Whether you have purchased an operating facility or developed a Greenfield site it is reasonable to assume that at some stage you will have to refit, refurbish, extend or rebuild it. We have worked with a number of providers to ensure a positive financial outcome in each of these situations. 

We help clients answer three critical questions: 

• does the project add value to the organisation? 
• do you have sufficient capital/debt for the project? 
• will the operations produce a sufficient cashflow? 

With these answers, boards and owners can be assured that decisions involving millions of dollars are soundly based.

Operating a facility is much more than focusing on increasing or maximising short term profit, it is ensuring that your facility operates on a sustainable and stable platform for the long term. Our best practice insights assist you to manage bed mix, occupancy, capex and costs to ensure that you operate with appropriate surpluses and reserves. 

We see aged care moving to an environment where consumers will be more empowered. Key issues that will emerge for providers in this environment include: 

• market relevance - are you providing the standard and mix of accommodation that the market expects? 
• capital reinvestment - is the balance between surplus, profit distribution and surplus reinvestment enabling you to maintain the standard of your physical facilities? 
• staff engagement - are your reward and employment practices supporting business improvement?

The connection between cash flow and profit is always interesting and no more so than in aged care. Non-cash charges, facility upgrades, and revenue items mean there is a low level of correlation between profit and cash flow. 

Operating cash flow is assisted as both government and resident contributions to ongoing services are paid in advance, this minimises working capital requirements. On the capital side high care returns are inadequate to meet capital costs with low care and extra service bonds providing a cross subsidy for high care places. 

Understanding and managing cashflow in aged care requires the insight that can only be gained from advisers who specialise in this area. Our experience in cash flow forecasting and review for our aged care clients assists our clients generate the cash flow they need to ensure the sustainability of their operations and allows them to maximise the use of any excess cash liquidity.

In addition to our more specialised aged care services, we manage your tax and other financial reporting obligations. 

Our ongoing services include: 

• prudential audits 
• CAP funding audits 
• income tax compliance and planning 
• annual accounting 
• fringe benefits 
• tax management 
• capital gains tax management and planning 

As a provider, you're likely to think in terms of profit (or surplus) per bed. As tax specialists, we measure the average rate of tax for your profit providers. Our target rate is between 22% and 26%. Using a benchmark allows you to assess our performance.

With a controlled income stream, a fixed level of potential users (available beds), and escalating costs, a viable strategy is essential to achieve sustainability and meet your profit or service goals. Being able to accurately predict cash streams allows operators to be more adept in managing residents’ accommodation and care requirements and this in turn improves sustainability and outcomes for all. 

Our strategic advice provides answers to the following key questions: 

• what is my core operating purpose? 
• who is my target market? 
• what is my operating model? 
• what cash inflows are available to support this model? 
• does my governance model manage operational risk? 
• is my model financially viable over time? what are the requirements for eligibility for particular inflows? 

While the specific answers change from facility to facility, all facilities need to ensure they match their operating models to their strategy or purpose. Ever changing government policies, transitional arrangements and grandfathering provisions create unique challenges to facility operators. 

Our team works with operators and boards to define and refine strategies to anticipate and respond to these changes, ensuring that operational plans reflect and support organisational strategy.

In a case involving a $24m new build, our modelling enabled the operator to borrow funds on limited recourse guarantees. An external valuation confirmed our findings and gave great comfort to all parties. In another case, a review resulted in a client amending the scale of a proposed development to enhance its financial viability. 

Whether you have existing facilities, have purchased an operating facility or are developing a greenfield site, it is reasonable to assume that at some stage you will have to refit, refurbish, extend or rebuild it. 

When the time arises, you can rely on us to answer the critical questions: 

• Does the project add value to the organisation? 
• Do we have sufficient capital/debt for the project?
• Will the operations produce sufficient cash flow? 

With these answers, boards and owners can be assured that complex decisions involving millions of dollars are soundly based.