Can One Person Really Do It All?

I really believe the answer to be yes, if you can find a smart and sensible accountant then the early days should be well within their capability provided you’re trying to keep it simple – and in the finance and admin area that’s probably the best strategy.

The secret to the right individual is that awareness of ensuring they “know what they don’t know” – there’s lots of support out there for those prepared to ask and part of the energy of the startup community is that most things have been encountered and there’s normally someone out there prepared to share their experiences.

Most accountants have spent a good few years dredging through tax manuals for their studies that actually equips them quite well to navigate through legislation and tax rules to enable them to get 80% of the way there and then know what questions remain unanswered. This significantly reduces your professional costs but also gives you the person who has the whole picture which is honestly invaluable. Most advice will come in isolation of the big picture and having someone thinking about the global ramifications is really important.

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Can One Person Really Do It All?

R&D

At present there’s a wonderful opportunity for any Australian startup that can significantly contribute to the costs of getting a CFO on board – the R&D Tax Incentive. This is an opportunity for you to recoup 45% of your R&D spend in the year and so can prove significant. The secret again is to ensure that you consider this right at the beginning and are keeping the right records and plans and then tracking the costs properly (another good reason for XERO to ensure you have good records)

A word of warning – the registration form is indeed a bit of a nightmare but well worth persevering with as the rewards are pretty substantial.

R&D

Do I Really Need an Audit?

I imagine that, as with most things, there’s two schools of thought here – the YES camp and the NO camp. It’s not that I believe an audit will help uncover some secret process you should have in place or some dangerous absence of a fundamental control, you really should have someone around you to help with that sort of thing already. Where an audit is incredibly useful is establishing your profile as a proper company with real financial records. This will help you significantly when it comes to obtaining insurance cover, your banking relationship, commercial tenders etc. and so if the opportunity presents with a helpful accountant and you can afford it then it’s definitely worth considering. Having audited accounts going back to incorporation is really valuable and so as you complete your first financial year and are travelling through your second then it’s probably worth a discussion with a firm.

Do I Really Need an Audit?

So it’s Backed Up in the Cloud so I can NEVER lose it, right?

Don’t forget that if you use the cloud to sync your computer then IF you delete it from your computer then it’s gone forever. You still need to take a regular copy of all of you files and lock them away somewhere, which preferably isn’t your home desk and certainly not in your laptop bag. The other advantage of this is that is establishes a timeline on your adventures which can be useful later on (e.g. the proof of prior art)

So it’s Backed Up in the Cloud so I can NEVER lose it, right?

Email & IT

There’s nothing worse in my mind than getting an email from the CEO of a new business and his email address is bob.hoskins@hotmail.co  I’ve seen Google Apps used for the small and the large company so it must be pretty good at what it does and Microsoft now has Office365 offering something similar. The key thing here is that you’re replacing something that used to be either an expensive IT resource to keep your email running or a sticky-tape-and-string solution that was fraught with unreliability with something that should just work.

The two big wins are:

Email with your own domain name

Backup in the cloud

There was a time when that would be a full time sys admin role.

Plus it looks like you can then access the Word/Excel type options online, or pay a bit more from the ever so friendly Microsoft and they let you have offline version too! Maybe take a look at how you’re approaching your word processing and spreadsheets and work out the best fit.

Make sure you pick up the Google Drive or Windows One Drive application alongside the solution you’ve picked to backup your files to the cloud and you’ve got a pretty robust IT infrastructure out of the box.

Email & IT

Insurance

This is something that you can easily overlook early on but you need to be careful. As soon as you  find yourself in an employment relationship where you’re paying out more than a nominal amount (at present $7,500) then you need to get Workers Compensation cover in place. It’s not a hard process, a bit similar to a Greenslip for a car. In NSW there’s currently 5 companies that provide the cover and are normally happy to help you get your cover in place.

At these early stages it may actually be worth getting an insurance broker on board. The reason for doing this in my mind is that insurance is a complicated product which only really gets looked at closely when something disastrous has happened and hopefully not as part of the statement “your policy doesn’t provide cover for that”. That’s why a broker can be invaluable to help you understand your way through the variety of products out there and help you find the right one for you.

The other reason why I’d encourage you to find a friendly broker early is that writing an insurance policy for a company that you know nothing about is something of a gamble. If the first time that an insurer has heard of you is when you suddenly need a $20m professional indemnity policy then be prepared to pay a whopping “risk” premium. In the early days you’ll more than likely need a public liability cover if you interact with the public in any way, and that’s a good place to start, plus maybe some modest cover on the office computers. It’ll be around a thousand dollars but by starting this journey early you’ll probably have a 12 month relationship with the insurer before you start to need more serious products and that will make a huge difference to how they feel about you.

The other reason for appointing a broker is that you they’re always happy to help you understand what insurance you might need or is available. They’ll take you through Directors and Officers policies that will help cover your exposure and be a sounding board to understand at what stage that goes from being a prudent idea to an essential business expense. I’ve always used AON as my broker because they were the first to believe in the first startup (and many didn’t want to know us given our risk profile) so I’ve kept that relationship going, which is how I believe it should work.

Insurance

Insurance

This is something that you can easily overlook early on but you need to be careful. As soon as you  find yourself in an employment relationship where you’re paying out more than a nominal amount (at present $7,500) then you need to get Workers Compensation cover in place. It’s not a hard process, a bit similar to a Greenslip for a car. In NSW there’s currently 5 companies that provide the cover and are normally happy to help you get your cover in place.

At these early stages it may actually be worth getting an insurance broker on board. The reason for doing this in my mind is that insurance is a complicated product which only really gets looked at closely when something disastrous has happened and hopefully not as part of the statement “your policy doesn’t provide cover for that”. That’s why a broker can be invaluable to help you understand your way through the variety of products out there and help you find the right one for you.

The other reason why I’d encourage you to find a friendly broker early is that writing an insurance policy for a company that you know nothing about is something of a gamble. If the first time that an insurer has heard of you is when you suddenly need a $20m professional indemnity policy then be prepared to pay a whopping “risk” premium. In the early days you’ll more than likely need a public liability cover if you interact with the public in any way, and that’s a good place to start, plus maybe some modest cover on the office computers. It’ll be around a thousand dollars but by starting this journey you’ll probably have a 12 month relationship with the insurer before you start to need more serious products and that will make a huge difference to how they feel about you.

The other reason for appointing a broker is that you they’re always happy to help you understand what insurance you might need or is available. They’ll take you through Directors and Officers policies that will help cover your exposure there and be a sounding board to understand at what stage that goes from being a prudent idea to an essential business expense. I’ve always used AON as my broker because they were the first to believe in the first startup (and many didn’t want to know us given our risk profile) so I’ve kept that relationship going, which is how I believe it should work.

Insurance