Useful information on your BAS

A client recently asked me, “Is there any information on my BAS that’s actually useful?”

My reply was, yes, there is, particularly for people who don’t look at their financials very often.

The BAS is the form used by businesses to submit their GST information for the last period to the Tax Office. It also contains information about Wages paid, and PAYG tax withheld.

So, you can see that thhere are two key numbers on your BAS which tell you important information about your business:

• Sales

• Wages

As we know, wales is one of the most important numbers for any business. And as they say in the classics, “If you ain’t got sales, you ain’t got a business!”

But wages is also important. As one of your largest expenses, it’s critical to keep an eye on your wages expense on a regular basis.

However, from my perspective, it’s when you bring these two numbers together that you get the greater insight into your business. It's a ratio, called:

Wages as a % of Sales.

You find this by dividing your Wages figure by your sales figure. (Wages/Sales x 100). This will give you a percentage figure.

This gives you something to work with.

You can compare this percentage against your expectation, prior periods, or industry benchmarks.

But the starting point is to compare it against yourself.

And then think about it in critical terms:

• What did you think it would be?

• Is it better or worse?

• Is it more or less than the previous BAS?

• What can be done to improve it?

The sales and wages figure on your BAS are just static figures. It’s when you bring them together that you see their relationship to each other.

But it's when you compare them against previous BAS periods that you gain real insights into your business.

I'd be happy to discuss your figures with you.

Shoot me an email and we'll take it from there.

Peter