Episode A1.007 Tax & Money Management Systems

IBGR - RESULTS Radio Network. Everything a business owner needs to start, grow or exit a business. COME GROW WITH US.

Introduction
Your business + your skills + your money = future wealth & financial security

Half of new businesses fail within 5 years.  Most of the new businesses that fail within 5 years, fail due to cash flow shortages.  

Tax and money management can be the keys to your business success and resiliency.  Listen to the discussion I have with Wayne Coughenour, owner, acquirer, and accounting expert of My Tax Pilot.  We break down the essentials for your business to succeed and thrive whatever happens.

This is a great week to start your business!
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Listeners, check out the EY PDF that you can download entitled, “Worldwide Corporate Tax Guide”.  This will be super helpful to you as you create your business financial forecasts, models and set asides. 
https://www.ey.com/Publication/vwLUAssets/ey-worldwide-corporate-tax-guide-2019/$FILE/ey-worldwide-corporate-tax-guide-2019.pdf

Show Objective
Start with the endgame in mind.  

Let’s assume you want to build a business that becomes an asset.  You want to build wealth within your portfolio and within your community.  To do those things, you have to be able to generate revenue, meet the needs of your customers (or clients) and 

Startup Tax Planning for Better Cash Flow Management, by Capital One
 Source: Article BPlans, Capital One
Link: https://articles.bplans.com/startup-tax-planning-for-better-cash-flow-management/
 
Four Tax Planning Steps Every Small Business Should Take:

1. Understand your Tax obligations.
2. Set aside tax money every month.
3. Regularly check your projections.
4. Get outside help.

Key Concerns:
Cash is king.  The number one reason startups fail is because they don’t have enough cash.

Business.org, Startup Costs with examples, “Breaking Down Startup Costs: What to Expect”: https://www.business.org/finance/loans/business-startup-costs/

In Nigeria, take a look at “How To Start A Business In Nigeria”, on the How We Made It site here:
https://www.howwemadeitinafrica.com/how-to-start-a-business-in-nigeria/279/

In Australia, you can take a look at the government’s handy estimator here:
https://www.business.gov.au/planning/new-businesses/calculate-the-start-up-costs-of-your-business

In the UK, check out the website to dive into the particulars on UK recommendations:
https://www.startuploans.co.uk/business-advice/how-to-calculate-business-start-costs/
 
In India, you can visit the government’s site to determine if you meet the startup criteria.  Visit the website here:
 https://www.startupindia.gov.in/content/sih/en/startup-scheme.html

AVC, Nov. 27, 2019
“Cash Management In Startups”
Fred Wilson, Venture Capitalist, etc.
Link: https://avc.com/2019/11/cash-management-in-startups/
“It all starts with a cash forecasting model. It looks like a forward-looking profit and loss statement. But you do it on a cash basis. And you include balance sheet items like security deposits, equipment purchases, etc in it. Think of it as forecasting your checking account over the next year.” ~ Fred Wilson, AVC

What You Need to Know
Good Financial Model includes:

1. Financial Statements: Profit and Loss Statement (P&L), Balance Sheet (BS), and Cash Flow Statement (CF)
2. Operational Cash Flow Overview
3. Key Performance Indicators Overview

EY, Article, “The Ultimate Guide To Financial Modeling for Startups”, 
by Wout Bobbink, October. 2019
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https://www.ey.com/en_nl/finance-navigator/the-ultimate-guide-to-financial-modeling-for-startups

What You Need to Do:

Source: TempCFO Article, “How To Overcome and Prevent Cash Flow Management Problems at Your Start-up”

Link:
https://tempcfo.com/overcome-cash-flow-management-problems/

5 Best Practices for Managing Your Startup’s Cash Flow At Any Stage of Growth:

1. ID your break even point
2. Review Income, Scrutinzie expenses.
3. Don’t Let Recievables Slip.
4. Have an Emergency Savings Account
5. Don’t Do It Alone (this is a serious tax pitfall!)

 
Contact Wayne Coughenour, owner of My Tax Pilot, at 804-740-6742.  Visit Wendy’s website, Ascend Coaching Solutions, or call Wendy Dickinson at 804-372-7575.

Previous Show: Episode A1.006 Business Insurance
Next Show: Episode A1.008 Recording Keeping Basics (Monthly, Quarterly, Annual schedule)

Written by Wendy Dickinson

* I am not a CPA and the recommendations given in this show do not constitute legal or financial advice. Seek professional advice for all legal and financial matters. 

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