Managing your cashflow

Take your business to the next level

Managing your cashflow

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Contents

Keeping your business running smoothly 3

Understanding cashflow 4

Top tips to get cash flowing into your business quicker 4

Learning the basics of invoicing customers 6

The requirements of tax invoices 7

Preparing your books with MYOB online accounting software 9

MYOB Essentials 10

MYOB AccountRight 12

Looking for a Approved Partner, bookkeeper or trainer? 14

The information provided within this document is of a general nature and is intended to be a guide only, in accordance with our Legal Disclaimer. For specific advice regarding your particular circumstances, please consult your tax agent or the Inland Revenue Department as appropriate.

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Keeping your business running smoothly

Many small business owners experience stress when it comes to managing cashflow. Timing is everything and knowing how much you have to pay your suppliers and who still owes you money is critical to your business success. The tips in this fast guide can help you manage your cashflow, reduce your stress, and get your customers to pay faster.

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Understanding cashflow is the key to running a successful business. Cash flows in from the sales you make and the invoices you issue, and flows out to meet all your expenses.

Planning or forecasting for your cashflow helps ensure you’ll have adequate money to pay future bills. Forecasting 12 months ahead will give you a good idea as to your available cash on hand and help manage any unexpected surprises.

Understanding cashflow

Top tips to get cash flowing into your business quicker

1Make your payment terms clear

Get your customer to agree to your estimated price provided on a quote prior to the work they want done. If your payment terms are stated clearly on your quote or invoice, it is considered a binding contract.

2Invoice your customers as early as possible

Try not to wait until the end of the month to do your customer invoicing. If you wait 20 days to invoice then that’s 20 days of no cashflow.

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3Email your invoices rather than posting them

If your customers have email addresses, use this as a faster, more reliable method to send your invoices. Posted invoices can easily be delayed or lost.

4Always have detailed descriptions on invoices

Customers that dispute invoices often delay payment as they are unsure of the job you had completed. Including a description in your invoices reduces the likelihood that someone will have cause to dispute the details.

5Accept a wide range of payment options

The more options you can provide to your customers, the more flexible and easier it is for them to pay on time.

6Use reports to track amounts owing

Using reports allows you to easily track who owes you money and what you need to pay. With good accounting software, you can easily view your business performance in a snap.

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An increase in sales and productivity is great for your small business. But creating manual invoices, writing cheques, or making online payments can be frustrating and time consuming with a lot of room for human error.

The Goods and Services Tax (GST) is a tax added to the price of goods and services sold in New Zealand, collected by registered businesses at each step in the supply chain. Currently, the GST is set at 15% of the price of the product or service.

Learning the basics of invoicing customers

You need to register for GST if your turnover is $60,000 or more in a financial year. As a GST-registered business, you collect GST on behalf of the Government by building it into the prices of your products and services then claim GST back on the products or services you’ve bought as business expenses.

Find out more about GST for Small Business

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Requirements for issuing tax invoices for sales between $50-$1000

1 the words ‘tax invoice’ in a prominent place

2 the name and GST number of the supplier

3 the date the tax invoice was issued

4 a description of the goods and/or services supplied

5 a statement that GST is included, and

6 the total amount payable for the supply.

A tax invoice is not needed for supplies of $50 or less (including GST). However, it is best practice to keep records for these purchases, such as invoices, vouchers or receipts. At a minimum, record the date, description, cost and supplier of all purchases.

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Tax invoiceWindows Solutions GST 00 000 000 000

Date: 00/00/0000To: Auckland Glass 4 Southdown Ln Penrose, 1061

Unit 7 9-23 Morrison Dr, Warkworth 0941

Description of supply TotalWindow frames $825

TOTAL PRICE INCLUDING GST $825 The total price includes GST

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Requirements for issuing tax invoices for sales greater than $1,000

1 the words ‘tax invoice’ in a prominent place

2 the name (or trade name) and GST number of the supplier

3 the date the invoice was issued and the name and address of the recipient of the supply

4 the quantity or volume of the goods and/or services supplied. (eg. litres of petrol, hours of labour, kilos of potatoes etc).

5 a description of the goods and/or services supplied.

6 Unit price

It must also have either:

7 the total unit price amount, excluding tax, charged for the supply

8 the GST and the total amount payable for the supply, or a statement that GST is included in the final price if it has been.

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Tax invoiceWindows Solutions GST 00 000 000 000

Date: 00/00/0000To: Auckland Glass 4 Southdown Ln Penrose, 1061

Unit 7 9-23 Morrison Dr, Warkworth 0941

Qty Description of supply

Unit Price

GST Total

50 Window frames $150 $15 $8250

10 Deadlocks $40 $4 $440

TOTAL AMOUNT PAYABLE $8690 The total price includes GST

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Preparing your books using MYOB accounting software can save you a lot of time. It has all the smarts you need to complete your pay run like GST codes that you can allocate to each of your business transactions. Generate reports detailing GST related income, expenses and capital purchases to complete your GST return with ease and efficiency.

Preparing your books with MYOB online accounting software

Using MYOB to do my books has been a huge help. It makes it easy to file my GST returns, something I dreaded having to do.

Denyse Forsyth Kruizey Kidz

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All the features you need to take care of business

Quick and easy to set up, MYOB Essentials has all the features you need to take care of your day-to-day bookwork, including:

MYOB Bankfeeds™

Link your bank account and save around 10 hours.

Always tax compliant

Fast and easy updates ensure your business is in line with the latest tax legislation.

Work together with your advisor

Share information with your accountant or bookkeeper without having to be in the same place.

Better manage cashflow

MYOB Essentials lets you manage your cashflow, invoices and tax liabilities in real time.

Safe and secure

You can securely store and manage supplier bills in your accounts to make your monthly obligations easier.

100% online

There’s no software to install on your computer, MYOB Essentials is fully accessible via your web browser.

Try for free

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Take care of your people

Essentials Payroll has everything you need to take the hassle out of paying employees and meeting your employer obligations.

Meet your employer obligations

Essentials Payroll is the fast and easy way to manage your PAYE compliance requirements.

Cut time spent managing payroll by 40%*

Get real-time access to more accurate employee timesheets, when employees enter their hours via their smartphone or online using MYOB YourPay. Hours and notes are automatically imported to the payrun.

Choose to take the hassle out of PAYE compliance with MYOB PayAgent

Nominate MYOB as your payroll provider to outsource the processing of wage payments to employees, PAYE payments to IRD and reporting to IRD.

Next generation Payroll

New ways to help businesses manage payroll - cut time spent managing payroll by 40%*

* Source: Customer survey via MYOB Client Insights Panel, June 2014

Try for free

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Ideal for desktop users wanting to move online or needing a more customised solution.

Stay competitive

MYOB AccountRight is powerful accounting with business management capabilities so your business can stay competitive to get ahead.

Stay in control

Fully customisable, it enables you to stay in control of the most demanding jobs, inventory and multiple company accounts.

Stay informed

Includes 150 reports and a fully customisable dashboard for your specific business requirements.

Stay compliant

Improve productivity and efficiency, make compliance easy, and choose the plan that best suits your business needs.

Learn more

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Access the best parts of your MYOB with our OntheGo app.

+ Send and track invoices using your mobile

+ Better manage your cashflow with real-time invoice tracking

+ Easily see when customers view your invoices to minimise late payers

+ OnTheGo updates your accounts automatically

+ There’s no need to rekey information back in the office

Payments made simple

Take credit card and debit payments on your phone with BNZ PayClip. BNZ PayClip accepts EFTPOS, Visa and MasterCard credit and debit cards, using contactless, swipe, chip and PIN.

With low fees and no strings, PayClip is the easiest and best way to take payments on the move.

To learn more, visit myob.co.nz/onthego.

Always out and about for work?

Access the best parts of MYOB Essentials and AccountRight with MYOB’s OnTheGo mobile app.

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MYOB Approved Partners are accredited by MYOB to provide onsite support for MYOB products including sales, setup, implementation, training, advanced reporting, trouble shooting and bookkeeping.

Find an MYOB partner nearest to you.

Looking for an Approved Partner, bookkeeper or trainer?

myob.co.nz 0800 60 69 62

We’re here to help

MYOB NZ Ltd. All rights reserved. No portion of this book may be reproduced mechanically, electronically, or by any other means including photocopying, without written permission from the publisher. MYOB NZ Ltd. L2 5 Sir William Pickering Drive, Christchurch. NSME189240-0916