Yearly Archives: 2018

When do you start making profits?

One of the key pieces of information for any business is - what is your break-even point? This is the point of sales volume or revenue, that is required to cover all your costs, being both fixed costs as well as variable costs. At this break-even point your total profit is nil. Before you reach that break even point, you will be making losses. After that break even point, you will be making profits. In order to generate sales, you have to incur costs. You need to know how much you must sell in order to break-even. You can get our free break-even point calculator here. It is an Excel spreadsheet that you can use to calculate your break-even point. So, how do you calculate your break-even point? (more…)...
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Setting Remuneration for Directors of an Indigenous Corporation

Setting Board remuneration for a commercial company is relatively simple. There are a number of databases providing comparative remuneration levels that can be trawled and you can check with Human Resource Employment agencies. Setting Board remuneration for a Not-for-profit is extremely difficult because of the paucity of publicly available information. Multiply that level of difficulty by 10 for information about remuneration of Directors of Indigenous organisations. Trying to shoe-horn "median" rates from general surveys on samples of NFP's into your particular circumstances is so inappropriate, don't even try it. There are no set tables. So what steps can you take in setting equitable remuneration for Directors of Indigenous Boards? I can recommend 6 steps to take to set remuneration for Indigenous Boards. (more…)...
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8 Financial Ratios To Measure Your Business Performance

  As a small business owner, you work hard to make your business a success. You record your financial transactions, and whether you use your own software, or you ask your accountant to prepare them, from time to time you print a financial report and look at your business' financial performance. However, those reports, commonly your Profit & Loss and your Balance Sheet, can only tell you so much about your business. They will give you clear information about the dollars at play, but how is your business performing really, from year to year? That's why it is important to review financial ratios from time to time. Financial ratios are the relationships between key numbers in your accounts. Some financial ratios tell you about the profitability of your business. Others inform you about your liquidity, and yet others will tell you about the efficiency of your financial assets. An example of a financial ratio providing information about your profitability is your Return on Equity, or the rate of return on the investment you have made in your business. If your Return on Equity is 6% and bank interest on an equivalent investment with no risk is 2% you need to ask yourself if the extra 4...
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Does Your Board Handle Change Well?

Change is an inevitable part of life, and of the life of an Indigenous organisation. I ask those readers who have been through the journey of Indigenous organisations through the 80's to now to consider how the environment and climate around Indigenous organisations have changed. The change from grant-funded operations to Native Title negotiations; the change of Governments, government agencies and legislation affecting Aboriginal people; and the change from the Aboriginal Councils and Associations Act 1976 to the Corporations (Aboriginal and Torres Strait Islander) Act 2006, and how that has "professionalised" the Indigenous Board from the old "Council" or "Committee". Change is the future - how future proof is your Board? (more…)...
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