XU Magazine - Issue 11

Tax time is done… but are you ready for Audit time?

Probably the single biggest benefit that cloud accounting has brought to the industry is clarity. Once a dark art, the process of consolidation of the right data in a single source of accounting truth has now come to anyone with a Xero subscription. Hooray!

Does anyone remember their first accounting class – and the explanation of where the term general ledger came from? I do (images of leather bound books and all those columns…).

So, with the rise of cloud accounting, are we now seeing the accounting field embrace true monthly reconciliation and therefore monthly clarity as a result? Is this an unwanted overhead for small businesses?

If you are anything like some small business owners I know personally they are lucky to be able to tell you their current bank balance – and even then, they wouldn’t know their true cash flow position without a great deal of guess work. Unfortunately, they’ve sometimes “outsourced” their responsibility due to overwork, stress and pressure. It’s a recipe for a tax and cash flow disaster.

For all the enlightened folk reading this article (thank you!) I am guessing this proposition of business owner not being connected to their own business is both laughable – and scary – and too common. The answer rests of course in engagement and ownership by the business owner, mirroring the advice that someone once said to me: “Chris, you are the one that signs the tax return, remember what that means…”.

So, with June 30th behind us, I’d like to challenge the good readers of XU Magazine, to challenge their clients to talk about clarity and ownership.

Why does clarity really matter?

No one likes to say it but an audit can occur at any time. For external auditors finding the business in disarray becomes a challenge…even if nothing wrong has been done.

(At this point I’m assuming receipts are against invoices and super has been paid on time).

However, what we here at Asset. Guru have empowered many to do is an “Asset Audit”.

What is an Asset Audit?

As Asset Audit is the process of discovering if the organisation has a real (i.e. factual and complete) statement of their assets that reflects what an auditor would actually see, even in a quick visit to one of the sites or office locations. “What do you own?” is a great place to start, and not taking the dreaded asset spreadsheet at face value. Two verticals with a huge return on investment in this activity have been Not for Profits and Farming clients.

Asset.Guru becomes the onsite and HQ validation and capture tool to then help the finance and business teams to work together. The minimal training requirements and global access then complete the offering. The result is a house in order, potentially higher tax deductions and even more importantly, a lower chance of “rolling forward” mistakes. Oh – and far fewer emails to you sending around an asset spreadsheet. Follow up your great Hooray (again!). Happy “auditing”!

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About the author

Chris Petersen

After many years of software experience, Chris launched Asset.Guru to disrupt the billion-dollar Fixed Asset Management industry. Petersen is a believer that SMBs can leverage technology to innovate much faster than the titans of the industry – that speed becomes a unique value proposition against much larger established players.