Australian SMEs can look forward to a generally bright financial outlook in 2017 despite some uncertainty in the wake of world political events, such as the looming Trump presidency, Brexit and China’s troubled economy. We don’t know exactly how those events will affect Australian businesses so it seems that most SMEs are taking a business-as-usual approach at the moment, with overall confidence reasonably high.
The mining downturn will put some pressure on Western Australian businesses but there is still growth in WA; it just isn’t quite as strong as the growth we expect to see in the eastern states. And there is still some concern around interest rates with most SMEs hoping they stay low.
We have identified three key trends likely to emerge or continue in 2017.
1. Innovation will increase
The government’s focus on innovation is a positive opportunity for SMEs, and there are numerous grants and tax benefits available for businesses looking to innovate. We recommend businesses seek professional advice to ensure they’re not missing out on any of the grants, rebates or other benefits available to them.
2. International investment goes both ways
RSM has seen a large number of Australian clients investing internationally, which can be a useful way to spread risk.
At the same time, Chinese business interests in Australia are likely to increase, both in terms of state-owned enterprises and private business. These organisations have demonstrated a strong preference for property investments, and it’s important that they understand the rules for conducting business and investing in Australia.
3. Technology will be a key focus area and SMEs need help to protect themselves
SMEs can benefit from putting the right technology in place, whether it’s to streamline their accounting processes or enable innovation. For example, using a cloud-based accounting system can reduce the time and effort spent on managing accounts effectively, which is a win for the client and their accounting firm.
Similarly, making sure the systems used within the business are integrated and offer operational efficiencies can make a big difference to that business’s cashflow. So accounting firms are likely to look to bolster their own skills in these areas so they can be more helpful to their clients, acting as business advisers and not just financial advisers.
Technology has always been a key focus for RSM and it’s important to continue to stay ahead of developments in these areas so we can keep helping our clients. For example, our cybersecurity team can help clients mitigate the risks associated with a greater dependence on technology. We’ve seen one scam recently where hackers gained access to the CEO’s email and was able to send fake email messages both within the business and to business partners and customers that looked completely legitimate. This creates a huge potential for negative fallout, so we can develop strategies that help businesses avoid such attacks.
These are just some of the ways a good accounting firm can help SMEs understand and navigate the current business environment successfully, paving the way for growth. It’s important to be aware of these key trends so businesses can leverage every opportunity.
Jamie O’Rourke, Chairman, RSM Australia