Automotive Accountants’ Network Forum For Accountants.  By Accountants.
Is this growth? 28 July 2009 Presenter:  Angelo Sirianni, Colledge’s FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE...
This presentation has been prepared by Colledge’s for the general information of its clients and seminar attendees.  While...
Quote for the day “ If we are going to carry on growing, and we will, because no country is going to forfeit its right to ...
Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
<ul><li>Market forecasts 2009 </li></ul><ul><li>Winners </li></ul><ul><li>Losers </li></ul><ul><li>Industry matters </li><...
<ul><li>The Economy </li></ul><ul><li>Interest rates </li></ul><ul><li>RBA forecasts </li></ul><ul><ul><li>Cash rate </li>...
<ul><li>Market forecasts </li></ul><ul><li>2009: 830,000 to 925,000 </li></ul><ul><li>First half : 455,223 </li></ul><ul><...
<ul><li>Winners </li></ul><ul><li>Holden </li></ul><ul><li>Mazda </li></ul><ul><li>Hyundai </li></ul><ul><li>Nissan </li><...
<ul><li>Losers </li></ul><ul><li>Toyota </li></ul><ul><li>Mitsubishi </li></ul><ul><li>Honda </li></ul><ul><li>Suzuki </li...
<ul><li>Industry matters </li></ul><ul><li>Volkswagen and Porsche </li></ul><ul><li>GM </li></ul><ul><li>Ford </li></ul><u...
The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
<ul><li>Government sponsored SPV </li></ul><ul><ul><li>Was $2 Billion </li></ul></ul><ul><ul><li>Was $800,000 </li></ul></...
<ul><li>Finance companies </li></ul><ul><li>Margins were 1.75 to 2%, now 3-5% </li></ul><ul><li>GE continues funding deale...
<ul><li>Westpac and St George merger </li></ul><ul><ul><li>New automotive business for Westpac after the AGC problems some...
<ul><li>RBA Forecasts </li></ul><ul><li>Forecasts no change in RBA cash rate of 3% until early 2010 </li></ul><ul><li>Infl...
<ul><li>Cash Flow </li></ul><ul><li>Banks/Finance companies competing with government for funds </li></ul><ul><li>Higher b...
<ul><li>Interest rates </li></ul><ul><li>Cash rate RBA 3.00% </li></ul><ul><li>BBR 90 day price 3.19% </li></ul><ul><li>10...
<ul><li>Banks </li></ul><ul><li>Investment rates on deposit funds to: </li></ul><ul><li>$4.54 at call for personal </li></...
<ul><li>Lending rates </li></ul><ul><ul><li>House average around  5.5% </li></ul></ul><ul><ul><li>Equity access around  6....
Global & Australian  Economic Outlook Reference: Article: Polygenis, R. “Australian Economic Outlook”,  ANZ Economic Outlo...
<ul><li>Global overview </li></ul><ul><li>The worst seems to be over </li></ul><ul><li>Recovery will be slow </li></ul><ul...
<ul><li>Risks </li></ul><ul><li>Production increases not yet felt in the USA/Europe </li></ul><ul><li>Policies to stimulat...
Global & Australian Outlook  FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
<ul><li>Australia </li></ul><ul><li>Managed to circumvent the “GFC” </li></ul><ul><li>Only advanced economy to avoid 2 qua...
<ul><li>Australia – Business Conditions </li></ul><ul><li>Business credit has contracted by 5%, six months to May 2009 </l...
<ul><li>Australia – Housing  </li></ul><ul><li>Household disposable income has risen by 6% to March 2009 </li></ul><ul><ul...
<ul><li>Australia – Housing  </li></ul><ul><li>Concerns over first time home buyers over extending </li></ul><ul><li>Media...
<ul><li>Employment </li></ul><ul><li>Will be the key </li></ul><ul><li>Growth has ground to a halt </li></ul><ul><li>Busin...
<ul><li>Risks to Employment </li></ul><ul><li>Decrease of hours can only go so far </li></ul><ul><li>All forward looking i...
National Consumer Credit Protection Bill References: National consumer credit protection reform, Media Statement, 25 June ...
<ul><li>Proposed Act to  “establish ... a single, standard, national law for the regulation of consumer credit”  and bette...
<ul><li>The Bill is ‘Phase 1’ of 2008 agreement with COAG  (Council of Australian Governments)   </li></ul><ul><ul><li>Com...
<ul><li>ASIC will be the sole regulator.  </li></ul><ul><li>Lenders have until 31 December 2009 to register for a licence....
<ul><li>Disclosure of Commission </li></ul><ul><li>The Bill requires lenders to inform consumers of the full credit propos...
But, you may not have to  panic just yet... National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLE...
<ul><li>The initial, proposed legislation was amended on 25 June 2009 after consultation with industries. </li></ul><ul><l...
Colledge’s will keep a close eye  on the Bill and will alert you  of future information. National Consumer Credit Protecti...
Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
<ul><li>Current Situation </li></ul><ul><li>Extension of GST on Holdback refund </li></ul><ul><li>Test case currently bein...
<ul><li>Issues to consider </li></ul><ul><li>ATO Interpretive Decision </li></ul><ul><ul><li>ATO ID 2008/166, 17 December ...
<ul><li>Scope </li></ul><ul><li>All factory incentives including: </li></ul><ul><ul><li>Fleet claims </li></ul></ul><ul><u...
<ul><li>Factory incentives (continued) ‏ </li></ul><ul><ul><li>Target incentives </li></ul></ul><ul><ul><li>Parts obsolesc...
<ul><li>The size of refund if successful </li></ul><ul><li>Is likely to be more than the Holdback refund </li></ul>Son of ...
<ul><li>Stop the Clock letters </li></ul><ul><li>Action may take some time </li></ul><ul><li>Not clear if successful </li>...
<ul><li>Timing </li></ul><ul><li>Section 105-65 (1) Restriction of GST refunds </li></ul><ul><li>Effective 1 July 2008 </l...
<ul><li>Therefore the period prior to 1 July 2008 as the review period </li></ul><ul><li>Four year rule applies </li></ul>...
<ul><li>Why lodge “Stop the Clock”? </li></ul><ul><li>Need to be in it </li></ul><ul><li>Subject to a test case </li></ul>...
<ul><li>Process </li></ul><ul><li>Lodge “Stop the Clock” </li></ul><ul><li>90 days to quantify claim </li></ul><ul><li>ATO...
<ul><li>Process </li></ul><ul><li>ATO will hold the claim in abeyance, subject to the test case </li></ul><ul><li>ATO insi...
Issues to consider 1. Results of the test case 2. Meet the 90 day timeframe 3. Substantiate the claims 4. Factory action, ...
Police Checks FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
<ul><li>Is there an easier and timely way of obtaining a Police Check? </li></ul><ul><li>Should take no more than six week...
Record keeping requirements:  Salespersons’ hours FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWOR...
<ul><li>VACC has sought advice from the Workplace Ombudsman </li></ul><ul><li>Compliance with the pay slip/record keeping ...
<ul><li>Advice from the Ombudsman – sample pay slips comply </li></ul><ul><li>If there is a short fall of commission payme...
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28 July 2009 Automotive Accountants' Forum

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In our July 2009 Automotive Accountants' Network Forum we discussed the Vehicle Industry, The Economy & Finance, the Economic Outlook globally and for Australia, the proposed National Consumer Credit Protection Bill, GST Son of Holdback, Police Checks and Record keeping of salespersons' hours and overtime.

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28 July 2009 Automotive Accountants' Forum

  1. 1. Automotive Accountants’ Network Forum For Accountants. By Accountants.
  2. 2. Is this growth? 28 July 2009 Presenter: Angelo Sirianni, Colledge’s FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  3. 3. This presentation has been prepared by Colledge’s for the general information of its clients and seminar attendees. While the information herein has been prepared with all reasonable care and derived from sources believed to be accurate, no responsibility or liability is accepted by Colledge’s or any of its affiliations, for any errors or omissions including liability to any person of negligence or otherwise. Recommendations may not be appropriate in all circumstances and clients must consider their own personal objectives and financial advice before acting on recommendations in this presentation . Colledge’s (ABN 52 439 950 641) FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  4. 4. Quote for the day “ If we are going to carry on growing, and we will, because no country is going to forfeit its right to economic growth, we have to find a way of doing it sustainably.” Tony Blair, former British Prime Minister FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  5. 5. Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  6. 6. <ul><li>Market forecasts 2009 </li></ul><ul><li>Winners </li></ul><ul><li>Losers </li></ul><ul><li>Industry matters </li></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  7. 7. <ul><li>The Economy </li></ul><ul><li>Interest rates </li></ul><ul><li>RBA forecasts </li></ul><ul><ul><li>Cash rate </li></ul></ul><ul><ul><li>Inflation </li></ul></ul><ul><ul><li>Consumer confidence </li></ul></ul><ul><li>Overall cash flow </li></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  8. 8. <ul><li>Market forecasts </li></ul><ul><li>2009: 830,000 to 925,000 </li></ul><ul><li>First half : 455,223 </li></ul><ul><ul><li>Down 16% on 2008 </li></ul></ul><ul><ul><li>Stimulus package: 102,847 in June 2009 </li></ul></ul><ul><li>Second half : Similar to first half </li></ul><ul><ul><li>Tax incentives for SMEs to 31 December 2009 </li></ul></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  9. 9. <ul><li>Winners </li></ul><ul><li>Holden </li></ul><ul><li>Mazda </li></ul><ul><li>Hyundai </li></ul><ul><li>Nissan </li></ul><ul><li>Kia </li></ul><ul><li>Mercedes </li></ul><ul><li>Peugeot </li></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  10. 10. <ul><li>Losers </li></ul><ul><li>Toyota </li></ul><ul><li>Mitsubishi </li></ul><ul><li>Honda </li></ul><ul><li>Suzuki </li></ul><ul><li>BMW </li></ul><ul><li>Isuzu </li></ul><ul><li>Lexus </li></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  11. 11. <ul><li>Industry matters </li></ul><ul><li>Volkswagen and Porsche </li></ul><ul><li>GM </li></ul><ul><li>Ford </li></ul><ul><li>Hyundai </li></ul>Vehicle Industry Summary FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  12. 12. The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  13. 13. <ul><li>Government sponsored SPV </li></ul><ul><ul><li>Was $2 Billion </li></ul></ul><ul><ul><li>Was $800,000 </li></ul></ul><ul><ul><li>Now zero </li></ul></ul><ul><li>How many dealers received assistance? </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  14. 14. <ul><li>Finance companies </li></ul><ul><li>Margins were 1.75 to 2%, now 3-5% </li></ul><ul><li>GE continues funding dealers </li></ul><ul><li>Capital Finance: Review of all senior positions </li></ul><ul><li>Ford Credit only doing bailment – no retail </li></ul><ul><li>ANZ takes over Esanda </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  15. 15. <ul><li>Westpac and St George merger </li></ul><ul><ul><li>New automotive business for Westpac after the AGC problems some years ago </li></ul></ul><ul><li>Funding of car dealers </li></ul><ul><ul><li>Stricter limits on bailment / floor plan </li></ul></ul><ul><ul><li>Money easing for retail paper </li></ul></ul><ul><li>Importers pricing forecasts </li></ul><ul><ul><li>$A at 80+ cents – good to maintain current pricing </li></ul></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  16. 16. <ul><li>RBA Forecasts </li></ul><ul><li>Forecasts no change in RBA cash rate of 3% until early 2010 </li></ul><ul><li>Inflation RBA target for 2009 at 1.5% </li></ul><ul><li>Consumer confidence index okay </li></ul><ul><li>Housing up Clearance rate 80+% </li></ul><ul><li>Retail up The Harvey Norman index </li></ul><ul><li>Car market up Stimulus package to 31/12/09 </li></ul><ul><li>Unemployment : Forecasts to over 8%, now a lot lower </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  17. 17. <ul><li>Cash Flow </li></ul><ul><li>Banks/Finance companies competing with government for funds </li></ul><ul><li>Higher borrowing costs </li></ul><ul><li>Banks cashed up? </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  18. 18. <ul><li>Interest rates </li></ul><ul><li>Cash rate RBA 3.00% </li></ul><ul><li>BBR 90 day price 3.19% </li></ul><ul><li>10 year rate (around) 5.7% </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  19. 19. <ul><li>Banks </li></ul><ul><li>Investment rates on deposit funds to: </li></ul><ul><li>$4.54 at call for personal </li></ul><ul><li>$2.75 at call for business </li></ul><ul><li>$3.05 at call for super funds </li></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  20. 20. <ul><li>Lending rates </li></ul><ul><ul><li>House average around 5.5% </li></ul></ul><ul><ul><li>Equity access around 6.0% </li></ul></ul><ul><ul><li>Investment property 5.75% </li></ul></ul><ul><ul><li>Personal loans (unsecured) and overdrafts </li></ul></ul><ul><ul><li>11 – 13.7% </li></ul></ul><ul><ul><li>Credit cards 12.55 - 16.27% </li></ul></ul>The Economy & Finance FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  21. 21. Global & Australian Economic Outlook Reference: Article: Polygenis, R. “Australian Economic Outlook”, ANZ Economic Outlook , July 2009 FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  22. 22. <ul><li>Global overview </li></ul><ul><li>The worst seems to be over </li></ul><ul><li>Recovery will be slow </li></ul><ul><li>Global manufacturing has bottomed </li></ul><ul><li>Production rebounded in Asia </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  23. 23. <ul><li>Risks </li></ul><ul><li>Production increases not yet felt in the USA/Europe </li></ul><ul><li>Policies to stimulate demand may not be sustainable </li></ul><ul><li>Consumer demand has not shown signs of substantial recovery </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  24. 24. Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  25. 25. <ul><li>Australia </li></ul><ul><li>Managed to circumvent the “GFC” </li></ul><ul><li>Only advanced economy to avoid 2 quarters of negative growth </li></ul><ul><li>Businesses have adjusted their behaviour to ensure financial resistance </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  26. 26. <ul><li>Australia – Business Conditions </li></ul><ul><li>Business credit has contracted by 5%, six months to May 2009 </li></ul><ul><li>Business investment to be a significant drag </li></ul><ul><li>17% fall in investment in 2009-10 </li></ul><ul><li>Government infrastructure spending to fill the gap </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  27. 27. <ul><li>Australia – Housing </li></ul><ul><li>Household disposable income has risen by 6% to March 2009 </li></ul><ul><ul><li>Low mortgage repayments </li></ul></ul><ul><ul><li>Government stimulus package </li></ul></ul><ul><li>Sharp turn-around in housing finance approvals over 20% </li></ul><ul><ul><li>First home buyers' grants (38% of new approvals) ‏ </li></ul></ul><ul><ul><li>Lower interest rates </li></ul></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  28. 28. <ul><li>Australia – Housing </li></ul><ul><li>Concerns over first time home buyers over extending </li></ul><ul><li>Median house price has fallen by 4-5% </li></ul><ul><li>However, has strengthened from the month of March </li></ul><ul><li>Weakness in the upper level </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  29. 29. <ul><li>Employment </li></ul><ul><li>Will be the key </li></ul><ul><li>Growth has ground to a halt </li></ul><ul><li>Business is hoarding labour </li></ul><ul><li>A shift towards shorter hours – due to recent skills shortages </li></ul><ul><li>Hours worked fell by 2.1% </li></ul><ul><li>Increase in part-time employment +72,600 </li></ul><ul><li>Decrease in full-time employment - 83,100 </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  30. 30. <ul><li>Risks to Employment </li></ul><ul><li>Decrease of hours can only go so far </li></ul><ul><li>All forward looking indicators point to unemployment to be as pronounced as in previous recessions </li></ul><ul><li>High risk in retail/hospitality – account for 18% of total employment </li></ul><ul><li>ANZ forecasts unemployment to be 8% by mid 2010 </li></ul><ul><li>Currently at 5.7% (May 2009) ‏ </li></ul>Global & Australian Outlook FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  31. 31. National Consumer Credit Protection Bill References: National consumer credit protection reform, Media Statement, 25 June 2009, Minister of Financial Services, Superannuation and Corporate Law, Chris Bowen MP http://alp.org.au/media/0609/mscca250.php The National Consumer Credit Protection Bill 2009, http://www.treasury.gov.au/consumercredit/content/downloads/Consumer_Credit_Brochure.pdf Article: Oakes, D. New credit laws to strengthen consumer rights, The Age, 25 June 2009 FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  32. 32. <ul><li>Proposed Act to “establish ... a single, standard, national law for the regulation of consumer credit” and better protection for consumers . (ALP Media Statement, 25 June 2009) </li></ul><ul><li>Bill was introduced and read in House of Representatives on 25 June 2009 </li></ul><ul><li>Referred to Committee in Senate </li></ul>National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  33. 33. <ul><li>The Bill is ‘Phase 1’ of 2008 agreement with COAG (Council of Australian Governments) </li></ul><ul><ul><li>Commonwealth to be responsible for consumer credit regulation. </li></ul></ul><ul><li>Aims to eliminate “unscrupulous and incompetent” lenders and increase standards in the (credit) industry. </li></ul>National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  34. 34. <ul><li>ASIC will be the sole regulator. </li></ul><ul><li>Lenders have until 31 December 2009 to register for a licence. </li></ul><ul><li>Strict and comprehensive licensing conditions. </li></ul><ul><li>Licensees will not be allowed to give credit to consumers who cannot afford repayments. </li></ul><ul><li>Stricter penalties for misconduct (for lenders). </li></ul><ul><li>Increased court assistance (for consumers). </li></ul>National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  35. 35. <ul><li>Disclosure of Commission </li></ul><ul><li>The Bill requires lenders to inform consumers of the full credit proposal disclosure, including: </li></ul><ul><ul><ul><li>How much the broker receives for securing the loan; </li></ul></ul></ul><ul><ul><ul><li>All costs the consumer will have to pay to the broker, bank and others; and </li></ul></ul></ul>National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  36. 36. But, you may not have to panic just yet... National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  37. 37. <ul><li>The initial, proposed legislation was amended on 25 June 2009 after consultation with industries. </li></ul><ul><li>Car dealerships (as ‘point-of-sale’ retailers) “... will be exempt from the requirements that facilitate assistance to consumers. The Government will examine the issues of regulatory oversight within the next 12 months ” . (National Consumer Credit Protection Reform: Media Statement, 25 June 2009, Chris Bowen MP) </li></ul>National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  38. 38. Colledge’s will keep a close eye on the Bill and will alert you of future information. National Consumer Credit Protection Bill FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  39. 39. Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  40. 40. <ul><li>Current Situation </li></ul><ul><li>Extension of GST on Holdback refund </li></ul><ul><li>Test case currently being prepared </li></ul><ul><li>ATO keen to have the issue tested </li></ul><ul><li>Issue still unclear </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  41. 41. <ul><li>Issues to consider </li></ul><ul><li>ATO Interpretive Decision </li></ul><ul><ul><li>ATO ID 2008/166, 17 December 2008 </li></ul></ul><ul><li>Provide background on payments other than “holdback” e.g. Fleet, margin support, discretionary payments </li></ul><ul><li>Defines what is a supply </li></ul><ul><li>Defines what constitutes a supply between a manufacturer and dealer </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  42. 42. <ul><li>Scope </li></ul><ul><li>All factory incentives including: </li></ul><ul><ul><li>Fleet claims </li></ul></ul><ul><ul><li>FBT reimbursement </li></ul></ul><ul><ul><li>Annual, quarterly, monthly bonuses </li></ul></ul><ul><ul><li>Demo bonuses </li></ul></ul><ul><ul><li>Subsidies </li></ul></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  43. 43. <ul><li>Factory incentives (continued) ‏ </li></ul><ul><ul><li>Target incentives </li></ul></ul><ul><ul><li>Parts obsolescence payments </li></ul></ul><ul><ul><li>Advertising reimbursement </li></ul></ul><ul><ul><li>Run out bonuses </li></ul></ul><ul><ul><li>Warranty? </li></ul></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  44. 44. <ul><li>The size of refund if successful </li></ul><ul><li>Is likely to be more than the Holdback refund </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  45. 45. <ul><li>Stop the Clock letters </li></ul><ul><li>Action may take some time </li></ul><ul><li>Not clear if successful </li></ul><ul><li>Need to be in it </li></ul><ul><li>Issue regarding 'stop the clock' </li></ul><ul><li>90 days to quantify the claim </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  46. 46. <ul><li>Timing </li></ul><ul><li>Section 105-65 (1) Restriction of GST refunds </li></ul><ul><li>Effective 1 July 2008 </li></ul><ul><li>Negates any windfall gain </li></ul><ul><li>Claims relating to GST refunds post 1 July 2008 may not result in a refund </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  47. 47. <ul><li>Therefore the period prior to 1 July 2008 as the review period </li></ul><ul><li>Four year rule applies </li></ul><ul><ul><li>From 30 June 2005 to 30 June 2008 </li></ul></ul><ul><li>If 'stop the clock' letters lodged prior to 30 June 2008, the period may be </li></ul><ul><ul><ul><li>1 July 2000 to 30 June 2008 </li></ul></ul></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  48. 48. <ul><li>Why lodge “Stop the Clock”? </li></ul><ul><li>Need to be in it </li></ul><ul><li>Subject to a test case </li></ul><ul><li>Some value (in it) ‏ </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  49. 49. <ul><li>Process </li></ul><ul><li>Lodge “Stop the Clock” </li></ul><ul><li>90 days to quantify claim </li></ul><ul><li>ATO will reject the claim </li></ul><ul><li>Lodge objection within 60 days </li></ul><ul><ul><li>Issue unresolved </li></ul></ul><ul><ul><li>Subject to a court challenge </li></ul></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  50. 50. <ul><li>Process </li></ul><ul><li>ATO will hold the claim in abeyance, subject to the test case </li></ul><ul><li>ATO insist on a quantified claim </li></ul><ul><li>Must be a substantial claim </li></ul><ul><li>Within 90 days of lodging 'stop the clock' </li></ul>Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  51. 51. Issues to consider 1. Results of the test case 2. Meet the 90 day timeframe 3. Substantiate the claims 4. Factory action, if any? Son of Holdback FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  52. 52. Police Checks FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  53. 53. <ul><li>Is there an easier and timely way of obtaining a Police Check? </li></ul><ul><li>Should take no more than six weeks </li></ul><ul><li>Some instances taking up to 12 weeks </li></ul><ul><li>What are members of the forum doing? </li></ul>Police Checks FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  54. 54. Record keeping requirements: Salespersons’ hours FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  55. 55. <ul><li>VACC has sought advice from the Workplace Ombudsman </li></ul><ul><li>Compliance with the pay slip/record keeping obligations under the Act. </li></ul><ul><ul><li>Three payslips submitted </li></ul></ul><ul><ul><li>Retainer at award rates – offsetting required </li></ul></ul><ul><ul><li>Retainer marginally over award rates – offsetting required </li></ul></ul><ul><ul><li>Retainer well over award rate – no offsetting required </li></ul></ul>Record Keeping – Salespersons Hours FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
  56. 56. <ul><li>Advice from the Ombudsman – sample pay slips comply </li></ul><ul><li>If there is a short fall of commission payments that does not compensate for overtime, the payslip would have to reflect that fact </li></ul>Record Keeping – Salespersons Hours FOR ACCOUNTANTS, BY ACCOUNTANTS COLLEDGE’S AUTOMOTIVE ACCOUNTANTS NETWORK FORUM
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