RUSSELL TURNER
CHARTERED ACCOUNTANTS
Introduction
Volume 3, Issue 1
April 2003
Inside this issue
Staff Authority
2
Terrible Puns
2
End of Year
2
ACC Cover Plus
Extra
2
Computer Corner
2
Entertainment
3
Community Services
Card
3
Brain Teaser
3
Chicken Soup
3
The Back Paddock
4
Client Profile
4
The war is over!! Oil prices have stabilised, the NZ dollar has
weakened, the economy is slowing, interest rates are likely to move
down and the SARS virus will find its way to NZ. There is always some
good news mixed with the bad, but now that the Iraqi war is over the
focus will revert to the world economic activity, particularly the
influential USA economy. The influence of poor farm commodity
prices and fewer job vacancies might indicate that the NZ economy
cycle is coming into line with the rest of the world.
We offer these rather worldly issues to contemplate during the spiritual
season of Easter.
A big thanks to all those clients we saw at the Dargaville Field Days in
February. We had a site in the rural services 2 marquee and will in all
probability be there again next year. It provided a great opportunity to
look around at agricultural products and groups that are out there, as
well as talk to others in the industry to give us a feel for what is going on.
We now have an 0800 telephone number. If you live out of town please
feel free to use 0800 389 479 to contact us.
This newsletter we look at staff authority, revisit ACC Cover Plus
Extra and Entertainment expenses. Are you eligible for a community
services card? We take a break from staff profiles and profile a client
Kiwi Timber Protection on the back page.
Over Easter we will be closed from Friday 18 to Tuesday 22 April
inclusive. We will also be closed Friday 25 April to mark ANZAC
Day.
TAX CALENDAR
May 7
Provisional Tax for taxpayers with a May Balance Date
June 7
Provisional Tax for taxpayers with a June Balance Date
July 7
Provisional Tax for taxpayers with a March or July Balance Date
RUSSELL TURNER CHARTERED ACCOUNTANTS
13 Rust Ave, PO Box 1249, Whangarei Ph: 0800 389 479 Fax: 09 438 7825 Email: [email protected]
7
The Back
Paddock
Business
Give Staff Authority
A woman went into a fabric shop to buy 1.5 metres of
material. There were two pieces to choose from, one of
which was 1.6m and the other 2m. Unfortunately, the
short piece had a fault, but the shopper suggested she take
the whole 1.6m to compensate. The assistant refused the
offer and cut 1.5m off the 2m length. She said she did not
have the authority to supply more than the amount paid
for.
Empower your staff as much as you can and encourage
them to use their judgement. When they make mistakes
be supportive and remind them it is a small price to pay
for the number of times they get it right. Tell them the
extent to which they can commit the business.
Give them plenty of authority so they rarely need to seek
your authority. It is demeaning for the staff member and
does not impress the customer. Look at the picture from
the customers’ point of view. Nothing beats dealing with
an employee who can put things right on the spot. You
want the customer to tell people about an excellent
experience, not the opposite. When setting limits to
authority, decide on the worst that can happen if the
authority is used to the full. Contrast this with the
damage done by messing around an unhappy customer.
Terrible Puns
What’s the definition of a will? (It's a dead giveaway)
A backward poet writes inverse.
You feel stuck with your debt if you can’t budge it.
He had a photographic memory that was never
developed.
Santa’s helpers are subordinate clauses.
End of the Year
If you have a 31 March balance date
(end of financial year) you are starting
into the 2003/2004 financial year.
If you have not received an end of year letter from us
please call and we will ensure you get one.
Once you get your letter please read it, fill in the details
required and bring it in with your financial records for the
year. Once you are ready please come in and see us so we
can discuss the details with you.
If you require the financial statements by a certain date
please let us know so we can meet the deadline.
ACC Coverplus Extra
You are not bound to accept ACC as it is. You may
negotiate your own deal by choosing the Cover Plus
Extra.
Advantages include; nominated weekly compensation
amount; no need to prove loss of earnings; no adjustment
for part-time return to work; you have a greater cover in
the first year of business.
Disadvantages include; if your injury ends your
working life your income each year will only be the level
you nominated in your application for ACC Cover Plus
Extra.
If you are interested please call and we can discuss the
option, or we can forward an application to you.
Computer Corner
A tech once calmed a man
who was enraged because
his computer "had told him
he was bad and an invalid."
The tech patiently
explained that the
computer's "bad
command" and "invalid"
responses shouldn't be
taken personally.
Have your own computer and
want to process your business
information on an easy
computer system. We would
recommend a system called
Mind Your Own Business or
MYOB for short.
MYOB
comes in a simple cashbook or
a full accounting system to
track sales and purchases. If
you are interested call and talk
to one of our staff.
Technology
The following quote is from Douglas Adams book “The
Salmon of Doubt”:
I’ve come up with a set of rules that describe our reactions
to technologies:
1. Anything that is in the world when you’re born is normal
and ordinary and is just a natural part of the way the
world works.
2. Anything that’s invented between when you’re fifteen and
thirty-five is new and exciting and revolutionary and you
can probably get a career in it.
3. Anything invented after you’re thirty-five is against the
natural order of things.
RUSSELL TURNER CHARTERED ACCOUNTANTS
13 Rust Ave, PO Box 1249, Whangarei Ph: 0800 389 479 Fax: 09 438 7825 Email: [email protected]
RUSSELL TURNER
Entertainment
50% Deductible
Extract from a book in the
“Chicken Soup” series
Private boxes and pleasure craft
Food and drink consumed by staff off the premises
Food or drink consumed in an exclusive lounge
area
Staff parties, e.g Christmas party
100% Deductible
Food and drink consumed on the premises, but not
for a party
Monetary sponsorship or promotion
Beware of fully deductible expenses if they are for the
benefit of employees. You may be liable for Fringe
Benefits Tax. If you have questions please call and we
will help you. Alternatively we can send you an IRD
booklet if you wish to read more about this.
Community Services Card
After doing some research into community services
cards, we have discovered that you can earn $89,000
and still have one. The major requirement that needs
to be met is a family of 14 persons. Eligibility for a
Community Services Card starts at a family income
below $29,900 for a family of 2 persons. This
threshold increases by $4840 for each additional
person in the family.
CLASSICAL LATERAL THINKING EXERCISE
One half of two plus two.
The answer could be 2 or 3 but if we follow mathematical laws we
would multiply before we add, therefore 1/2x2=1+2=3.
No. 9
There is a house with four walls. Each wall faces
south. There is a window in each wall. A bear walks
by one of the windows. What color is the bear?
The Easter Bunny
by Beth H. Arbogast
When I was a little girl, every Sunday my family of six
would put on their best clothes and go to Sunday
School and then church. The kids in elementary
school would all meet together to sing songs, and then
later divide into groups based on their ages.
One Easter Sunday, all the kids arrived with big eyes
and big stories about what the Easter Bunny had
brought. While all of the kids shared their stories with
delight, one young boy, whom I will call Bobby, sat
sullenly. One of the teachers, noticing this, said to
him, "And what did the Easter Bunny bring you?" He
replied, "My mom locked the door on accident so the
Easter Bunny couldn't get inside."
This sounded like a reasonable idea to all of us kids, so
we kept on going with the stories. My mom knew the
true story, though. Bobby's mom was a single parent,
and she suspected that they just couldn't afford the
Easter Bunny.
After Sunday School was over, everyone went off to
church. When my dad came to meet us my mom
announced that we were going home instead. At
home, she explained that to make Bobby feel better,
we were going to pretend to be the Easter Bunny and
make a basket of goodies for him and leave it at
church. We all donated some of our candies to the
basket, and headed back up to church. There, mom
unzipped his coat which hung in the foyer, hung the
basket over the hanger, and zipped up the coat and
attached a note.
Dear Bobby,
I'm sorry I missed your house last night. Happy
Easter.
Love,
The Easter Bunny
7
RUSSELL TURNER CHARTERED ACCOUNTANTS
13 Rust Ave, PO Box 1249, Whangarei Ph: 0800 389 479 Fax: 09 438 7825 Email: [email protected]
The Back
Paddock
Farming Income
Significant swings in farming incomes are always
difficult to cope with~ especially when the swings
are negative. Farmers are generally not good at
retaining a cash buffer for the rough years, and are
already starting to feel the strain.
Bankers who have pushed the borders of budgeting
in their lending have quickly started feeling a bit
tense. Accountants who seek to manage tax planning
for their clients will find the going quite tough.
In the dairy industry gross incomes will be down
about 30% this year compared to 2002. The payout
has gone from $5.30 to a projected $3.60 and as the
season progresses even this price appears to be at the
top end of the range. We have known this for a while
but it is only now that the reality of the drop is sinking
into our consciousness.
For sheep, beef, deer and cropping farmers in general
the worldwide commodity prices are flat or going
nowhere while the currency has gone into orbit and
farm incomes plummet.
What can be done to manage this ongoing
problem?
Farming revenues are made up of production
quantities and market price. The average farmer has
little or no control over the price but they do have
some say over the level of production. While the
seasonality factors influence grass and crop growth ,
the level of fertiliser, irrigation, supplementary feed
and other factors are under the control of the farmer.
The next question becomes how much and of what.
As long as the price received for the product is higher
than the cost of producing the product you make
money. This means in seasons where prices are high it
becomes economic to spend more to produce more.
An example is the growing of maize for livestock
feed. As long as the cost of producing the maize is less
than the increase in income you will make more profit
from the exercise. The problem arises when the price
for each unit produced drops below the cost of
providing this extra feed.
The question you must ask yourself is when is it
economical to spend money to produce an extra unit
of production.
Do you accept a medium price and gear your business
on this or do you manage your business to adjust with
the fluctuations. Either way not planning and going
with the flow is not a good option.
Client Profile - Kiwi Timber Protection Limited
After 28 years dry-stock farming at
Purua, Alan & Dianne Broughton
with the encouragement of their son
Adrian set up the timber treatment
plant in Union East St off Rewarewa
Road in Whangarei. It was a huge
challenge for the family but with the
practical timber treatment
experience that Adrian brought to the
business combined with the parents
business skills and capital, the
business has gone from strength to
strength.
Just recently they
Disclaimer: The views expressed herein are those of the authors and are
based on information believed but not warranted to be correct. Any views
or information, whilst given in good faith, are not necessarily the views of
Russell Turner Chartered Accountants and are given without responsibility
and no right of action shall arise against the firm or its employees either
directly or indirectly out of any advice or information
commissioned an LOSP plant to
meet the demand for treated housing
timber following the leaky buildings
fiasco. They continue to treat large
volumes of timber using the CCA
process for traditional timber uses.
They invite you to see their plant &
products and for our farming clients
they have provided the enclosed
voucher.
If anyone else is in need of treated timber products phone our office
and we will be happy to despatch a voucher.
We wish continued success to Kiwi Timber Protection Ltd.
A defendant in a closely contested case was unable to attend
court because of illness. The verdict was in his favour, so his
solicitor sent him a cable which read: “Justice has triumphed!”
To which the client replied, “We must appeal at once!”
RUSSELL TURNER CHARTERED ACCOUNTANTS
13 Rust Ave, PO Box 1249, Whangarei Ph: 0800 389 479 Fax: 09 438 7825 Email: [email protected]