Prosperity feature in Australian Accounting Awards

Fast-Growing firm of the year 2East Coast accounting and financial firm, Prosperity Advisers has won the prestigious ‘Fast-Growing Firm of The Year’ award at the Australian Accounting Awards 2015.

AAA_SEAL_2015_Fast-Growing-WINNERThe Australian Accounting Awards are the only industry awards designed to showcase excellence right across the accounting profession. With a broad range of categories that examine excellence across the breadth of the profession, the Australian Accounting Awards provides a platform for all industry leaders to be recognised.

Prosperity recognises that the rate of business change continues at an increasing pace and invests considerable time and resources in a disciplined planning process that keeps them at the forefront of those changes. Prosperity regards its vision as ‘true north’ as they continue to evolve their advice offering. Prosperity’s innovative approach to advice have resulted in two year revenue growth of 29% in a period where research house IBIS have reported accounting firm growth to average just over 3% per annum.

Prosperity Director of Business Services and Taxation, Megan Faraday-Bensley accepted the award on behalf of the 150 strong team. She thanked Prosperity’s clients for their continued support and added “Our strategy of embracing industry change and disruption as well as developing a culture that has enabled us to attract and retain good people has enabled us to continue our double digit growth.”

The success comes just after winning a prestigious Edge Award for HR and Cultural Innovation in Miami, USA last month. The award was conferred by the Leading Edge Alliance, the second largest international association of accounting firms with 220 member firms globally.

Prosperity CEO, Allan McKeown said “We are very proud of the collective efforts of our people across our Newcastle, Sydney and Brisbane offices. The Fast-Growing Firm of the Year Award is a wonderful recognition for the tremendous effort our team has put in supporting our five point growth strategy. Our focus is on value added service rather than number crunching tasks means our clients receive advice that is more holistic and forward looking to assist them to drive innovation and make better decisions.

Getting the finance you need to ensure business success

Business lending is shrinking as banks continue to favour home loans over business loans in their short-term approach to capital use and returns. It is stifling the economy and it is a major frustration for businesses that are seeking capital to fund their growth. In their recent submission to David Murray’s financial system enquiry, Industry Super Australia confirmed that the amount of commercial lending for every dollar of residential property lending has plunged from $3.84 to $1.62 over the past 25 years. The land of opportunity has become the land of property.

How do borrowers navigate these changes? Communication between borrowers and lenders is the key to a successful banking relationship. Bankers do not like surprises. As a borrower, be proactive and provide financial information that is both timely and accurate. Prepare and deliver on financial forecasts and projected financial covenant ratios. These add to a borrower’s credibility and offer opportunities to negotiate during the loan renewal process. Additionally, business owners should stay focused on their core business and have a solid business plan with contingencies in place.

So businesses who are seeking funding need to carefully consider the way they frame their finance proposal to their banker, positioning it in the best possible light. A professional, well-thought out application with strong supporting documentation is critical. Understanding what banks are looking for will help you get it right first time and improve your chances of success.

Banks typically look for three major elements when they assess your business’ credit risk. These are commonly known as ‘The three Cs’.

The first critically is ‘character’.

Bankers will assess your character by reviewing a range of documents that provide information about your history, track record and experience in business. They are seeking to understand your commitment to a relationship with the bank. Considerations include:

  • Have you been able to meet your forecasts?
  • What is your repayment history like?
  • Do you do what you say you will do?

The bank will also want to see that you have plenty of ‘skin in the game’. Are you contributing enough to your own cash or equity to the purchase or new project?

The second thing a banker will look for is ‘collateral’.

Here the bank ‘credit department’ reigns supreme. They will be seeking all the first mortgage “bricks and mortar” security they can get their hands on supported by a mortgage over your equipment, other assets of the business and personal guarantees from directors. Think twice about pledging all of your assets if you can avoid it as it limits your borrowing options in the future.

Thirdly, a banker wants to look at your ‘capacity’.

They need to know that your earnings are sufficient to pay the loan back without creating distress. When you apply for the loan, you will be asked to outline all of your income, and provide comprehensive financial data on the business. These will include cash flow and profit and loss forecasts and a robust business plan.

Once you have satisfied the ‘three Cs’ there remains much devil in the detail. Your ranking in this area will determine how much negotiation leverage you have around some very important final points namely:

Covenants – These are the ratios and conditions that the bank will monitor to ensure satisfactory performance of your loan. They may include the ageing of your debtor’s maximum, stock levels and interest cover (the number of times your net profit exceeds your interest bill). Breaking these covenants give the bank the power to charge penalty interest rates and even call in your loan. So it is sensible to ensure they are achievable. While it is important to monitor them once in place, practically they are usually regarded as a guideline by the bank and a lever to deal with relationships that have deteriorated beyond repair.

Security – We live in difficult and uncertain financial times. While it is necessary to ensure the bank has ‘sufficient’ security, do not be overly generous. Look to exclude the home and personal assets where possible. Maintaining separate banking relationships for business and personal loans can give you options and keep each bank on their toes.

Repayment terms – Interest only terms take the cash flow pressure off your business by excluding the additional burden of the extra loan portion payment particularly in the early period of the loan. Banks however are keen to see a start to the repayment of their loan and are reluctant to extend interest only beyond two to three years.

Even if you satisfy the three ‘Cs’ and all other lending criteria you may experience variations between banks so it’s important to get some advice. Some banks have particular industry focuses (and usually specialised products to match) and others will seek to reduce their exposure to a type of business purely because the bank has a high total exposure to that area they are seeking to reduce on a pure risk balance basis.

In a challenging borrowing environment a thorough understanding of how banks assess your position; a well thought out finance proposal; and careful consideration of the terms will give you the best chance to obtain the finance you need to ensure business success.

Prosperity CEO appointed to LEA’s Global Board

Prosperity Advisers is a member of LEA Global / Leading Edge Alliance ranked by the International Accounting Bulletin as the second largest International firm association of independent accounting firms for 2014.

The LEA Global is an International alliance of independently owned accounting and consulting firms. Established in 1999, The LEA has more than 190 member firms worldwide with collective revenues of over 2.9 billion USD. Over 100 countries are represented by the association.

“By utilising technology, developing innovative special interest groups, and connecting internationally to the knowledge of our member firms, LEA Global members are able to compete on a substantial scale, throughout the country and across the globe,” stated Michael Davis, Managing Partner HW Fisher & Company, London and LEA Chair.

“LEA provides the resources that support their consistent growth and, subsequently, its own. The combined knowledge of the many top firms in LEA is shared across all firms, and contributes to the continuing success of each.

“When the idea for LEA was conceived, the plan was to introduce an independent association that helped firms compete with the Big Four. The competitive landscape changed since our inception in 1999 as other large national and regional firms emerged. Yet the continued growth of the Alliance is a testament to the independent successes of member firms and their ability to understand and proactively deal with new challenges. The appeal of an accomplished association that consistently meets the needs of its membership is indisputable,” said Gary Shamis, Managing Partner SS&G Financial Services, Inc. & LEA Chair Emeritus.

“Accounting has come out of the dark ages. The most successful firms operate as strategic businesses, and this view extends to its client base, centers of influence and the alliance it belongs to.  Over the past 14 years, LEA’s success has proven that the attention and support it provides to its members, including their overall operations special interest groups, has been a major factor in the success of its member firms.”

LEA Foundation firm, Prosperity Advisers Group CEO, Allan McKeown has recently been appointed to LEA’s Global Advisory Board.

Prosperity is a full-service accounting, business and financial advisory firm.  Prosperity has an East Coast footprint with offices in Sydney, Newcastle and Brisbane.

McKeown said “our firm’s membership has been invaluable in providing our clients with personal contacts and a global reach to assist with their International business expansion.”


Are these the greatest opportunities in Asia right now?

As a privileged part of the Australian delegation to the Asian Financial Forum in Hong Kong last month, Luke Malone, the head of our Asian Business Desk, has his eye on Asia. 

The Asian Financial Forum last month brought together 1200 business leaders from throughout the Asia Pacific region and addressed many of the economic opportunities and issues that matter. 

Over coming months I plan to provide you with articles that give you an insight to these, so you can take advantage of our learnings as we navigate the Asian Century.

This week I want to talk about the three biggest areas of focus at the conference, and highlight what could be the most exciting opportunities for Australia in coming years:

1.  Food security and production for a growing Asian population

Food security in Asia is a large opportunity for Australian food businesses looking to produce and export into the region.  Recent data shows that we have the capacity and ability to produce food for over 500 million people here in Australia.  With growing population density throughout Asia and land shortage in many countries, the ability to produce the quantities of food for the emerging middle class in these countries seeks is becoming more and more difficult.  The changing socio-economic position of many has increased their desire to eat well, and their ability to afford high quality produce for which Australia is most renowned.  This is a trend that may change the allure of farming and food production investment in Australia in coming years.

2.  China and the ASEAN+6 Relationship will lower tariffs and build trust

This year, the 10 ASEAN Countries plus China, Japan, South Korea, India and Australia and New Zealand will start negotiating a Regional Comprehensive Economic Partnership.  The plan is to have a deal in place by 2015 creating a free trade zone that will encompass almost two thirds of the world’s population.  Lower trade barriers and greater trade integration should lower the tariff costs for businesses working across borders in these 16 countries.

3.  Chinese capital is freely flowing out of China seeking a return  

Recent figures on China’s foreign direct investment (FDI) shows two very interesting trends.  Outgoing FDI rose almost twelvefold from $5.5 billion a year to more than $65 billion per year from 2004 to 2011 and is expected to reach approximately $150 billion per year by 2015. In contrast, inward FDI fell 0.2 percent in October 2012 from a year earlier to $8.3 billion, the 11th fall in 12 months.  (Source: China Daily Jan 18-24 2013).  The sentiment of Chinese investors and businesses is strong despite some of the portrayed ‘slow down’ of the Chinese economy portrayed by the Western media.  My discussions with many prominent investors and high net wealth family groups during the Asian Financial Forum indicated that the desire for investments in Australian agricultural assets, resources, real estate and education remains strong.

Each of these issues presents terrific opportunities for Australia in an Asian context.  We are watching the trends closely with many of our Asian Business Desk clients, looking for ways that business and investment can benefit from the changes.


About our Asian Business Desk

At Prosperity Advisers we have a dedicated Asian and Chinese business desk that understands the culture of doing business in China.

Our team includes Tax, Accounting, Corporate Advisory, Audit, Wealth Management and Mergers & Acquisitions Specialists who speak the language and have extensive Chinese and Asian business experience.  We currently act for a number of high net wealth Chinese investors and we help guide them on the transaction and regulatory path to both source investment opportunities in Australia by connecting them with the right people, while at the same time managing tax and other compliance objections.

For outbound investment into China, Luke and his team spend significant time in China and the Asian region and our connections in the region allow us to advise outbound Australian investors on the complex path of investing in China and Asia.  We are also a member of the Leading Edge Alliance, an accounting firm affiliation of some 4,000 members throughout the world and a strong presence in China and Asia.


Using cloud accounting to keep your finger on your business pulse

Increasing numbers of our clients are moving to cloud based accounting packages, and are asking us to assist with the rollout.   Others are approaching us for insight and information on why they should consider the change.  So this week we take a look at the benefits of cloud accounting systems and give you a snapshot of the major players in the industry. 

Existing methods of dealing with the transfer of data files between client and advisor all bring their own deficiencies – issues with file sizes, duplicate or out of date file versions, remote access limitations and restrictions on bank downloads. Cloud accounting software gives you accounting as it happens.  It streamlines the bookkeeping and allows for real time understanding of your business’ financial position.  It also makes the interaction with your external advisor far simpler.

Whether you choose one accounting system or another comes down to the level of sophistication of your business and the skill level of the team. Having worked with a range of businesses adopting cloud software, I urge you to take your time when considering the system you will use because every business’ requirements are unique and as you will see below, every system has slightly different capability and user interface design.

There are many measureable benefits in moving from a desktop program to the cloud.  Most systems interface with daily bank feeds that itemise your transactions, cutting down on data entry and vastly improving the reconciliation process.

[Above: Prosperity Director, Stephen Guthrie talks about Prosperity’s migration to Cloud Technology]

Dashboard views of key business metrics, such as profit and loss, accounts receivable, accounts payable and cash balances, give you a quick snapshot of real time performance. As web-based applications, many have interface capabilities with other applications such as CRMs, business productivity suites and online retailing systems giving you much more power than you may have had before in your desktop package.

In addition to this, accounting in the cloud makes managing your business remotely and collaborating with external advisers easier than ever.  Both you and your accountant can log into your portal through separate logins from anywhere with internet access and look directly at an invoice, report, process or issue.  Gone are the days of transferring large datafiles back and forth and trying to keep records in sync.

The current major players in the Australian cloud-based accounting software landscape are Saasu, Xero, MYOB, and Quickbooks.  We take a quick look at each:

Saasu is a Sydney-based provider of cloud-based accounting solutions for small and medium businesses. The Saasu application includes capabilities that align with the desktop offerings of accounting suites including purchases, inventory management, sales, payroll, ecommerce, CRM, point of sale, document and workflow management.  Saasu includes full inventory and payroll functionality in its “medium” business package as well as including automatic bank feeds from most Australian banks directly within the application.

Saasu also goes beyond the basics by providing full tax and superannuation calculations for Australian businesses alongside complex inventory and a lightweight customer relationship manager (CRM) that should meet the needs of most small businesses.

Saasu is well known for its strong online accounting API that enables connection to hundreds of web applications, software products, payment services plus thousands of banks.

  • Cost: AUD $9 – $60 per month
  • Strengths: Strong online accounting API that allows online retail and other web applications to interface.
  • Weaknesses: More complex dashboard than Xero
  • Web:

With an exponentially growing customer base, Xero must be doing something right.  A simple, browser-based accounting package, Xero doesn’t offer the complexity of Saasu.  It does however offer fully integrated payroll and bank feeds.

Xero is one of the larger cloud based accounting vendors. Publicly listed on the New Zealand stock exchange, they have invested heavily in both product design and marketing channels. Xero has 50,000 customers around the world and country-specific versions for the UK, Australia, New Zealand and the US.  All data is located in the US and Xero uses a content delivery network to overcome speed issues caused by geographic distance from users.

Last year, Xero purchased Australian payroll provider PayCycle providing complete financial/payroll functionality to customers. Xero has built in automatic bank feeds with over 5,000 banks internationally including all major Australian banks.

  • Cost: Xero costs between $29 and $64 per month.
  • Strengths: Automated bank feeds, integrated payroll, very intuitive user experience and dashboard.
  • Weaknesses: The lack of inventory is a barrier to product companies.
  • Website:

MYOB Live Accounts
MYOB LiveAccounts is a first generation cloud accounting software pitched at small businesses and individuals wanting a simple double entry system.  Similar to Xero and Saasu, MYOB LiveAccounts can be set up to pull bank feeds in automatically, and includes payroll functionality.

Business owners looking for functionality akin to their existing desktop version of MYOB will need to wait for the new MYOB AccountRight Live which is expected to launch in the last two months of 2012.

  • Cost: Live Accounts costs $25 per month
  • Strengths: Automatically create and allocate transactions via bank feeds, integrated payroll, easy BAS preparation,
  • Weaknesses: No inventory management, time billing, or multi-currency
  • Website:

MYOB AccountRight Live
From November 8 this year, MYOB will make available AccountRight Live, which adopts a hybrid model – user access will be via a locally loaded MYOB application which will then access a cloud based data file. The data file can be used locally in periods without internet access and then synchronised later to the cloud. This product therefore differs from other cloud based systems, where all the necessary software is available via a web browser session.
AccountRight Live will allow your accountant, bookkeeper, or other members of your team to all connect to the same data file and receive automatic updates of all records in real time on their desktop record of accounts. 
It is not yet clear whether AccountRight Live will offer the connectivity to other applications promoted by Xero and Saasu. The ability to import automatic bank feeds is currently available in beta stage.

  • Cost: From $23 per month to $59 per month
  • Website:

Quickbooks – Hosted or Online
Quickbooks offer the opportunity to leverage their existing strong desktop products into the cloud using two alternate approaches.

Quickbooks Hosted
The hosted version of Quickbooks offers the same feature set that is available on the desktop application. The application itself, together with your datafile, is hosted on a remote server and is accessed via your web browser (in a similar manner to Saasu and Xero).

If you also own a desktop version of Quickbooks, you will be able to download a copy of the data file to work on offline and then re-sync it later.

Quickbooks Online
Quickbooks Online does not have the feature set of the desktop version or the hosted version and is therefore not suitable for all business types. It is a different product, designed specifically for internet access, which brings both benefits and disadvantages to the use experience.

  • Cost: Quickbooks Hosted is priced on a per user basis from $310 per annum. Quickbooks Online is priced from $25 – $55 per month.
  • Strengths: Bank feeds and multi-currency features can be handled within the package by the $40/month offering.
  • Weaknesses: The Online Australian edition does not at this stage offer payroll, time tracking and inventory tracking.  Payroll can be set up manually in the chart of accounts but is not as simple as Saasu and Xero.
  • Website: Hosted –; Online –

Our experience
The above outline is just a quick overview of the options available. Our team works with all of the systems in this lineup and is happy to give you further insight if you are thinking of moving from the desktop to the cloud.

Having migrated our own computer environment from locally based servers into a secure hosted cloud based system, we understand the concerns around data security and have also experienced the benefits such a move creates for the mobile business owner.

Article by Stephen Guthrie, Director, Prosperity Advisers. Stephen and our other Advisers provide Business, Tax and Family Office services to our clients from offices in Brisbane, Sydney and Newcastle.