I was invited for an interview by YOU FM and therefore decided to create a blog out of the questions that were asked.
1. What are the basic business practices?
1)a. Making profit – you must never compromise on this important business principle. For anything that will comprise the business from making profit, it is not good for the business.
1)b. Customer service – do realise that no business runs successfully without customers. Pay attention to them, treat them well and serve them to the best of your ability. Once a customer decide to buy from you, make it your job to retain them. That’s mainly how your business will grow.
1)c. Treat your employees well – Your employees play a very important and big role in your business. They are the most stakeholders in your organisation. Your employees are the one in close contact with your customers everyday. To receive customer satisfaction, make sure that you as an employer you create a very safe space and great work environment.
2. When starting off a business a very small one, is there a necessity to open a bank account or is there a particular amount of money I need to be making to open a business account?
– Yes. A business bank account must be opened immediately after you have received the company registration documents from CIPC. It is important that you transact every business activity from the right type of bank account. Business account assist in building a financial profile / portfolio for the business. It also assists us to account.
3. In order to register a business is there a need to have a business plan?
– Entrepreneurs and SMMEs need to move away from the popular notion that a business plan is only required for funding applications. It is an incorrect one. You need a business plan to measure your performance and progress. It serves as a roadmap for your business. You need to set goals for your business. Goals such as, what do you want your business to achieve in a certain period? Where do you see your business in x years time? Thus a business plan comes very handy to such.
4. What are the most common source documents important for every business owner?
4)a. Invoices – we need to comply with all the business requirements. Make sure we invoice our customers. Invoices: i) Getting paid on time. In this day and age we need to make sure that we make things easy for us to enable us to run our businesses smoothly. An Invoice with the important details such as the payment terms, full banking account details and amount payable make it easy for you. ii) Invoices assist for audit purposes. If SARS initiates an audit of your business you need to ensure that whatever paperwork they will require, you have. Failure to produce any paperwork is a failure to dispute any of their demands. iii) Invoices are also important for legal purposes. Imagine there are customers that do not want to pay for your Invoices. You require assistance from collection agencies or attorneys to recover the funds on your behalf. The starting point is that you produce all the source documents so they can assist you with the case.
4)b. Employment contract – employees need to know what is expected of them in the business. Important terms should be stipulated in the contract. This is same as committing work with our business associates. Contracts teaches individuals to act in a specific manner. Thus they act as the guidelines.
6. What are the most basic compliance principles that businesses should know and practice?
– Keeping the business active by making sure that the CIPC annual returns are filed every anniversary of the business.
– SARS returns must be submitted every financial year of the business. Whether operating or not. You need to declare the status of the business. Compliance is essential for every organisation, it creates growth as the business will always be ready for any open opportunities.
Happy trading!
Compiled by Ms. Dikeledi Seoloane on behalf of the accounting firm – Matsobanemetja Business Consulting (Pty) Ltd
Dikeledi is a registered business accountant and qualified tax practitioner.
http://www.matsobanemetja.co.za
Matsobanemetja Business Consulting Pty Ltd 