When was the last time you spoke to an advisor? If your answer was June 2020, you’re not alone. Many small business owners visit their bookkeeper, accountant or BAS agent to get help with things like tax deductions and reporting at end of financial year (EOFY). However, there’s plenty of value an advisor can offer all year round. And chances are, if you’re only consulting them once in a blue moon, you might not be making the most of those conversations.
This EOFY is the perfect opportunity to start afresh or build on an existing relationship with your advisor. As you get your books in order, now is the time to ask questions about where your business is headed and how you can access extra support, if necessary. If you don’t know how to start these conversations, don’t worry. We’ve compiled a list of tips to help you build trust and understanding, all so you can leverage your advisor’s skills, experience and counsel to thrive in the new financial year.
Remember, your advisor is more than a number cruncher
Most advisors have an extensive skill set that stretches well beyond ‘number crunching.’ There are no rules around how often you should meet. However, to provide top quality advice, an advisor needs to develop a deep understanding of your business – over time and through frequent contact. As you get to know one another, you can start to leverage their expertise to support other areas of your business. Start by looking at your biggest pain points – be it cash flow, pricing strategies or access to funding, there’s so much an advisor can do to help.
Find your right fit
The best advisor-client relationships are built on mutual understanding, trust and respect. As a small business owner, you’re not expected to be as financially literate as a trained professional. If you’re struggling to understand your numbers, you need someone who can help you connect the dots in a way that works for you. Feeling comfortable enough to ask for clarification is important, and it comes with finding your right fit.
Do your research on the types of advisors that specialise in your industry. If you’re not happy with the first person you speak to, keep making calls until you find someone that resonates. Xero has made it easy to connect with advisors from anywhere in Australia, so don’t be afraid to look far and wide to find your right fit.
Work with your advisor, not against them
Advisory is an investment. To see a strong return, you need to acknowledge that the relationship works both ways. If they ask you for information, do take the time to get back to them.
Similarly, keep the lines of communication open when planning for big decisions. Although it might seem obvious, their job is to offer advice. They can help you think through your next steps, as well as assess any risks. Consulting your advisor before taking action can be as simple as a five-minute phone call. If you’re charged for those quick conversations, consider it a business investment that could otherwise become more costly down the track.
Leverage off the cloud
Advisors love working with clients that are streamlined and efficient in how they operate. The best way to get your business in order? By adopting cloud-based accounting software. For example, data automation apps like Dext and Hubdoc minimise manual data entry, meaning advisors can use that time to focus on more strategic support for your business.
Speak to your advisor about EOFY sooner rather than later
If you haven’t already started talking to your advisor about tax time, now is the time to do so. EOFY is all about preparation. The more time you give your advisor between now and 30 June, the better prepared they’ll be to help manage your tax position and put strategies in place for the last 30 or 60 days of the financial year.
Remember that 15 June is when most advisors start processing final payroll reconciliations, including staff bonuses. If you engage an advisor beyond this date, it’s highly unlikely that you’ll get the most out of your time with them, have all your ducks in a row by the end of the month, or even get an appointment.
Submit your tax time super contributions early
It’s important to note that superannuation plays a big role in tax planning. Ensuring any contributions are received by your fund on or before 30 June – not just paid out of the business account, but actually received – could be the difference between receiving a deduction this financial year or having to wait until the next. The latter could leave you vulnerable to exceeding FY22 super thresholds for you and your employees and missing out on the deduction in the current financial year altogether.
An advisor can help you create a super contribution timeline, complete with critical deadlines. The more time they have to do this, the better prepared you’ll be.
Getting the most out of a relationship with your advisor will help make FY22 your best year yet. Armed with the power of your numbers (and more), together, you can take your business to new heights.
To search for an accountant, bookkeeper, BAS or tax agent, visit the Xero Advisor Directory.