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Marching On - End Of Financial Year is Fast Approaching

Written by Luke Bland . March 17, 2021
4 min read

I’m going to go out on a limb and guess that this financial year hasn’t quite turned out as you expected it to. At best, all of your business strategies and planning from last financial year ensured you were well placed to pivot and adapt as the Coronavirus crisis unfolded. Now with the end of financial year (EOFY) approaching, whether you experienced COVID-19 as a background inconvenience or acutely as a major source of upheaval, there are lessons, evidence and understanding to be gained from reflection on the last 12 months that will hold you in good stead for the coming 12 months – whatever they may bring.

Contents

Diversion or Derailment?

Dealing with a prolonged crisis is exhausting and all consuming. It can be hard to get a real sense of the extent of the impact as you deal with day-to-day concerns. Take this EOFY period to examine your experience in light of scale.

According to the Australian Bureau of Statistics (ABS), over half of all businesses were significantly impacted by COVID-19 restrictions (peaking at 53% in April 2020). Similar numbers reporting cash flow issues, having less than three months of business operations covered by cash on hand.

Accommodation and food services, arts and recreation services, and administrative and support services industries were especially impacted in February 2021.

A trusted external authority, such as a business adviser or chartered accountant, can give you detailed insight on your business performance and direction on the way forward. You can also obtain comparisons and benchmarks across local economies or specific sectors with the Business Conditions and Sentiments report from the ABS.

Tax Planning – Strategies & Opportunities for Business Owners

Making Your Business & Processes Stronger

Even with COVID-19 occurring, and continuing to unfold, life has marched on. Thousands of new products have hit the market, thousands of people have retired, and business managers have made decisions they may have never considered before. So some of them were bound to be imperfect, while others have flourished.

But amongst this, having an external influence as omnipotent as COVID-19 should not provide an excuse for lax compliance, or poor performance generally. Try to be honest in holding a mirror to your organisation’s performance. Use the following prompts to examine what level of influence internal factors had on your performance:

  • Was COVID-19 a cause or a catalyst for your challenges?
  • Are you and your team able to respond quickly to changes?
  • Do you have proactive processes and reporting in place?
  • Do you have a strong network set up to turn to for advice?

Once you have the answers to these questions it’s time to work out a plan forward on how you can improve and rectify these areas. Look for quick fixes first and then take more time for any more problematic areas. Again it could be worth your time enlisting the help of a third party to help you.

New Financial Year Approaching

There are always new challenges to face and opportunities to take advantage of, some familiar, some unknown. It’s important to set clear objectives for the year ahead, including business and financial targets, as well as personal and family goals. It’s just as important to have a system in place to monitor your progress toward achieving these objectives, and the ability to review and adapt as necessary.

The starting point is to take a step back and consider your current position. Then think about where you want to be in one years time. Leading to the all-important question: how do you get there? Should you:

  • Take advantage of low interest rates to fund a new venture?
  • Hire additional staff to help grow your business or wind things back to focus on your core activities?
  • Invest in new technology?
  • Update your internal systems and processes?
  • Adjust your marketing plan?
  • Consider if now is the right time to sell?
  • Look at a restructure?

BLG Business Advisers are your cavalry. Whether it be profit margins, cash flow, business structure, asset protection or finding a strong support network, our team can help you tackle whatever the new financial year throws your way. Take some time to talk with us for advice and direction, and you can decide if we are what you are looking for.

Wishing you every success!

*This information is relevant at the time of publishing and is subject to change.*
Written by Luke Bland . March 17, 2021
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