Independent agencies often make mistakes related to finance, systems, reporting, compliance, and planning. They may lack investment in key finance functions and personnel, use inadequate basic bookkeeping systems instead of specialized software, and fail to generate important reports on staff utilization, profitability, debtors, and other metrics needed for timely decision making. As a result, agencies can be non-compliant with tax and regulatory requirements, uninformed about their true financial position and cash flow, and without proper processes, insurances, HR management, and legal oversight of client contracts. To avoid these pitfalls, agencies need industry-specific financial systems, reporting, tax and legal advice, and well-motivated personnel supported by the right remuneration

1. Mistakes independent agencies make and how to avoid them

2. Do you have the right finance resource?
● Large spectrum between necessity and best practice
● Lack of investment in finance overhead:
- People
- Systems

3. Do you have the right system?
● Using a basic bookkeeping system is one of the major mistakes agencies make
● All companies need an accounting and payroll system but agencies also need one or
many additional capabilities including CRM, Traffic, Timesheets, Production, Media
● Without this capability you cannot get accurate and relevant reporting
● Revenue always the focus but what about other measures

4. Do you get the right reports ?
● Detail reporting allows you to make timely business decisions to improve the efficiency and profitability of
the business
● You should be getting a range of reports including:
● Staff Utilisation
● Client profitability
● Job profitability
● Departmental profitability
● Detailed margin analysis
● Job overrun reporting
● Debtor days
● Multipler analysis

5. Do you budget and forecast?
● Do you do monthly revenue forecasting by job?
● Do you do a budget at the start of the financial year?
● Do you know your likely year end profit position?

6. Are you compliant?
● There are so many areas of compliance in the Finance space:
● Payroll Tax
● BAS
● PAYG
● Superannuation
● FBT
● 457 training spend
● The cost of non compliance is massive

7. Are you getting the right tax advice?
● Things to look for when choosing a tax accountant:
1. Do they ask lots of questions about your business?
2. Do they specialise in your industry?
3. Do they offer extra services ?
4. Do you get along with them?

8. Are you worried about cash flow?
● Cash flow is often the biggest worry in a small / medium business
● What should your baseline be?
● Do you know what your upcoming tax liabilites are?
● Even when making a nice profit cash flow often doesn’t reflect this
● Important to stay on top of debtors and have working capital/ cash flow measures and reporting in place

9. Is your process safe?
● Dual approvals on bank transactions imperative
● Fire drill- dealing with problems as they arise rather than having a process that
prevents panic
● Tight billings process vital

10. Do you have the right Insurances and Broker?
● What questions do they ask to get to know your business?
● What experience do they have in the industry?
● Are they are cultural match for your business?
● Has your service level been established?
● Can they help with Life insurance?
● Are they only worried about finding the cheapest solution?
● Do they ‘roll over’ your policies each year without offering you any alternatives?
● Have they discussed insuring bad debts?
● Do they explain why one quote/insurer is better suited than another?

11. Are your staff motivated?
● Remuneration structure for staff
● Communication of results with management team / entire
agency

12. Who is managing hr?
● HR management fire drill?
● Is there a culture of continual coaching?
● Pay reviews on merit?
● Do you onboard?
● KPI’s set to business goals?

13. Other Questions
● Do you get HR advice on terminations/redundancies?
● Do you ensure a lawyer reviews all your clients contracts?
● Do you have employee contracts that are up to date with current legislation?

14. Quick Tips
● Make sure you have an Industry based system and finance team
● Get to know your balance sheet
● Ensure you have safe and efficient processes

15. Thank you!