Why you should Care about the
Personal Property Security Register
Honestly, I got a shock when I looked into this – you might too!
Do your own research
make sure you protect your business
It is all about you and the new Aussie Law!
A friend has been “rabbit-ing on” about this for months – sort of in the same way that people talk about diet fads or pyramid selling schemes… constant overwhelming evangelical barrages of information.
For the most part I have completely ignored him – I hate hard sell (or even soft sell for that matter, I like to take action as and when I need it).
But his tone is getting more and more rabid and, as I trust him, I thought perhaps I should investigate a little bit…perhaps I was ignoring something important and five minutes wouldn’t hurt. Turned out he was right
this post is about urging you to understand what impact the Personal Property Securities Act will have upon your business.
I Googled “PPSR” and got a shock – which isn’t a good thing!
I consider myself both well-informed and well organised and yet this came as a surprise:
“Every business that supplies goods (by sale or lease), or finance needs to consider the impact of the Personal Property Securities Act upon its operations.
Businesses that ignore the PPS Act face a real risk of suffering significant losses in the future in ways that have not occurred in the past. Conversely, businesses that make the necessary adjustments to their documentation and business processes will enjoy significantly new protection from bad debts that simply has not existed in the past.”
Legal Practitioners’ Liability Committee, PPSA Bulletin No.2[/box]
The Gov gave a really long run-up for this Legislation so the banks and the big-end finance companies could get themselves in order; upgrade their software and systems, practices and communications. But it is the smaller end of town that seems to have overlooked how enormous the flow on effects could be should something go wrong – Liquidators are able to repossess any unregistered assets you think you have title of, or think you hold as your security.
To be honest I think some of my apathy, and no doubt others as well, has resulted from extra slow creep; at an almost tectonic speed! This Act that was passed in 2009, came into effect in 2011 and has had transitional arrangements in place until January 2014 – the year run-up length of time has resulted in a seemingly “stealthy” introduction as SMEs all automatically relegate this to the “I’ll think about that later” basket.
This legislation will catch out thousands of businesses in 2014 leading to losses in the 100’s of millions-and all preventable which is unbelievably frustrating! If you choose not to act that is one thing, but at least make an informed choice rather than simply being oblivious (just like I was until yesterday).
Personal Property Securities Register
Places to start your Research
The Aust Government’s Website – what to do, how to do it, and quite a lot about the whys and wherefores.
Veda Credit Checksalso has a good summary from the point of view of anyone who provides Finance (and remember if you have any Debtors then you are providing finance).
I have no affiliation to these particular service providers, in my research these simply stood out as good information sources – please feel very free to research you own other useful references as well.[/box]
The Australian Government’s PPSR website now contains warnings on the end of the transition period in January for registration of business assets-or risk losing them under the PPSA. Pity they haven’t OVERTLY TOLD businesses about the Act as it looks like 95% plus of Australian business assets (equipment,machinery, inter-company loans, IP and so on) have yet to be registered……… That really is a lot of SMEs who are yet to act, so many that I felt the need to include a post on it and spread the word.
If you know (and you will for sure) businesses that have not yet taken steps to protect themselves please encourage them to talk with their accountant or legal advisers or a professional in the PSSA area to see how the new Legislation will effect them.
About the Author
Eve Blackall the small business answer to The Supernanny.
At Smart Accounting you work one-on-one with Eve who has already assisted hundreds of business owners increase cash-flow, grow profits, also ensuring those businesses fetch the highest price when it comes time to sell.[/box]