NZ Carbon Pricing- Lessons for Australian Business

New Zealand has been implementing an Emissions Trading Scheme (ETS) since 2008 and it would be sensible to look across the ditch to see what can be learnt from their experience.

To date, the NZ ETS only applies to forestry, energy generation and fossil fuels but already impacts have been felt in the pricing of electricity and petrol. Further significant price increases are expected with the inclusion of industrial waste in 2013 and agriculture in 2015.

Carbon is actively being traded in New Zealand. The price of carbon has been capped until 31 December 2012 at $25 per NZU (NZ Unit of carbon – effectively the right to emit one tonne of carbon dioxide). NZ carbon reached a post Christmas high of NZ $7.65 on February 3^rd 2012.

In Australia, the country’s 500 biggest polluters will be required to pay for their carbon pollution from 1 July 2012 onwards. The Federal Government has shortlisted 800 businesses from which it will draw its list of 500. There is still much confusion and a lack of understanding of the impact that will be felt by not just the unlucky 500 businesses, but by the wider economy as the effects ripple through the supply chain.

Carbon tax and carbon accounting are without doubt going to become areas where experts can truly add value to your business. The legislation and deadlines are constantly being amended and altered. Don’t put your business at risk by not staying abreast of developments.

Only deal with reputable intermediaries if buying or selling carbon credits. As with many new industries, there are opportunists that will exploit opportunity to make a quick dollar. Make sure you deal with experts.

Your first port of call should be Munro Accountants, as we make it our business to look after your business in this emerging area. We can refer you to carbon accounting and audit specialists, point you in the right direction for purchasing carbon credits or recommend an organisation to give you a green audit and third party green certification.

Your carbon commitments will increasingly influence your business investment decisions. Make sure you understand the carbon implications of decisions you are making now. Your Munro contact can assist in identifying opportunities and implications.

© Peter Morgan 2012

Nine marketing themes for 2012

By Munro Accountants’ Social Media Manager, Jen Fitzgerald.

Gone are the days of traditional Marketing.  The 4P’s - Price , Product, Place and Price were the fundamentals I learnt in Uni ( back when dinosaurs ruled the earth). But Marketing has evolved way beyond that and there are many new challenges because of it. Marketing is now technology driven  and customers tell us instantle through blog comments, Twitter and  Facebook “likes” what they want from a product or service. It used to be that marketers told their customers what they need.

This article from Smart Company features  ’9 marketing themes for 2012′ and no surprises that 7/9 are computer centric.  Read it here.  However, the  two that aren’t, ROI and Collaboration, are still fundamentals that have been taught since way back in the dark ages and should be in the top three of this years themes. 

ROI – It is sometimes difficult in marketing to measure ROI but there should always be some sort of result produced through any campaign or marketing effort.
Collaboration through old fashion networking, identifying key influencers and alliances is still king. An example is asking for endorsements from our clients. This strengthens our relationships with them and we promote their product or service  on our website in return. Example here. It’s a win win.

Please comment below on this blog and arrticle.

 

Inspiration for the new year

By Peter Morgan
Business Development Advisor

So who is looking for inspiration and fresh ideas as we head into a 2012 that will see London bring us the 30th Olympic Games of the modern era, and a total solar eclipse in Port Douglas on 18th November?

One of my favourite sources of inspiration in life and in business is Alan Weiss. You can check him and his ideas out at www.contrarianconsulting.com

Here are some of his ideas pertinent to this time of year that I would like to share with you:

1. Like Alan I enjoy a drink with family and friends on New Year’s Eve, but I have often felt in the past that by overdoing things I wreck the start of the New Year! If you don’t drink or don’t like the drink offered for a New Year toast, simply take it graciously and don’t drink it, but raise it for the toast. Why cause a commotion that can be avoided?

2. Why not make a resolution or two right now and make a start on them, so you’ll hit the New Year with a running start (unless it’s that diet one of course!).

3. Eliminate two of your biggest time wasters of the past year.

4. Have you planned and scheduled and safeguarded your family and ‘you’ time for 2012. Have you ring fenced the key events you want to witness? Reference my intro above again….

5. Don’t be hesitant to say  ‘Happy New Year’. Your intent is positive and well meaning and if someone takes umbrage, then it’s really their problem.

Have a Happy and Prosperous New Year and I highly recommend a free subscription to Alan’s emails ‘Balancing Act’ and ‘Monday Morning Memo’

An Accountants Guide to Christmas

The funny and serious side by Peter Morgan

Christmas presents a number of annual challenges for business, particularly around gifts, entertainment and Fringe Benefits Tax (FBT).

 Here are our recipes for another fun filled, tax efficient festive season.

 Gifts

The tax treatment of gifts depends primarily on whether or not the gift can be considered as entertainment – so tickets to the Broncos are not tax deductible (but tickets to Manly might be*).

For gifts which are not considered to be entertainment the Fringe Benefits Tax (FBT) and tax consequences are as follows:

1. Gifts to employees and family members of less than $300 – no FBT and a tax deduction is allowed;

2. Gifts to employees and family members of $300 or more – FBT is payable and a tax deduction is allowed; and

3. Gifts to clients, suppliers, etc. – no FBT and a tax deduction is allowed.

For gifts which are considered to be entertainment The FBT and income tax consequences are:

1. Gifts to employees and family members – FBT is payable and a tax deduction is allowed (except where the $300 minor benefit exemption applies); and

2. Gifts to clients, suppliers, etc – no FBT and no tax deduction.

*Not really

The Office Party

Christmas party costs are exempt from FBT provided that they are on a working day, at your business premises and include current employees only. Spouses or Associates may also be FBT free provided that they satisfy the $300 minor benefits exemption.

Many employers prefer to host Christmas parties off the business premises and these can also be FBT free if they satisfy the $300 minor benefits exemption. The $300 is assessed employee by employee and includes any gifts.

The cost of Christmas parties for employees is tax deductible only to the extent that the cost is subject to FBT. If the record keeping is too much bother and you would rather just pay some FBT and claim a deduction then you can elect for the 50/50 split method where 50% of the entertainment costs are subject to FBT and therefore become deductible.
Now for some Xmas fun

Christmas Cake

1 cup of water
1 cup of sugar
4 large brown eggs
2 cups of dried fruit
1 teaspoon of salt
1 cup of brown sugar
Lemon juice
Nuts
1 bottle of brandy

Sample the brandy to check for quality. Take a large bowl. Check the brandy again. To be sure it’s the highest quality, pour one level cup and drink. Repeat.

Turn on the electric mixer, beat one cup of butter in a large fluffy bowl. Add one teaspoon of sugar and beat again. Make sure the brandy is still OK.

Cry another tup. Tune up the mixer. Beat two leggs and add to the bowl and chunk in the cup of dried fruit.

Pick up fruit from floor. Mix on the turner. If the fired druit gets stuck in the beaterers, pry it goose with a drewscriver

Sample the brandy to check for tonsisticity. Next, sift two cups of salt. Or something. Who careshz? Check the brandy. Now shift the lemon juice and strain your nuts.

Add one table. Spoon the sugar or something. Whatever you can find. Grease the oven. Turn the cake tin to 350 degrees. Don’t forget to beat off the turner. Throw the bowl out of the window. Check the brandy again and go to bed.
Merry Xmas from all of us at Munro Accountants- Click here for our special Xmas message

Business structures tips and traps

• Do you understand your business structure?
• Is your business structure appropriate for the current economic climate?
• Is asset protection a concern for you?

Then you should be looking closely at your business  structures, or at least gain a greater understanding of them.

Click here for a quick questionnaire by the Qld Government Business Development department to determine which structure you  should have.

View Michelle’s video on the topic also.
Phone  us on 075539 9777 for a  business rstructure eview

Where do we go from here?

Our political world has been very turbulent lately, and that doesn’t just speak of our government here in Australia.

It seems every country is experiencing its own political storm which is affecting the rest of the world markets with instability and uncertainty.

As business owners, this is not bringing us much joy as it is making it difficult to plan for the future and to know whether business can be expanded for example.

It’s amazing that during these turbulent times, we’ve experienced a government who seems to have taken every opportunity to carry out everything it possibly can and in such a way that hasn’t taken into consideration the majority of the people’s concerns.

There doesn’t seem to be a two-tier governing system anymore. Once upon a time the lower house which represented the government of the day would make decisions and introduce bills. It would then be passed over to the Upper House for scrutiny, review and debate.

Not anymore. These days it seems we have Senators wanting to make the rules by pushing their agendas into the lower house and then when it comes to reaching the upper house, they already know what they are voting on. Scrutiny and judgement has gone.

And it would seem that we are no longer voting in a major party, as it’s been the independents and minor parties who have had the most say in this current government. The only policy I can think that the current government has actually introduced on its own merits in this term is the Mining Resources Tax, which incidentally attributed to the axing of the former PM Kevin Rudd in the first place.

Every other bill has been at the request of the independents and Greens and so it’s not a majority of what the people want to see get introduced as changes to law, but what minorities want. Is this the best way to run a country for the better? Would you run your business this way?

It’s been interesting to see how big business has to conduct its daily affairs when they are continually being forced to negotiate with their workforces via unions that represent their staff.

Take the recent QANTAS furore. Now whether you believe Alan Joyce did the right thing or not, how is it possible for a CEO to run a business if a line of staff that a business employs is wanting that business to invest in infrastructure just for the good of them. Doesn’t a business owner/manager get the right to decide on issues that are the best for the company overall? After all its the shareholders who have put up the money for that business to trade and they do so expecting a return. If that return is continually being put back out to the staff of that company, then you’re not going to have happy shareholders who invest their money at a risk for a return.

No shareholders could mean no business; and subsequently no job security for any employee. It’s very short-sighted for a union to make such demands when a business is trying to compete on an international level.

And if you are trying to compete in this current business market, what are you finding the most frustrating issue to overcome to take your business forward?

Is the uncertainty of the global market holding you back? Or is the downturn in the market causing your business stress because it seems no one is moving forward?

The best way to overcome these issues is to plan and strategise. Don’t bury your head in the pile of bills that overwhelm you every day. After all, Fail to Plan could result in a Plan to Fail.

Don’t let the global and political issues hold you back anymore. Take back control over how they are going to affect you and become the leader in your industry again.  Please feel free to comment in space below.

©2011 Michelle Gargar

We are now Carbon Accountants

More than Accountants we are now Carbon Accountants

Munro Accountants have been working behind the scenes to serve business clients in relation to the new Carbon tax legislation. We are proud to have taken the first steps towards this project by working closely with the Carbon Credit Corporation (C3) and Carbon Offset providors.

Munro Accountants can measure a client’s carbon footprint, using specialist carbon footprint software called Carbonview, and also buy and sell carbon credits globally on behalf of clients.

This is ideal for businesses looking to reduce their carbon footprint in a less formal manner in advance of any legal requirement.

Munro Accountants also recommends a local green certification provider, backed by Bureau Veritas, that will identify tangible cost reductions as part of their process. This can dramatically enhance a business’s prospects of securing contracts with customers for whom the carbon in their supply chain is an issue.

Taken together, businesses of all sizes can then accurately assess their carbon emissions and offset them to be “carbon neutral” under the Federal Government’s National Carbon Offset Standard (NCOS), or opt for a lesser level of certification that can still include ISO 14001. Businesses can engage in carbon related customer loyalty programs, similar to the carbon offset flights programs, run by most major airlines.

This relationship will provide businesses all over Australia the opportunity to use Munro Accountants to take advantage of the new low carbon economy in Australia.

For more information contact Peter Morgan 07 5539 9777 or email  peterm@munro.com.au

Please share your thoughts on this topic below

Fishing or work?

Be clear on your definition of success
by Peter Morgan
Business Development Advisor

Today I want to share with you one of my favourite business parables. It underlines one of the reasons that I chose to join the team at Munro Accountants – who aim to be different in a way that you value, based on your definition of what is important, and what constitutes success.

A boat docked in a tiny Mexican village. An American tourist complimented the Mexican fisherman on the quality of his fish and asked how long it took him to catch them. “Not very long,” answered the Mexican. “But then, why didn’t you stay out longer and catch more?” asked the American. The Mexican explained that his small catch was sufficient to meet his needs and those of his family. The American asked, “But what do you do with the rest of your time?” “I sleep late, fish a little, play with my children, and take a siesta with my wife. In the evenings, I go into the village to see my friends, have a few drinks, play the guitar, and sing a few songs … I have a full life.” The American interrupted, “I have an MBA from Harvard and I can help you! You should start by fishing longer every day. You can then sell the extra fish you catch. With the extra revenue, you can buy a bigger boat.

“And after that?” asked the Mexican.

With the extra money the larger boat will bring, you can buy a second one and a third one and so on until you have an entire fleet of trawlers. Instead of selling your fish to a middle man, you can then negotiate directly with the processing plants and maybe even open your own plant. You can then leave this little village and move to Mexico City, Los Angeles, or even New York City! From there you can direct your huge new enterprise.” “How long would all that take?” asked the Mexican. “Twenty, perhaps 25 years,” replied the American.

“And after that?” the Mexican asked.

 ”Afterwards? That’s when it gets really interesting,” answered the American, laughing. “When your business gets really big, you can start selling stocks and make millions!” “Millions? Really?

And after that?”

“After that you’ll be able to retire, live in a tiny village near the coast, sleep late, play with your children, catch a few fish, take a siesta with your wife and spend your evenings drinking and enjoying your friends”

Tax forum farce

Last week we saw the government host the Tax Forum to discuss possible changes to our taxation system overall. Interestingly, they didn’t include for discussion any of the new taxes they want to introduce, such as the carbon tax (now passed in the Lower House) or resources tax.

And the other main tax that affects us all, GST, seemed to be off limits as well.

So what was the purpose of a tax forum if you can’t actually discuss all taxes? And what outcomes were they really hoping for in two days?

If the politicians of this country were serious about taxation reform then they should make more of a serious effort than only two days to sit down and take the opportunity to develop a real vision for our future. Oh sorry, that was what the Henry review was for.

Taxes we pay

When the forum first started it was reported that 10% of the taxes in this country collects 90% of the taxes. So my question is why do we have 90% of the other taxes and what is the cost for collecting such taxes.

Government departments get too focussed on the principal of why they collect the taxes and not the actual outcomes of how the taxes are affecting us as a community. If the costs for such collection are offsetting the collection, then what is the point? After all, the collection of taxes is supposed to be the good of the community.

So using those statistics, if the governments eliminated up to 50% of those superfluous taxes they would only miss out on 5% of the total revenue. What could such savings from the payers in the community actually give back to the community? If only our governments could have such vision.

And if they were so concerned about the loss in revenue, surely they could recover that lost revenue from the other remaining taxes. Wayne Swan’s focus was that tax reform should be revenue neutral.

So why not consider a broader based tax system that removes layers of complexity that still delivers the levels of taxation revenue required but actually cuts costs for the community at large. The simplest way of doing this is using the GST platform. It’s a fairer way of taxing as it is based on our consumption and it gives us a choice to save.

This way, taxes such as payroll tax, which is a disincentive tax, could be removed.

So what other taxes would you like to see removed?

After all, taxes just add to the costs of doing business and ultimately the consumers all pay, so why not tear away the hidden taxes and make the actual tax being paid, more transparent.

It’s going to take a government with a clear vision and a mandate to accomplish such changes and it will involve all levels of governments. Will we ever see a fair and competitive tax system in this country in our generation? We can only have hope.

©2011 Michelle Gargar

BD Live! is launched

Are  accountants’ as useful as an ashtray on a motorbike? Peter Morgan, Munro Accountants’ Business Development Advisor, asks this question in his first video in the all new social media zone BD Live! in the centre of our homepage.

BD Live! is a section devoted to everything in Business Development coming to you via Facebook, video blogging , Tweeter and/or written blogging.  Peter will be steering BD Live! to bring you many thought-provoking articles and videos . An avid Twitterer and a natural in front of the camera, Peter welcomes comments and feedback on any topics he puts forward. You  can do this at the bottom of the You tube or this blog or send him a tweet. You can find all about Peter  through his  LinkedIn profile here and  follow him on Tweeter.