By Leon Gettler >>

THE COVID-19 crisis has shown businesses the importance of getting real time information and adapting their business models to keep customers on board.

Colin Hewitt, the founder and CEO of Float, a Scottish cash flow startup that opened an office in Sydney in 2019, said this had become absolutely critical.

Mr Hewitt said there were cash flow implications for businesses on government support such as JobKeeper in Australia, and similar programs overseas.

He said schemes such as JobKeeper left businesses struggling to understand needs around their staff. As companies look at the future of JobKeeper and whether it will be removed, they need to conduct scenario planning about what they could afford and what paths they need to plan for.

“We’ve seen a huge surge in demand in our product from accountants and book-keepers who are needing to do this en masse for 50 to 100 of their clients, because they are all asking the same questions: what happens if the JobKeeper scheme runs to an end,” Mr Hewitt told Talking Business.


Scenarios include putting people back on the payroll along with depleted and uncertain sales over the next period.

Mr Hewitt said he had “never seen anything like this before in business”. 

He said COVID-19, with its differing impact across different regions and cities had created enormous cash flow implications for national businesses.

“From a cash flow point of view, we’re seeing people running different promotions in different parts,” Mr Hewitt said

He said this saw companies running schemes in which they approach customers ‘doing it hard’ in certain regions and cities and cutting special deals with them, offering their service at reduced rates to give them the chance to survive as a business.

“Those schemes will need to be rolled out differently for different locations because everyone is going through different things,” Mr Hewitt said.

“More than ever now we’re seeing the need for businesses to get their financial reporting cycle in a much faster loop from when they’re recording their sales and expenses, getting those plugged into their accounting software and getting real time cash flow reporting as soon as they can because things are changing so fast.

“Traditionally we’ve had spreadsheets which have had forecasts that are made up of maybe 12 to 24 months and you’ve had your management accounting which is sitting somewhere else,” he said

“Really we’re seeing the opportunity for those to come together so the management accounts are impacting the forecasts in real time and people can actually make faster responses.

“That opens up possibilities for businesses. Instead of having a financial report that many business owners don’t understand hit their desk a couple of months out of date, what they can now expect is, if they are using the tools now available to them, they are getting management information almost to the day and that’s then able to inform their forecasts.”



Mr Hewitt said this method would be particularly helpful for businesses in global markets.

He said companies will need to assess how COVID-19 has, and will continue to, affect their businesses. Some of the issues may not be related to COVID.

“We’re not out of this yet,” Mr Hewitt said.

The uptake of digital accounting will make businesses more robust to cope with the next pandemic, he said.

“It’s now absolutely critical that businesses have that real time dashboard of what is happening in their business and using these data capture tools, the online banking, the accounting software and the reporting and forecasting software.

“This is absolutely going to help to know your tax liability, to be able to understand which clients are not paying and how much cash you’re sitting on that is receivable.

“So all that information is there to help come together and make better forecasts.”


Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at



THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has welcomed media reports that  the Federal Treasury is considering a revenue-contingent business loan scheme, saying it would provide a lifeline to small businesses recovering from the COVID crisis.

Ms Carnell, who has been calling on the Federal Government to introduce a revenue-contingent loan scheme since April last year, said the program would provide otherwise viable small businesses with the cash flow they need to survive the next 12 months, particularly as JobKeeper is phased out.

“Access to credit will be critical to keeping small businesses afloat as various government support measures are withdrawn, rent relief ends and those overheads start to pile up,” Ms Carnell said.

“We know that many small businesses haven’t been able to fully recover from the COVID crisis so this targeted support measure could mean the difference between life and death for them.” 

Under the Ombudsman’s proposal, the revenue-contingent loan program for small businesses would operate similarly to HECS, requiring borrowers to repay when their turnover reaches a designated level.

The loan would be Federal Government-funded and capped at a percentage of the small business’ annual revenue. Applicants would need to satisfy a viability test conducted by an accredited adviser to be eligible.

“Sudden lockdowns and border closures have hit small businesses hard in recent weeks – it’s no wonder they are reluctant to take on additional bank debt when conditions can deteriorate without warning,” Ms Carnell said.

“Even in the best of times, small businesses have struggled to secure finance. Taking into account the enormous challenges that they are now facing, the impact of insufficient working capital could be devastating for the small business owner and staff, not to mention the broader economy.

“The latest ASIC data shows external administrator appointments were up 23 percent in December 2020 and economists are predicting the number of businesses entering voluntary administration to rise steeply this year.

“A revenue contingent loan scheme would give small businesses the confidence they need to seek funding, so they can survive and employ again.”


THE Australian Prudential Regulation Authority (APRA) has warned of excessive ‘non-investment fees’ revealed in its ‘heatmaps’ that show many for-profit super funds with administration fees “in a sea of red”.

“There is a sea of red for administration fees in the for-profit sector, underlining the importance of including all fees in the Your Future, Your Super performance benchmarks,” Industry Super Australia (ISA) deputy chief executive Matthew Linden said.

“Heatmaps are already having some success in prompting trustees to drive down fees, so it is vital they are expanded to the Choice sector – which has the highest fees.”

However, he said, the Federal Government continued to ignore the regulator and has deliberately excluded administration fees from its new performance benchmark regime. 

Mr Linden said the retail superannuation sector generated much of its $10 billion annual profit “from its lucrative administration fees” and by deliberately carving them out from the performance benchmarks in the Your Future, Your Super legislation the government risked undermining the entire reform package.

He said the government must shift to the more logical net-return measurement – that tests performance based on all fees and charges – not carving out administration fees.   


APRA has strongly expressed how excessive administration fees can impact returns and questioned the justification for asset-based administration fees, favoured in the retail sector. It found some members with a $50,000 balance were paying more than two and a half times higher administration fees than members in other MySuper products.

ISA analysis also shows that the average worker in MySuper products with the highest administration fees will have $158,000 less than those with the lowest fees.

ISA evidence suggested APRA’s heatmaps seem to have already prompted some funds into cutting fees. The success so far underlines the importance of quickly expanding the heatmaps to cover the entire APRA regulated system, Mr Linden said.

He said it was disappointing the roll-out beyond MySuper had been further delayed and would not initially cover the whole Choice sector. The Productivity Commission found the Choice sector was the high-fee tail of the system and littered with dud products.

But the Choice sector remains stubbornly immune to transparency measures and performance testing – with no heatmap coverage, product dashboards delayed for more than seven years, and alarmingly the government admitting to having no timeframe to include 80 percent of the Choice sector in the proposed performance benchmarks.

“The worst performers must be called out and be the target of regulatory action, but there remains some kinks in the heatmap methodology that we look forward to refining with APRA as it uses the heatmaps to road test the new performance benchmark regime,” Mr Linden said.

He said APRA was right to flag pursuing action against funds that had not lifted their performance from last year’s heatmap release – “chronic underperformance should be stamped out no matter where it is found”.


BUSINESS growth platform, Moneytech Limited, has launched a new online small business loan facility specifically designed for the micro SME market.

Moneytech’s new facility provides micro SMEs with a low doc revolving line of credit between $50,000 and $250,000, with approvals and access to funds within 24 to 48 hours.

Moneytech chief executive officer, Nick McGrath said the facility was designed to support the ongoing funding needs of businesses with revenue above $700,000 per annum, and is believed to be the first of its kind to be offered by a non-bank lender in Australia.

Mr McGrath said the firm’s new offering addresses the need for genuine working capital solutions to help micro SMEs navigate the complex operating environment. 

“We saw a gap in the market for solutions that catered to the specific needs and challenges of the micro SME segment,” Mr McGrath said. “Moneytech’s revolving line of credit has the flexibility to be used for whatever the business needs – paying for stock, bills, subcontractors, or paying down existing financing facilities.

“We’re pleased to see our new business facility gain traction among our referral partners and SME customers. Based on some initial testing with select Moneytech partners, we’ve already received positive feedback, with over 40 applications now approved.”

Mr McGrath said the new facility is complemented by a end-to-end digital experience for brokers and direct customers accessed via Moneytech’s online funding portal, the Moneytech Exchange.

“We have worked hard to ensure brokers and SME customers can enjoy a truly unique digital experience without needing to print a single piece of paper. From initial application, to signing official loan documents powered by DocuSign. It is a quick and easy digital process,” he said.


When completing credit analysis for the new facility, Mr McGrath said approval decisions would be based on pre-and post-COVID trading conditions.

“We recognise how important it is to keep cash flowing to businesses when they need it most,” he said. “To assist those businesses who have experienced significant disruption to their operations, our new facility analyses before and after-pandemic sales and revenue before arriving at an appropriate decision for each and every customer.”

While some traditional financiers have started scaling back finance to COVID-affected businesses, Mr McGrath said for many non-bank lenders, such as Moneytech, it had been business as usual in an unusual time.

“We’ve continued lending to new customers, and supported our existing customers with the additional funding they need to help them through this period.”

The new facility forms part of the broader Moneytech growth proposition for SMEs which also includes trade, debtor, equipment and term loan finance solutions for mid-sized businesses. 

“As our customers grow and their funding needs evolve over time, we have the capability and expertise to service them fully,” Mr McGrath said.

“Through this new offering, we’re also pleased to expand our working relationship with mortgage brokers. For those who are small business owners themselves, our solution offers mortgage brokers an opportunity to further diversify their income stream into business lending. “


THE Institute of Public Accountants (IPA) has commended the Federal Budget's design to 'create jobs and get Australia moving again' but has repeated its call for the Federal Government to now "address the longer-term need for reform".

“The Federal Budget released last week is designed to reboot the economy which faces the bumpy road of a pandemic fuelled recovery,” IPA chief executive officer, Andrew Conway said.

“We all understand the level of debt that Australia now finds itself with but unfortunately, this is unavoidable if we are to get the country moving again. We need to get the doors of small business and the borders open again, create jobs and get the cash registers humming again, in order to recover and grow in a new ‘COVID-normal’ world.

“This Budget is regarded as being all about ‘jobs, jobs, jobs’.  However, it is important that we focus on ‘reform, reform, reform’; specifically, reform to taxation, reform to regulation and reform to workplace relations," Mr Conway said.

“The measures taken in this Budget such as JobMaker hiring credit, JobTrainer, enhanced and extended instant asset write-off, the second Women’s Economic Security Statement, Boosting Apprenticeships Wage Subsidy, the Digital Business Plan, additional R&D incentives, boosting mental health support, and insolvency reforms all point to important measures designed to provide structural support to small business. 

“Most of the tax measures are temporary in nature and while they will bring forward significant activity over a one to two year period, we will need the next series of structural reform measures to create the foundation needed for a longer term prosperity," he said.

“Budget announcements are the easier part of the solution which is an important element of the economic reboot. The hard part is still to come and that is structural reform which we acknowledge comes with political risk but is essential for sustainability and to reap the benefits of this early investment.

“Long term economic stability and prosperity will only come once we address the structural deficiencies of our tax system and in the broader economy and remove the regulatory burdens that form a wet blanket on small business survival and growth," Mr Conway said.

“It’s relatively easy to spend money which is necessary for the reboot versus structural reform which is hard work and will take courage to deliver.

“It is therefore essential that we pursue the holy grail of meaningful and holistic reform if we are to grow from this reboot phase to kicking the real goals the economy requires for a sustainable and prosperous future,” Mr Conway said.


THE Institute of Public Accountants (IPA) is supportive of the Federal Government's JobMaker program, but is suggesting 'a few tweaks' could make it more effective.

"Overall, the Institute of Public Accountants is very supportive of the JobMaker measure as it is essential that Australia’s economy not only recovers but also expands through job creation,” IPA chief executive officer, Andrew Conway said.

Mr Conway said the IPA expressed some concerns over the JobMaker Hiring Credit and small business eligibility, in its submission to the Senate Economics Legislation Committee Inquiry into Economic Recovery Package (JobMaker Hiring Credit) Amendment Bill 2020 (provisions)

“The JobMaker Hiring Credit Budget 2020-21 fact sheet indicates that employers who had no employees as at September 30, 2020, will not be eligible for the first employee hired but will be eligible for second and subsequent hires," he said. "This effectively means that a sole trader needs to employ two additional employees to qualify for one JobMaker hiring payment. 

“This could be a lost opportunity considering there are currently more that 1.2 million small business entities that are non-employing.  Just think of the numbers that could have been incentivised to employ for the first time but may not have the capacity to employ two staff.

“The fact that these payments are paid in arrears is also an issue, as it doesn’t help an entity with cash flow concerns.  Even though the proposal is for businesses to start employing from October 7, the earliest they will receive a JobMaker hiring payment will be after February 1, 2021.   This may be counterproductive for those small businesses which would otherwise hire new employees," Mr Conway said.

“We are pleased that the Australian Taxation Office (ATO) will administer the JobMaker Hiring credit. It has proven to be capable of administering JobKeeper, where it was able to put systems in place within a relatively short period of time which was a credit to its capability.

“Another concern is that an employer needs to be reporting through Single Touch Payroll (STP) in order to be eligible even though it is not mandatory for all employers to be STP compliant until June 30, 2021. We understand the ATO’s preference to deal with an employer who is STP compliant, however, this could preclude many smaller employers (1-4 employees) who are not currently required to be STP compliant. In comparison, JobKeeper did not favour employers using STP, and was more inclusive in its design," Mr Conway said.

“It is unclear as to whether employers who are on JobKeeper will be ineligible for JobMaker. Given that JobKeeper payments cease on March 28, 2021, the IPA believes that these employers should be permitted to transition to JobMaker after this date.  The continuity of payments would assist in the recovery effort and help to ensure their ongoing viability.

“The IPA’s view is that these features, especially when considered collectively, detract from the policy objective of incentivising employers to take on additional employees,” Mr Conway said.



THE FEDERAL Government’s plan to bring back the loss carry back initiative is being welcomed by the Institute of Public Accountants (IPA), but it will not help the majority of small businesses, IPA’s analysis shows.

The offset rate increases are welcomed but the cap of $1,000 is inadequate, IPA chief executive officer, Andrew Conway said.

“While we fully support the loss carry back scheme and continue to advocate for it to be a permanent fixture of our tax system, it does not help unincorporated small businesses,” Mr Conway said.

“The majority of small businesses are unincorporated entities, and therefore this policy will not directly benefit the army of entrepreneurs struggling to survive in a post COVID world.

“Increasing the unincorporated tax discount would be a better option to incentivise most of the unincorporated small businesses around the country to take a risk, grow their business and employ workers.

“While this group will enjoy any brought forward stage two or stage three tax cuts, this initiative directly rewards individuals who take on the arduous challenge to run a small business. 

“The small business income tax offset (also known as the unincorporated small business tax discount) can reduce the tax a business pays by up to $1,000 each year. Only taxpayers carrying on a small business as a sole trader or have a share of net small business income from a partnership or trust are eligible.

“The rate of the offset was 8 percent up to the end of the 2019-20 income year but will increase to 13 percent for 2020-21 and again increase to 16 percent for 2021-22 and then remain at that level,” Mr Conway said.

“While we are pleased that the small business tax offset rate is increasing, it is still capped at $1,000 which means that most small businesses will achieve their offset faster, rather than enjoy any more benefit as the rate increases.

“To incentivise small business to employ people, we are calling for the rate and threshold increases to be tied to small businesses which employ people,” he said.

“Over 60 percent of small businesses are non-employing and in the current environment the government needs to encourage all businesses, both small and big, to do their bit to soak up the pool of unemployed,” Mr Conway said.


Contact Us


PO Box 2144