Archive for August, 2010

« Back to blog home

Forever…..

Tuesday, August 31st, 2010

How long does the stuff we put on the internet actually last?  Based on my very rudimentary checking, it would seem like it’s there forever.  Somewhere.

When I see things like facebook, twitter and social networking sites like these, I have a concern that people can post stuff which they then have the rest of their lives to regret.  It is an issue that we need to be aware of and we need to take care that what we post on the net is something that won’t come back later and cause us embarrassment or discomfort.

I suppose the issue is something that younger people need to consider carefully as they try to grapple with this new, hyper connected world.  All their friends are on various sites and can post all sorts of stuff on there.  In many cases, we poor parents will not know what they’re doing until it is too late.  Similarly, the schools would have an almost impossible job to control what can go on.  And, the ultimately unfortunate part is that no matter how hard you try, it will be highly unlikely that you can get through to the kids the import of “just silly” things that they may post.

Similarly, what happens when the current crop of 12-18 year olds finish their studies and go for jobs.  Most employers are now moving to the ubiquitous “google check” on potential employees.  All the stuff that they have posted over how many years is then available to potential employers to pore over and bring in to their consideration as to whether the kid is worthy of employment.  Now most employers will look at it and think (hopefully) – they were only 14.  Some may not.

I suppose it’s like tattoos – they look great when you’re young and trendy and are (currently, apparently) the essence of “cool”.  Trouble is that you’ll grow out of them.  Think of all those young girls who see themselves as very with-it at the moment with their arm and ankle tatts.  Bet they might think a bit differently when it comes to their wedding day…(that’s of course if they ever get married, or leave home….)

The posting of “stuff” on the internet needs to be treated with caution – it is there forever and I am not aware of any method available that will allow the “stuff” to be permanently removed once posted. 

Be careful what you and yours post – it is there forever.

Success in Succession

Thursday, August 26th, 2010

Last week I attended the Taxation Institute of Australia National Intensive Conference on issues surrounding succession for family businesses.

The TIA conference is always an absolute ripper and covers the various aspects of the particular technical issue at a very in-depth level.  The presenters are some of the best and most highly qualified in Australia and the attendees tend to be the “leaders” in tax from around the country.

Anyway, back to this year’s topic.  The basis of the conference was to explore in depth aspects surrounding the issues of succession.  There were papers presented on how to deal with Trusts, superannuation funds, insurance proceeds and the impact of divorce on planning for succession. 

On review of the presentations and papers, it highlighted to me just how complex this area is and the issues that arise from seemingly “simple” transactions can have profound effects on the next generation from both operational and taxation perspectives.  There are a lot of practitioners out there who profess to understand the detail about succession.  Unfortunately, from my discussions with various delegates at the conference, they get to see the messes that are created when well-meaning but not-up-to-speed advisers create succession plans for clients.  The “clean up” process can be lengthy, costly and messy.

Any succession planning process needs to be considered in light of a wide range of factors.  To enable a successful succession, a business needs to brief competent and experienced professionals in the accounting/tax, business advisory and legal areas.  This is especially the case where there are trusts, superannaution funds and possible relationship breakdowns involved.  This latter issue is especially important due to the increased powers of the Family Court with regard to reversing transactions that had been effected as part of the succession where there is a marriage breakdown subsequent to the succession.  The potential ramifications from this aspect alone can be horrific from a taxation perspective.

So, if you’re looking at succession for your business (and most businesses should be doing this), care needs to be exercised in selection of your advisers.

Surround yourself and your family with the “right” advisers to ensure your success in succession.  If you don’t it is highly likely that you’ll end up as a Case Study at a future conference!

When is the right time?

Tuesday, August 24th, 2010

I was having a think about things the other day regarding how people approach their businesses. This largely came about due to work we’re doing on our business in here.

The one thing that I realised is that a lot of people (yours truly included) get in to the habit of NOT doing things until it becomes either too late, ineffective or plain inexcusable.

The best way to demostrate this is by the exercise analogy. We all know that we should exercise because it is good for us and can have the result of reducing adverse health issues later in life. On a cold winter’s morning however, the attraction of exercising is diminshed because the warmth and cosiness of your bed are very appealing. The consequence is often that you will roll over, snuggle up and think how nice it is to be “in here” rather than “out there”. Now, you will get some form of comfort from doing this – rested and relaxed for the morning. BUT, each day you do this, you get less used to exercising. It gets easier to make the excuse and you will develop a habit of not doing exercise. In effect you will rationalise your exercise desire away.

There won’t be any great impact now, tomorrow or next week. There will be in many years to come. It’s an incremental thing.

Same with business. You will know things that need to be done in your business. You will appreciate that the things you need to do will more than likely give the business a “high pay-off”. You will also know that starting to do these things will be hard – it will be a process that takes you out of your established routine and may well require you to honestly and truthfully assess various aspects of your and your business’ performance. “Yep, I know I have to do it but I will put it off until tomorrow” – and so it goes.

What if you actually started doing it? What if you made (and kept) the commitment?

One of the real privileges we get in our work is to encourage and assist our customers in identifying the issues they need to address then help them through this often difficult process. The results are, by and large, astounding.

When it comes to exercise, it really is easy to roll over and snuggle in – it’s not going to have any impact until it is (possibly) too late. When it comes to business, it’s easy to rationalise things away – imagine, just imagine, that you decided that NOW is the time to start doing the things that matter?

Making a difference starts with making a change. The right time to do that would be????