An electrician who is a sole trader.
Jim had been working for an employer for a few years and decided to commece working for himself. He obtained an ABN and started issuing his invoices. He was keeping his receipts in a box as he knew he needed them for his tax return. In September he took his invoice book and receipts into his accountant for his tax to be prepared. A few weeks later his accountant called him to let him know his tax was ready and he owed the tax department $20,000. If that wasn’t a shock enough he was then given the accountant’s bill for $5,000.
 Bookkeeping Made Simple stepped in and helped Jim out. We put him onto MYOB live accounts. He issues his invoices from his laptop (although there would have been no problems with him keeping his invoice book) and emails them directly to his clients. We download his bank statements and credit card statements each month and record the payments received against the invoices and the payments he has made. We then give Jim a statement of his income and expenses and an estimate of how much tax he has to send the ATO. Now at the end of the quarter we automatically prepare his BAS, send it though to him by email then lodge it with the ATO well before the due date.
This all costs him $100 per month and his last accountant’s tax bill was just $500. In total we saved Jim $3,300 a year in accountancy fees
Jim is also now aware of how much he owes the ATO each month and can set that aside so that he has no nasty shocks at the end of the quarter and tax year.
Small architectural firm
Architects Pty Ltd had been operating for 5 years. Their accounts had been prepared on MYOB Business Basics. This had been working well for them for a while but they had started to notice a few things weren’t working well for them anymore.
- They were having to calculate the payroll on excel for their 5 employees (originally it had only been one but the business was growing). This was becoming onerous and after accidentally deleting the excel sheet they realised it wasn’t a reliable way of undertaking this task.
- They had recently duplicated payment of some supplier invoices.
- They were sending the MYOB backup file through to their accountant each quarter who then prepared the BAS charging them $250 each time. At one time the accountant claimed he never received the email and the client was charged $110 late lodgement fee by the ATO.
- They had been working out costings for each job again using excel. They noticed that as the volume of the jobs was growing this task was becoming extremely time consuming and error prone.
 Bookkeeping Made Simple came along and upgraded them to Accountright Plus. We set up their file including Payroll and Jobs. We spent some time training the Office Manager in inputting the purchases, jobs and payroll functions.
Since then Architects Pty Ltd have been able to email their employees their payroll advices weekly, print the PAYG Summaries for the ATO annually, calculate the PAYG Withholding monthly and the Superannuation quarterly both accurately and quickly. They are able to remit their own BAS quarterly to the ATO. But best of all, they can look at their job costings at any point just by clicking a button.
All in all, Architects Pty Ltd have saved $1000 annually in accountancy fees by lodging their own BAS and saved over 200 hours in labour costs by eradicating onerous excel sheets.
Small administration services company.
Admin Pros Pty Ltd had always had an in house bookkeeper. Sarah, the director of the company always thought Kate the bookkeeper was great… and then Kate resigned to go back to uni. Kate had traditionally cost Sarah approximately $15,000 per annum in wages plus $1,350 in superannuation. Luckily Kate was a casual so Sarah didn’t incur any expenses when Kate was unavailable because of illness or her children’s illnesses, although the bookkeeping obviously fell behind when this occurred (which was reasonably frequent). And of course Sarah had to cover Kate’s worker’s compensation and provide a secure location for Kate to work in as her work was highly confidential. When Kate handed in her resignation Sarah advertised for a new bookkeeper… spent over $1000 in advertising costs and over 20 hours in reading through resumes and conducting interviews. Finally Sarah hired a new bookkeeper. The bookkeeper turned out to be nothing like what he had presented himself on paper and Sarah had to let him go – one week before the BAS was due.
Sarah then contacted Bookkeeping Made Simple to see how we could help. Elizabeth, the director of BMS went to visit Sarah at her office the next day to determine how the bookkeeping had been done in the past. After spending an hour with Sarah, Elizabeth provided a solution to Sarah’s problem.
- Host her MYOB on the Web via a secure remote connection.
- Collect her invoices issued and invoices paid together with the staff’s timesheets and the bank statements weekly and courier them to BMS.
- These were then entered, the Bank Accounts reconciled. BMS advised Sarah which debtors should be contacted for payment and after Sarah confirming, BMS was able to do this for her.
- Sarah was able to see at any time how much money she had in the bank and who still owed her money. She could see how much she owed her creditors and she could see which of the debtors BMS had contacted.
- BMS prepared the BAS and lodged it electronically with the ATO the day it was due therefore avoiding any late payment penalty.
BMS was able to provide Sarah with a fixed fortnightly fee of $585 which turned out to be a lot cheaper than what she had been paying Kate – and Sarah was able to free up the space in the office for a new employee.
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