Accounting

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Accounting

Why not study your stock shrinkage now?

POS SOFTWARE

 

 

Now you have done your stocktake.

It is a simple calculation for you or your accountant to do to determine your stock shrinkage. 


(stock shrinkage)= (opening stock) - (closing stock)+(purchases) -(Total sales at cost price) 

Generally what we do now calculate it as a percentage of sales, so it becomes = (stock shrinkage)/(Total sales) x 100% 

Although often people use, shrinkage by stock value which we do in two steps.

(Average stock holding) =((opening stock) - (closing stock))/2 

(shrinkage by stock value)= (stock shrinkage)/(Average stock holding) x 100% 

So now you know your stock shrinkage, so you have an idea of how big a problem you do have. 

As a punt, I would say that it will be about 1.4%, but it does vary a lot.

One client of ours reported that it was less than 0.1%, which is the best figure I have ever seen. I have also seen a shop which a receiver told me it was 6%, which is no wonder a receiver was there. 

I do suggest that you do these calculations because if you do not know it, what can you do to fix it? Some significant reasons would be.

1) Customer theft - The five-finger discount

2) Damage - We had one furniture shop that was recording huge numbers of damaged goods somewhere between receiving and customer delivery.

Goods that suffer a significant damage problem should be moved to a safer place. I know a shop that after calculating their damage rate stopped handling glass products.

3) Supplier fraud - Which is all too often, although many suppliers claim they are accidents, I am not so sure. The result though is that a supplier bills you for goods shipped, but for some reason, you did not get.

4) Staff theft - I have seen retailers in tears when they discovered what a valued staff member has done. In my experience, this is zero or 100% of the problem. If you have some virtual products, e.g. lotto or telco this can be a measure here. As a rule, experts say that it accounts for half of all retail shrinkage which means that its the most important item. 

5) Administrative errors - are pricing mistakes and sloppy bookkeeping.

For the others as a first guesstimate, most people assume that each of the above factors is equal.

In the retail world, shrinkage is a part of life but, does not mean you have to give away so much. 

Depending on your margins, a 1.4% stock shrinkage could amount to a 20% loss in profits. 


 

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Your tax claims with running your business from home

POS SOFTWARE

Due to COVID-19, we all do a lot more work from home. To many, it is a new normal.

Now there are some of the expenses of working from home can be claimed too. 

Some valid deductions would be on your home computer. You can look at such as its desk, your computer chair, electricity, carpets, lighting, etc.

You can also often claim a share of the rent for the area of your office from which you conduct business.

I would suggest that you discuss this with your accountant, click here for more details.

 

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Here are some of your last minute ATO requirements

POS SOFTWARE

Review your debts and write off the bad debts in your computer system. What most people do is write them off in the official books. Then put them into a voodoo account in case they do actually by some miracle get paid for them.

Write off any trading stock that is damaged or obsolete.

Revalue your damaged stock to the current value of the stock.

Keep in mind what your accountant will want is your stock valuation by

*Cost prices 
*The Market selling value 
*Replacement value 

If your books are set up on a CASH system, you need to pay off outstanding debts to get the credit for them in this financial year.

To help you we will be doing webinars on financial and management reports very soon.

 

 

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What your required for your end of year reporting

POS SOFTWARE

The end of the financial year is coming so we all need to finalise our tax paperwork and accounting. 

Here are some steps that you will need to do from your point of sale software. 

* Review your bad debts and determine what you are going to do about them. 

* Remember you are going to have extra bills like insurance appearing, so you need to budget early for July so look at the creditors listing to mark what is not going to be paid soon.

* Review your stock. Consider writing off old stock. Why not start an EOY sale now?

* Take an end of year backup of your information and file it away somewhere. Remember you will need to keep this for seven years at least after you lodge your return. Please do not use any EL Cheapo USB sticks

* Contact your accountant and to get a list of documents that they need. I would suggest as a least they will require you to prepare the following documents for them.

Sales reports
Stock Valuation 
Customers Outstanding 
Creditors Outstanding 
Subagents Outstanding

I usually say that this it is an excellent time to review the past year, to see what’s worked and what hasn’t, then to plan for next year. But, 2020 has been such a challenging time, starting with the drought, bushfires and COVID-19 who knows what to expect now but so far it looks good since we have opened up, 
 

 

 

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Law on Itemised bills

POS SOFTWARE

This came up yesterday, a customer wanted an invoice from some items he purchased a few days ago on a statement.

Firstly our understanding is that any customer has the right to ask you for an itemised bill or account for up to 30 days after receiving the statement and must be provided free of charge within seven days of the request.

The main reason is my experience people do request this, is because some of the items have GST and some do not. 

It is actually very easy to do in our system as we have automated the operators and you can print in seconds.

I would suggest here using the A4 receipt, in the cash register look for the item, click on the "Receipts" button, find the receipt you would like to print, then select the "A4 Print" button:

 

Out will come an A4 receipt:



 

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MYOB integration Free

POS SOFTWARE

MYOB software is the most popular accountancy system in our market space, and our point of sale software integrates into MYOB Essentials and AccountRight. 

This is available free to our clients. 

Using this integration will save an MYOB user saves our clients time as it removes manual data entry; this reduces errors and is quicker in transferring the information.

Having worked extensively with MYOB for many years and is one of the first software companies to have done the integration, we have gained much respect for this accountancy program. 

One function they have that I like is the "smart bills", where a person can drop an image of an invoice into MYOB, and it can often read all the information even if the invoice does not have an ABN number. This function is not available in many other accounting programs.

If you are interested check out the automatic MYOB Data Transfer section in your POS software.

MYOB

Once set up, all you need to do is select the dates to go.


By doing this both your point of sale software and MYOB will work together to bring businesses like yours, an integrated point of sale and accounting platform to helps you better manage your business.

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Large organisations payments systems are in trouble

POS SOFTWARE

 

If you deal with large organisations, what you will notice is that currently, their payment is now all over the place.

What has been happening is that their payable processing cycle works by the accounts department getting a bill from you. This bill is then passed by them to the relevant department to match your quote, review that your work been done and to approve the payment. Once they get that approval, then they schedule a payment to you. As it is this schedule can take a while.

However, what been happening now is that in this current crisis, this procedure is not working, mainly as some key people are not at work. It only takes now one guy and suddenly this cycle halts. The accounts department will not pay until the cycle is done, and they have approval. I also suspect that everyone is looking for an excuse to delay payment anyway.

We are now suffering from big organisations taking even longer than before to pay.

If you have a solution to this problem, please share as we all need an answer.

One of my clients is attaching this note to his bills.

"Please take care of this invoice and clear the payment because we have also the cash flow issue and also can't get jobkeeper due to Government policies. So we have to pay salaries to our staff and we need the cash to clear the salaries.

Hope you understand and clear the payment soonest." 

 

 

 

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Debt controlling

POS SOFTWARE

Debt is everywhere, it affects almost every human organisation, in my lifetime, I have seen the greatest empire in the world, the USSR and most important people like the Shah of Iran collapse from it. 

They did not have money to pay for people, and because of the debt no-one would lend them more money, soon their worlds collapsed.

Debt is part of modern life. If you sit back and wait, the worst might just happen. Here is a quick way of determining just how much debt your business is owed.

So go to main menu.

Register reports


Now usually, I would recommend using Trial Balance(excel), but for this example, I just wish it to be simple, so I selected Trial Balance.

 

 

Now select today's date, although just to show you the power of our system, I picked a random date many years ago.

I also selected by order by Surname as I think it makes it easier to find, and I ignored the "More Criteria" because I do want to keep it simple, but I urge you to experiment later with these options.

 

 

Now out pops among other details a page like this one below Although for security reasons, I blanked out the names, you can see all the relevant information is here.

 

A total will be printed at the end.

This gives you a quick look to understand your situation.

 

What interesting exercise is to go back in and select today's date last year and see how your debt situation is shaping up. If it is dramatically going up, I would suggest that you take action rather then praying for the best.

 

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Invoicing

POS SOFTWARE

Invoicing is now easier in our cash register in the new version as we have automated more the operators' work easier. Using it you can print the invoice in seconds, with minimum steps, you do not need a keystroke as it can use a touch screen but if you like you can use the keyboard shortcut keys.

This will save you time and effort, mainly if you are dealing with busy businesses and customers.

If your customers want an A4 receipt which is often true of business customers it is elementary to do, click on the "Receipts" button, find the receipt you would like to print, then select the "A4 Print" button:

Out will come an A4 receipt:

What we do suggest is that invoicing immediately and getting the customer email address to email these invoices immediately too while it is still fresh in everyone mind.  The quicker they get it the quicker you get paid.

Besides being a double hit on the bill, this email address can then be used for loyalty marketing purposes so serving another function.

 

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Balancing the till

POS SOFTWARE

Balancing your tills is essential to any retail business. It actually should be part of your daily routine, but now suddenly you sense that something is not right and you want to balance the till. This is where we use X-offs,

What we strongly suggest is that every cashier has their cash drawer. There is no problem as our system allows many tills to work on one computer,

At the start of each shift, the staff member gets the float. This can be easily balanced at any time.

Go to the End of Day section in the cash register and select X-offs

With this summary of sales what will get extra information which may help with your investigations such is the net sales, voids, paid ins/outs, taxes, the breakdown of various methods of payment and more.

Select on the end of day page choose the X-off option that is below the EOD option marked in green. Select the time the staff member assigned to the register started and the current time. You now run the report.

Now it’s time to count your cash.

When balancing lookout for overages and shortages, an overage is not to be ignored as it can mean that people are not recording all their sales. If so, why are they not recording all the transactions?

 

 

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