The Essential Gude to Monitoring Financial Performance
Caroline Gillies • August 8, 2024
Monitoring your financial performance is like checking your businesses financial heartbeat. It’s all about tracking those crucial metrics and indicators to see how well your financial engine is running. Ready to dive in? Here’s how to keep your financial game strong and your money matters on point!:
- Set Clear Objectives and Metrics: Define specific financial goals and key performance indicators (KPIs) that align with your business strategy. Examples include revenue growth rate, profit margins, cash flow, and return on investment (ROI).
- Regular Financial Statements: Review and analyse financial statements regularly. The main documents include:
- Income Statement: Shows revenue, expenses, and profitability over a period.
- Balance Sheet: Provides a snapshot of assets, liabilities, and equity at a specific point in time.
- Cash Flow Statement: Tracks cash inflows and outflows to assess liquidity.
- Financial Ratios: Calculate and analyse financial ratios to gain deeper insights into different aspects of financial performance:
- Liquidity Ratios (e.g., current ratio, quick ratio) measure the ability to meet short-term obligations.
- Profitability Ratios (e.g., gross profit margin, net profit margin) assess the profitability of the business.
- Activity Ratios (e.g., inventory turnover, accounts receivable turnover) evaluate operational efficiency.
- Debt Ratios (e.g., debt-to-equity ratio) indicate the level of financial leverage.
- Budget Variance Analysis: Compare actual financial results against budgeted figures to identify discrepancies and understand the reasons behind them.
- Trend Analysis: Track financial trends over time to spot patterns, opportunities, or potential issues. This involves comparing current performance with historical data.
- Benchmarking: Compare your financial performance with industry peers or competitors to understand your relative position and identify areas for improvement.
- Cash Flow Management: Monitor cash flow regularly to ensure sufficient liquidity for operational needs and to support growth.
- Risk Assessment: Identify and assess financial risks that could impact performance, such as market risks, credit risks, or operational risks.
- Management Reporting: Develop concise and informative reports for management and stakeholders, highlighting key financial metrics, trends, and insights.
- Use of Financial Software: Leverage accounting and financial software systems to automate data collection, analysis, and reporting processes, improving accuracy and efficiency.
- Regular Reviews and Adjustments: Conduct regular reviews of financial performance and adjust strategies as needed to achieve financial goals and improve overall performance.
By following these steps and methods, businesses can effectively monitor their financial performance, make informed decisions, and drive sustainable growth and profitability.
If you require assistance with designing, implementing, or understanding any of these steps, please contact Clear Vision Accountancy Group, 4688 2500, and allow us to assist you.
The ATO is cracking down on people who claim too many tax deductions for properties that they use both personally and as rentals — especially holiday homes. A new draft ruling says that if you use a property for both personal use and renting it out, you must split (apportion) the expenses in a fair and reasonable way. You can only claim deductions for the portion of time or space used to earn rental income. If the ATO thinks your property is really a holiday home — for example, you block out peak times for your own use and only rent it occasionally — they can classify it as a “leisure facility.” If that happens, you cannot claim big expenses like mortgage interest, council rates, land tax or maintenance. You’ll only be allowed to claim small costs like cleaning, advertising and platform/agent fees. The ATO says many owners of holiday homes have been claiming too much by showing “rental losses” every year. They are now looking more closely at cases where the owner keeps the property unavailable for rent during busy periods. How do I stay off the ATO naughty list? If you mix personal use with rental use, be careful. Only claim the rental part of your expenses, or the ATO may deny most of your deductions.
From 1 October 2025, the Australian Taxation Office (ATO) officially closed the Small Business Superannuation Clearing House (SBSCH) to new users. Thanks to the efficiencies of Xero, this change does not impact Xero clients, as Xero includes its own built-in auto-super functionality. This means employers can make superannuation payments directly through Xero—without needing to access the ATO’s separate clearing house service. Key Dates and Details No new users: From 1 October 2025, the SBSCH stopped accepting new registrations. Full closure: The SBSCH will be fully decommissioned on 1 July 2026. Existing users: Businesses currently using the SBSCH can continue until 30 June 2026 but are encouraged to transition to an alternative solution before this date. At Clear Vision Accountancy Group, we highly recommend Xero as an efficient, streamlined, and ATO-compliant payroll and superannuation solution. If you’d like to discuss transitioning your business to Xero, call our team today on (07) 4688 2500 — we’re happy to help.
If you own a rental property or holiday home, keeping the right records is key to maximising your tax deductions and staying ATO-compliant. This week, we’re highlighting what the ATO expects you to keep when it comes to residential rental properties. Here’s a quick checklist of the documents you should hold onto: Purchase & Sale Documents – Contracts, settlement statements, and legal documents. Loan & Ownership Records – Loan statements, refinancing documents, land tax assessments. Rental Income – If you don’t have a rental statement you will need to document all rental income received, including bond money retained, insurance payouts, and any other reimbursements. Expenses & Repairs – Keep receipts and invoices for expenses like advertising for tenants, property agent fees, council rates, strata levies, repairs, maintenance, insurance, and interest on loans. Depreciation & Capital Works – Receipts for assets over $300, depreciation reports, and capital improvement records. Before and after photos of any capital works. Holiday Home Use – If your property is rented out part-time, you’ll need evidence of when it was genuinely available for rent (e.g. booking requests, advertising, availability calendars). How long to keep records: You’ll need to keep most records for at least 5 years after lodging your tax return, or longer if claiming capital works or carrying forward losses. Keeping detailed records ensures you claim everything you're entitled to—and makes things much easier in the event of an ATO audit. Need help getting your documentation in order? Reach out to our team at Clear Vision Accountancy Group—we’re here to help. To read a more detailed list of items you need to keep for your rental property visit: Records for rental properties and holiday homes | Australian Taxation Office
