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10 Appetizers for Managing Costs and Your Business by David Eu

10 Appetizers for Managing Costs and Your Business by David Eu. Managing Costs & Managing Business. Appetizers – Managing Costs. Appetizers – Managing Business. Outsourcing - Definition. Contracting out a business process to a third party, such as Accounting, Human Resource or IT

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10 Appetizers for Managing Costs and Your Business by David Eu

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  1. 10 Appetizers for Managing Costsand Your BusinessbyDavid Eu

  2. Managing Costs & Managing Business

  3. Appetizers – Managing Costs

  4. Appetizers – Managing Business

  5. Outsourcing - Definition • Contracting out a business process to a third party, such as Accounting, Human Resource or IT • Includes both foreign and domestic contracting (includes offshoring or relocating a business function to another country) • (Source: Wikipedia)

  6. Outsourcing - Advantages

  7. Outsourcing – Quote of the Day

  8. Tax Incentives • Corporate Income Tax Rebate (CIT Rebate) • Productivity & Innovation Credit Scheme (PIC)

  9. Tax Incentives – CIT Rebate • Granted to all companies and registered business trusts for YA 13 to YA 15 • CIT rebate computed based on tax payable amount after deducting the set-offs (e.g. DTR and UTC) • Does not apply to income of a non-resident company subject to final withholding tax

  10. Tax Incentives – CIT Rebate Benefits • Relieves some cost pressures • No application required • Immediate cash flow benefit when included in ECI • (Consider resubmission of ECI if already submitted) • Consider deferring your capital allowance claims or plan your group relief for YA 2013 to YA 2015 to maximise CIT rebate benefits

  11. Tax Incentives – PIC Qualifying Conditions (Source: www.rivin.com)

  12. Tax Incentives – PIC Benefits (Source: www.iras.gov.sg)

  13. Tax Incentives – PIC Benefits (Source: www.iras.gov.sg)

  14. Centralised Procurement Definition: Purchasing made either by company headquarters or some regional or divisional level.

  15. Centralised Procurement • Advantages • Minimisecosts i.e. economics of scale purchase price, volume deliveries reduces delivery charges • Better control of inventories i.e. kept at optimal level via automated purchase system • Disadvantages • Delays as requires time to collate purchases across departments • Not cost effective to buy system for small entities

  16. Internal Controls Definition; Systematicmeasures (such as reviews, checks and balances, methods and procedures) instituted by an organizationto: conduct its business in an orderly and efficient manner, safeguard its assets and resources, deter and detect errors, fraud, and theft, ensure accuracy and completeness of its accountingdata, produce reliable and timely financial and managementinformation and; ensure adherence to its policies and plans.

  17. Internal Controls

  18. Audit Exemption

  19. Audit Exemption • Exempt Private Companies (EPCs) with an annual turnover of less than S$5 million are exempted from statutory auditing requirements. • Instead of filing audited annual accounts, the EPCs have to merely submit a declaration of solvency signed by the directors and company secretary. • If, for any reason, the solvent EPC is unable to submit the declaration in the prescribed form it must submit its unaudited accounts to the registrar, ACRA.

  20. Audit Exemption • Proposed change by the Steering Committee for Review of the Companies Act on accounts and audit for small companies. • A small company is defined as a private company and if it fulfils two of the following criteria: • Total annual revenue of not more than SS$10mil; • Total assets of not more than S$10mil; and • Number of employees of not more than 50. (Source: https://www.acra.gov.sg)

  21. Implementation of budget / forecast In business, a budget can be defined as a plan for an organisation's outgoing expenses and incoming revenues for a specific time period. Budgets are used in many organisations to: Track and control spending. The purpose is to ensure that available funds are used according to plan, within preset limits and not exceeding available funds. Support funding requests.The purpose is to justify the use of funds and to help plan future spending accurately by describing how funds will be used.

  22. Bench-marketing to market leaders / competitors

  23. Analysis of key performance ratios (Source: http://www.subjectmoney.com)

  24. Dashboard Think of the dashboard of your car. What do you, as the driver, really needs to focus on in order to keep using your vehicle? Take the same approach with the numbers! One clear summary page, which highlights key performance elements. A picture tells a thousand words.

  25. Dashboard • Use advanced excel functions to synthesisedata into meaningful visualisations • Reports with summarisedinformation rather than raw data • Enhance decision making process through building of powerful charts • Interactive controls for direct user interface and easy navigation

  26. Dashboard - Examples

  27. Efficient use of resources / optimiseworking capital

  28. Customer loyalty program • Retain existing customers and attract new customers via redemption rewards program • Reduce A&P costs via using existing database to perform targeted marketing • Using tiered rewards program to entice customers to level up their spending

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