While salon owners are coming to grips with a mind-boggling 2020, and losing sleep over lost revenue, as well as fears of further – and longer – lockdowns, there have been calls for the Federal government to provide financial advice to small business owners.
CPA Australia and Chartered Accountants Australia and NZ have called on the Morrison government to set up a government-funded voucher system to provide small businesses with professional financial advice once stimulus measures end in September.
Supporting the proposal, the Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, said that it aligns with her office’s COVID-19 Recovery Plan, which also highlighted the need for a small business viability voucher program.
“Small businesses have endured some of the toughest trading conditions we’ve ever seen in Australia over the past few months,” Kate said. “ABS data tells us 900,000 businesses are getting JobKeeper payments and about 690,000 businesses have received emergency cash flow assistance, while 38 per cent of businesses still trading have renegotiated their rent arrangements. Two thirds of businesses were still reporting reduced revenue in June,” Kate added. “Of those about a third were reporting revenue losses of 50 per cent or more. Small businesses with cashflow issues, compounded by falling revenue, may find getting the professional financial advice they need unaffordable. The ramifications of this could be devastating, both for the business and its owner and family, down the line.”
Under the proposal, small-business owners facing financial difficulties would obtain a small business viability voucher valued up to $5000 to access tailored advice on how and whether to turn around their business by a relevant accredited professional. The advisor would be paid directly by the government to the accredited professional up to the value of the voucher.
Ms Carnell pointed out that this proposal would ensure small businesses “have access to expertise in judging business viability, so they can make an informed decision about whether to turn their business around or exit.”
“Ultimately, we want to see as many small businesses come out the other side of this difficult period as possible,” Carnell said. “Getting a tailored business plan is critical to their survival.”
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