Category: Axelerate Blog

13- Dec2021
Posted By: Axcelerate
130 Views

Accounting and payroll software that’s leading the market into transitioning digitally

More and more South African companies across industries and sectors are coming to the realisation that a paperless system is the way to go. Moving from a paper-based system to a digital and cloud system to be specific, not only simplifies operations but makes it seamless. This system is financial management on the tip of your fingers.

Although we cannot replace the role that accountants and bookkeepers play in updating business ledgers, at the core of a highly functioning business is how it stores its client’s data, financial data, and other information that is important for the business to thrive. Axcelerate in partnership with leading software accounting firm —Sage has been the leading accounting practice to slowly phase out a paper-based accounting system.

There are benefits to the new way of doing things, and considering the impact of paper on climate, more businesses have an interest in the need to do things digitally. The system allows both clients and business owners to keep track of all transactions, send and receive invoices, record sales, and file tax returns on behalf of for their clients. With the newly launched tax wizard, business owners and accountants are able to file their tax returns through a ground breaking integration to SARS’s e-filling.

Other benefits include the following, according to Axcelerate’s Executive Director, Tshepiso Sekudu

  • There is little room for human error, a challenge most companies face when dealing with a paper-based system, i.e., capturing the client’s details incorrectly, information asymmetry and other accounting errors which poses a risk to the internal control environment;
  • Growth: Migrating to a paper-based accounting operating software allows the business to scale to its fullest potential by enabling the company to manage their client’s information and data without seizing the capacity to do so;
  • Proper record keeping: Record keeping can be a nightmare for both business owners, accounting officers and bookkeepers, as information constantly needs to be updated, and this system allows for the updates to be automated without changing a whole document by hand.
  • Increasing profits: Increasing profit margins and multiplying revenue is an important part of growing the business. This also comes with the idea that when you have the correct systems and processes in place, the business can thrive. This also reduces expenses incurred when using paper.
  • Focusing on the bottom line: Moving to a paperless operating system also offers the business overall financial growth. It attracts customers worldwide and allows business owner to manage their data and information remotely without moving or being physically present.
  • Integration: software that allows for integration to e-commerce platforms, digital account management for customers to manage their accounts and secure online payments via various payment gateways.
  • Lastly, it offers the convenience of not losing important information, which may be backdated and needs to be kept on record for future filing. All historical and current information is kept within the same system, which allows for auditing purposes to be seamless.

“Our clients and our counterparts are always curious about how we keep our competitive edge as a business. And we are quite clear that part of growing the business involves moving with the trends and new ways of doing business, which involves technology and improving on systems”

Tshepiso Sekudu -

He also adds that the system places the client’s needs for privacy and data protection at the centre. As an accomplished accounting firm, Axcelerate believes in compliance and ensuring that clients can trust in them for managing personal and sensitive information correctly.

Who can use this product?

Whether you are a newly founded business owner, freelancer or an existing business, this software is for you and all your clients’ needs to be able to manage information correctly and in the most reliable way.

How do I migrate?

Our team at Axcelerate are ready to provide you with details for your bespoke business needs. Reach out to us on our website www.axcelerate.co.za as well as for any further enquiries email info@axcelerate.co.za , sign up by clicking here and let us take care of the migration.

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Making an impact through teaching accounting skills

As a growing business, Axcelerate is passionate about making an impact and transferring skills and empowering others. Axcelerate, powered by Sage has been hosting a selected individuals to attend the sage Skills Empowerment  bootcamp. The Bootcamp has been a success and yielded positive following the bootcamps being held in the two cities in Gauteng (Johannesburg and Pretoria) between August and November 2021.

The bootcamp covers various modules such as bookkeeping fundamentals, Sage Business Cloud accounting, Sage Business Cloud Payroll and Sage Cloud Payroll Professional. This year Axcelerate successfully trained 85 candidates, who have all completed the programme. “I just want to extend my gratitude to Axcelerate team for their investment in me, you guys changed my narrative, a month after the bootcamp I am employed in the global mining company, I aced three interviews and I was the one to decide where to go”, one of the beneficiaries testified.

“Given the state of unemployment in South Africa, hosting these workshops help young graduates and matriculants to gain skills. Reducing the unemployment rate in South Africa through education and skills transfer is part of Axcelerate’s mission”. We exist to curate and train new finance and payroll professionals , and we need new minds and talent to improve the sector, Managing Director Refentse Masha (CA) SA said.

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Axcelerate’s value is being able to empower others to be astute professionals in the sector in areas of business management software, accounting, tax, financial management and reporting. These are skills that can help them in their future as well as increase their chances of employment prospects.

All bootcamps are funded by Sage, thus increasing capacity within the Finance and ICT sector.

Cash flow management is a crucial part of the business

Money is an essential part of ensuring a successful and sustainable business. After profits and making revenue, management of those finances needs to follow. For a small-medium enterprise, having an accountant as part of the team is an investment.

Cash flow management can be explained as tracking every single transaction coming in and out of business. This can be done by interrogating the business’s income and expenditure statement, and each transaction should be kept in a ledger for tracking purposes. This ultimately assists the business to know where it could potentially face financial woes.

How often does this happen?

For a small start-up, reconciling an expenditure and income statement should be a weekly exercise. As the business grows, one can employ a monthly system and implement checks and balances to track transactions. As invoices are paid, other incomes are made, and cash is flowing in, it is equally important to keep track of the expenses accrued in the business at the end of the month. A weekly system allows the business owner or accountant to know if the company will meet its monthly obligations.

How does cash management keep a business afloat?

Keeping cash inventory is one of the key business pillars of building a sustainable business. According to the online learning platform, inc.com, “cash is king”, which means that the business cannot operate or fulfil its purpose without cash. Making money is a very big part of keeping the business and more importantly sustaining the business. However, the life and durability of the business over the years relies heavily on the management of the cash injected. Therefore, there needs to be a balance between the money coming in and the money going out. Ideally, a business owner should separate themselves from their business, in other words separating business and personal finances and kept in separate accounts.

Small businesses need to get into the habit of saving and investing profits back into the business. In the first three or five years of the company, the profit made should not be paid out to directors or shareholder. Taking the decision to re-invest the profits will do things for the business, one, compound the revenue made in the business, and secondly grow the business, allowing it to survive in tough seasons.

The business primarily exists to service its core clients that have a personality of their own and are somehow attached to the businesses.Poor cash management leads to various challenges for businesses, and these include inability to meet daily operations, dishonouring services and contracts with services providers, bankruptcy and business rescue for big firms. Small firms have the advantage of a few overheads, however good financial management also involves chasing invoices and following-up with clients for payments.

Good cash flow management allows the business to earn a good credit score with its creditors (the bank) and other investors. When you maintain cash flow management, you can build a good credit rating. This means that it will be easy to access credit lines with the banks and access funding, loans, and grants from potential investors. Managing your cash well shows investors that you can safeguard cash flow and manage your expenses — a measure of good financial management any investor is always looking for in its returns.

How to position your business for growth: Advice by Axcelerate

The advent of Covid-19 is no different from the global economic crisis in 2008, which led to most companies, banks, and other institutions closing shop. Today’s situation, however different it may be in its merits, still poses the same threats and has the same effect on business.

On the contrary, in his book “Built to last” Jim Collins posits that most lucrative and big businesses as we know them to be today were built during the 2008 global crisis, the likes of IBM for example. Today, entrepreneurs have emerged from the pandemic across the globe, building companies that will inevitably outlast the pandemic. This essentially infers that there can be opportunities for businesses during a crisis, and in fact, a crisis is the best time to start a business, but where do you start?

  •  Find a problem and seek to solve it: Each business has a vision and mission set to position the company for growth beyond making returns and profit margins. When seeking to start a business, especially as a start-up, look for a problem that exists in society and let your business be the solution to solve this problem.

The advantage of the pandemic is that it created many problems and exacerbated others that existed long before Covid-19. These problems are also business opportunities. The opportunities of scale that exist during this time will allow most businesses to establish themselves as sustainable companies.

  • Be clear on your goal as a business: Defining your why is what Author Simon Sinek refers to in his book Start with Why. Defining your why allows you to understand reason your business exists and who it is intended to serve, and in what way. If you are set on establishing a small business, your focus should be to grow the service your business offers, no matter the size of the market. However, should you wish your business to grow in scale, your focus should continue capturing market through your product and offering.
  • Identify a target market: Your target market is what is referred to as the niche. These are a group of individuals that will be your consumers of product or service. It is important to be intentional as a business in defining who you will be servicing. This allows for you to focus and not derailing for your primary mission to serve your clientele. The business primarily exists to service its core clients that have a personality of their own and are somehow attached to the businesses.
  • Create value: There are many businesses that will be in your market or sector/industry. It is important that you set yourself apart by creating value through your company. This will be your unique trademark and your unique value proposition that will either grow your business or retain or attract new customers. One of the best investments customers make towards your business is returning after the experience with your product or service because of the value to add it added their lives.

“A business is more than just an idea, a service or a company; it is a purpose for which it exists to serve in society”, said Axcelerate’s Executive Director Tshepiso Sekudu. Businesses become institutions that live long after their founder’s lifespan seizes. Therefore, make sure you build a business that exists for a purpose larger than yours, he added.

How to spring clean your finances

September ushers spring as a new season and is a new month. This time of the year is often likened to cleaning up, clearing up and creating space for new things. This includes arranging our finances accordingly. Often at the beginning of the year, people sign up for things such as gym, subscribe to platforms and attach themselves to new debt. Spring is regarded as a time for one to turn over a new leaf and set their house in order, but what does this practically look like?

Amongst the most basic steps one can take to clean their finances is for one filing for outstanding SARS submissions/VAT returns, review their budget, cancelling unused subscriptions and commitments that no longer serve them.

Filing your tax returns

Filing your tax returns can save you money through refunds as well as avoiding penalties where you may owe the South Africa Revenue Services (SARS) money. This is also beneficial for taxpayers who have paid towards medical aid contributions, a retirement saving product, or a tax-free savings account. These are all ways you can begin to savour money that you have “spent” towards contributions in the year. In addition, you can also claim for your Pay-as-you-earn (PAYE), as you are required to pay up to 10% of your salary through PAYE and you can then claim for up to a maximum of 27.5% of your taxable income, with a cap of R350,000 per annual.

If you run a business, being tax compliant through your tax filings is important. This means that you need to ensure that all your tax-related paperwork is in order. As a business owner, you can also claim for Value-added Tax (VAT). This is what you would have paid on most inputs and expenses you have incurred with added VAT.

Cancel your unused subscriptions

At the beginning of the year, you may have set financial goals and some of them you have reached and others you have not. This could be due to a number of reasons, including oversubscribing to platforms such as Netflix, movie sites, joining the gym but not training, and signing up on music platforms such as Apple Music or Spotify you never use. When one looks at the accumulation of how much their entertainment bill accounts to and other unnecessary expenses tally up to, they would be shocked. If you find yourself spending R50 to R100 or more on each entertainment platform yet, you are not using it, which means it is time to cancel the subscription. If you have signed for gym membership and have not gone to the gym no more than three months regularly, then you need to review. Saving R50 or R100 may sound like it is not much when it is in actual fact, that is cash that you could put to good use or save towards something.

Reviewing budget

There are a lot of expenses that go unnoticed on our budgets, especially when you look at your bank statement. Make reviewing your budget monthly a good habit to adopt. This way, you can plan better for items you spent on promptly as well as items you may not have needed yet overspent on them. This could not only save you money but also help you to budget appropriately for more important things. Align your budget with your priorities and always aim to pay off your debt first, save and invest. This is not the only way to advance your financial goals and financial standing, however, it does improve your financial freedom. Debt is one of the number triggers of stress and once you manage to reduce their debt obligations, builds your savings portfolio, this will free up cash to allow you to invest in different asset classes and help you compound your wealth.

Axcelerate’s Managing Director, Refentse Masha CA (SA) advised that keeping to a healthy and prudent financial status should be a year long process and not only a spring project. “It is important that we always check in with ourselves financially, weekly, monthly, quarterly and of course annually.” This means that we grow in line with our financial goals, added Masha.

Tax season could offer a relief for employees working from home

With the Income Tax season opening for taxpayers to file, some South African individual taxpayers will now be eligible to claim for working from home expenses. According to the South Africa Revenue Services (SARS), employees who have been working remotely can now claim for expenses incurred whilst working from home.

In previous years, the working from home expense claim applied to freelancers and contractors. However, between the period 2020-2021 most employees started working remotely from home and some even set-up office solely for working due to Covid-19 and the imposed lockdowns. It is no brainer that such a tax rebate could potentially come as a relief for most taxpayers during these Covid-19 times.

Who qualifies for claiming for working from home expenditure?

According to Section 11 (a) of the Income Tax Act (ITA) you qualify for working from expense claim “if you are an employee who works from home and has set aside a room to be occupied for the purpose of “trade”, e.g. employment, you may be allowed to deduct certain home office expenses for tax purposes calculated on a pro-rata basis.”. SARS also provides clear guidelines on how to calculate the expenses apportioned to working from home which need to be supported by documents such as invoices, bond statements, a valid lease agreement, and utilities bill.

Who qualifies for claiming for working from home expenditure?

  1. If you have a separate room set up for only office use and only use that room for “trade”.
  2. If as a salaried employee, you perform more than 50% of your duties at home.
  3. If your remuneration is based on commission and you are performing more than 50% of your duties from.
  4. Your employer must allow for working from home

SARS has also provided a list of expenses that fall within the working from home expenditure, and these consists of, rent of the premises, cost of repairs to the premises, expenses in connection with the premises. Other expenses include phones, internet, stationary, rates and taxes, cleaning, office equipment, and wear and tear on either furniture of equipment related to work.

Whilst it may be an opportunity to earn rebates, claiming for home office expenses must be carefully considered, SARS Commissioner, Edward Kieswetter cautioned Taxpayers during a SARS briefing in July. He said that the decision to claim for working from home expenses by using your primary residence could have long-term implications on your capital gains for tax purposes. “The home office area will, on a pro-rated basis, be excluded from the primary residence exclusion of R2 million on disposal of the residence”, states SARS. In other words, that area will be seen as business premise and not as a residential area, which could affect you when deciding to sell your house.

The idea of claiming for expenses incurred from working remotely is good, except one needs to evaluate the impact it has in the long-term. Meanwhile most employees have earned more benefits and savings by working from home resulting in reduced expense on items such as costs on fuel and transportation to and from work.

“It is also wise that taxpayers take precaution when it comes to claiming with SARS, as some claims may offer more short-term benefits than long-term gains. Working from home has benefited both employers and employees but for the benefit of claiming, employees should look at the long-term effects of deeming parts their residential areas as their employment domicile as this may not be easily reversible”, said Refentse Masha Axcelerate’s Managing Director.

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03- Aug2021
Posted By: Axcelerate
273 Views

Funding Your Business Through Your Side Hustles, Tshepiso Shares His Success Story

When Tshepiso decided to quit his corporate job, he focused on getting his side hustle up and running by getting different revenue streams going. From selling hot water bottles during the Winter months and umbrellas during the Summer months, he managed to gain enough finances to focus on his software business, Axcelerate, which streamlines businesses through the implementation of Enterprise Resource Planning (ERP), Advisory, Bookkeeping, Payroll, Tax, Accounting and Financial Management.

Get tips and advice on the “blind spots” business owners need to look out for and how to make your side hustle a success in this podcast.

Got your own business or looking at starting one? Sign-up for Sage’s 30-day free trial and see how their software can help take your business further: https://bit.ly/3djWTiW

Send us your questions about small businesses and it could feature in our upcoming SME podcast on WhatsApp on (+27) 72 934 4218. Follow us on TwitterLinkedIn and Subscribe to our YouTube channel for more Financial Freedom content: @HonestMoneyPod

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Why save when you can budget?

July marks National Savings month in South Africa. However, savings as a practice in South Africa for most South African is an elusive idea, for several reasons. The most popular reason why South Africans struggle to save is because of affordability. In other words, the gap between their income versus their expenses on a month to month is vast. The second one is attributed to people not believing in saving or grappling with the understanding of its importance.

Data indicates that only 6% of South Africans can afford to retire comfortably for reasons attributed to poor financial behaviour, including a poor savings culture. Savings is about a balance between satisfying our current needs with those in the future. There are small ways to start, personal finance advocates always preach living within your means to maximise your salary, save and plan for some purchases. This also means training your mind to be disciplined when it comes to money and avoiding being lulled into unnecessary debt and spending.

Whist it is important to save, what is more important is understanding the difference between savings and investing, and what each offers. Saving and investing are about smart ways of balancing our present and future needs. For some saving also means saving towards future goals and for rainy days and for others investing is channelling funds towards wealth creation. This is informed by ones goals, which could either be short or long terms financial goals.

Short term goals are, for example, a holiday to your dream destination, a special item or even an emergency fund for anything unplanned. Cash saved in this account can be saved in a current or flexi-fixed account to access whenever you need it and is within the six to 12-month period. On the other hand, with long-term goals the period is longer than 12-months, which sometimes can be confused with investments, you need a fixed account or an investment vehicle such as Eft’s, shares, bonds and even property. This results in your money compounding in interest and allowing for you accumulating  a larger sum of  which you can cash out when looking to invest in an asset such as a car or house later.

The first step to take towards saving is acting on your intention and opening a dedicated savings account, where you will deposit money every month. More to your convenience, request a scheduled transfer with your bank on a specific date from your current account to your savings account. The next step is to decide how much you can “afford” to save. Typically, advisors say people should save 30% of their salary, and others say 10%. Affordability has a continuum that differs from person to person but what is important is to start.

Savings is a habit, and a budget is a skill, the former needs you to make it a lifestyle, and the latter requires decision making on prioritising your basic needs and wants. Financial literacy organisation ASISA provides simple steps to saving, and these include:

  • Savings clubs / Stokvels
  • Savings accounts
  • Notice deposit accounts
  • Tax fee savings products
  • Shares & Unit trusts
  • Govt bonds and Retirement Annuities
  • Endowment policies

Although these are recommended, they are many other platforms and vehicles you can explore when it comes to savings as well as investments. Whilst it is better to start sooner rather than later on, start when you are ready.

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From side hustle to SME: How Axcelerate grew its business using Sage’s business cloud solutions

Sage’s business cloud solutions offered small business Axcelerate a way to grow its business and service its clients without the expense and admin burden of fixed office and IT infrastructure.

Growing a new business’s turnover by 50% in normal times is impressive; achieving it in a pandemic with lockdown restrictions is exceptional. It’s exactly what Axcelerate, a professional services firm and accredited Sage partner, achieved in 2020.

Axcelerate specialises in streamlining businesses by implementing enterprise resource management, as well as offering advisory services, bookkeeping, payroll, tax, accounting and financial management services.

Started as a side hustle in 2017, Axcelerate became a full-time occupation for executive director Tshepiso Sekudu at the beginning of 2019. The full-time focus benefited the business: turnover doubled last year and is on track to grow by double digits this year.

One of the main pillars to the company’s growth is using Sage business cloud solutions. It allowed for working remotely from anywhere and is also affordable as no fixed infrastructure is needed.

The new normal was always our normal

Virtual offices may seem like the new way to run businesses, but for Axcelerate there was never any other option. Starting out as a side hustle meant costs had to be kept low and the business had to run virtually.

“The new normal was always our normal,” says Sekudu.

Sage’s online software solutions for small businesses give business owners the ability to organise, and make admin and accounting quick and easy with features such as integration with point-of-sale systems.

This solution also gives businesses the ability to personalise and track invoices, helping with branding and cash flow management.

Important for Axcelerate and many other businesses is that these services are in the cloud. Business owners don’t have to go into an office or have access to a fixed desktop system. They can log in and work from anywhere — something Axcelerate did last year when they moved the growing team into a central co-working space in Midrand.

“Everything was already up and running because we had been using the cloud, so when we moved in we could start working immediately,” says Sekudu.

Using the cloud also gives the business a cost advantage.

“It’s cheaper to set up infrastructure. He compares it to a pay-as-you-go model — you buy what you need and don’t incur any unnecessary or fixed costs for infrastructure that may not be used.

An easier, smarter, cheaper way to work

In addition to helping their business grow, as a Sage partner, Axcelerate has helped clients migrate to the cloud and integrate their systems, including those who were working on desktop systems.

“Migrating to the cloud makes functions such as accounting and payroll easy for these businesses,” says Sekudu.

Visit Sage for more information on how their accounting and business solutions make lives easier for business owners.

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