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How to motivate and incentivise employees

Posted on December 3, 2020 by admin

Each employee is motivated and incentivised by different things. While some employees are more motivated by money, others might feel motivated when their work is recognised. It is important to try to understand what will best work for an employee and reward them accordingly to ensure productivity.  Providing an incentive will motivate certain employees to be more productive and produce quality work. There are various types of incentives that can be applied, such as bonuses or travel perks. These incentives give employees more to work for than their paycheck and act as motivation to put in extra effort in the work they complete.  Recognition can also be a powerful motivator. Identifying that an employee has completed their work to a good standard and acknowledging their efforts will motivate them to continue producing good work. Employees will also appreciate their employers noticing their efforts and feel that their work is relevant and integral to the business. If you notice that an employee is doing particularly good work, public recognition can also be extremely effective.  Employees who are self-motivated feel the same sense of accomplishment when they meet their own goals as other employees might feel when they meet company standards. For […]

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Conducting due diligence when buying an existing business

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You’ve found the perfect business for you to buy. It fits all your requirements and you’re in a position where you can comfortably buy the business. What’s next? Before you sign the contract to finalise the buy, it is important to conduct due diligence. For this, you should review the financial records, business operations and legal documents. These will prepare you to manage the business and identify any risks or problems in process that you might need to tackle head on. You will also be able to better understand what will be expected of you as owner of the business and which responsibilities have been allocated to that position.  You should review items such as:  Licenses and permits: Have all the necessary permits and licences been acquired, and if not, look into why this might be the case – were they denied a permit due to any issues with the business? Contracts and leases: Have you spoken to the landlord and whether they’ll be transferring the lease agreement/negotiating a new lease? Is the business in contract with another that is problematic? Agreements: Are there any agreements the business is in that you don’t feel comfortable with? Status of plant, equipment, […]

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Partnership Agreements: What you need to know

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A partnership agreement formalises the business relationship between two partners. It can cover everything from low-level processes, up to how dispute resolution will take place in the business.   Business partners are personally liable for the business in a partnership, therefore, determining the finer details is extremely important and can prevent complications down the line. The agreement will help allocate the responsibilities and obligations of each partner. It will also help establish the rights of each partner and how profits and losses will be distributed amongst partners.  An agreement should take the following into consideration for it to be an effective piece of documentation: Percentage of ownership: How much will each partner contribute to the business? This contribution could be in the form of capital or equipment and service – regardless, this will determine how much ownership of the business the partner has.  Division of profit and loss: Allocation of profits and losses might simply follow the ownership percentages or simply be equal between partners. Regardless of how the division will be allocated, it is important to clearly identify this in the agreement.  Length of partnership: The agreement could be for an unspecified amount of time, or the design of the […]

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Self-managed super funds (SMSF) aren’t just about financial investment

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Individuals may be looking to opt for an SMSF because these provide entire control over where the money is invested. While this sounds enticing, the downside is that they involve a lot more time and effort as all investment is managed by the members/trustees.  Firstly, SMSFs require a lot of on-going investment of time: Aside from the initial set-up, members need to continually research potential investments.  It is important to create and follow an investment strategy that will help manage the SMSF – but this will need to be updated regularly depending on the performance of the SMSF. The accounting, record keeping and arranging of audits throughout the year and every year also need to be conducted up to par.  Data shows that SMSF trustees spend an average of 8 hours per month managing their SMSFs. This adds up to more than 100 hours per year and demonstrates that compared to other superannuation methods, is a lot more time occupying.  Secondly, there are set-up and maintenance costs of SMSFs such as tax advice, financial advice, legal advice and hiring an accredited auditor. These costs are difficult to avoid if you want the best out of your SMSF. A statistical review […]

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What record-keeping requirements does the ATO have in place?

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Record-keeping, if done well, can help running a business much easier. It gives you an overview of the business’ financial progress so that owners can assess their strengths and weaknesses and make decisions accordingly. Record keeping also enables owners to meet their tax and superannuation obligations easily – all the data and information required is readily available. Finally, record-keeping provides owners with a profile, of sorts, which demonstrates the financial position of the business to banks or other lenders.  Record-keeping requirements related to tax and superannuation need to be met. The specifics will depend on the unique tax and superannuation and obligations your business may have and the structure of your business (sole trader, partnership, company or trust).  The Australian Taxation Office (ATO), requires the following from all businesses:  The records cannot be changed and further, the information should be kept so that it cannot be changed or damaged.  The records must be kept for 5 years from the date they were prepared, obtained or a transaction was completed – or the latest act they relate to. The records might need to be kept for longer periods in certain circumstances.  The business must be able to show the ATO their […]

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Roadmap to a digital transformation

Posted on November 25, 2020 by admin

Digital transformation of a business allows you to reach a wider audience and makes interaction with your business a lot more appealing as it is convenient for customers. This will help your business grow and flourish in today’s atmosphere.  To start off your transformation, you need to know the rules. You should protect your business from cyber threats, and cover any legal essentials that are expected from businesses. Finally, even a digital transformation has real-world work health and safety concerns, so make sure you take these into consideration.  Next, you need to identify the right tools. Moving your business online requires the right software and tools that are most compatible with your business. This might take some research, but the more you plan ahead, the easier the processes from here onwards will be. Your team members might be skilled in their own professions, but they might require some help to readily use the digital framework. Ensure that you are helping your employees with this change and keeping communication channels open to ease this process.  Your marketing plan will need to be updated according to this change. You will need to integrate your website, social media and other updates into the […]

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The risks involved in debt consolidation

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Debt consolidation is a form of refinancing which involves taking one larger loan out to pay off multiple small ones. Although this might make managing repayments easier, you may end up paying more money interest rate or fees.  There will be companies that make offers which are too good to be true. If you feel that an offer is unrealistic and the company is promising that they can get you out of debt no matter what your situation is, you should reevaluate using their services. Don’t trust companies that:  Are not licensed Ask you to sign blank documents Refuse to discuss repayments Rush the translation process Won’t put all loan costs and interest rates in writing before you sign Arrange a business loan when you only need a consumer loan The goal behind the consolidation is to manage your payments, not create more fees and interest for you. Therefore, before signing onto an agreement, check how consolidation compares with your current fees and interest rates altogether. Also, take into account expenses and penalties associated with your existing loans and whether you will have to pay more money for paying off your loan early. If the expenses work out to be […]

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Why company culture is important

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Company culture has become an important part of how businesses are perceived. Businesses with a positive culture are more likely to attract clients and customers. Statistics also show that over 50% of executives believe that having a good culture can influence productivity, creativity, profitability, firm value and growth rates.  However, while it can be easier to describe and quantify a company’s products and services, defining culture is a lot more difficult. It requires capturing the company environment, values and relationships.  Identifying what your company culture is, or what you want it to be, will determine your work processes, hire new people into your team, and how you and your employees interact with clients.  The first thing to do is to identify key traits that describe your culture. Bring together a diverse group of people from across your company and brainstorm words and qualities which describe the culture. Collate the words which you hear the most so that you end up with a list which is representative of the culture that employees most relate to.  The next thing you need to do is distil this list down to the core values you can see in it. You can conduct surveys (if […]

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Transition to retirement

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The transition to retirement (TTR) strategy allows you to access some of your super while you continue to work.  You are able to use the TTR strategy if you are aged 55 to 60. You can use it to supplement your income if you reduce your work hours or boost your super and save on tax while you keep working full time.  Starting a TTR pension: To start your TTR pension, transfer some of your super to an account-based pension. You have to keep some money in your super account so that you can continue to receive your employer’s compulsory contributions as well as any voluntary contributions you may be making.  Government benefits and TTR: The benefits you or your partner receive might be impacted if you choose to opt for this strategy. How and what exactly will change might become clearer upon discussing this with a Financial Information Service (FIS) officer.  Life insurance and TTR: In some cases, the life insurance cover you have with your super may stop or reduce if you start a TTR pension – check this before making any decisions or changes. TTR can help ease your mind as you transition into retirement but it […]

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Tax contributions on your super

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How much tax you pay on your super contributions and withdrawals depends on a variety of factors. The process takes into account your total super amount, your age, and the type of contribution or withdrawal you make.  How are super contributions taxed? The money that you contribute to your super account through your employer is taxed at 15%, and this is the same with salary sacrificed contributions. But there are exceptions to this: If you earn $37,000 or less, then the tax will be paid back to the super account due to the low-income super tax offset (LISTO) If your income and super contributions add up to more than $250,000, then you are also required to pay an additional 15% Division 293 tax.  Any after-tax super contributions (non-concessional contributions) are not taxed further. How are super withdrawals taxed? How much tax you pay on withdrawals depends on whether you withdraw as a super income stream or a lump sum. Since this can be a convoluted process, it may be beneficial to approach an advisor and clarify any questions you may have before you withdraw money.  What about beneficiaries? If someone dies, then their super money will go to their beneficiary. […]

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