When Brisbane-based couple Tom and Kathy changed from being a sole-trader tiling business to a company, they found themselves facing many changes to compliance and reporting that weren’t straightforward to understand or implement. Kathy was running the books but knew that with better accounting systems in place her job would be a lot easier, as keeping up with compliance was proving a challenge on top of invoicing, reconciliations and payroll.
Tom and Kathy had used a local accountant previously, but decided they needed better systems, greater support, more in-depth strategic advice and – ultimately – the knowledge they’d get clear answers to their questions without needing to chase their accountant. For tradies like them, time was just as tight as cash flow.
Tom and Kathy decided to engage our experienced accountants to set their business up with best practice accounting systems and in doing so, we’ve helped them feel in control of their accounting – and empowered them to make more confident business decisions.
One of the hardest parts about running a business that operates within the construction industry is the many areas of compliance, from small business tax returns and other reporting, unions and large insurance costs. Add payment terms that cause gaps between cash flow coming in and expenses going out into the mix, and it’s no surprise that many small construction and trade businesses fold every year.
After delving into their books, our accountants quickly realised Tom and Kathy’s accounting systems weren’t doing the heavy lifting. As a result, the couple were overwhelmed, behind on reporting, and didn’t have the expertise to overhaul their accounting systems on their own.
“Our problem was that at the start, there were so many little avenues along the way that needed to be sorted out with the building industry,” says Kathy. “There’s our unions, a lot of liability in terms of insurance, all of the WorkCover and the induction and safe work method statements, and of course the tax side of things with the ATO.”
Payroll was one of the problem areas we saw an opportunity to improve. While Kathy had a payroll system in place and a Xero account, she wasn’t using all the features and plugins to streamline accounting processes, meaning payroll and other bookkeeping took longer than necessary.
We helped Tom and Kathy assess different apps for employee timesheets that directly link to payroll and showed them simple tips to make their systems, including Xero, work better for them.
“Project Alfred showed us a couple of little Xero tips which really cut down on the time we spend on payroll over half, three quarters,” says Kathy. “It was just crazy how much time we saved just by using these little processing tips.”
Another thing we helped implement was a more effective receipt management system using Hubdoc, helping Tom and Kathy avoid double-entering or missing receipts.
“The way Project Alfred worked alongside us through this process was really helpful,” says Kathy. “They were thorough and gave us clear instructions on how to file documents, which made our life easier. If I need to find an invoice or anything, it's just so searchable.”
The construction industry is highly susceptible to ripples in the Australian and global economy, and Tom and Kathy wanted to know how much money they were making and if it was worth doing certain jobs. Our team helped them access data so they could better understand the viability of their business and different projects.
Kathy also highlighted the usefulness of the tools we’ve given them, such as the Xero Projects plugin, which they use to help cost down each job. “These tools have helped us really dial in and work out what’s making money, what areas we can improve on, and also work out what percentage of profit we need before we talk about growing our business,” says Kathy.
Tom and Kathy chose to outsource all of their tax and compliance tasks to Project Alfred, and although they still manage their bookkeeping inhouse, they know our team is ready to help whenever they’re stuck or go through a busy period.
If your small business needs help setting up streamlined accounting systems, schedule a discovery call with our experienced team to find out how we can help.
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