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McLEAN AND CO.
ACC Corporation have recently commenced sending out their Invoices to self employed persons.
The invoicing covers CoverPlus levies for the 06/07 year, plus residual levies for 05/06. The levies collected fund current and future injury claims, and contribute towards ACC's injury prevention programmes.
It is important that on receipt you check your invoices carefully to make sure they are correct. Pay particular attention to the liable earnings, the classification unit and your full time/ part time status.
When invoices are mailed, you should receive:
|A Summary of Account- the total includes invoices for the new tax year, plus any payments outstanding on past invoices (including those on instalment plans)|
|A Tax Invoice- outlining amounts due. Remember that invoices which remain unpaid after 62 days will start to incur penalties unless a payment plan has been set up.|
|A Calculation Sheet- showing how earnings are calculated, and how they are used to calculate levies.|
|A Booklet on how to pay levies- outlining payment options and penalties|
|An Instalment Plan Form- for invoices greater than $500.00 (excluding GST) there is an option to pay levies by instament, direct debited or from a nominated bank account. An administration charge of 5.4% applies.|
|Reply paid Envelope- to be used for correspondence and payments.|
Under the Companies Act, a company must be governed by a board of directors. The board, and each of its directors, is ultimately accountable to shareholders for the company’s survival and success.
A board of directors performs four key functions:
As a director, you should participate in, review and approve corporate strategy and its formulation. You should have an accurate understanding of a company’s business model, how it makes its money, and the competitive environment in which it operates.
A board of directors ensures that executive management do a good job. The board holds management strictly and continuously to account for the successful implementation of the company’s strategy, through sound operational planning and execution.
A board of directors appoints a chief executive, and sets the chief executive’s salary and employment conditions. The board monitors the chief executive’s performance and is ready, willing, and able to act when unsatisfactory performance occurs.
Directors are part-time and their tools of trade are thought, discussion, questioning and consideration of company information. These tools are only deployed at scheduled board meetings. Therefore, it is essential for a board of directors to have an effective culture of trust, diligence, commitment to the company, candour, and informed and professional debate. In this way you, as a director, can focus on the important issues, at the right time and in the right manner. This is essential as directors operate under strict legal duties.
Directors must act in good faith and in what they believe to be the best interests of the company. In general, that means working to achieve the best long-term results for the shareholders.
Directors must also act with reasonable care, diligence and skill. In practice, that means you are required to know about what’s going on in the company, how it’s performing, and what key issues and risks it is facing.
In your role as director you must always act for a proper company purpose and never for a personal reason. You must declare all conflicts of interest in an 'interests register' but you can vote on any matter in which you hold a personal interest provided the company’s constitution does not prohibit this.
You also have to ensure that the company isn’t trading in a reckless manner nor while it is insolvent. That means the company can’t trade in ways that might cause substantial risk of serious losses to staff or creditors. In practice, it should be run in a way that ensures it has enough money to pay its staff, suppliers, bank and anyone else it owes money to.
In addition, directors must not give out confidential company information unless required by law, or to provide information to the shareholder who appointed you, or if the board authorises you to.
As a director on a board, you ensure a company complies with all applicable laws and regulations.
You must be informed accurately of all relevant risks in the business and you must approve the company taking on these risks. You will set policies and delegations of authority for the efficient running of the business. In particular, directors are required to ensure the company keeps accounting records that:
|explain the company’s income and expenditure, stock, assets and
||allow its financial position to be determined with reasonable
||comply with generally accepted accounting practice.|
Directors can be fined up to $10,000 for failing to ensure these records are kept.
Directors are generally appointed at shareholders’ meetings. Directors can be appointed between shareholders’ meetings by the board itself, but their appointment must be ratified by shareholders at the next meeting. Directors serve for fixed terms. Shareholders can also vote directors out.
Boards of directors generally set their own pay. However, they must also place details of all payments in the company’s register of interests, and they must certify that the payment is fair and reasonable for the work they do. If directors fail to disclose their interests, they can be subject to fines of up to $10,000.
Larger companies often have the shareholders determine directors’ pay. For small owner-operator companies, the owners, directors and senior managers may be the same people, and directors may receive only their shareholder salaries.
Directors can meet as often as they choose. For very small owner-operator companies, directors’ meetings may be a formality. Larger companies will hold regular directors’ meetings as the oversight of directors is an important check and balance on company performance.
Your company is required to keep for seven years records and minutes of all meetings, copies of annual reports, and copies of financial statements. The company must also keep a copy of its constitution, share register and register of interests.
For very small owner-operator companies, the same person or people might be shareholders, directors and managers. For these companies, the owners have a strong feel for company performance and may be able to make most decisions themselves with appropriate advice from their accountants, lawyers or other professionals.
However, for most small enterprises, and certainly for medium and large companies, it’s wise to make external appointments to the board of directors. External directors can provide advice and expertise that can help the company grow. They can shift the focus on to the big picture, whereas owner-operators might focus on the immediate work they need to get done. They also bring an independent perspective.
Ideally, a board of directors will include a wide range of skills and expertise relevant to the company’s performance. For example, it might need experts in financial management, market development, production management, capital-raising, and the specific sector the company works in. It might also include a mix of entrepreneurial people and those who are more cautious.
You can’t be appointed as a director if you are:
|an undischarged bankrupt
||are of unsound mind
||are under 18
||are prohibited for any other reason under the Companies Act or the
Protection of Personal and Property Rights Act.|
This information is for people who are finalising the tax and other financial affairs of someone who is deceased.
Usually you will have to file a final Income Tax Return (IR3) for the deceased, including their income up to the date of death. Contact IRD if you are uncertain whether you will need to file a final tax return.
If their estate is still receiving income after the date of death, you will have to file an Estate or Trust Income Tax Return (IR6).
Their student loan is written off after IR have sighted the death certificate. Please send IRD either the original or a certified copy of the death certificate. If you send the original, include a return address so this can be sent back to you.
Contact IRD if you are unsure of where to send the death certificate.
Their estate is liable for any outstanding child support amounts. The outstanding amount can only be written off if there are no funds available from the estate.
Any child support amounts owing to them at their date of death can be paid to their estate.
What’s a winning business name? A business name that draws business in itself.
Creating a winning business name takes some thought but is one of the most important things you’ll do during the process of starting a business. Starting out with a weak business name is like trying to golf with only one club in your bag. You may sink some shots but it will be a whole lot harder.
So how do you create a winning business name? Get your family, friends and/or colleagues together for a business name brainstorming session and work through these five rules for choosing a business name:
1) A winning business name has to be memorable – but easy to spell.
Obviously, your potential customers and clients need to be able to remember your business name. But they also need to be able to find it easily if they’re looking for it in a phone book, directory or online.
2) A winning business name needs a visual element.
Generally we are hard-wired to “see” images when we read or hear language, and incorporating a visual element into your business name can be a powerful aid to customers’ memory (and a powerful advertising tool). So want your business name to have a strong visual element to it. .
3) A winning business name has to have positive connotation.
Many words have both denotation (literal meaning) and connotation (emotional meaning). A word’s connotation can be positive, neutral or negative, depending on the emotional associations that people generally make. What it means to you is that when you create a business name, you need to choose words that have the positive connotations that you want people to associate with your business – and make sure these connotations are suitable for your business.
4) A winning business name needs to include information about what your business does.
You need to be sure that your new business name at least gives your potential customers or clients some clues about what you actually do. That’s why you see so many landscaping businesses that have the word “landscaping” in their name, and hair styling businesses that include words such as “salon” or even “hair designs” in their names. Including information about what your business does in your business name also makes it easier for potential customers and/or clients to find your business in phone books and directories (both off and online).
5) A winning business name has to be fairly short.
Once again this is vital because you want customers and clients to be able to remember your business’s name (and be able to tell other people what it is)! But it’s also important for promotional purposes. You want a business name, for example, that will fit well on a business card, look good displayed on a sign or in an ad, and perhaps even a business name that will serve well as a domain name and show up well in search if you have an online business. So keep it as short as possible.
HOW TO MEASURE PERFORMANCE?
Most businesses measure their performance according to financial results, but that’s only one side of the business. A good financial result this year might be hiding less obvious but equally important performance issues.
To get a realistic view of your business’s performance, you need to take account of:
Costs and Financial Performance
|Are you making a profit?
||How much return are you getting for the capital you have invested?
||What are your costs per unit and your stock costs?
||Do you have cashflow problems?|
Customer Satisfaction and Market Perceptions
|Are your customers happy?
||Do you receive many complaints?
||What is your market share?
||How good is your customer service?|
|Are your staff happy?
||What is your staff turnover?
||Do you have problems with absenteeism or low morale?
||Do you invest in skills development?
||Do you provide clear career paths so people can see the benefits of
working for you?|
Processes and Innovation
|Are your products or services made and delivered on time?
||Do they need to be repaired or remade often?
||Are you continually improving your products or looking at new product
For each aspect of business performance, it’s worth developing a set of measurable targets or 'performance measures'. You don’t need too many, but you do need to align them with your goals for the business. It’s likely your key financial indicators, such as returns on investment, or profits, will be used as performance indicators.
You might also want to use results from customer and staff surveys, or measures of your service level, such as the number of complaints you receive or how quickly they are dealt with. Make sure your performance measures are aligned with your goals for the business. Staff who want to impress you will focus their efforts on things that are being measured.
One way to improve performance is to benchmark your business against others.
That doesn’t just mean comparing your bottom-line financial results or your market share with competitors. It also means looking at your customer service performance and looking at where other companies might do it better than you. You don’t need to compare your company with competitors. You might be able to benchmark against a similar company overseas, a supplier, customer, or a company in another sector of the economy altogether.
Think about which businesses you admire and why – then set about learning from them.
Some of the information you need may be publicly available, through newspapers or annual reports. Other information may be available through market research. But you might also find that businesses you want to benchmark against are only too willing to help, so long as you’re not a competitor and you are willing to share information with them too.
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