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Financial performance report

Introduction

The purpose of this report is to provide the information on financial performance of Grow
Management Company in financial year 2019-2020.

2019/20 Performance

Analysis of the previous year’s (2019/20) profit and loss statement for Grow
Management Consultant, including revenue generated, cost of sales, as well as gross

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profit/loss margin and net profit/loss margin.

 Overall performance is positive with the net profit (net income) is $652,077

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 There is difference with the budget compared to the actual, budgeted amount is
$665,360 but the actual is $707,795

 Total revenue generated for year 2019/20 is $1,335,600

 Total cost of sales is $34,000

 Gross profit margin for year 2019/20 is ($40,000-$34,000)/$34,000 = 17.65%

 Net profit margin is $652,077/$1,335,600 = 48.22%

Analysis of overall business performance, as well as performance of each of the

income streams for 2019/20.

 Consulting fees are predicted to generate $1,100,000 but in actual it generated

$1,175,000

 Workshops income are deemed to gain $48,000 but on year 2019/20 it gains
only $36,000

 Publication of income are not meet the budgeted amount which only gain $2000,
budgeted amount is $5000

 Executive search generates the same amount compare to the budgeted which is
$108,000

GBSEBFIFMI6N01A-TNASCK-E2pSdf/ TASK 2
Outline the reasons for profit or loss based on your analysis of the data and
research on economic conditions and business trends.

In view of the analysis, reason behind the profit or loss of Grow Management Consultant
is cause by the Workshops event which isn't increase numerous specialists since
customer prefer the consulting service which regard to be more compelling for them. In
the other hand cost that happened as the result of workshops and e-book distribution are
high. High e-book cost can be seen from the contract writers that charge a lot.

Strategic goals and priorities

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 Grow Management Consultant aim to achieve profits of at least 10% per annum.

 Increase range of e-books commencing with Organisational Change e-book to be

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published during 2021.

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 Demand for services backed by analytics is expected to have growth of 3.8% in
2015-16.

Cash flow statements analysis

In view on the cash flow statement year 2019/20, it concluded that it doesn’t project any
issue. This can be seen from the income that generated by client consulting & executive
search is high.

Financial Software

There is few of financial software that be utilized for Grow Management Consultant,
below listed the software including its advantages & disadvantages:

MYOB

Advantages:

 Fully online setup can be used for computer, tablet or mobile

 Automatic Update

 Frequently backup so the loss of data & security can be guaranteed

 A payment from a customer can be quickly applied against a lot of invoices at

once, or applied to the oldest to the newest.
Disadvantages:

 Have a lot of version and can be hard to choose from

 For some user the add-ons and fees are confusing

 Learning the software is online only

XERO

Advantages:

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 Send invoices via Xero, using nice templates with your logo & details.

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 Reports are fast. Can run multiple reports at once in browser tabs.

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 Staff accesses their private employee portal. Staff can download payment
summaries; pay slips and lodge leave requests.

 Simple pricing.

Disadvantages:

 Slow with high number of transactions

 Can be cost more depends on the plan

 Lack of support
Report on Key Financial Compliance Requirements & Liabilities

GST Reporting Requirements

Based on the Australian Taxation Office rule, company’s GST reporting and payment
cycle will be one of the following cycles:

 Monthly – if GST turnover is $20 million or more.

 Quarterly – if GST turnover is less than $20 million – and we have not told you that
you must report monthly.

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 Annually – if you are voluntarily registered for GST. That is, you are registered for
GST; and your GST turnover is under $75,000 ($150,000 for not-for-profit bodies).

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Depending on the condition and situation, the cycle use to report and pay GST can be

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change. This may happen when the company GST turnover changes or if company
choose to report and pay using a different cycle.

GST reporting for Grow Management Consultant the requirement is decided to be done
quarterly. Grow Management Consultant needs to use one of the following methods to
report its GST:

Full reporting method

If your GST turnover is $10 million or more, you need to use the full reporting method.
You can also elect to use the GST full reporting method if either:

 Your GST turnover is less than $10 million but you have aggregated turnover greater
than $10 million (for the previous year or the current year)

 You make input taxed supplies as your main business or enterprise activity.

Below the full reporting method, you calculate, report and pay your GST amounts
monthly. You provide more detailed information on your business activity statement
(BAS) using this method.
Simpler BAS reporting method

You report amounts at the following labels on your Simpler BAS activity statement each
month, if your GST turnover is less than $10 million:

 G1 Total sales
 1A GST on sales
 1B GST on purchases.

Labels below with its amount doesn’t need to be report:

 G2 Export sales

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 G3 Other GST-free sales
 G10 Capital purchases

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 G11 Non-capital purchases.

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If you have wine equalisation tax (WET), luxury car tax (LCT) or fuel tax credit (FTC)
obligations or entitlements, you must also report these amounts each month
(labels 1C, 1D, 1E, 1F, 7C or 7D). These labels are shown on your BAS if you need to
report on them.

GST instalments method (pay quarterly and report annually):

You can elect to report and pay GST annually. You can only use this method if you are
voluntarily registered for GST. That is, you are registered for GST and your turnover is
under $75,000 (or $150,000 for not-for-profit bodies).

If you are eligible and have elected to report and pay GST annually, you do not need to
report or pay any GST during the year. At the end of the financial year, you must report
and pay any amount due. If you are using the deferred GST scheme you need to
withdraw from the scheme.

If you are a representative member of a GST group, you can elect to report GST
annually only if each member of the group is eligible. Once an election is made, annual
tax periods will apply to all group members.
PAYG withholding obligations

As an employer, Grow Management Consultant have a role to play in their employee

meet their end-of-year tax liabilities. This can be done by collecting pay as you go
(PAYG) withholding amounts from payments Grow Management Consultant make to:

 Their employees
 Other workers, such as contractors, that you have voluntary agreements with
 Businesses that don't quote their Australian business number (ABN).

Several things to keep in mind:

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 Grow Management Consultant must register for PAYG withholding before you are
first required to make a payment that is subject to withholding. This is required even

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if you don't withhold an amount from a payment made.

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 If Grow Management Consultant cease to be an employer, they should cancel their
PAYG withholding registration.
 Before Grow Management Consultant enter into a work agreement or contract, they
need to check that the worker is legally allowed to work in Australia.
 PAYG withholding is different to payroll tax, which is a state tax.

PAYG income tax instalment

Grow Management Consultant need to plan ahead for its income tax to keep a healthy
cash flow. PAYG Instalment will sort out this. How it is work? By making regular payment
during the year then Grow Management Consultant doesn’t have to pay a large tax bill
when the lodging the tax return.

Payment are based on Grow Management Consultant income, when the tax lodged the
amount that have been paid will be offset toward any tax that Grow Management
Consultant owe for the year.
Payroll tax obligations (state government)

Grow Management Consultant need to check if they need to pay payroll tax depends on
how much wages they pay for employee. Grow Management Consultant need to register
for payroll tax if your total Australian wages are more than the threshold. Check the
threshold for each state or territory where they have employees. Since they wage
amount are less than $75,000 & $95,000 (Which is $42,000 based on cashflow
statement 2019/20) in 31-days then the company don’t have to register and pay for
payroll tax.

Superannuation entitlements and requirement to comply with legislation

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regarding frequency of payment, choice of fund and reporting to staff

Grow Management Consultant need to pay for their workers super. To put it simple

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Grow Management Consultant are paying more than $450 in a calendar month, so they
have to pay super on top of their wages.

The minimum Grow Management Consultant must pay is called the super guarantee
(SG):

 The SG is currently 9.5% of an employee’s ordinary time earnings

 Grow Management Consultant must pay the SG at least four times a year, by the
quarterly due dates
 Grow Management Consultant must pay and report super electronically in a standard
format, ensuring you meet Super Stream requirements
 Grow Management Consultant super payments must go to a complying super fund –
most employees can choose their own fund
 if Grow Management Consultant don’t pay the SG on time, they may have to pay the
super guarantee charge.