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October 2017 NEWSLETTER
Running On Empty: Is Our Downgrade To Full Junk Status Coming?
South Africa’s “Day of Reckoning” will be 25 October, when the new Minister of Finance presents the MTBF (Medium Term Budget Framework).  We should all be concerned about what will happen to our credit rating if the agencies aren’t satisfied that we are still committed to a prudent fiscal policy.  

To date only our Rand denominated debt (about 10% of our total debt) has been classified as junk, but could we be in for worse?

The problem is that the Minister needs to fill a R60 billion hole, and the question is whether we should all be preparing now for the possibility of a downgrade to full junk status.  We discuss the Minister’s options …
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You Need Independent Directors, not Herd Mentality 
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“Here’s to the crazy ones.  The misfits.  The rebels. The troublemakers. The round pegs in the square holes.  The ones who see things differently.” (Steve Jobs when he was reinstated as CEO of Apple)

Directors are duty bound to apprise themselves of company activities and to make up their own minds as to how decisions should be taken.  A spirit of independence and good governance should infuse leadership so that the best interests of the company are safeguarded.

Yet all around us we see companies in difficulty - State Owned Companies flounder and multinational heavyweights like KPMG, SAP, McKinsey and Bell Pottinger are in serious trouble. 

How can you chart a better route for your company?  

We discuss the “herd mentality trap” and how to avoid it.
 
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You Don’t Need a Formal Enquiry to Dismiss an Employee 
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Do you always have to go to endless bureaucratic lengths with disciplinary cases against your employees?

We discuss the case of a law lecturer who, having been arrested and detained by the police on criminal charges, was then dismissed by his employer after a disciplinary hearing held in his absence.  Both he and his attorney had failed to make representations in response to disciplinary charges instituted against him.  

We discuss the outcome of the employee’s application to the CCMA for compensation, the requirements of the “Code of Good Practice: Dismissal”, and the importance of complying with them.

We end with a warning that in some circumstances a full formal hearing should always be held. 
 
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Payslips Are Important! A Practical Guide to Getting Them Right 
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It’s easy as an employer to lose sight of the potentially negative consequences of not getting employee payslips 100% correct.

Errors will put both you and your employee at risk of wasted time, frustration, after-the-fact arguments with SARS or retirement funders, and so on.  You even risk damage to your public image because of course payslips are often used in the public domain, such as for getting bank loans.

Perhaps worst of all, you could jeopardise the mutual trust inherent in your employer/employee relationship.

Here’s our checklist of 6 things in particular that you should always verify and check …
 
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3 Future ‘People’ Trends – Be Prepared 
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“Leadership involves finding a parade and getting in front of it” (John Naisbitt, futurist and author of ‘Megatrends’)

Trying to forecast the future is always going to be a very inaccurate science, but on the basis that “forewarned is forearmed”, being aware of likely future trends – even in the most general sense - is fundamental to good business and personal planning.

So let’s take a look at a recent survey which identified three major likely trends for the next five years.  

All of them will present us with a range of challenges and opportunities, and we need to be ready for them.

Businesses in particular should start planning now for how they can and should prepare to adapt to these changing landscapes. 
 
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Tax Deadlines for October 
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Your EMP501 Interim Employer Reconciliation is due on 31 October. 

It pays to begin this early as it is a lengthy exercise and SARS have introduced new income source codes and have updated e@syFile™ Employer which you will need to use when submitting the return.
 







Disclaimer

The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

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