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Impending legislative changes will have a major impact on franchise networks according to one mid-tier accounting firm which is encouraging all franchisees to "get their house in order".
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Accounting franchises brace for legislative changes
05 September 2017
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9 minute read
BDO partner and franchise expert Jason Daniels told Accountants Daily that the impending Single Touch Payroll (STPR) legislation and the proposed 'joint employer' legislation will have a unique impact on franchise networks.
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“Impending regulatory changes that will impact on the operation of franchise systems include the planned introduction of Single Touch Payroll (STPR) legislation from 1 July 2018 and the proposed 'joint employer' legislation targeted at franchisors and group employers,” Mr Daniels said.
“These moves by the Australian government (through the Australian Taxation Office and Fair Work Australia respectively) are designed to provide further protection to employees and ensure they are being paid the right amounts at the right time.”
Not only will this impact accounting franchises, but also any franchise clients, which accountants should be working with to ensure they are compliant with these new requirements ahead of their implementation according to Mr Daniels.
“Franchise networks must get their house in order quickly with major new legislative changes on the horizon, or run the risk of exposing themselves to significant financial and reputational damage,” he said.
“Franchisors must be across these changes now and understand what they mean for their franchise systems.”
Mr Daniels said it is imperative that franchise groups ensure their internal systems and processes are working for them, not against them, in this changing environment.
“Accountants should be educating franchise clients on the changing environment and making sure their compliance basics are right,” he said.
“The identification and management of risks across the systems and processes of a franchise network doesn’t have to be expensive and complicated, but it does have to be planned and carried out, regularly and methodically.”
According to Mr Daniels there are five key compliance areas to be aware of; franchise payroll and employee obligations, key supplier risk, franchisee performance, regulatory compliance and funding and financier.
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