By Maddern Accountants 18/04/2011
Ensuring that your business system can handle growth and change is critical for effective tax governance. By 'business system', we mean the systems, processes and controls you have in place to capture and record GST information.
An ability to handle growth and change is particularly relevant to small-to-medium (SME) enterprises with growth potential and is important during periods of economic fluctuation.
Those businesses at risk include businesses experiencing rapid growth, restructure, mergers or de-mergers and businesses where there has been a change in accounting staff.
It’s good to pay particular attention to your systems when you are going through a significant change or restructure. Ensure that your systems:
are set up to report new branches correctly
establish GST accounting processes
invoice trading stock correctly on transfer to a new business
properly integrate with any new computer or accounting systems
correctly classify intra-group transactions subsequent to the change
set up succession planning in terms of staff change or movement
provide for staff training in the correct use of your systems.
Errors often occur because of incorrect interpretation of the GST law during these changes.
Ensure that your business has established procedures for seeking technical advice to confirm the correct treatment of GST transactions, and that your staff are aware of, and understand these procedures.
