Sipho went to the local bank and met with one of the bankers who informed him of the business loan application requirements (business plan, bank statements, cash flow projections and security). Sipho quickly realised that without financial management skills his...

A bank (and other funders) will require a business plan, bank statements, cash flow projection for at least the next 24 months, security/collateral (personal and business assets). Sipho seems to be having none of these. Sipho’s lack of (and non-investment in)...

While awaiting the outcome of the bid submitted Sipho looked at his bank balance and said eish! I am running out of cash. Sipho is only left with R 20 000. The second project is only 20% complete and requires R 700 000 to be completed. Sipho decided to...

Sipho and his accountant are being dishonest, they are misrepresenting the financial and tax affairs of the business because Sipho’s business has been trading for at least 18 months and was awarded 2 projects. Filing “zeros” is a criminal offense (tax evasion) and...

The tender bid is due in 2 days. Sipho called his friend, Hendrik, to find out where and how he can obtain a tax clearance certificate. Hendrik referred him to some accountant who filed “zeros” on tax returns and generated a tax clearance certificate for Sipho. Sipho...

In order obtain a tax clearance certificate Sipho must, on behalf of the company, file an income tax return. This means that financial statements need to prepared and a tax calculation must be performed to determine whether the company made a taxable profit or not. A...

It is now 18 months since Sipho has been in business. Sipho is actively looking for new business opportunities on newspapers, tender and municipal websites. He came across another water reticulation project however this required a tax clearance certificate. Being an...

Sipho is running the risk of not being able to complete the second project as he has taken the deposit meant to fulfil the second project and utilised for the first project and financed his own lifestyle. Not completing the second project will result in loss of trust,...

Sipho yet again struck the lotto and was awarded a second project by his local municipality. He was given 50% upfront as a deposit by the municipality. Sipho used the money to fund the first project and bought himself a BMW, he now eats take way food for breakfast and...

It is said proper planning prevents poor performance. Sipho needed to plan and determine all the resources required and expenses to be incurred (including consulting fees). This is called budgeting and will involve seeking quotes for machinery, pipes, consumables,...