The Prime Minister Kevin Rudd's proposal to allow businesses to defer lodgement of their Business Activity Statement from quarterly to annually is a potential recipe for disaster for small businesses. Currently, to lodge a BAS the business owner has to have all their financial records up to date. Everything they have spent or earned during the quarter needs to be accounted for and allocated and recorded. The actual filling in and lodgement of the BAS form once this has been done takes about 15 minutes. So the Prime Minister's proposed policy will do one of two things. It will either save business owners approximately 15 minutes every three months because they no longer have to lodge BAS forms. Or it will encourage them to defer recording of their financial transactions until the end of each year, depriving them of an up-to-date understanding of their financial position. The Prime Minister's research apparently suggests that small and medium enterprises spend almost 500 hours a year on their tax obligations. In fact those 500 hours are spent recording and tracking the financial health of their business, which forms an integral part of managing a successful business.
