There and back again

It’s been a crazy six months since I last blogged.  My son had a life threatening accident which had a profound affect on me, I’m approaching my 40th birthday with mixed perspectives, and my daughter has started school.  Campbell Tyson has changed markedly with the retirement of one director (Nigel Hicks, a long and faithful servant of CT), the future appointment of another (Mat Robertson, on 1 April 2013), moved premises (Level 2, 1 Wesley Street), new server (big thank you to OutsourceIT), new phone system (thanks Sietec), and I am taking over as Managing Director on 1 April 2013 (from Glen Beal, after a formational/inspirational 5 years in the role).  A fair bit for six months!

So, what now?  Well, with any change there comes consolidation and refinement.  I look forward to working with the superb team here at Campbell Tyson to assisting our clients to “Improve Beyond Today”.  And I will keep you posted on how we go with this blog!

Meetings, meetings and, oops, another meeting

Stephen Lynch from Results.com has a great strategy he uses to ensure when he is meeting with a team member, its a productive discussion:

As a leader, you want to encourage your people to think though the issues first, and make good decisions themselves.  Alternatively, if it is a situation where they really do need your input or sign off – you want them to present all the options along with their thoughtful recommendation as to what the right decision should be.

I recommend training your people to use GROW framework to think through the issues – and even have them present issues to you in this manner.

G = Goal

What is the goal?  What is the outcome we want to achieve here?

R = Reality

What is the current reality?  What is happening and why?

O = Options

What options do we have?  What are the implications of each option?

W = Will

What WILL we do?  Here is my recommendation

Yes, things may take longer to resolve initially – but you must be disciplined if you want to stop getting sucked into “reverse delegation.” Push back, and tell your people to go away and present their issues to you in this manner until it becomes their new default behavior.

In effect, you are now learning to delegate more effectively.  You GROW your people by making these situations a valuable coaching opportunity – with the intent to teach your team how to problem solve and make great decisions without you needing to be there all the time.

Simple, but you can see how it would be effective.

Till next time.

Keep your records

Hi there

Lovely weekend to be indoors.

There was a recent case through the courts in respect of record keeping (or the absence of it) for IRD purposes.  Here’s a summary:

 Commissioner’s default assessments confirmed, 12 July 2012

In a case where a taxpayer did not keep useful or complete records and failed to file income tax and GST returns, the Taxation Review Authority (TRA) has held that the Commissioner’s revised schedules were the most reliable reconstruction allowed by tax law and confirmed them as the new assessments for the years in dispute.

Background

The dispute concerned the tax liability of the taxpayer for the years ended 31 March 1995 through to 31 March 2000 and GST assessments for GST periods falling between 1 April 1994 and ending on 31 March 2001. During the course of the hearing, the Commissioner accepted some amendments to the assessments based on new evidence produced by the taxpayer in the course of the hearing.

At material times, the taxpayer was a property developer with various other sources of income from dealing in motor vehicles on a part-time basis and taking on residential boarders.

The taxpayer did not keep adequate business records in accordance with s 22 of the Tax Administration Act 1994 or s 75 of the Goods and Services Tax Act 1985. He did not keep a cash book, a note book, journal or balance sheet. In this respect he was operating in breach of his obligations as a business taxpayer under the Tax Administration Act. He also failed to file timely tax returns.

The Taxation Review Authority

The TRA noted that in the absence of business or personal records over material times, it was very difficult for the taxpayer to prove the ingredients of the Commissioner’s assessments to be wrong on the balance of probabilities. The taxpayer’s difficulties were also exacerbated in this challenge by the delays occasioned by him failing to prosecute the case in a timely manner.

The TRA found that apart from specific examples where documentary proof had been provided or where the TRA had particular views, the taxpayer’s evidence was too unreliable to be accepted. The TRA said that there was no room for “reconstructions” and “guess work” in taxation. The taxpayer had failed to comply with the statutory duty placed on business taxpayers by the Tax Administration Act to keep accounts.

The TRA accepted that the assessments represented an honest attempt by the Commissioner to arrive at the amount of taxable income and the amount of tax due by the taxpayer for the income years in question. The taxpayer’s challenge was dismissed.

Case 1/2012 TRA [2012] NZTRA 01, TRA 148/04, 2 July 2012.

Morale of the story, make sure you keep adequate records for the time required, or the IRD has practically  the right to state the facts.

Till next time.

Growing your business in 2012

Hi there

This link will take you to a summary of a most excellent seminar that Campbell Tyson put on with BNZ, Perceptive and Co.7

Enjoy!  http://youtu.be/vuIYO8sicPA

Till next time.

Balancing a Budget

I’m married to a teacher and so have been very close to what has been going on in the media as a result of Budget changes for schools.  I must say, I really feel for the schools.  As Gary Sweeney alluded to at a recent NZAIMS conference, the current issue is not about Teachers wages or contracts, it is about budget cuts affecting their ability to do the job they were charged with – teaching children.  It appears that Intermediate schools will no be doing everything they can to voice their displeasure and bring pressure to bear on the Ministry.  I believe this is a sensible approach to highlight policy decisions that will have a negative impact on what must surely be the most important thing we do as a country – the education of our future generations.

What saddens me is that there is no discussion around what other areas could be cut back.  Balancing a budget as a country is vital.  Just look at Ireland, Greece, Spain and Portugal to see what happens if you throw caution to the wind and borrow to fund a lifestyle beyond our means.  We have short patience for any one who does it personally, let alone a country that should know better.

Fine, campaign to stop the attempted $43million savings the Government are pursuing in a admirable attempt to balance the budget, but rather than whinging with your hand out, say what you are willing to give up to make it possible.  Suggest the areas that the Government could save money to offset the Educational Spending.  To the protesters, contribute more than clever banners and poorly sung Pink Floyd songs.  Start some meaningful dialogue rather than singing rhymes.  Show some of the maturity you are supposed to be passing on to the youth you are seeking to protect.

To avoid being a hypocrite, I should say what I would do.  What about:

• Treating prisoners in Prison as though they are there to be punished.  Drop the perks provided (under-floor heating, personal TVs, etc.) that would be denied to our Elderly in their homes
• Get rid of Tertiary Institutions that teach no courses of value (and “steal” funding from those that do)
• Get rid of funding for PC initiatives that bring no value other than promotion of “diversity” in society – if they were so valuable we would be doing it ourselves
• Remove the option of being a beneficiary as a lifestyle choice (I have a wonderful view of the Pukekohe Courts, and I can see where your tax-payer dollar is going)

No I don’t have a perfect answer, and I know there are people who would take exception to my suggestions above, but for us to be a country that is proud of the way we teach our children, we still need to balance our budget.

Till next time.

Stereotyping in Europe

Had a bit of a break from social media due to moving residences.  Thought you might all be interested in this little graphic, given what is going on in Europe at the moment.

Thanks to Dean Edgerton at the ANZ!

Till next time.

Pay rise time!

New minimum wage rates take effect from 1 April 2012. The new adult minimum wage rates (before tax) that apply for employees aged 16 or over will be:

· $13.50 an hour, which is

· $108.00 for an 8-hour day or

· $540.00 for a 40-hour week.

The new minimum wage rates that apply to new entrants and employees on the training minimum wage (before tax) will increase to:

· $10.80 an hour, which is

· $86.40 for an 8-hour day or

· $432.00 for a 40-hour week.

Record keeping is very important regardless. To cover potential claims, questions and audit, you need to:

1 Keep worked time records. This is a legal requirement and ensures you know how many hours everyone is working.

2 Ensure that in any pay period the salary amount paid to your staff member meets the minimum wage rates above.

Till next time.

Bye bye Amie :(

Today is the last day that Amie will be working with us.  Amie and her boyfriend Ryan are about to embark on their great overseas adventure.  And while the Team here wish her well on her travels, she will be greatly missed.  Amie has always been the life and soul of CTCW, heavily involved in all things, a wonderful friend, a caring person, always there with a smile and a kind word.  Anya summed it all up in her farewell poem:

LETS TAKE A LOOK BACK TO YOUR FIRST WEEK

TO A NICE POLITE GIRL WHO DIDN’T DARE GIVE ANY CHEEK

TO A WELL MANNERED LADY, SHY AND QUIET

WITH LOTS OF PRETTY SHOES AND A REALLY CRAP DIET

TIME TRUDGES ON AND HOW SOME THINGS CHANGE

WHO WOULD HAVE THOUGHT ONE VOICE COULD REACH SUCH A RANGE

LOUD AND ANNOYING SOME MIGHT SUGGEST

BUT NOT TO THOSE WHO KNOW YOU THE BEST

ALWAYS PROUD OF YOUR FELLA AND YOUR LIFE TOGETHER

A MORE SUITED COUPLE YOU WONT FIND, EVER

ONE THAT WONT SHUT UP, THE OTHER BARELY A SQUEAK

BUT THERE’S NO CHANCE YOUR KIDS COULD TURN OUT TO BE MEAK

WE WATCHED WHILE YOU STRUGGLED WHEN HE WENT AWAY

FIVE MONTHS COUNTING DOWN, DAY BY DAY

YOU FADED AWAY BEFORE OUR EYES

WHILE WE WAITED PATIENTLY FOR YOUR LOWS TO BECOME HIGHS

AND NOW WE KNOW THAT YOU WILL ALWAYS STAY STRONG

TOGETHER, THE TWO OF YOU CAN NEVER GO WRONG

HAVE YOU ALL HEARD ABOUT AN UPCOMING TRIP?

YOU HAVEN’T, THAT’S WEIRD, YOU MUST BE A DRIP

OFF TO THESAVANNAHSHE GOES TO MEET HER FIRST LION

AND TO CAMP ON THE PLAINS BESIDE HER ONE AND ONLY, RYAN

ALL THE ADVENTURE YOU’LL HAVE UNDER A SKY SO BLUE

AND YOU’LL SMILE EVERY DAY LIVING YOUR DREAM COME TRUE

BUT, WATCH OUT FOR THE SPIDERS, THE SNAKES AND THE BUGS

DON’T TALK TO STRANGERS AND BE WARY OF THUGS

DRINK PLENTY OF WATER AND DON’T TELL ANY LIES

AND FOR GOOD SAKE, KEEP YOUR DAMN FRINGE OUT OF YOUR EYES!

WE’LL MISS YOU SO MUCH, ALTHOUGH, YOU ARE A PAIN IN THE ASS

TEAM 4’S FIRST CSA, WITH YOUR ODD SENSE OF CLASS

IT WONT BE THE SAME WITHOUT YOU RIGHT HERE

TO PISS ME OFF WITH YOUR CONSTANT VERBAL DIARRHOEA!

IF WE’RE WORKING HARD ON THE JOB BEFORE US

WHO’S GONNA SHOUT “BOB SAGGET, NIBBLETS, OR MUNUS”

MAKING US LOSE OUR FOCUS AND RHYTHM

TRUELY, YOU HAVE BEEN A BIT OF A PROBLEM

COME TO THINK OF IT, I WONT MISS YOU AT ALL

IN FACT, HOW CAN YOU HAVE THE GALL

TO LEAVE ME BEHIND AND RUN OFF TO MYFAVOURITE PLACE

WAIVING YOUR PASSPORT AND ITINERARY IN MY FACE

GOOD RIDDANCE I SAY, DON’T BOTHER TO WRITE!

DON’T SEND ANYTHING I’LL JUST BURN IT, ALRIGHT!

AND I WONT REMEMBER THE GOOD TIMES WE SHARED

OR HOW, TOWARDS ME, YOU WERE NEVER SCARED

I TAKE BACK WHAT I SAID BEFORE

OF COURSE I WILL MISS YOU, I’M JUST BEING SORE

TO HAVE TO TRAIN SOMEONE TO TAKE YOUR PLACE

WHEN WE ALL KNOW THAT COULD NEVER BE THE CASE

I JUST HOPE THAT YOU WILL MISS US WHEN YOUR GONE

AND YOU’LL STICK TO YOUR PLAN AND WONT BE GONE TOO LONG

AND IF THERE’S A WEDDING WHILE YOU’RE AWAY

YOU BETTER SEND INVITES, OR THERE’LL BE HELL TO PAY

SO GOODBYE, GOODLUCK, TAKE CARE OVER THERE

WE ALL WISH YOU WELL ON YOUR BIG ADVENTURE

AND I HOPE YOU REMEMBER FONDLY THESE LAST WORDS FROM MY LIPS

AMIE…… YOU KNOW I CAN’T EAT YOUR GHOST CHIPS!!!

Amie – we are all going to miss you here at Campbell Tyson.  Kia Kaha, have a superb trip, and come back to us when you are done!

 

 

Impending Year End

For those of you with a standard balance date (31 March), we have the financial/tax year end coming up fast.  The following are a number of ways you can legitimately manage your tax position.

1. Consider prepaying certain expenses – Some expenses can be prepaid in March and claimed as a tax deduction in the year to 31 March 2012, regardless of their amount.  These include stationery, postage and courier charges, vehicle registration and road user charges, rates, subscriptions for papers or journals, and even audit and accounting fees!Other expenses have limits on the extent to which they can be claimed if prepaid.  These include rent, consumables, insurance premiums, professional or trade subscriptions, travel and accommodation, advertising, periodic charges and other services.  The rules surrounding prepayments are quite complex, so if you’re planning this type of expenditure, please contact us.
2. Trading Stock– Trading stock (excluding livestock) must be valued at the lower of cost or realisable value.  General adjustments for obsolete stock are not acceptable to Inland Revenue.  It’s important therefore to perform a physical stock take at year end and actually dispose of any obsolete lines or alternatively write that stock down to its net realisable value.Clients with an annual turnover of less than $1.3m can value their closing stock at the opening stock value, but only where closing stock can be reliably estimated to be less than $10,000.
3. Loss offsets and subvention payments – 2011 loss offset or subvention elections must be filed with IRD on or before 31 March 2012.  Subvention payments relating to the 2011 income year must be paid by 31 March this year.  The IRD changed its practice of requiring an actual physical payment, and now accepts that a subvention payment can also be made by book entries so long as the payment obligation is discharged. 
4. Write off any bad debts – To claim a deduction for a bad debt you need to physically write the debt off in your debtors’ ledger prior to the end of your financial year.  For most clients that’s 31 March 2012.  There should also be evidence that you have taken reasonable steps to recover the debt prior to writing it off.
5. Employee expenses – Any amounts owing to employees at year end (such as holiday pay, bonuses, long service leave, redundancy payments) can be claimed for tax purposes in the current year as long as they are paid within 63 days of balance date.
6. Review last years fixed asset register – The book value of assets can be written off for tax purposes if the asset is no longer in use by the business, the business has no intention of using that asset in the future and the cost of disposing that asset is expected to be greater than the proceeds from its sale.  Actually, it’s simpler than that.  Scan your asset schedule from last year’s accounts and you’ll probably notice assets that no longer exist (the mobile phone that you dropped in the tide at Christmas time), or simply don’t work.
7. Retentions – Retentions on building contracts are generally taxable in the year the contractor becomes legally entitled to receive them.  This can result in significant deferral of income.
8. Discount Reserves – A deduction for a discount reserve, to cover for example prompt payment discounts, is allowable where debtors are entitled to such a discount.  In the first year a deduction of the actual discount percentage is allowed and in subsequent years a calculation is made to maintain the discount reserve at that percentage level.  If the credit period offered to customers exceeds 93 days, different rules apply
9. Repairs and maintenance – General adjustments for repairs and maintenance reserves are not allowed as a tax deduction.  Instead it may be worthwhile to undertake any necessary repairs and maintenance on key assets prior to the end of the financial year to ensure a full deduction.  Deciding whether expenditure on an asset is deductible as repairs or maintenance or should be capitalised is not always cut and dried, so please contact us if you aren’t sure.
10. Imputation credits and dividends– Companies that have imputation credits for tax paid at 30% have until 31 March 2013 to distribute dividends with those imputation credits attached up to the previous maximum of 30:70.  But tax paid at 28% for the 2011-12 income year and onwards can only be attached at the new rate of 28:72.In addition, imputation credit account balances must not be overdrawn as at 31 March each year.  If so, they attract penalties.

    We realise the subject for imputation credits is complex for many of our clients.  Rest assured we will contact you regarding any necessary dividend and taxation planning before 31 March.

11. Income – Be sure to review any credit notes issued to customers following balance date that can be applied to the previous year, i.e. 31 March 2011.  In doing so, you will be entitled to effectively reduce your current year’s taxable income.

If you are uncertain on any of the above issues, or had a query concerning what you are able to do to plan for the year end, don’t hesitate to drop me a line.

Till next time.

The Same, yet different

The cat is out of the bag. CTCW will no longer be CTCW on 1 April 2012.  Campbell Tyson will be the name replacing Campbell Tyson Cooper White, something Jacqui our receptionist is greatly looking forward to.  Have you ever heard someone rattling off a seven syllable name before she even gets to hers up to a couple of hundred times a day?  Exhausting!

It does raise an interesting point, how important is a name?  We believe it is very important for us.  Campbell Tyson celebrated its 90th birthday on 1 March 2012.  Admittedly, the name has changed many times over the years, but the Campbell name has been there longer than most.  That cornerstone name has provided the impression of gravity and stability that the firm has stood for.  The Tyson name has, through shared “real estate”, taken the same connection.  The Cooper White aspect, not given up lightly, has contributed significantly to our culture, and while the names may not be on the letterhead, they still influence what we do and how we do it.

How will the name change affect what we do?  It won’t.  We will still be striving to go beyond what our clients expect in terms of performance and service.  We will continue to be “thinking forward” rather than focusing on historical data, looking for opportunities for our clients.

You will no longer see a list of the Partners of the firm on our letterhead.  Our Team approach to supporting our clients means that everyone on our staff is integral to the service we provide.  Putting 56 names on our stationery would be over the top, however!

What you will see is different signage, different colours, a different motif and easier phone introductions in your dealings with Campbell Tyson.  Same great service!

Till next time.