Have you been burning the midnight oil in your office to finalise bookkeeping tasks or work on your business financial administration recently just so you could meet the QBCC reporting requirements?
It’s certainly one way to get yourself out of trouble but it doesn’t have to be like this. In this article I’ll give you some tips on how to take back time you might have wanted to spend enjoying with your family.
The dates for lodgement of annual reporting each year are:
- for SC1 and SC2: lodge from 1 November / due by—31 March
- for categories 1-7: lodge from 1 August / due by—31 December.
Challenges of QBCC Financial Reporting
Many builders and tradies have asked me what to do to make QBCC reporting easier for them and not have it turn into a nightmare. My stock-standard answer usually is: systemise and streamline your business’ financial administration. When you have to provide your financial information to the QBCC at set intervals, or even on an ad hoc request, you need to have financial systems in place that allow you to tap into real-time data and produce reports easily.
For example, you need to provide the QBCC with a figure for both your Maximum Revenue and your Net Tangible Assets. They are set at the following levels:
- For self-certifying category 1 (SC1) licensees, the minimum NTA is set at $12,000 for a fixed maximum revenue of $200,000.
- For self-certifying category 2 (SC2) licensees, the minimum NTA is set at $46,000 for a fixed maximum revenue of $800,000.
If you have your figures handy you can go straight to the QBCC website and use the online Calculator to work out your Maximum Revenue and Net Tangible Asset.
How to be well prepared for QBCC Financial Reporting
There are three key things you need to do to get your preparation up to scratch for QBCC reporting purposes.
- Review your accounting system and ensure that you have your expense chart of accounts set up the right way. It is important that you have assets posted with the right account code in your system. There are also various report types that you can set up in accounting systems that will allow you to easily access the data.
- Make sure you enter your financial data every week and reconcile the ledger at least once a fortnight or monthly against your bank account.
- Review your financial position on a quarterly basis. In particular, look at the two critical areas of assets and liabilities.
Once you’ve set up your system properly and utilise the above processes, it’s easy to produce the reports and meet your QBCC reporting requirements at the click of a button. It is important though that you are consistent in your practices. Don’t let your data entry lag behind, as that’s what can trip you up to produce accurate reports.
Prevention is better than the cure
Most builders and tradies love making good money, but when it comes to managing the money for the business, there’s usually less passion for it. While it’s often regarded as a necessary evil and red tape, it is what it is and businesses will always need to have rigorous financial administration and budgeting processes to be successful and get the edge over their competitors.
Having your accounting system set up properly to equip you with better reporting capability is definitely true to the adage ‘Prevention is better than the cure’. I’ve recently been involved in helping a business owner fix a non-compliance issue they had with the QBCC MFRs. It was definitely not a walk in the park and the additional cost of rectifying the situation was truly adding pain to the injury.
Interested to find out more about how to make meeting your QBCC reporting requirements a breeze? Then call my office on (07) 3399 8844, or just visit our website at www.straighttalkat.com.au and complete your details on our Home page to request an appointment.
Please Note: Many of the comments in this article are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.
Copyright © 2022 Robert Bauman.
