Let's Talk Business March 2015

Also inside this issue

Page 2 • Beef 2015: The Countdown Has

Begun

Page 3• Client Spotlight: Rural Supplements

& Bonnie Doone Beef

Page 4 • Passing The Torch: The Importance

Of Succession Planning

Page 5 • The ATO Goes Paperless

Page 6 • 5 Tips to Ease the Small Business

Hiring Process

Page 7 • A New Era For Powers Agribusiness

& Finance

Page 8• Let’s Talk Powers

MARCH 2015 Issue

B E E F A U S T R A L I A

“ Beef Australia 2015 is happening from 4 – 9 May 2015 at the

Rockhampton Show Grounds. Powers will be setting up camp

at our trade fair stall in the Sidney Kidman Indoor Pavilion for

the week. ”

2 0 1 5T H E C O U N T D O W N

H A S B E G U N

LET’S TALK...BUSINESS Page 2

by Vickie WhitePrincipal POWERS ACCOUNTANTS & ADVISORS

BEEF 2015

Beef Australia 2015 is happening from 4 – 9 May 2015 at the Rockhampton Show Grounds. Beef Australia 2015 is Australia’s National Beef Exposition and has been running since 1988.

Taking place every three years, 2012’s event saw over 85,000 people attend. Beef Australia 2015 brings together all facets of the beef industry to celebrate successes, learn from experiences and prepare for the future in what can be described as a tumultuous industry at best. We recognise the importance of this event to the industry and to our clients, so will be setting up camp at our trade fair stall in the Sidney Kidman Indoor Pavilion for the week.

However, the point of Beef Australia 2015 is not just to have a chat. With so many special guests lined up for the different events, Beef Australia 2015 is a chance to learn from the experts.

Our special guest is Kerry Lonergan from ABC Landline, who will be hosting Powers’ seminar. The seminar, which

will take place on Wednesday 6 May at 11 a.m. in the James Lawrence Pavilion, will include a Q&A discussion with a panel of experts including Ian Congram and Geoff Arnold from Powers, Westpac and QRAA representatives and some of our own clients.

Titled, “Having your steak and eating it”, the panel will discuss succession planning and how farmers can transfer their legacy to the next generation while protecting their lifestyle in retirement.

Be sure to buy your tickets in advance because they are selling fast! Details can be found on the front page of our website www.powers.net.au.

Other events that Powers are booking into our calendars are the Rural Press Club Breakfast, the Sportsman’s Lunch on Friday and the Gala Ball on Saturday evening.

For more information about the week’s events, go to: www.beefaustralia.com.au

THE COUNTDOWN HAS BEGUN

Any Australian Beef Producer can tell you why Powers are excited about the second week of May.


Bonnie Doone is a picturesque property, nestled west of the Coominglah ranges near Monto, home to Beef Producers Grant & Carly Burnham. Grant, a third generation Beef Producer and his wife Carly, share a passion for the bush.

The Burnhams pursue a balance between art and science - using research and data to implement leading edge management practices and working with the flow of nature to ensure harmonies balance all parts of the business, family and community.

Grant and Carly believe fertility is the biggest production driver in any beef cattle business and have selected heavily on this trait. Bonnie Doone Reds (Red Brangus

Stud) is the result of 15 years of pressure on selection and culminating in highly fertile bulls bred from a commercially focused herd.

At Bonnie Doone the philosophy is to give back more than is taken. This applies to all areas of the property, business and people, with Bonnie Doone selling directly to families who are increasingly aware of where and how their food is grown.

Three generations of breeding beef cattle is the platform which the Burnhams have used as their stable base to move into what they believe is the future of beef cattle production systems.

To learn about Bonnie Doone Beef check out their website: www.bonniedoone.com.au

To learn about Rural Supplements, give them a call on 1300 272 545

Rural Supplements are one of the State’s leading Stock Feed and Production companies. Founded by Barry Williams, Darren Childs and Craig Atkinson in 2005 and based in Central Queensland, Rural Supplements’ business has expanded significantly, now servicing all of Queensland as well as parts of the Northern Territory and New South Wales. The concept for Rural Supplements came through this group of livestock industry experts’ belief that there was a need for a more specific focus on the feeding options and requirements for Central Queensland livestock.

Barry, Darren and Craig’s experience is the driver behind many of the unique and industry leading products offered by Rural Supplements. Now covering all aspects of livestock supplementation, Rural Supplements offers:

• Molasses based pasture supplements (bulk depot and trough deliveries)

• “Turbo Power” Molasses Ration • Molasses based silage concentrates • Protein meal based concentrates for Grain, Silage

and Molasses Rations • Weaner, Breeder and Production Dry Licks • Stockfeed Grain Rations

They believe the key to their success and continued growth lies in a commitment to customer satisfaction, consistently high quality products and understanding the client’s needs. By partnering with some of the world’s leading Research and Development companies in animal health and nutrition they continue to stay at the forefront of advances made in the industry.

CLIENT SPOTLIGHTRURAL SUPPLEMENTS

CLIENT SPOTLIGHTBONNIE DOONE BEEF


Family businesses account for a staggering 70% of the businesses in Australia with the estimated wealth of the sector being $4.3 Trillion. According to a recent survey, 81% of owners intend to retire in the next 10 years generating a wealth transfer of $3.5 Trillion.

Of current family business owners, 88% believe the same family or families will control their business in five years, yet succession statistics contradict this belief.

Only about 30% of family and businesses survive into the second generation, 12% remain viable into the third generation and roughly 3% of all family businesses operate into the fourth generation and beyond. The statistics reveal a disconnect between the optimistic belief of today’s family business owners and the reality of the massive failure of family companies to survive through the generations.

Research indicates that family business failures can essentially be traced to one factor: An unfortunate lack of planning for family business succession.

Most family business owners put off their succession planning because they do not want to think about their retirement, disability or death, however, planning for business succession should be a priority in every family owned business. A family business owner’s decision to eventually retire is not as simple as no longer going to the office.

Key questions need to be answered before the family owned business owner can “leave” the business:

• will he or she have enough money at retirement; • who is going to own and manage the business; • how will ownership and management be transferred to

new owners; and• should the business be carried on or sold to a third

party?

An effective business succession seeks to alleviate the above issues by setting up a smooth transition between the family business owner and the future owners of the business.

Growth and SustainabilityFamily businesses often have intimate histories and complex cultures that are hard for outsiders to understand or replicate. Families today are often more complicated and less traditional than they once were. Fortunately, with focus and planning, this can be easily overcome by paying attention to the details.

For most family and closely held businesses, planning for succession is the toughest and most critical challenge they face. Yet succession planning can also be a great opportunity to maximise opportunities and create a multi-generational institution that embodies the founder’s mission and values long after the owner/operator is gone. The most critical issues facing family businesses are

PASSING THE TORCH

Succession planning is a growing concern, yet most business owners keep their head in the sand until it is too late.

by Ian CongramManaging Director POWERS FINANCIAL GROUP


family-based issues more than they are business-based issues.

Key issues include:

1. Alignment of family interests. Alignment of interests between current owners and others becomes more pronounced as members retire and hand over the reins to the new generation, while at the same time looking to the company for their retirement income.

2. Balancing of financial returns. Creating buyout agreements is challenging without the right advice. When the retiring generation looks to the value of their interest, they tend to look to a number on the balance sheet. In fact, the true value of a business should be based on an earnings capitalisation model, a concept unfamiliar to many smaller family companies.

3. Inter-family disputes. The interest of one family member may not be aligned with another family member. These situations can become even more difficult where, e.g. a divorce of a family business owner or a death and the surviving spouse is holding stock (and voting rights) but is not involved in the business.

4. Estate and Inheritance issues. These include taxes and probate delays upon the death of a family business owner.

To help ease this struggle, there are at least four fundamental principles that should be considered when starting to plan for the handover of your family business:

1. It is never too early to start planning. Unforeseen events, such as death and disability, often cause a rapid transition of the family owned business. The time to begin a succession plan is now. The longer the succession plan is in place, the smoother the transition of the business will be.

2. Involve your family in the succession planning process. This serves two purposes:

a) it cuts down family discord later, as each family member knows where he or she “stands” relative to the business; and

b) it allows you to determine the best successor for the business.

2. You may find, in your discussions with your family that not every family member desires to be involved in the business, as they may have their own businesses or careers they desire to pursue. Involving your family also gives you the opportunity to do an honest assessment of those desiring to succeed you. While it may have been your great desire to leave the business to your firstborn, they may not have the managerial and other skills necessary to lead the business.

3. Train your successor(s). Your succession plan should not be simply about transferring ownership; it should also be about training your successors to properly execute your succession plan. There are few things as devastating to watch as a business fail that you worked so hard to build. In carrying out any succession plan, adequate time must be given to train those who are eventually going to run the business.

4. Get the right advice. Speak with a Lawyer, Accountant and other professional advisors knowledgeable in the succession planning field to assist you with your succession plan. These advisors are crucial to running a business and should be involved at the earliest stage.

Putting off business succession planning is a mistake. A proper effective succession plan will ensure that your retirement needs are met and that the business you worked so hard to build, will continue to flourish for years.

Speak to your Powers Accountant today about how to initiate the planning process.

Did you know?From the 1 July 2014, notification of Activity Statements including Business Activity Statements (BAS) and Instalment Activity Statements (IAS) for wages/Pay As You Go (PAYG) withholding have been automatically sent by the Australian Taxation Office to that person or business’ registered email address. This means that there will be an increasing array of paper lodgements that will eventually become electronic.

The Team at Powers updates client contact details as they are provided. However, if you are not sure that the details we hold are current or would like to change your correspondence method to paper, please contact your advisor at Powers.

by Karen ThompsonManager - Business & Taxation Services POWERS ACCOUNTANTS & ADVISORS


5 TIPS TO EASE THE SMALL BUSINESS HIRING PROCESS

by Estelle SchluterHuman Resources ManagerPOWERS FINANCIAL GROUP

They try, or more accurately, struggle to take care of the service delivery, product development, bookkeeping and business expansion all at once. As the business grows, it slowly becomes apparent that the load needs to be shared.

In small business, having the right people working for you is as important as having the right product. Finding people that you can trust to handle your business and interact with your clients can be tricky, so we have prepared a list of tips to help you navigate the hiring process:

1. Explore the alternativesThe first question you have to ask yourself is: “Do I really need to hire someone?” Many services can just as easily be outsourced.

Using external services is often an easy and cheap alternative to hiring when you are seeking a specific service, with reassurance coming from the fact that you are most likely engaging with experts or specialists. Be wary though: only use providers who guarantee quality.

2. Prepare to be patientOkay. So there is no external service that can fulfil your need. You are in it for the long haul now. While everyone knows they should hire slowly and fire quickly, small businesses often do the opposite.

However, if you are thinking long term, it is easy to see that the cost of a bad hire is much greater than the time you take to find the right person for the job. After all, when you are already increasing costs by making the hire, can you really afford to have an employee who is not working to full capacity?

3. Know what you wantThis might sound obvious, but establishing a clear Position Description from the get-go can prevent worlds of trouble.

One easy way to identify what you will need your new employee to do is to keep a running list of the tasks you require assistance with and use that as the basis for the Position Description.

Another way to help you develop the Position Description is to browse through your competitors’ advertisements for similar positions. This will give you an idea of what skills they are seeking, as well as an indication of the salary ballpark.

4. Be the match-makerAs important as it is to have the most qualified person for the job, it is absolutely essential that the person is a good fit with your company, especially in small business when hiring two employees might double your total team! Recruiting with the company’s values and mission statement in mind is key.

Make sure you get to know the person you are considering hiring, not just their experience. Knowing about their passions and attitudes will help you to understand their work ethic and how you will work together.

If you already have other employees, their input can be important in cultivating a positive team culture. The best way to find new employees is always to explore your networks; if a person is recommended by someone you know and trust like a friend or advisor, part of the screening has already been done for you.

5. Always be on the look-out for talentOnce you have found the right person, it is easy to say, “Thank goodness that’s over”, and turn off your scouting attitude. However, by constantly being aware of talented, passionate people, you will make the recruitment process much easier next time!

Far too often, small business owners carry the weight of the world on their shoulders alone, operating as a one-person band.


Tell Us How We’re DoingYour feedback is very important to us. If you have any compliments, complaints, or suggestions about our service or team, please contact our Business Development Manager, Nick Pollins, on 07 3906 2888.

We’re always interested in improving our services and value what you have to say.

2015 has ushered in changes at Powers Agribusiness Services.

Martin PentecostPOWERS AGRIBUSINESS & FINANCE

The agribusiness industry poses a very unique set of business challenges and demands. Unpredictable cash flows, uncertainty of the weather and seasonal considerations are all factors that require a particular approach to proper business planning. Powers’ Agribusiness & Finance Division offers targeted and informed agribusiness advice across rural Queensland.

At Powers we offer practical financial advice to help our rural clients make the right decisions today, setting in place the right structures for future succession and focusing on minimising the risks of this volatile industry. A large proportion of our client base is directly involved in primary production, as well as the support industries that go with this sector. These include: beef and dairy cattle, sheep and wool, pork, poultry, grain, cotton, horticulture and equine industries.

Martin Pentecost has joined Powers in the role of Agribusiness & Finance Consultant. Martin is based at our Rockhampton office and will travel extensively conducting on-farm meetings and visiting our Biloela office weekly as well as our Monto and Brisbane offices as required. With the aim of meeting as many clients as possible, Martin will be actively contacting clients over the next few weeks to introduce himself; so you can expect to hear from him in

due course.

His experience and expertise in the rural economy is focused on the following areas:

• Competitive Brokering Service• Liaison with QRAA, Centrelink, and Government bodies

regarding Grants and benefits• Succession Planning Facilitation• Preparation of reports for banks and financiers• Developing Business Plans• Due Diligence• Competitive Brokering Service• Rural business cash flow forecasts and budgets• Restructure of family businesses• Operational Management• Performance Benchmarking• Annual bank reviews• Practical advice for each phase of your business life

cycle• Investment and funding advice• Agricultural Asset identification• Market intelligence for investors

Speak to Martin Pentecost about what Powers can do for you on 07 4928 1555.

A NEW ERA FOR POWERSAGRIBUSINESS & FINANCE

BILOELA 54 Callide StreetBiloela QLD 4715PO Box 98 Biloela QLD 4715Ph 07 4995 6677 Fax 07 4992 1787

BRISBANE10/8 Metroplex AvenueMurarrie QLD 4172PO Box 518 Cannon Hill QLD 4170Ph 07 3906 2888 Fax 07 3906 2889

ROCKHAMPTON75 High StreetNorth Rockhampton QLD 4701PO Box 5161Red Hill QLD 4701Ph 07 4928 1555Fax 07 4926 1184

MONTO3 Newton StreetMonto QLD 4630PO Box 69Monto QLD 4630Ph 07 4166 1366Fax 07 4166 1343

[email protected]

www.powers.net.au

Visiting Mundubbera and other locations by appointment

Contact us

The information in this document is of a general nature and is provided for information purposes only. It does not take into account your particular objectives, financial situation or needs and should not be used as a substitute for independent advice from a qualified professional. Limited liability by a scheme approved under Professional Standards Legislation other than for the acts or omissions of financial services licensees. All financial advice is provided by Authorised Representatives of Professional Investment Services Pty Ltd AFSL 234951 ABN 11 074 608 558.

For further information on any of the articles in this issue, please contact your local office:

Two Become One in RockhamptonThank you to those clients and associates that attended our event on 17 February at the Rockhampton Leagues Club, celebrating the final stage of the merger between Powers Financial Group and ABA White Accountants. We are very excited to extend our offering in Central Queensland and look forward to working with clients in and around Rockhampton.

Social Media If you are coming to Beef Australia 2015, be sure to RSVP on our Facebook event. Just search for Powers @ Beef Australia 2015 to keep up to date with competitions and events that will be running throughout the week.

Graduate Program We are proud to announce the launch of our Graduate Program. To kick off the applications process, Powers recently participated in the CQU Careers Fair 2015, the CA Employment Evening and the recent CPA Careers Expo. More information about our Graduate Program is available on our website (www.powers.net.au), so if you know of anyone who is looking for a career in accounting, please tell them to contact Estelle Schluter on 07 4995 6655.

New Team Members We have recently added two new team members to Powers Financial Group. Martin Pentecost, our new Agribusiness and Finance Consultant, will be based in Rockhampton but will be travelling between offices to connect with all of our clients working in agriculture. Karen Thompson, our new Manager of Business Services and Taxation, will operate out of our Brisbane office.

Rocky River Run This year, we become proud sponsors of the Rocky River Run, which will take place on Sunday 24 May 2015. The Rocky River Run is an annual event hosted by the Rotary Club of Rockhampton to raise funds for the prevention of youth suicide. Powers’ Agribusiness & Finance Consultant, Martin Pentecost, will be participating in the 5km race. See you at the finish line!

Website Redesign We are delighted to announce the launch of our redesigned website. A lot of planning and consideration has gone into the design and development of the site, which will be constantly updated with useful information and calculators. Be sure to add it to your favourites! www.powers.net.au

Let’s Talk Powers Below: Pictures from our Two Become One launch in Rockhampton

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Let's Talk Business March 2015