your financial position easy. At Spectrum Accounting we are entirely cloud- based, using top-rated accounting software that prioritises information security, visibility and efficiency. Our systems and processes are user friendly, and we can provide training to you and your team to get the most out of them.
Tailor-made Service Offering
Every business is different, each with its own unique strengths and challenges. Holistic Accounting recognises that a one-size-fits-all approach is unlikely to give your business the overall results you desire. That’s why at Spectrum Accounting we work with your existing strengths and resources and tailor our bookkeeping services to the level and extent that your unique business requires.
If you think a holistic approach could be a good fit for your business, we’d love to hear from you. Contact us today.
Customer Story: Pro Pour Concrete Systems Limited
Owned and managed by Dan Vessey, Pro Pour Concrete Pumps provide a concrete pumping service using a concrete boom pump. The truck mounted hydraulic pump transfers liquid concrete through a series of hydraulic powered articulating arms and pipes to locations that a standard concrete truck can’t easily access. Dan and Pro Pour Concrete Pumps have a reputation in the commercial concrete industry for being experienced and knowledgeable with well-maintained equipment. Dan prides himself on clear and effective communication, a crucial skill when working in fast paced and potentially hazardous commercial construction sites.
Playing to his strengths
When he set up Pro Pour Concrete Pumps, Dan was aware that accounting was not his strongest skill and planned from the start to find a reliable accountancy service provider who would be persistent, structured and ensure the financial side of his business was run the right way. He was looking specifically for a professional with experience in small New Zealand businesses who was engaged and genuine. Dan found Diane and Spectrum Accounting through a mutual personal contact and hasn’t looked back.
“What I have found with Spectrum Accounting is that I sleep better. I think more clearly and I can plan better. There is a whole section of stress removed from my day-to-day now that I have Diane and Jacquie helping me with my books and planning”
The Spectrum Accounting difference
When Spectrum Accounting started working with Dan and Pro Pour Concrete Pumps the first thing they did was to strip everything back and rebuild Dan’s financial structure and processes to ensure every element was as clear and easy to maintain as possible. Dan has been impressed by their industry experience, knowledge, structure, planning and exceptional communication.
“Spectrum Accounting work with an approach that is catered to the needs of my business. If there is anything that needs urgent attention, they are right there to alert me and help me sort it out. From transaction reconciling to extensive statistics and data collection to form an overview of financial health and performance – they have me covered, and I am very appreciative.”
Spectrum Accounting assist Pro Pour Concrete Pumps with:
- Tax compliance and GST preparation
- Day-to-day bookkeeping
- Financial planning
- Regular reports
“I feel as if I am their only client in the manner they work with me, I feel like my business is focused on, never forgotten or put to the bottom of the list like larger accountancy groups.”
If you need some help getting your books in order, talk to Spectrum Accounting today.
Going self-employed in 2022? Basic accounting terms you need to know
| Assets = | Liabilities + | Owner’s equity | ||
| Building | Vehicle | Cash = | Bank Loan + | Owner Investment |
| $40,000 | $20,000 | $20,000 = | $20,000 + | $60,000 |
Look for these key factors when appointing an Accountant
Your business might have grown a lot or just a little recently, but you know it’s time to find a trusted accountant who would help you grow and get fantastic results.
With so many accounting firms in New Zealand, you might be wondering what they offer and how you can choose the right account for you. All of them might be real professionals but might have different industry experiences or offer an additional support level.
Read further to find out what you need to consider when hiring an accountant.
- Looking into the future
It’s vital in business to look back and evaluate what went well and what did not. Some accountants are great at reporting based on what has already happened, but a great accountant should be able to tell a story with numbers. That story needs to translate the results into forecasts and guidance. At the end of the day, you want to learn and grow and not just look at reports. Ask your accountant if they can help with forecasting and planning for your business.
- Available technology and tools
In the modern world of working remotely, business owners appreciate online tools, especially when they can be used from anywhere in the world. How handy would it be to have access to your accounting dashboard while having a cup of coffee and a caramel slice on your deck? Very handy, indeed. This is where software like Xero makes our lives easy. A great accountant will be able to help you set it up and provide training and support so you can get real-time data on the tip of your fingers. Ask your accountant if they use cloud-based accounting and can dedicate time to showing you how to use it.
- Client relationship and customer service
Customer service and client relationship is a big deal in the service industry. There is no difference between “big” and “small” clients in customer service. When looking to hire an accountant, it is a great idea to set up an initial meeting to see if you are comfortable asking them questions about your business. It’s also a great idea to see how you can work together, as an accountant should be your trusted partner. Go ahead and check out reviews first to see what other clients say about the accountant you are thinking of hiring.
- Fear-free and zero judgement environment
Do you shiver when accountants talk numbers and send you reports? Some business owners do. While running a business, you might know the basic concepts of accounting. Understandably, accounting might not be your field of expertise. So relying on an accountant to explain things in plain English is a fair call. A meeting with an account should really be easy and conversational as if you are talking to your friend and business partner. No one wants to leave a meeting feeling lost, or the worst-case scenario, misinterpret the information your accountant just tried to communicate to you. Ask your accountant if they can set up a meeting with you and see if you feel 100% comfortable in it.
- Pricing options
Accounting firms offer packages for businesses of various sizes, and hence, a different level of support. What might work for the “big fish” won’t work for a small or medium-sized business. What is more, if an accountant charges per minute like lawyers, perhaps you won’t be getting from them the amount of support you were hoping for. We think that a much better and fairer way to charge for the time is only the actual time spent on our clients’ books. Have a chat to an accountant you are considering engaging to see what billing process they follow.
It’s definitely a good idea to look around and consider the 5 things listed above when looking for a perfect accountant. If you would like to chat with us and see if we can work together, then get in touch via our contact form or by calling us on 021 274 0289.
Why is regular Bookkeeping important for businesses?
Every successful business is built with a solid foundation. A key component of that foundation is regular bookkeeping. Regular bookkeeping can not only keep you out of trouble with the Inland Revenue Department, but it can also help you grow your business through effective cash flow management and accounting policies.
What is Bookkeeping?
Bookkeeping is the process of maintaining financial records of a business. Every business has some type of bookkeeping that they will perform on a monthly or even daily basis. Tasks like payroll, bank reconciliations and invoicing are some of the most common bookkeeping tasks. These tasks need to be performed regularly in order to stay up to date with information. A lack of timely bookkeeping can lead to errors, lost items and even fraud. Monthly controls surrounding bookkeeping can help keep your business running smoothly.
Benefit #1: Saves You Time and Money
Regular bookkeeping has many benefits to you and your business. Staying on top of bookkeeping can save you time at the end of the year when it is time to file your business or personal return. You won’t have to spend countless hours searching for receipts and transactions, instead the year should be fairly complete. Moreover, regular bookkeeping can help you avoid late filing penalties which can range from $50 to $500. The Inland Revenue Department can be very strict on imposing late filing penalties, all of which can be avoided with the assistance of monthly bookkeeping.
Benefit #2: Accurate Financial Data
Just like regular bookkeeping can save you money, it can also help ensure that you have accurate financial data. Transactions are more likely to be entered correctly when they are done shortly after receiving the information. If you wait until the end of the year to reconcile your accounts and enter information, you heighten your risk of incorrect data. This can be detrimental to your business since taxes are calculated based upon the financial data from your accounting software. Duplicate entries can cost you more money in taxes, especially on the GST tax. Avoid future amendments and correspondence with the Inland Revenue Department by ensuring your data is accurate when you enter it.
Benefit #3: Promotes Business Growth
Accurate financial data leads to business growth. Regular bookkeeping helps you maintain accurate records which can be used for business planning and projections. Business planning is essential for steady growth. Planning future labor needs, supply orders and capital needed are all factors that come with business growth. Regular bookkeeping can help you reach these goals by giving you a clear picture of your business’s financial health. You don’t want to be scrambling for money or to find a labor force because your books weren’t reconciled. Effective cash flow management stems from transparency in the accounting records. Without regular bookkeeping, you won’t be able to fully understand where your business stands.
Benefit #4: Avoid Letters from the Inland Revenue Department
Another reason why your business needs regular bookkeeping is to effectively handle the Inland Revenue Department. As mentioned before, the Inland Revenue Department can be very strict when imposing penalties. Sometimes the Inland Revenue Department can be wrong about the fines and penalties they impose, making sound bookkeeping necessary to prove you don’t owe any penalties. Moreover, you can potentially request penalty abatement if you have sufficient evidence to support your viewpoint. The Inland Revenue Department often times gives you a short amount of time to respond to the letter and pay any fines or penalties. If you are behind on your bookkeeping, you may miss the deadline to respond for penalty abatement, highlighting the important of staying consistent with monthly bookkeeping tasks.
Benefit #5: You Learn the Whole Business Process
Learning how to bookkeep for your business can come with a learning curve. Accounting is hard, especially when you have New Zealand tax laws to follow. Learning the entire business process, from invoicing to providing the good or service, is critical for you to grow your business. How do you expect to pass the task off to someone else if you don’t understand how to complete it yourself? Take the time to learn the laws and regulations surrounding monthly bookkeeping. It will pay off in the long run.
Bookkeeping is a critical component of every business, from a one-man company to a company with a hundred employees. Don’t be stuck warding off the Inland Revenue Department because of racked up fines and penalties from late filing and inaccurate records. The few hours a week or month spent doing bookkeeping tasks will reap significant results in the end.
Avoid confusions: New Legislation – Sick Leave 10 days per year
From July 24, 2021 employee’s sick leave has gone up from 5 days to 10 days per year, and this will happen for any employee who reaches either their 6-month anniversary or yearly anniversary with an employer.
This doesn’t mean that employees will start getting five more sick days per year starting from July 24, 2021. For example, if an employee’s anniversary date is on July 23, you get new 5 sick days for the coming year, so an employee won’t get an increase until July 23, 2022. In addition, if you are a new employee, you will be entitled to 10 sick days as soon as you become entitled to sick leave.
Employees can spend sick leave when they are unwell or injured and need to care for family members who are ill or depend on them for care.
If an employee was already allotted ten or more sick days a year, they would not be affected directly by this change in the minimum number of sick days.
Sick leave entitlement is not pro-rated, which means that you would still get ten sick days per year even if you work part-time three days a week. Therefore, everyone can accumulate up to 20 sick days a year.
Employees wouldn’t be eligible for payment of sick leave if the day they were sick wasn’t a day they would have otherwise worked.
Sick leave is defined as days rather than hours. This means that if an employee works for part of the day and then goes home sick, this may be counted as using a whole sick day, no matter how much of the day they have worked. However, in some cases If an employee works a half-day then goes home sick, their employer could agree to only deduct a half-day of sick leave (which would be better for the employee). Payment for this half sick leave day would be half of their daily pay or average daily pay.
Ransomware: one click can make you spend a fortune. Is your business at risk?
Ransomware is a type of malware that encrypts your files and makes them unusable in order to extort money from you and your company. There are various ways to distribute ransomware, the most common being via email attachments or malicious links downloaded from phishing sites.
Ransomware can infect any computer or device you use, not just work machines. It doesn’t matter if you work in a bank or insurance company. Everyone is vulnerable to this type of malware.
Attackers target businesses and demand the ransom to be paid quickly, and many companies bear the burden of ransomware. But these criminal activities are now threatening organizations in every industry.
Despite its reputation as a cybercrime tool, ransomware has become mainstream in the past few years and is no longer exclusive to malicious hackers looking to make a profit. With the increase of targeted attacks aimed at large corporations, it’s easy to see how it earned a spot among modern threats.
If you’re attacked, don’t pay the ransom—it only encourages more cybercrime.
If you pay a ransom, there is NO guarantee that your files will be returned to you. In addition, if you pay the ransom, the attacker can gain access to your computer again and again.
Here is what you should be doing if you are targeted:
If you’re targeted, the more quickly you get your network offline, the more you can contain the spread of the malicious software. The less time your system is connected to the internet, the less time it’s vulnerable.
Seek the advice of an IT professional. When you’re faced with cyber-crime, your first instinct may be to turn to your IT department. After all, when it comes to information technology, no one knows the scoop like an insider. And if your IT guru isn’t available, don’t panic. There are plenty of companies that offer tech support for a variety of issues, including ransomware attacks. After a breach, try to understand how the attackers got in.
If you’ve already paid a ransomware fee to get your files back, your computers might still be compromised, and you should take steps to ensure that no other parties can access your data.
If you or your business experiences ransomware or another cyber security issue, use this form to report it to CERT NZ.
Here is how you can protect your business:
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- Be cautious about clicking on links in emails that you’ve received from unknown senders. Make sure your computer’s software is always up to date and that your employees know how to spot dodgy emails. You should always look at the URL when you’re signing into a site and check it against the page you expect, the sender of unexpected emails to see if they match and be wary of any emails that contain attachments.
- Make sure you install every available update to your devices and software as soon as it comes out. This will ensure that your systems are protected against emerging threats.
- Add two-factor authentication to your accounts. This is typically a code that’s sent to your phone or an authentication app to verify your identity. This adds an extra layer of security to your logins.
- Always keep a copy of your business data elsewhere. If your storage is compromised or if it breaks down, you’ll have an easy way to get back up and running.
- There are many different types of logs that can be used to monitor your website and systems. Contact your IT team or service provider to determine what’s right for you. Logs will let you know if any unusual or unexpected activity occurs.
- You should always have an incident response plan in place because no matter how well you prepare and how good your cybersecurity is, things can still happen. You don’t want to be left without a backup plan. Make copies of all important documentation and know who to call in case you can’t access your system.
