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Spring is here! My favourite time of the year. You have got to love seeing the new lambs skipping around in the paddocks and even better knowing that the winter is behind us and summer is just around the corner.
Roll on barbies!
 

Accounting Lingo

We have a sneaking suspicion that there are plenty of business owners out there who receive their Annual Financial Accounts from their accountant, take a quick look at the profit made, tax to pay, and then put it aside as it too hard to understand.

Accounting terminology is one of those areas which you may sometimes prefer to skim over, but it can really help your business if you can understand some of the nitty gritty in your financial reports. Over the next few issues of our newsletter, we’ll shed some light on some of these reports and terms for you. 
 
So let's get started:

 

This top section has two parts.

Part One

Sales/ Revenue/ Income - This is the amount of money you have invoiced or collected from Sales, and excludes GST. This figure can contain Sales that you have not yet been paid for.
This section can also contain Revenue that is not from Sales such as Interest Income and Insurance Payouts.
Part Two
Cost of Goods Sold / COGS - This can be shown in this format
Opening Stock 105,000
Purchases         30,000
Closing Stock   85,000
Cost of Goods Sold =  50,000
Opening Stock + Purchases - Closing Stock= Cost of Goods Sold

There may simply be an amount for Purchases if you do not hold stock.

In this section there may be also a section containing Direct Costs. These are the Direct Costs that make up producing your goods or providing your service.
Examples of these are Wages, Hire Equipment, Sub Contractors, Dump fees.

Sales less Cost of Goods Sold and Direct Costs = Gross Profit/ GP.

Gross profit is an important measure because it indicates the efficiency of the management in using labour and supplies in the production and sales process.

It should be kept in mind that gross profit usually varies significantly from industry to industry. If you are comparing Gross Profit from company to company it is important to compare with companies within the same industry

Although gross profit provides the important information about how much mark up a company can make on its sales, it is not the best measure of profitability of a company as a whole because it excludes many costs such as operating costs and overhead expenses. Therefore profitability of a company should not be measured solely on the basis of gross profit.

Go on...dig out those old financials and check them out.

Please give us a call or your accountant if you do have any questions. We are here to help.

 

Fancy Reports


Did you know that there are new reports available in Xero. Exciting new fields can be added, formulas and lots more.
They are a work in progress, with updates added every six weeks.
Check them out under Reports> All Reports and click on 'Try out new Reports' in the top information box.
Call us if you need any assistance with any of these new reports

WorkflowMax grounds efficency for Polcon


Polcon is a contracting business specialising in ground works to get builders to foundation level.  Recently, we worked with them to implement WorkflowMax into their business. 
Here’s what Managing Director Andy had to say about the process.

“As a small but growing business, it’s important to us that we continue to develop new systems and processes so that we can achieve greater levels of performance, productivity and profitability,” says Andy. 

“An integral part of this has been the inclusion of WFM through the assistance of Equation. Being able to customise WFM for our job specifics has provided us with greater efficiencies with our jobs.”
“In particular we required a Job Brief that needed to have a particular layout,” he says.
 
“Equation created a Job Brief that met our specific requirements which now makes it easier for our Project Manager to keep track of our jobs and staff. 
The value of the Equation service to our business has been immense.”“I believe that introducing WFM into your business with the assistance of Equation and their skills in customising it to your needs is worth every cent,” says Andy. 



Customising Templates in WorkflowMax

 

In every WorkflowMax there is a standard branding theme that is used for your PDF invoices, quotes, purchase orders, and Job briefs. They also display the standard elements (such as page size, margins and font) which are hard coded and cannot be deleted.


Within WorkflowMax we can either create your own customised print templates for you to show you own logo size, tables, particular wording etc. Once you have more than one branded template, you can select which template to use from the print option screen when you generate invoices, purchase orders, quotes or job briefs.
It may not be an exact replica of what you are using now but we can certainly customise something specific or different for your business.

 

Do you want your forms to look different?

If you want to change the look and feel of your printed and emailed documents then contact Equation to customise them for you.

Ever wondered what we look like from space?

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We hope you’ve found some useful tips in our Spring newsletter.  Don’t hesitate to give us a call if there’s anything we can help you with. 

Best regards

Nicole, Bonnie and Theresa.

 

 

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