Fonterra’s recent announcement - $16 billion in cash returns and a 15% revenue boost - is great news for farmers. With strong returns flowing in, many are asking: what’s the smartest way to reinvest? Paying down debt has long been the default. But with stronger equity positions and healthier balance sheets, now’s the time to think bigger. Here are three areas where reinvestment can drive long-term growth and resilience. 1. Rethink land use If a change in land use could lift your profitability, it’s worth exploring. Whether it’s diversifying into horticulture, or leasing out underused land, banks are increasingly backing strategic shifts that build equity. The right move could reshape your farm’s future. 2. Invest in business essentials Reinvesting in business essentials helps protect your equity and maintain leverage with lenders and suppliers. This might mean upgrading infrastructure, ticking off your farm environment plan, or tackling deferred maintenance. These aren’t just compliance tasks, they’re the foundation of your long-term viability. 3. Streamline for efficiency Technology and infrastructure upgrades can reduce labour hours, cut power costs, and future-proof your operation. Think solar panels, cow collars, automatic drafting systems, or finally replacing that tractor that’s costing more than it’s worth. With investment incentives currently available, now’s a great time to act. The takeaway  Strong returns give you options. Reinvesting in land use, business essentials, and efficiency can strengthen your balance sheet, boost productivity, and set your farm up for long-term success. At Diprose Miller, we help farmers make smart, strategic decisions that support growth and protect family prosperity. If you’re ready to put your returns to work, let’s talk.

Keeping on top of the financial management of your business can be hard work. It's possible to have a profitable business that is struggling to find the cash flow to pay expenses and fund growth. Likewise, you could have positive cash flow but are not turning a profit, particularly if you are re-investing profits back into the capital expenditure. Turning a profit is at the heart of running any successful business But without an even and predictable flow of cash into the company, you can't cover your overheads, you can't pay your employees, and you can't run your day-to-day operations – let alone think about expanding and growing the business. In the end, you need both. But if you’re going to be in control of your financial destiny, it’s important to get your head around the important process of cash flow management. Let’s look at some of the key things to understand about your finances: Profit is a by-product of a successful business – as the owner, you want to make profits, but profitability isn’t the only goal. A business can easily be profitable, but also be highly unstable in the longer term. What you want is stability and consistent revenues. Cash flow keeps your business alive – good revenues (income) serve to bring cash into the business. Without cash to cover your operating expenses, you have no means to keep the lights on in the business. So cash really is king! Know your cost base and overheads – the flip side of your cash flow position is your costs. In an ideal world, you want more cash inflows than cash outflows, so it’s important to know your expenses and costs and to manage them carefully. Be proactive about spend management and easing expenditure – if you can take action that reduces your spending, that is hugely positive for your cash flow position. Choose cheaper suppliers, negotiate better deals and bring that cost base down. Drive more revenue, through increased sales and marketing activity – if you can increase your revenues, you also boost your cash flow. So it’s important to be proactive about running targeted sales and marketing campaigns to increase your sales. Keep the cash flowing and the profits take care of themselves – if you achieve the ideal cash flow position, the company sits on solid financial foundations, the cash is there for investment and the business can grow. It’s that simple. Talk to us about improving your cash flow management Whether you’re new to running a business, or a seasoned owner who needs some financial support, we can give you the cash flow advice you need. We’ll review your finances, delve down into your cash flow, and come up with key ways for you to increase your cash income and reduce your cash expenses. It only takes a few small changes to achieve a far better cash flow position for your business – helping you maintain positive cash flow AND generate profits.

Sometimes you may pay your employees sums in addition to their normal wages, such as: allowances benefits holiday pay lump sum payments Some are tax free, but most are taxable. For some, the employer pays the associated tax. For others, the employer deducts PAYE on the employee's behalf. You may also provide various non-cash benefits to your employees as part of their total employment package. Even where the benefits are not in cash, they still have a value which is taxable. The tax treatment depends on what the payments are for and the circumstances that apply. A brief overview Allowances There are different kinds of allowances but if it's a straightforward reimbursement to the employee for out-of-pocket work-related expenses, the allowance isn't taxable. Mileage, meals, and tools (including telecommunication devices) are examples. If the amount of the allowance is more than the actual amount of the expense, then the difference is taxable. The employee will be subject to PAYE or you will pay FBT on the difference. What about travel? Where you pay a travel allowance to an employee, you need to determine whether you are liable for FBT (if you paid for the travel) or the employee is liable for PAYE (if you reimbursed the employee’s travel costs). For a travel allowance to be tax-free, the travel must be ‘on work’ rather than just ‘getting to work’. Different factors affect the tax treatment. Can I claim GST on benefits and allowances paid to employees? You may be able to claim GST on allowances paid to employees for work-related expenses, if you are registered for GST. Keep all relevant tax invoices. You can’t claim GST for items that aren’t employment related, so this generally rules out claims on benefits. Benefits Benefits include anything that benefits the employee. They're not wages as such, but they're part of the employee's total employment package. As they're a perk of the job for the employee, you, as the employer, will usually pay fringe benefit tax (FBT) or be subject to PAYE on the value of the benefit. Benefits fall into several categories: non-cash, cash, and so-called special benefits. Holiday pay The employee is liable for PAYE on pay for annual leave and statutory holidays. Lump sum payments Pretty much anything else is classified as lump sum payments. These include bonuses, cashed-in annual leave, payments for accepting restrictive covenants, exit inducement payments, gratuities, or back pay, redundancy payments, retiring allowances, and overtime. Employees are usually liable for PAYE on these payments. Note that: the PAYE rate will vary depending on the employee's total taxable income ACC earners' levy won't apply above the maximum liable income threshold redundancy payments and retiring allowances are not subject to ACC earners' levy It can be confusing working out the tax treatment of these payments for your business. Let us know if you would like to discuss how the rules apply to your business.

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Unemployment in New Zealand has been steadily rising over the past two years. The unemployment rate has risen from 3.4% in Q1 of 2023, to 5.1% in Q4 of 2024. The rate has remained static for Q1 of 2025, but this prolonged rate of unemployment may be having a detrimental impact on the future of your small business. Let’s look at the alignment between unemployment and your future growth. 1. Reduced consumer spending: With more people out of work, consumers have less disposable income to play with. This leads to customers tightening their belts and less consumer spending on non-essential goods and services. This can directly impact your sales and monthly revenue, forcing you into a corner where prices (and margins) might be decreased to encourage more sales. 2. Low morale and poor employee retention: While a larger talent pool might seem beneficial, high unemployment can sometimes create a sense of job insecurity among your existing employees. Unstable economic conditions can lead to decreased morale, higher stress levels, and a potential struggle to retain top talent, who may feel less secure in their current roles. 3. Difficulty securing loans and funding: Banks become more risk-averse when there’s evidence of high unemployment, poor economic conditions and unpredictable market conditions. The recent CPA Australia Asia-Pacific Small Business Survey found that only 26.4% of Kiwi businesses expect it to be easy to access finance. Reduced access to funding can lead to poor cash flow, slower growth and an increasing need to reduce costs. 4. Decline in overall business confidence: The combined impact of poor economic conditions and high unemployment is significant. This unpredictable and unstable outlook can have a major effect on business confidence. New Zealand's ANZ Business Outlook Index fell sharply to 36.6 in May 2025 from 49.3 in the previous month. This may deter your small business from investing, innovating or expanding – all factors that could hinder your own long-term growth and stability. If you need support getting your business through the tough times – we’re here to help. There are still ways to control your spending, drive growth and do your bit to provide employment.

For centuries, accounting was all about reviewing historic information – but that only told you about the past, not what was going to happen in the future. If you’re only looking back at past periods and historic numbers, this limits the insights you can achieve for your business. With a backward-looking ideology, it becomes difficult to plan, run through different scenarios or understand the path of the business going forwards. Forecasting changes this. With the right data analysis and forecasting tools, you can project sales, cash, revenue and profits into the future – and get in control of your business. A forward-looking view of your business journey Forecasting switches the focus of your financial management. By moving to a forward-looking view of your business journey, you can see further down the road – and that helps to spot any opportunities and avoid common business pitfalls. Forecasting adds value by: Highlighting the data patterns – a forecasting tool takes your historic data and projects it forward in time. This helps you and your advisers spot patterns, trends, gaps and opportunities, revealing the true ‘story’ behind your business accounts. For example, forecasting may reveal a predicted seasonal slump in the next quarter, allowing you to plan ahead and proactively take action to minimise negative impacts. Giving you a future view of your business – instinctively, business owners will look back at prior periods to assess performance. There’s value to reviewing your historic actuals, of course, but using forecasting helps you to look forward, rather than just backwards. Forecasting is the satnav, showing you the road ahead, rather than the rear-view mirror showing you the road you’ve already travelled. Helping you scenario-plan – with a financial model of your key drivers, combined with accurate forecasting, you can quick answer your burning ‘What if…?’ questions. Forecasting lets you run different scenarios, with different drivers, to see how business decisions may pan out over time. If option B performs better than option A, that’s invaluable information when defining your next strategic move. Making informed, evidence-based decisions – having ‘the full picture’ of combined historic numbers, forecasts and longer-term projections aides your business decision-making. Forecasting gives you solid evidence on which to base your strategy and helps to red flag any threats that are looming on the horizon – giving you the best possible information to keep your executive team informed and on the ball. A more effective relationship with your accountant – forecasting also helps us to get a better insight into what makes your business tick. This helps to spot potential areas of performance improvement, and to give you the best possible strategic advice, all backed up by solid, empirical data and management information. If you want to get in better control of the destiny and results of your company, we’re here to talk. Forecasting helps you highlight your future threats and opportunities – and create a proactive strategy to improve the performance of your business. It’s not always an easy process, but almost always one worth undertaking.

Understanding your finances is a vital part of running your business. But getting down into the nitty gritty of your business’ financial reports isn’t every entrepreneur’s top skill. If you are new to company accounting, or simply want to expand your knowledge, this guide explains the foundational reports. The profit and loss report and the balance sheet are both key reports when it comes to getting in control of your company’s financial health. What’s a profit and loss statement? Your profit and loss statement is commonly called your P&L, but is also referred to as your income statement or statement of earnings. It’s a full breakdown of your company’s revenue (money coming into the company as sales and other business income) and your expenditure (direct costs, overheads, expenses and other costs). As a business, you obviously want to turn a profit and make money from your venture. Careful observation of your P&L allows you to track your revenues and expenses over a set period of time. You can then look back over the period and see exactly where you’re making money, and where you’re losing money. The more you make, and the less you lose, the greater your profits will be at year-end – and your P&L is your barometer for measuring these metrics. The P&L statement is good for: Giving you a breakdown of all revenues and relevant costs and expenses Showing the profit and loss figures over a set period of time Summing up your profit and loss for the period to gauge if you’re profitable. What’s the balance sheet? The balance sheet gives you a snapshot of your company’s financial health at a given point in time, based on the following accounting equation: ‘Equity = Assets - Liabilities’ The balance sheet shows you the company’s: Assets (the things the company owns, including cash) Liabilities (the things the company owes other people) Equity (retained earnings plus the funds you originally invested as shareholders) Unlike the P&L – which shows you the revenues and expenditure over the course of a given historic period – the balance sheet is best seen as a ‘screenshot’ of your current finances. In a nutshell, it shows you what the company is worth on paper right now, based on the current numbers in your business accounts. So it’s a vital tool in your accounting toolbox. The balance sheet is helpful for: Assessing the current financial position of the company Providing evidence of your financial position to banks, lenders and investors Making decisions on company dividends and related distributions Giving potential buyers an idea of the company’s tangible net asset value, if you plan to sell up. Talk to us about expanding your accounting skills If you can’t quite tell your assets from your equity, we are here to help. Accounting can be complicated and it takes time to fully grasp all the different terms and processes. We’ll be happy to run you through your latest management or statutory accounts and explain exactly what each report means – and how it reflects your current performance as a business. Get in touch with us to find out more.

If you operate your business as a company, and you make a vehicle available to an employee to use privately, you’ll be liable to pay fringe benefit tax (FBT). This applies on vehicles made available to: employees (and their associated persons), and shareholder-employees (business owners) This applies whether the vehicle is actually used for private purposes or not. FBT does not apply: to vehicles that come within the definition of being ‘work related vehicles’ that are not available for private use for certain emergency calls and some out of town travel for working owners in Look Through Companies (LTCs). Instead, such benefits are treated as a distribution of profit to the working owner to the extent of the private use for sole traders and partners in a partnership. Instead, they make income tax and GST adjustments for private use. Not all ‘business’ vehicles are ‘work-related vehicles’ for FBT purposes. And some companies have other options instead of paying FBT. In some cases, exemptions apply. When is FBT payable? FBT is normally payable quarterly but can be filed quarterly, annually or by income year. Filing frequency depends on the type of company you manage, the benefits you provide and how much tax you pay. It’s important for clients to get this right because the use of, and deductions claimed for, vehicles is a common feature of any Inland Revenue review of a company’s tax affairs. You need to understand how the rules apply to your specific business. If you’re unsure and need advice, we’re here to help.

A good credit profile acts as the foundations for your finance strategy. But what can you do to build and nurture a good credit profile and business credit score?