As a business owner, you juggle various roles, from operations and customer service to possibly even manufacturing. Amidst it all, you may find yourself wondering, "When will I start making money?"Whether your business deals with products or services, you've likely encountered the term 'breakeven analysis.' But what exactly does it mean, and why is it important? At Attune Advisory, we understand the complexities of managing a business, and we're here to guide you through the intricacies of breakeven analysis.

What is Breakeven Analysis?

At its core, breakeven analysis serves as your financial lantern, illuminating the path to determine the minimum amount of sales you need to coverall your expenses. This is the point where you're not yet turning a profit, but you're not sinking into debt either.

The Significance of Breakeven Analysis

Your breakeven point is like a financial safety net. It provides valuable insights for setting sales targets, pricing strategies, and expansion plans. In essence, breakeven analysis empowers you to make informed financial decisions to ensure the stability and growth of your business.

Performing a Breakeven Analysis

Step 1: Fixed and Variable Cost Types

Begin by identifying your fixed costs, which remain constant regardless of your sales. These costs typically include expenses like office space rent, utilities, and staff salaries. Next, list your variable costs, which vary based on the volume of products sold or services rendered. Variable costs encompass expenses such as materials for products and additional labour you might need to deliver services.

Step 2: Crunching the Numbers

The breakeven analysis formula is pretty straightforward:

Breakeven Point = Fixed Costs / (Price per Unit (or Hour)– Variable Cost per Unit (or Hour))
That mathematics is simpler than it first appears – simply plug in your costs and prices, and you'll easily find your breakeven point.

Why Breakeven Analysis can be Your Best Friend

1. ‍Strategic Pricing: Breakeven analysis helps you establish optimal pricing for your products or services, preventing under-pricing while allowing you to maintain competitiveness and not sacrifice profitability.
2. Financial Transparency: Understanding your breakeven point offers valuable insights into efficient cash flow management. It unveils the minimum revenue required to sustain your business and plays a critical role in shaping your overarching business strategy.

Frequently Asked Questions:

• ‍What About Businesses Offering Both Products and Services? If your business combines products and services, you can conduct individual breakeven analyses for each category and then consolidate the findings for a comprehensive overview.‍
• Is Breakeven Analysis Beneficial for Startups? Undoubtedly. Breakeven analysis is indispensable for startups as it builds a financial guide that can facilitate funding acquisition as well as establish a path for future growth.‍
• Do I Need To Maintain and Refresh MyBreakeven Analysis? 100%. It's imperative to regularly review your breakeven analysis. With changing costs, fluctuating prices, and evolving business dynamics, performing annual updates is a prudent practice.

As you can tell, our belief is that understanding your breakeven point, whether your business deals in products, services, or a combination of both, is not a luxury – it's a necessity.

Having said all this, if you find breakeven analysis overwhelming or are looking for some help to get it right, let's tackle it together– you're not alone. At Attune Advisory, we're here to simplify the process for you. You can book an appointment with us via email or reach us at 1300 866 113, and we'll help you navigate your breakeven analysis and other financial aspects of your business with tailored advice that supports your business strategy.

Running a business in today's fiercely competitive landscape involves navigating complex challenges, embracing innovative technologies, and weathering global economic, political, and health uncertainties. These factors introduce intricacies, heightened risks, and increased ambiguity, underscoring the importance of sound financial strategy for maintaining a competitive edge.

However, many businesses grapple with the dearth of experience, expertise, or capital required to tackle these financial intricacies effectively. Balancing the multifaceted demands of a business often results in stunted growth especially in the startup ecosystem, where financial guidance is pivotal, yet resources are limited.

This dilemma is exactly why we offer our Virtual CFO service …

But what exactly is a Virtual CFO?

A Virtual CFO, also known as an Outsourced CFO, offers the same strategic financial insight and manoeuvring as a traditional CFO. However, the key distinction lies in their outsourcing arrangement and part-time or ad-hoc engagement.

This flexible model empowers businesses to harness expert financial guidance and strategy without shouldering the full cost of a permanent CFO. Attune Advisory’s Virtual CFO is the perfect solution for businesses seeking the expertise and financial insight of a CFO, without the permanent full-time employee price tag.

Here are four unmistakable signs that your business could benefit from a Virtual CFO:

1. You're Overwhelmed by "In" and "On" Business Tasks

Achieving a delicate equilibrium between working "in"and "on" your business is pivotal for sustained success. It's easy to become ensnared in day-to-day operational demands, leaving scant room to envision growth opportunities and strategic planning.

Alternatively, you might be dedicating considerable time to financial tasks, fund allocation, and business strategy, but a lack of financial expertise could render these efforts time-consuming and inefficient.Juggling all aspects of your business, though commendable, can prove counterproductive.

If your business faces a challenge in striking this balance, it's a clear signal that you could benefit from a Virtual CFO. Our Virtual CFO service creates an environment that fosters equilibrium, allowing you to allocate more time to your niche while benefiting from fresh financial perspectives to drive informed strategic forecasts and decisions.

2. Your Business Battles Financial Hurdles

A Virtual (or Outsourced) CFO can be structured in a way that best suits your business, but ideally would assume responsibility for overseeing all financial functions within your organisation. When your business encounters financial turmoil, we bring our seasoned skills and experience to the table, helping to steer your company toward financial stability.

A Virtual CFO can develop a comprehensive three-to-five-year financial plan, furnish monthly consolidated reports for informed decision-making, assess the timing and quantum of future capital raising, evaluate your company's valuation at specific milestones, and delve into essential financial metrics for your industry and plenty more.

3. Your Business Seeks Expansion or Experiences Rapid Growth

Business expansion invariably ushers in increased risk and heightened planning needs. A Virtual CFO is primed to develop the financial infrastructure your growing business requires. We can ascertain the most cost-effective tax structure, guide you through multi-state registrations, leverage our extensive network for equity and investments, and ensure robust financial reporting and risk assessment.

Our experts understand that startups and SMBs or SMEs have their sights set on growth. We’ve walked in your shoes, making our insights invaluable in devising effective strategies for your business's journey to success.

4. Your Business Lacks an ExitPlan

As the day approaches when you contemplate selling your business or making an exit, strategic planning becomes paramount. A Virtual CFO can offer commercial and strategic counsel to position your business favourably for sale. We assist in defining strategic objectives, refining market positioning and pricing, instituting corporate governance and ongoing reporting, optimising business structure, exploring domestic and international expansion, formulating HR strategies, and tackling other mission-critical concerns.

A forward-thinking Virtual CFO safeguards your business against value erosion by identifying and mitigating risks. We adopt a multifaceted approach to maximise your company's true worth, implementing processes and strategies over time to prepare your business for a successful exit. Preparing a business for sale is a gradual process, and engaging a Virtual CFO several years in advance is a prudent move.

Leverage the Expertise of Virtual CFOs

Our Virtual CFO Service can be relevant at any stage of your business's life cycle, whether you need short-term capital infusion or long-term growth planning. Regardless of your unique financial position, aVirtual CFO customises strategies, offers guidance, and facilitates planning to cater to your business's needs. With our expert guidance, you save both time and money.

To explore how our Virtual CFOs can empower your business, get in touch with the Attune team today on 1300 866 113. Your financial journey awaits, with your highly skilled Virtual CFO to guide the way.

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In the world of business, the age-old adage "You need to spend money to make money" rings true (generally). Yet, without proper financial planning and budgeting, companies risk overspending, accumulating debt, and jeopardising their financial goals. A well-structured budget serves as a compass, ensuring that businesses allocate resources efficiently, remain accountable, and steer clear of financial turbulence.

For business owners, the importance of crafting a strategic budget cannot be overstated. Here, we delve into the significant advantages of establishing a robust budget for your business:

1. Achieving Financial Goals

Every business owner harbours dreams of growth and expansion.However, without effective financial planning, these aspirations can remain out of reach. A budget serves as the roadmap to your financial objectives, guiding you through resource allocation, cost-saving strategies, and expenditure control. Employing a 3-way model – incorporating budget, forecasts, and cashflow – provides a holistic framework for efficient business planning and management.

2. Prioritising Expenses

Throughout your business journey, there will be periods where specific activities demand prioritisation. However, limited cash flow may hinder such endeavours. By integrating forecasts into your budget, you gain a clearer understanding of where your resources are best deployed. This insight enables you to optimise resource allocation, redistributing funds from less crucial areas to high-priority projects. To achieve this, always consider both your budget and forecast within your financial planning.

3. Effective Debt Management

Debt is an inescapable facet of most businesses, particularly startups and SMBs or SMEs grappling with uneven cash flows. It's easy to overextend credit and accumulate debt in pursuit of growth opportunities.Efficient cash flow management is the linchpin for effective debt management.Your budget should account for inflows and outflows, ensuring you meet payment deadlines without incurring late penalties or additional interest. Clear payment plans in your budget help proactively manage cash flow and honour financial obligations.

4. Preparing for Emergencies

While most expenses are foreseeable, external factors such as economic downturns or unforeseen crises can severely impact businesses. SMBs / SMEs, in particular, are vulnerable, often resorting to borrowing in dire circumstances. A well-structured budget allocates funds to an emergency fund, safeguarding your business from reactive resource reallocation during times of instability. This financial safety net provides the flexibility needed to maintain operations during challenging periods.

5. Informed Financial Decision-Making

Business owners frequently grapple with pivotal decisions that can shape their company's destiny. When it comes to allocating financial resources, having comprehensive information at your disposal is paramount. A3-way financial planning model empowers you to assess the consequences of your choices, from their impact on debt obligations to potential resource redirection from high-priority activities. For instance, deferring bonus payments to the next fiscal year can both reward employees and alleviate tax liability.

The Real Power of Effective Budgeting

Indeed, spending is an integral part of business growth.However, budgeting, along with forecasting and cash flow management, ensures that your expenditure is strategic, timely, and well-directed. Your business can only expand as far as its resources allow, and effective budgeting keeps the engines running smoothly while keeping debt in check.

If you require guidance in budgeting for your business, the Attune Advisory team are perfectly placed to help you formulate and implement a robust financial strategy and budget that is tailored to your business’ unique circumstances.

For insights into how we can assist you with your budget and strategy, reach out to us today on 1300 866 113 or send us an email to start the conversation– your financial success awaits!

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As the financial year progresses, it's crucial for both individuals and businesses to stay on top of their tax obligations. To assist you in keeping track of these vital dates and ensure you meet your tax lodgement requirements, we have compiled a comprehensive list of key October deadlines (provided by the Australian Tax Office (ATO)).
 
And remember, even though the first deadline is just weeks away, it’s not too late to get tailored, strategic tax advice and lodgement assistance with the Attune team. Now, let’s dive in...

October 21, 2023

1. PAYG Instalment Notice (Form N)‍

• Pay your annual PAYG instalment notice.
• Lodge only if you need to vary the instalment amount or use the rate method to calculate the instalment.

‍2. PAYG Instalment Activity Statement‍

• Lodge and pay quarter 1, 2023–24 PAYG instalment activity statement if you are the head company of consolidated groups.

‍3. Monthly Business Activity Statement

• Lodge and pay your September 2023 monthly business activity statement.

October 28, 2023

1. Activity Statement

• Lodge and pay quarter 1, 2023–24 activity statement if you choose to receive and lodge by paper and are not an active Single Touch Payroll (STP) reporter.
• Pay your quarter 1, 2023–24 instalment notice (form R, S, or T).
• Lodge the notice only if you need to vary the instalment amount.

2. Super Guarantee Contributions

• ‍‍Ensure you make super guarantee contributions for quarter 1, 2023–24 to funds by this date.
  Note: Employers failing to pay the minimum super contributions for quarter 1 by this date must pay the super guarantee charge and lodge a Superannuation Guarantee Charge statement by 28 November 2023.

‍3. Annual Activity Statement for TFN Withholding‍

• Lodge and pay the annual activity statement for TFN withholding for closely held trusts where a trustee withheld amounts from payments to beneficiaries during the 2022–23 income year.

October 31, 2023

1. Client List Update‍

• This is the final date to add new clients to your client list to ensure their 2023 tax return is covered by the lodgement program.
  Note: The lodgement program is a concession provided to registered agents, and the ATO may request documents to be lodged earlier than the lodgement program due dates.

2. Tax Returns for All Entities‍

• Lodge tax returns for all entities if one or more prior year returns were outstanding as at 30 June 2023.‍

Notes:‍

1. This means all prior year returns must be lodged, not just the immediate prior year.
2. If all outstanding prior year returns have been lodged by 31 October 2023, the lodgement program due dates will apply to the 2023 tax return.
3. Self-managed superannuation funds (SMSFs) in this category must lodge their complete Self-managed superannuation fund annual return by this date.
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3. Tax Returns for Prosecuted Entities‍

• Lodge a tax return for all entities prosecuted for non-lodgement of prior year returns and advised of a lodgement due date of 31 October 2023.

Notes:‍

1. Some prosecuted clients may have a different lodgement due date – please refer to the letter you received for the applicable due date.
2. Payment (if required) for individuals and trusts in this category is due as advised in their notice of assessment.
3. Payment (if required) for companies and super funds in this category is due on 1 December 2023.
4. SMSFs in this category must lodge their complete Self-managed superannuation fund annual return by this date.

4. Reports and Returns
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• Lodge your Annual Investment Income Report (AIIR).
• Lodge your Departing Australia Superannuation Payments (DASP) annual report.
• Lodge your Franking account tax return when both the: Return is a disclosure only (no amount payable); Taxpayer is a 30 June balancer.
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• Lodge your PAYG withholding annual report no ABN withholding (NAT 3448).
• Lodge your PAYG withholding from interest, dividend, and royalty payments paid to non-residents – annual report (NAT 7187). This report advises amounts withheld from payments to foreign residents for: Interest and unfranked dividend payments that are not reported on an Annual Investment Income Report (AIIR).
  Royalty payments.

• Lodge your PAYG withholding annual report – payments to foreign residents (NAT 12413). This report advises amounts withheld from payments to foreign residents for: Entertainment and sports activities; Construction and related activities; Arranging casino gaming junket activities.
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• Lodge your lost members report for the period 1 January – 30 June 2023.
• Lodge your TFN report for closely held trusts for TFNs quoted to a trustee by beneficiaries in quarter 1, 2023–24.
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By adhering to these important tax lodgement deadlines, you can ensure compliance with the ATO and avoid potential penalties. If you have any questions or require assistance with your tax lodgement, don't hesitate to reach out to the Attune Advisory team via 1300 866 113 or by sending us an email. We're here to guide you through the processes and offer tailored, strategic advice to help you build your financial future.