Accounting and Finance

Finance, Taxation, Insurance and Accounting related articles

Courtesy of our friends at the Urban Dictionary I have unearthed what I believe to be the definitive description of this month’s bulletin title:  Crash and Burn : to come to grief or fail spectacularly. If you are an industry professional active in the management rights industry I suspect this description may resonate with you.  Our own observations and feedback from the coal face suggests that deals have never been harder to hold together with many “surprises” along the way. Why is it so? Let’s have a look at the key moving parts, the accepted best practice processes and see if we can identify someRead More →

Contributed By: Mike Phipps Finance on

After last month’s bulletin (some said rant but no offence) regarding bank lending and personal responsibility we received quite a lot of feedback.  Most was based around misconceptions of how lender security works with suggestions that we need to drill down and provide some detail.  Given that books have been written on this subject any brief summary will, of necessity, only skim the surface. I should also point out that I am going to talk about a variety of security arrangements in very general terms and borrowers should always seek independent advice to ensure they fully understand their obligations. So, without further ado, here goes!Read More →

Contributed By: Mike Phipps Finance on

If you saw the recent 60 minutes feature on the post GFC failure of the CEC Group in North Qld and the attack on the Commonwealth Bank I am sure you would have been somewhat taken back by the content.  I won’t get into the detail here but sufficient to say that the program and its reporter displayed a spectacular lack of understanding of even the most rudimentary elements of bank finance and credit contracts. The founder of CEC, to no great surprise, is playing the bank sent me broke card to some effect and places the outcome completely at the feet of the lender.Read More →

Contributed By: TheOnsiteManager.com.au on

Some strata communities – formerly known as Body Corporates – aren’t liable to pay tax. However, this is not applicable to all stratas, and wrongly assuming you are exempt from paying tax can lead to fines and even court proceedings. It’s important to get in the know about strata communities and tax liabilities so you can gauge whether or not you are liable. If you need more information or one-on-one advice about your own situation, it may be worth speaking to a strata specialist with corporate tax knowledge, such as the team at Abacus Strata. Here’s a quick overview of strata related Tax to helpRead More →

In August last year we published an article contemplating credit challenges ahead.  I point this out with no great delight because, for once, it seems we had it right.  Drop me a line if you want a copy of the original article, it’s on our web site. Anyway, one of the key points I raised a year ago was the expected pressure on lenders to reduce interest only lending. That prediction has most certainly come home to roost.  In the past few months we have seen a range of major and second tier lenders bring in restrictive lending standards for interest only property finance andRead More →

Contributed By: Mike Phipps Finance on

I see there is a financial institution out there that proposes that it’s possible to love a bank.  It’s an interesting premise and given the overuse of the L word in modern dialogue I thought I’d go back to basics and have a look at the definition of love.  Turns out its pretty much all things to all people albeit my search through the Interweb found this rather succinct paragraph. Love can make you do anything and sacrifice for what will be better in the end. Love is intense,and passionate. Everything seems brighter, happier and more wonderful when you’re in love. If you find it,Read More →

When buying a management rights or leasehold accommodation business such as a motel there is an interesting dynamic at play that many purchasers fail to pay sufficient attention to. The fact is that outside the core group comprising the purchaser, the vendor and their associated advisors there is a third-party lurking. In the case of leases it’s the landlord and in the case of management rights it’s the body corporate. In both cases this third party has a vested interest in the professional capacity of the purchaser and their likely prospects of success. In both cases character, financial standing and qualifications will be important considerations.Read More →

Think back to a time when websites were merely an imaginary idea, rather like the concept cars of the future, considered impossible by the masses. Most couldn’t even visualize Google, it was just a funny word, spoken but rarely understood. Most of us couldn’t picture in our minds how a customer in the United States might be able to tap a few keys on his keyboard to book a hotel in Australia. How could that possibly happen without a phone or a fax? And just what was this thing called the Internet that none of us could see but which was creating immense wealth forRead More →

Contributed By: Mike Phipps Finance on

Everything we do as humans carries some form of risk. Stay in bed, grow fat and have a heart attack. Go out exercising on your bike and get hit by a bus. Eat and drink what you love and end up with high cholesterol. Watch your diet and feel miserable. It’s all about risk and more importantly a couple of key dynamics that are worth considering and they go hand in hand. The first is Risk Mitigation. We hear the term all the time, mostly when politicians or stockbrokers are talking. This is a pretty simple concept. Consider a risk and then look for thingsRead More →

Contributed By: Mike Phipps Finance on

Ok, I’ve said this every year but just to keep my 100% record intact………………..where the hell did 2016 go? Time just seems to fly doesn’t it?  It’s obviously an outcome of encroaching old age and certainly a reminder to enjoy life and not sweat the small stuff.  And let’s face it, in the overall scheme of things its nearly all small stuff. As usual I have made numerous resolutions with reduced alcohol consumption, a better diet and more exercise high on the list. I have also promised myself to appreciate the managing director more and not be such an egotistical, self-centred narcissist.  Not sure whereRead More →