Send business red tape packing

TECHNOLOGY is helping ease the burden for businesses, but some say red tape can be a blessing in disguise.

red tape

New technology is helping to ease the red-tape burden for small businesses, saving both time and money - but some say the red tape can be a blessing in disguise.

BDO private client partner Rod Naismith says that the reporting requirements for small business are "time consuming and a distraction from getting on with doing business".

"Business has its BAS (Business Activity Statements), payroll tax forms, state taxes, forms to do with WorkCover and so much more - it's quite a minefield for them to navigate through."

Naismith says government initiatives such as ABLIS (the Australian Business Licence and Information Service) and AUSkey are a good attempt at streamlining some of the processes for small business.

ABLIS gives small businesses one central location for all the guidelines and approvals they need to know to meet compliance responsibilities, while AUSkey gives small businesses a single login to a growing list of government agencies and services.

Naismith says the ability to communicate more online with government and to access information, rather than in the past when you would be on hold on the phone to the tax office, has greatly helped small businesses.

But the red-tape requirement is still a "massive distraction", he says.

"It takes away from what they (small businesses) do best, which is running their business.

"It's a costly burden to have their accountant attend to a lot of that stuff for them, so it can be time-consuming and costly."

Deloitte Private chief operating officer Michael Clarke says that, with multiple levels of government and often small businesses made up of multiple entities - such as a trading company with husband and wife shareholders, trusts, and self-managed super funds - the reporting burden can be enormous.

"But I think for SMEs, many wouldn't have much management reporting or information at all if it wasn't for government regulation," he says.

"In a funny kind of way, it's a blessing for many small businesses that they have to do that.

"Otherwise, entrepreneurs would often just look at the fact they've got cash in the bank - it is government regulation that forces them to do management accounting in the first place."

However, Clarke says the process of accounting and reporting is often reactive and based on historical data of no particular value to the small-business operator.

He says new web-based developments in accounting software, such as Xero, that provide immediate access to business records for all authorised parties - owners, accountants, external advisers - wherever they may be, makes reporting and record-keeping more relevant and meaningful.

"You work side-by-side in a single, shared ledger in a secure cloud environment and basically both the client and the accountant have a real-time view of the business at any point in time.

"It doesn't lessen the red tape but makes it more relevant and, in time, easier to lock into what those reporting obligations are."

Zachary Rook, 26, the owner of Brisbane-based commercial and residential moving and storage company Your Local Movers, has never owned a fax machine and does all the business's record-keeping in cyberspace.

"I can pretty much do everything I need to on my mobile phone if I have to," he says.

"Our computers are for getting on to the internet and that's it."

Rook, a member of the Entrepreneurs' Organization, says for the past six months the business has been doing virtually all of its government reporting online, which has allowed him to have a part-time office administrator rather than pay a full-time employee.

ACRONYMS FOR BUSINESS ACTION

They may have unusual names, but government business services AUSkey and ABLIS can help you cut red tape.

* ABLIS, which is the Australian Business Licence and Information Service, helps you find the licences, permits, codes of practice, standards and guidelines to meet your compliance responsibilities.

* Business owners can create a personalised report containing a summary of the state, local and federal government requirements relevant to their business, information about licence fees, access to forms, and where to go for more help.

* AUSkey is a single pass to log in to a growing list of business-government online services, like a security token used for internet banking.

* Business owners who register can use their AUSkey on the same day and get access to government agencies such as Centrelink, the ATO, the Australian Securities and Investments Commission, and various state revenue offices.