Directors duties

Directors of an organization are in a fiduciary relationship with that organization and should therefore always act in good faith towards that organization, and in the best interests of the organization. This fiduciary relationship forms the basis and the foundation from which all director duties emanate. Below is a summary of Common law duties and Companies Act duties (reference to […]

Doing business with your head in the cloud and your feet firmly on the ground – part 1

Prepared by: Reinier Duraan (Director MMS Group Cape Town) Many accountants and users of accounting software are still using the same software which they have been using for the last 20 odd years. Although the software is still performing the necessary primary functions and producing the basic reports, which could in some instances be a bit labour intensive to produce, […]

Private companies vs close corporations

On 1 May 2011, the Companies Act 71 of 2008 came into effect, replacing the Companies Act 1973 and amending the Close Corporations Act of 1984. The New Companies Act introduced fundamental changes to South African company law. Regardless, the BIG question remains: Why should I consider converting my close corporation to a private company? Currently there is no legal […]

The Concept of Scalability

What is scalability? Scalability describes how easy it is to expand a business model and grow its revenue significantly, without equally increasing its cost base. Relative to its fixed cost base, revenue has the potential to increase exponentially and therefore, scalable businesses offer more profitability and huge growth opportunities. Over the long-term, a scalable business model is optimally designed to […]

Section 19 of the FAIS Act and the relevant submissions to the FSB

Section 19 of the FAIS Act states that financial statements must be submitted by all Authorised Financial Service Providers to the registrar, not later than four months after the end of the provider’s financial year end. If your business’ financial year end is 28 February, this deadline is 30 June 2017. Categories of FSP’ and type of financial statements to […]

Inventory control: Saving your business money

What is Inventory control Inventory control is the process whereby management ensures that inventory on hand is kept safe and in such a manner that it would enhance the entity’s cash flow. Why is inventory control important Management must understand what inventory they have, where it is kept and how and when inventory is moved both in and out. Doing […]

King IV™ Applicability of The Code™:

King IV™ is voluntary applied, on an Apply and Explain basis. It applies to all organisations, regardless of their form of incorporation. It is structured as a Report that includes The Code™, and additional separate sector supplements for SME’s, NPO’s, State-Owned Entities, Municipalities and Retirement Funds. Purpose of The Code™: It focuses on the following outcomes: Ethical culture Good performance […]

Non-Executive Directors (NEDs): Have you registered for VAT?

SARS recently published two Binding General Rulings (number 40 and 41) that have put the tax treatment of non-executive director’s fees to bed, which will come in effect on 1 June 2017. As it stands, a Non-Executive Director (NED) earning more than R1 million in director’s fees in any 12-month period should register for VAT. What will happen when the […]

Succession planning

Owning a business requires careful succession planning and is part of your estate planning as you have to determine who will succeed you, or who will purchase your shares, or who will be entitled to the income after your death. The future ownership of your business is at stake. A Partnership automatically dissolves upon the death of a partner and […]