Priority Industries

12 months ago, we had hardly heard the term “priority industries”. However, the term is very applicable to the Australian government’s newest grant, ‘Industry Skills Fund’.

The government has once again elected to show preference to priority industries. These are the industries that the government believes enjoy a competitive advantage and are likely to exploit favourable market conditions or have a significant impact on the Australian economy.

Challenges For 2015

There are a number of key challenges facing the accountancy industry in Australia that are going to have significant effects on operations in 2015. Now is the time for accountants to finalise strategies to overcome these challenges.

Which include:

  • Digital Disruption
  • The Australian Taxation Office’s “Red Tape Reduction”;
  • Australian Economy;
  • Turbulence in Politics – The Effects on Business Relationships.

Business Plans Are Important For Businesses

It’s nearly the start of a new calendar year and it’s an appropriate time for accountants to be encouraging small/medium enterprise clients to prepare or update their business plans for the forthcoming calendar year.

Business plans are like ‘maps for tourists’. If you don’t know where you’re going to go, how will you know when you get there?

All members of the team should be involved in the business plan process. It’s important that stakeholders have the courage to express their true feelings and opinions on various items and that the team then works together, on an overall basis, to explore the goals of the stakeholders and try to develop an overall plan.

The planning process requires real honesty. Does the review of the goals of the various stakeholders align?

Entrepreneurs’ Infrastructure Program Fully Operational

Last week, the Australian government’s Entrepreneurs’ Infrastructure Program released the details of the final grant, Accelerating Commercialisation.

Accelerating Commercialisation assists entrepreneurs, researchers, inventors, start-ups, commercialisation offices (associated with universities and research centres) and small/medium enterprises address the challenges associated with commercialising novel intellectual property, in the form of new product, process or service.

Even the ATO is advising accountants to become business advisors

Speaking at the Australian Technology Showcase for Accountants (ATSA) Conference, held in Melbourne in October, the Second Commissioner of the ATO, Geoff Leeper, outlined the ATO’s policy relative to Standard Business Reporting Strategy (SBR Strategy). Mr Leeper indicated that the ATO had advised the Productivity Commission that the ‘Red Tape Saving’ from the introduction of the SBR Strategy would be $500million a year. Mr Leeper also said that “a lot of this would come from professional fees. This is the ‘digital disruption’ for accountants.”

Mr Leeper then added, “This is all going to change the role of accountants beyond compliance. Accountants have to become business advisor, rather than tax compliance experts for SMEs.”

ATO’s ‘Red Tape Reduction Strategy’ will reduce accountants’ income

According to Geoff Leeper, Second Commissioner of the Australian Taxation Office (ATO), the ATO’s ‘Red Tape Reduction Strategy’ will reduce accountants’ income. Mr Leeper was speaking at last week’s Smithink 2020 ATSA Conference in Melbourne.

“The ATO’s Red Tape Reduction Strategy will reduce the cost for SMEs, from the Small Business Reporting (SBR) strategy, by $500million a year. A lot of that will come from professional fees. This is the ‘digital disruption’ for accountants.”, Mr Leeper said.

PPSR: Insolvency events

Understanding incidents relating to insolvency practitioners, the Personal Property Securities Act (PPSA) and the Personal Property Securities Register (PPSR) will assist accountants in their services to businesses.

There’s been a steady flow of incidents, which relates to ‘insolvency events’, the PPSA and the PPSR, including:

PPSR: A time bomb for businesses

Lack of knowledge of the Personal Property Securities Act (PPSA) and the Personal Property Securities Register (PPSR) could be a ‘time bomb’ for businesses.

Millions of dollars has already been lost by businesses who paid for an asset but haven’t registered that asset on the PPSR. Whilst it’s voluntary to register, if your client is going to register, he/she has to register within a very tight registration time period. This highlights the need for a proper due diligence review to be undertaken now (if not yet done) so the decision can be made promptly on whether the registration of a transaction or asset rental, lease or storage is to be made on the PPSR.

Planning Services for ‘Disrupted’ Industries

Planning services for ‘disrupted’ industries is certainly a topical subject at present, following the publication of the updated Deloitte report, ‘Digital disruption – short-fuse, big bang?’

Deloitte have identified 17 industries, comprising 65% of the Australian economy, which will face significant ‘disruption’ by 2017.

Introducing a business advisory services strategy to your accountancy business will give you the tools to assist the identified industries.

The industries listed under the categories given by Deloitte were as follows:

Are you offering ‘real accountancy services’?

Accountants MinuteA young accountant, who participated in a business advisory services training program, sent me an email at the end of the training and said:

“Thank you, I now feel like I’m offering real accounting services.”

Deloitte has predicted significant ‘digital disruption’ to professional services firms (of which accounting services are part), amounting to a 32% drop in business activity.

Deloitte has made some suggestions on how the ‘digital disruption’ can be reduced, including ‘replenishing revenue streams’[1].