Company's Fascination over Large Leave Balances

random12 on 07/12/2021 - 20:45

One thing I have never quite understood is why company's are so worried about large leave balances, and more so during COVID.

Hasn't anyone taken a class in accounting? The expense is recognised when the work is done, not when the leave is taken. The fact that a company has $x in leave liability means nothing, because they also have $x on the asset side of the balance sheet in cash that would have to be paid if employees took all their leave today.

The only time I can see it making a difference is if an employee gets a raise. Say they go from $50k to $60k, that means the value of the leave has increased by 20%. But other than that, there is no difference. Or its that increase that they all worry about? If that is the case, why don't they build into contracts that leave balances translate into an equivalent $ amount on job changes?

Education & Work

Comments

  • bobbified on 07/12/2021 - 20:47
    +139

    Accrued Annual Leave is a liability. Liabilities are bad.

      • bobbified on 07/12/2021 - 20:52
        +66

        But if you have the $1bn cash and no liability, then you are better! So, liability is bad 😋

        I was actually in the middle of editing my earlier response to say that day to day, if you were to go on leave, one of your colleagues will probably cover your job. So there's no cost to the company's bottom line. If you have a lot of annual leave accrued and you then leave, your annual leave is paid out as cash at a rate that's been indexed in line with your salary and it's increases over the years. If you multiply that buy a large number of employees, then the total liability can be quite large.

          • LiteDough on 07/12/2021 - 22:47
            +8

            @random12: Okay how about this example

            Day 1 balance sheet
            Cash 1b
            Liability -1b

            Day 2
            You spend .5bn on something…inventory, for example.

            Day 3
            Hey, you have to pay out the liability, where's the cash? Even if business is slow due to COVID or whatever, you are entitled to pay.

            You can also consider reversing the order of day 2 and 3

            Even worse case scenario is if the company is in receivership or mass redundancy
            At bigger companies…the number looks bad (even if the company can afford it) and HR reasoning is that taking leave refreshes you for work, improves employee satisfaction/productivity and lowers turnover…
            At smaller companies it could be more of a cash flow problem.

            • haemolysis on 10/12/2021 - 08:53

              @LiteDough: This sort is just proves the opposite point.

              It demonstrates that it wasn’t the leave balance that was the issue, it’s poor financial planning of the company: dipping into money they don’t have.

              If they just set that money aside in a trust or something they’d have no issue, and in fact, they’d earn a profit on the interest.

              If they DO treat the funds like a loan, then they should be prepared to take out a real loan when the owner of the funds cashed in.

              Leave isn’t revenue.

          • burningrage on 09/12/2021 - 11:11

            @random12: You're forgetting Owners Equity but anyway…. :-)

        • deme on 07/12/2021 - 20:57
          +4

          This would be argument for keeping large leave balances since wage growth doesn't keep up with inflation, it would be less costly for a company to do this.

          • bobbified on 07/12/2021 - 20:58
            +1

            @deme: But if they force you to take your leave, then they will owe you nothing. And they're doing under the name of "health and safety".

            • deme on 07/12/2021 - 20:59
              -6

              @bobbified: Did you even read what I just wrote?

              https://www.investopedia.com/terms/t/timevalueofmoney.asp

              • bobbified on 07/12/2021 - 21:09
                +5

                @deme: You're saying that the dollar value of the leave will be worth less over time. What I'm saying is, it often doesn't cost the company anything for their employee to take their leave, so regardless of how much that dollar value has shrunken to, it's still money the company doesn't have to pay out.

                • deme on 07/12/2021 - 21:10
                  -5

                  @bobbified:

                  it often doesn't cost the company anything for their employee to take their leave

                  If the opportunity cost of an employee leaving is zero, why have you hired them?

                  What are you talking about?

                  • bobbified on 07/12/2021 - 21:15
                    +7

                    @deme: I don't know what industry you work in, but someone away on leave is a temporary thing. Does your employer always hire someone to cover you when you're on leave? Because no employer that I've worked for has ever done that. My more time-sensitive work gets passed to my colleagues (or it's left for when I come back) while I'm away and they don't get paid over time. That's the norm in the corporate environment.

      • iDroid on 07/12/2021 - 22:06
        +3

        Leave balances are stored in hours not dollars. There is additional risk in movements in hourly rate over time.

        • Aneurism on 09/12/2021 - 17:33
          +3

          Also, for some companies, there is a negotiated increase to wages each year. This would mean that if leave were left to accrue, the value of the leave per hour would increase year on year.

          If someone was promoted within the company, the value of each hour of leave would in theory also increase. If the person then left the company and were required to be paid out for their remaining leave, if there wasn't a fixed cap, then leave they were accruing at $35 an hour, ten years later might be worth $70 an hour.. etc.

      • ddhar on 09/12/2021 - 16:12
        +11

        OP, I take it your background is not accounting as you clearly do not grasp the concept of:
        1) Accrued liability on BS (salary is expensed in the P&L),
        2) Insolvency risk from carrying large liabilities on the balance sheet. It's a crime to trade while insolvent and directors are personally liable if this happens (Corporations Act 2001).
        3) Keeping large cash balances is an inefficient use of asset so hardly any companies will follow your scenario.

        If you did study accounting, I think you should refer back to your textbooks before making this sort of post.

        • AFOS on 09/12/2021 - 21:32
          -5

          I would not be so condescending here. OP has a valid point: salaries have already been recognized as an expense so why would a company bother about liability in their balance sheet. You are not responding to that particular question.

          BTW, as far as your p.2 is concerned, large leave liabilities have nothing to do with insolvency risk. Trading insolvent though is completely different matter. As far as employees entitlements in case of insolvency are concerned, they are covered by the government. Check this https://www.ag.gov.au/industrial-relations/fair-entitlements…

          For the OP: One of the reasons to force to take leave are bank covenants.

          • SlickMick on 10/12/2021 - 09:20
            +3

            @AFOS: ddhar's point, like dozens previous before it, absolutely address this concern. Every accountant knows not to allow leave liability to get out of hand, therefore most companies have a policy to not allow it.

            OP and his supporters apparently want to overthrow commonly known principles for what you seem to think of as revolutionary thinking, but in fact it's just that you aren't listening.

            Don't every study accounting, because you will not succeed with this attitude.

            • ddhar on 10/12/2021 - 10:02
              +4

              @SlickMick: OP has been working for 5 years and remains, in their own words, "very low on the corporate ladder". It's obvious why by now.

              Sometimes clowns like this manage to slip through the system and get promoted to managers (absolute nightmare).
              Thankfully the control systems are working properly in OP's case.

      • Duckie2hh on 09/12/2021 - 16:22

        Accrued leave means that employers will have to pay more for those leave hours when the employees salaries increase.

      • sackrace on 09/12/2021 - 22:55

        But nobody gives the company any money, this analogy is pointless.

      • funnysht on 11/12/2021 - 08:22

        Exactly if you give me a billion dollars I'm the liability….for you.

    • All Blacks NZ on 09/12/2021 - 12:06
      +4

      Exactly, from my understanding, large businesses like big banks etc have to put aside money to fund annual leave and long service leave etc. When I worked for nab, we were asked to take annual leave every year as the bank was required to put aside money to cover annual leave which is in millions because of the number of staff. Its also better for the mental and physical health of the staff to take regular leave.

      • naru6705 on 10/12/2021 - 17:01
        -1

        Not really when it forced on them

        • funnysht on 11/12/2021 - 08:23
          +1

          Despite this .ppl having a rest usually always come back feeling better.

    • cloudy on 11/12/2021 - 20:22

      Liabilities are bad.

      I look at lots of balance sheets, there's some liabilities i love. Unearned Revenue for instance is great, and is a liability.

  • jjjaar on 07/12/2021 - 20:55
    +43

    Because if people earn annual leave at $20 an hour but wait until they’re earning $40 an hour to cash it out, the company has underestimated how much they owe.

      • buckethat on 07/12/2021 - 20:58
        +66

        If it's not allowed under law… then it surely wouldn't be an easy solution.

          • dasher86 on 07/12/2021 - 21:46
            +21

            @random12: Yeah, nah. That would be illegal in Australia.

          • buckethat on 07/12/2021 - 21:50
            +1

            @random12: I'm not familiar with laws around payroll and such but if it is indeed a law, you can't always just get by it by signing a contract.

            Eg. a retailer can't just say 'if you buy from us, you agree to waive your rights to consumer rights and guarantee under the ACL'. Even if they did, consumer law would still apply.

            • geoffs87 on 10/12/2021 - 06:27

              @buckethat: How does TPG get away with that then? “By continuing with our service you waive your rights to satisfaction guarantee”

              • imurgod on 10/12/2021 - 10:13

                @geoffs87: The two are not remotely the same thing.

                • geoffs87 on 10/12/2021 - 14:57

                  @imurgod: Thanks… I guess? Care to explain? Your response added zero value to the conversation.

                  • imurgod on 10/12/2021 - 15:02
                    +1

                    @geoffs87: Sorry, I didn't read the comment you were referring to.

                    My bad.

          • LiteDough on 07/12/2021 - 22:29

            @random12: Just because you write it down in a company contract doesn't make it legal under state or federal law…even if you agree to it (and even if you did, someone else would lawyer up and the company hr/legal wouldn't let that contract go through).
            If you start a company, put everyone as casual if you want to bring down leave balances, at least it'll be legal.

          • SlickMick on 08/12/2021 - 22:55
            +18

            @random12: I'm out of negs for people who ask questions, get a very clear answer, then start arguing as if they have a clue

              • p1 ama on 09/12/2021 - 00:58
                +11

                @random12: https://www.ozbargain.com.au/node/446222

                How did the sick leave fraud go?

                p1 ama on 09/12/2021 - 00:58 (Collapsed - Offtopic. Show)
              • Hybroid on 09/12/2021 - 03:33
                +7

                @random12:

                I am very low on the corporate ladder.

                It makes no sense to me why the value of existing leave should increase when pay increases.

                These 2 are closely related.

                It's been explained several times here. High annual leave accrual is bad for balancing books end of financial year as it shows a large financial exposure and yes, it impacts business when pay increases.

                Annual leave is paid labour you are not doing. If you take a week of leave today, the cost to the business is $20/hour * 40 hours = $800 for the week.

                If you take it next year after your promotion, it's now $25/hour * 40 hours = $1,000 they are paying you to do nothing. Very simple concept.

                No, you cannot adjust leave amount based on increasing hourly rate. Not only incredibly tricky to calculate but not permissible by law.

                Hence, we're all encouraged to take as much leave as possible before end of year/financial year.

                • random12 on 09/12/2021 - 03:51
                  -7

                  @Hybroid: You did not understand what I asked.

                  I asked why the value of leave SHOULD increase. I was not asking IF the value of leave increases.

                  'Not only incredibly tricky to calculate' - no it's not, it's a simple rescaling. If you have 40 hrs at $20/hr, you have $800 of value. Once you change jobs, it will convert to 800/25 = 32 hours of leave.

                  • jnis6863 on 09/12/2021 - 07:34
                    +2

                    @random12: As an employee, I'm typically entitled to 4 weeks leave per year (plus whatever extra I can negotiate in my contract).
                    The fact that the value of this leave increases over time (as a result of salary increases) is a cost to the business, and not something that can impact the employee. It's not that it SHOULD increase - it's just a consequence of this specific system.
                    No matter what happens, I'm entitled to 4 weeks leave, even if the value of this leave goes up.
                    Whether it SHOULD increase is moot - 4 weeks is the entitlement. The increase in value is just a consequence of salaries rising.

                    In an alternative universe, employment legislation may have been drafted that provided each and every employee "a leave entitlement fund will be developed for each employee, which will grow at a rate equivalent to 4 weeks pay, for each year of employment. This fund can been used to purchase leave, however the purchase price of the leave will reflect the employees current salary, at the time the leave is purchased. At the end of employment, this leave fund will be paid out to the employee". But we don't live in that universe.

                  • redfox1200 on 09/12/2021 - 10:55
                    +1

                    @random12: Sorry that 4 week vacation you had planned overseas/interstate has to be shortened to 2 weeks now because we are paying you more….

                    Good luck with that

                    • random12 on 09/12/2021 - 16:33
                      -2

                      @redfox1200: 2 weeks at twice the pay, and then the person can take 2 weeks unpaid.

                  • ddhar on 09/12/2021 - 16:32
                    +1

                    @random12: The short answer to your question is Payroll works in Hours unit, not raw $.

                    Any increase in salary is a cost to the business and not borne by the employee.
                    Imagine the riots (and unions shouting) if companies try to pass this onto the employees.
                    It also discourages anyone from taking leave which leads to ballooning liability (for the company) and worsening mental health (for employee).

                • Morphio25 on 10/12/2021 - 06:42

                  @Hybroid: This literally happened to me in the job I got made redundant from in 2019. Got a $5K pay rise in 2018 I think it was (went having a $5K bonus component to $0 and that amount moved into my salary).

                  They then made me redundant the next week and I had something stupid like 12 weeks of annual leave owning as well as the 4 weeks redundancy leave and a further 11.7 weeks of long service leave. Worked out that that $5K pay bump was quite a handy little increase in my payout figure.

                  • ankor on 10/12/2021 - 08:16

                    @Morphio25: Sounds like your boss knew it was coming and did you a solid?!

                    • Morphio25 on 10/12/2021 - 09:18

                      @ankor: Probably not, everyone was shocked when they found out I'd been let go. My timeline is off too, the payrise happened in October 2018 (pretty sure) and I was let go in July 2019 (so my comment above should say … made me redundant the next year). The reason behind the pay rise was because the bonus program had turned into a bit of a joke, with the 6-monthly KPI's for it being set either ridiculously low or not at all such that everyone always got a 100% bonus so management at that time decided that rather than them having to been seen to do the work to set the KPI's and monitor them etc they'd just scrap it altogether and roll that amount into our salaries.

                      As I said though it worked out well, along with another 8 months at an extra ~$200 per fortnight it ended up giving me a whole lot more when I was made redundant which went a long way to my wife and I buying our dream home.

                  • lddv04 on 10/12/2021 - 14:39
                    +1

                    @Morphio25:

                    12 weeks of annual leave

                    I'm more concerned that you did not have a holiday in 3 years

                    • Morphio25 on 10/12/2021 - 16:58

                      @lddv04: I did though, I'd take random days off for things hear and there but mostly between Xmas and New Year I'd have a couple of weeks off but all up I probably only used 2 weeks a year of annual leave for probably the last 6 years I was there.

              • SlickMick on 09/12/2021 - 07:19

                @random12: Yeah most businesses without an unlimited budget, and ozbargainers, are wrong and you're the only one who can see the obvious truth here.
                And you feel as though you aren't getting the validation you crave for your revolutionary thinking?

              • Pinchie on 09/12/2021 - 10:37
                +3

                @random12: I understand your logic, cold though it is - If you accrue leave while being paid $25/hr and take it while being paid $40/hr hasn't that $15 seemingly-unjustifiably appeared out of nowhere when it's applied to your existing leave balances?

                Frankly no, it hasn't. Your contract has updated, your value-per-hour has increased, and any future leave you take will be taken at your currently-paid value. You're taking leave in 2021, it's neither reasonable nor legal to be paid at your 2019 contract rate just because the specific hours appeared there. This is something that's taken into account when your pay rise is calculated, and HR/Finance will absolutely view unused leave balances as a hanging debt. You'll find them encouraging people with large leave balances to start taking leave in order to try to reduce the associated dollar figures, as well as reduce the immediate increase in dollar value of your leave when your pay is increased.

                It's an accepted process, and it's up to the company to ensure that their leave liability is appropriately-handled and kept below a maximum value.

              • spiff on 09/12/2021 - 12:04
                +3

                @random12:

                I am very low on the corporate ladder.

                Yes I can see why

              • mattkenny on 09/12/2021 - 21:19

                @random12: Because the laws says it does. Just like you can’t just decide paying taxes is dumb, you can’t just change the accrued leave hours of employees. It’s written into law. It’s accrued in hours, and is paid out at the pay rate of the employee at the time it’s taken, not accrued. You can force them to have it paid out at current rate before a pay rise either - there are many legal restrictions on how much leave can be paid out, etc.

              • SlickMick on 10/12/2021 - 09:33

                @random12: Yah, I have a new batch of negs :)

                You acknowledge that you're inexperienced, but instead of learning from those who know, you arrogantly state that anyone who doesn't agree with you is wrong.

                They should make a documentary on how this career plays out.

      • Randolph Duke on 09/12/2021 - 12:23

        Why should people lose their annual leave entitlements when they get promoted?

        • jerrus on 09/12/2021 - 18:05

          They don't that's why some companies have a policy that requires an employee to keep their leave balance below a certain number of weeks. This limits the cost to the company if the employee is promoted. This can be negotiated if the employee wants and the company allows it.

    • FW190 on 11/12/2021 - 13:14

      if my workpace would double my pay, I would be happy to forgo any accured annual leave :)

  • SF3 on 07/12/2021 - 20:55
    +7

    Liability do not look good on a company’s balance sheet.

  • buckethat on 07/12/2021 - 20:57
    +5

    I've always just assume that it could pose a cashflow risk if say 100 employees accrue half a year worth of AL each and all leaves in short period of time.

    The way budgeting works is that each period, there is a certain amount allocated for paying out annual leave.

    So.. yeah its budgeting and minimising cashflow risk.. is my guess.

    Another thing is, annual leave is often paid at the current rate of pay even if it was earned at a lower rate of pay.

    There also might be some law about excessive annual leave accruals? Didn't read but link here.

    • deme on 07/12/2021 - 21:00
      -1

      some law about excessive annual leave accruals

      There is no limit on leave

      • Trance N Dance on 07/12/2021 - 21:17
        +10

        But one can be directed to take leave if over 8 weeks are accrued or contracted into the EBA/individual agreement.

        • deme on 07/12/2021 - 21:19

          In the land of the free (USA) at a lot of places it just stop accruing at ~200 hours.

          ie. you lose money

          • pandamninator on 09/12/2021 - 10:57
            +4

            @deme: A lot of places in the USA you don't get it full stop or at such a slow rate you'll have already gone postal by the time you hit 200 hours.

          • chriskq on 09/12/2021 - 16:54

            @deme: I work for a UK company, the UK employees are only allowed to roll over 5 days of annual leave each year. Luckily doesnt apply to me in Oz

            • pogichinoy on 09/12/2021 - 18:41

              @chriskq: Yep, and for some of my friends in the US, they can only roll over 15 days of annual leave each year. Pretty sad.

              Sad enough already they only get 14 days a year.

      • buckethat on 07/12/2021 - 21:45

        Not gonna lie, I didn't even read it. So, I stand corrected.

  • cuckchump on 07/12/2021 - 21:06
    +11

    how about companys who close for 1-2 weeks during NYE and want you to used leave if u still want tobe paid, how can u save enough weeks leave to go on a holiday unless u take unpaid leave

    • TheOtherLeft on 08/12/2021 - 08:01
      +11

      Some companies allow negative leave. You just work it back after the fact.

      • redfox1200 on 09/12/2021 - 10:57
        +1

        Why not afterpay and borrow money to go on a holiday too!

        Going to have the same issue the following year when you reach 0 hours leave and its christmas time again, back to negative

    • lalala1111 on 09/12/2021 - 14:21
      -1

      I know of a company where they increased it to 3 weeks (is normally 2 weeks) "for your mental health".

    • serpserpserp on 09/12/2021 - 15:19

      I haven't had a holiday since COVID started. So pretty easily.

    • jerrus on 09/12/2021 - 18:10

      They normally only add up to 7 days due to public holidays so you can save the remaining 13 days of leave (assuming 4 weeks) for your holiday. The employer doesn't want to fund you coming into work when there is no/little work to do. If you want an additional 7 days of paid leave you can negotiate it (most employers wouldn't mind averaging down your pay to facilitate this) or is your argument the company should shout you some extra leave?

  • shiznit on 07/12/2021 - 21:09
    +4

    It's easier to manage work if employees take leave a little at a time, since long periods of leave may require someone else to fill your position while you're away.

  • Jimothy Wongingtons on 07/12/2021 - 21:13

    I’ve been banking my leave for years if I cashed out one day it would be a pretty good hit on the cashflow

    • 87percent on 08/12/2021 - 08:11

      I was doing that too. I would book a month off in December, and then cancel it. Was doing it for a few years, and at one stage, I had nearly 15 weeks of annual leave banked. Now I have 3 weeks

    • mattkenny on 09/12/2021 - 21:30

      Just checked and I’ve got 13 weeks AL, 3 weeks TOIL. Just got a 15% pay rise. Must have hit their balance sheets a bit with that one. I was considering getting 2 or 3 weeks worth paid out for some work around the house, but decided I could probably wait until after my annual review was done ;-)

      I’ve always taken off about 4 weeks of leave each year, but since I was travelling a lot I was accruing TOIL at about the same rate as I was taking off 1-2 week blocks, so my actual leave balance didn’t get used much for a few years.

  • oO0Dam0Oo on 07/12/2021 - 21:24
    +1

    Can anyone confirm that if you cease working for an employer and have annual leave to be paid out, that no super is payable on the annual leave component?

    I don't believe it does which is one good reason for an employer to allow leave accumulation.

    • random12 on 07/12/2021 - 21:37
      +1

      Why?

      Again, if this is the case, just extend your end date by the amount of days leave, and then quit.

      You have 30 days leave and want to quit now? Just say you will quit in 30 days time and take leave everyday until then, so your balance is used before you go.

      • Archi on 08/12/2021 - 08:49
        -4

        if i was your employer and you did that…

        i would say that's OK, you don't need to take your annual leave, and i'll waive your notice period as well, grab your stuff and a security guard will walk you out.

        • Assburg on 09/12/2021 - 03:53
          +3

          So the trick is, if your boss is a scumbag who doesn't want to pay your super, first take all your leave, then come back and give two weeks notice.

          • Archi on 09/12/2021 - 08:30

            @Assburg: that would be the right thing to do, but not what the OP was implying

            You have 30 days leave and want to quit now? Just say you will quit in 30 days time and take leave everyday until then

      • Geoff01 on 08/12/2021 - 09:48

        And account for the leave you would accrue in that 30 days

      • redfox1200 on 09/12/2021 - 11:00
        +1

        Or just work those 30 days and get 2x your salary, rather than take leave to collect 10% super

    • Smiley82 on 07/12/2021 - 21:43
      +3

      This is correct.

      ‘Many termination payments do not constitute an employee’s OTE and therefore do not qualify to receive super contributions. According to the ATO, lump sum termination payments for unused annual leave, unused long service leave and unused sick leave are not part of an employee’s OTE. Similarly, termination payments to compensate an employee for unfair dismissal and redundancy payments are not OTE. Therefore, none of these termination payments would attract super contributions.’

      • random12 on 07/12/2021 - 21:48

        But you would get super if you were still technically employed but just on leave to run the balances down to zero before you officially quit?

        • Smiley82 on 07/12/2021 - 21:49

          Correct. If you use your leave, then quit, you’ll get super. But if you don’t have this opportunity (have to start a new role at a certain date etc) and get your leave paid out, you’ll miss out on super contributions.

          • random12 on 07/12/2021 - 21:50
            +2

            @Smiley82: Even if you have to start new role on a date. Nothing stops you from working new job while still being on the books at old job and on leave to run your balance to 0.

            • JDMcarfan on 08/12/2021 - 10:13

              @random12: Correct, unless either company has a non-compete policy or policy that requires express approval to be working for 2 companies at one time (unlikely if you head to rival/related industry company). Most corporate jobs are like that so you'd realistically just have to take the cash out or agree to extend your termination date to when your leave lapses and then start at the new company.

              Also note that if you are using up your leave and not cashing out, you will continue to acquire leave whilst on leave (confusing I know). For example. Lets say you have 6.5 weeks of leave and you 'quit' to leave in 7 weeks. When you use your 6.5 weeks of leave (52/8) you will acquire another half a week (19 hours of leave) that you should incorporate into the leave request for a total of 7 weeks leave.

              I guess that's the other added benefit of running out your leave before starting a new job. Unless you were planning to take an extended break, most people just elect the cash out and start the new job so that they can maximise pay.

            • mattkenny on 09/12/2021 - 21:38

              @random12: My contract forbids me working for another company while on leave. (Not sure if it’s just within the industry, or blanket rule x been ages since I read those particular details). Would probably be difficult to enforce too, but is generally to ensure that people do actually take leave and don’t burn out.

              Doesn’t mean they try to enforce it either though - we had a guy take 2 weeks leave recently to work a mining site shutdown and rake in a nice chunk of extra pay. Company happily let him do it.

          • buckethat on 07/12/2021 - 22:03
            +2

            @Smiley82: Today I learn, very good to know.

            Have always left my previous roles and got my leave paid out. Didn't really think about the super components.

            Will keep this in mind going forward, thanks stranger.

        • oO0Dam0Oo on 07/12/2021 - 21:52
          +1

          Business would need to agree to leave.

          Other scenario is if business is ceasing to exist then there would be a loss of super.

          All interesting discussions by the way.

    • deme on 09/12/2021 - 19:47

      I've always been paid super

  • dasher86 on 07/12/2021 - 21:29

    Well aside from the increases year on year and annual leave being paid out at your current rate of pay. On termination annual leave payout is subject to payroll tax.
    At the same time a good company wants you to take a holiday.

    • oO0Dam0Oo on 07/12/2021 - 21:32

      Only if over the monthly threshold so wouldn't apply for majority of small business. IANAA.

  • djones145 on 07/12/2021 - 21:34
    -1

    u note that companies have 1bn in liabilities but have 1 bn in assets cash so what's the problem

    the problem is that 1bn in cash is wasted. it could have been used to invest, in the market or in the company to get a better return than just cash . opportunity cost

    • dasher86 on 07/12/2021 - 21:38

      Also gearing ratios which can impact loans and the 'value' of a business on the balance sheet.

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