Which chapters should I read?
Find your role, then read the chapters in the order shown.
Sole trader or partner
You own the business yourself, or with partners, and there is no company.
- Chapter 2 — your personal obligation
- Chapter 3 — the Sustainable Cashflow Formula
- Chapter 8 (a sole trader) or Chapter 8C (a partnership) — a worked example like yours
Company director
Your business is a Pty Ltd or Ltd, even if you are the only director.
- Chapter 2A — the director’s legal duty
- Chapter 3 — the Sustainable Cashflow Formula
- Chapter 8B (a retail company) or Chapter 10 (a larger company) — a worked example like yours
Club committee member or club director
You help run a not-for-profit club, association or charity.
- Chapter 2B — the committee’s and directors’ duty (sections 2B.1–2B.7 are written for you)
- Chapter 8D (a community sporting club) or Chapter 8E (a licensed club) — a worked example like yours
- Chapter 2D — bring your accountant in from the start
- Treasurers: Chapter 2C — the detail your accountant will use
Accountant, auditor or verifier
You prepare, check or advise on a client’s accounts.
Everyone: once you have read your path, Chapter 3A shows how to make it a quarterly habit, and Chapter 3B how to train on a practice copy first.
Start Here
Two documents, two different jobs. How It Works (inside the app) is the quick-start — task-by-task, click-by-click, for setting up and operating BusinessSolvency independently, once the platform is live. This Manual is the deeper reference — the reasoning, the governance context, and the "why" behind every number. How It Works will link back to the relevant chapter here for anyone wanting the fuller picture, once it's built.
How to read the colours in this manual
- Green — the point of the chapter
- Yellow — remember this; also the point of the chapter in Chapters 2B, 2C and 2D
- Light pink — watch out; also the point of the chapter in the club worked examples (8D and 8E)
- Burnt orange — urgent: this will catch you out; also the point of the chapter in Chapter 2A
- White — notes and explanations
- Green, amber, red headers — the platform’s own traffic lights in the worked examples
Training comes first
Read the manual, then practise on a training copy before relying on real figures, whether you are an accountant, a bookkeeper or an owner. Why training comes first, and what it covers → · Chapter 3B: how to train, step by step →
Read First — Alpha Stage
The worked-example chapters (8, 8B, 8C, 10) link through to that business's live forecast inside the actual running app — an owner login is required to view it. This manual is written to be read on its own regardless; the live app is not yet open to the public.
Part One
Foundation
Chapter 1
Foreword — The Research Behind BusinessSolvency
Stephen Fairbairn's personal research journey — from business closure to the platform. Covers the April 2016 research findings, the Sustainable Cashflow Formula, the profit culture problem, and how ASIC RG 217 confirmed for incorporated companies what the research had identified a decade earlier — direct, personal exposure for a sole trader or partner all along.
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Chapter 2
Your Legal and Financial Obligation
Direct, personal exposure every sole trader and partner already carries with no separate entity in between. Explains why: incorporation is what triggers the company-director legal framework (Section 588G, safe harbour, Director Penalty Notices) — not board size, and not how hands-on the owner is — with the company-director detail in Chapter 2A. Why relying on a "feel" for the business isn't enough, and lessons from real Australian business failures.
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Chapter 2A
If Your Business Is a Company — The Director’s Legal Obligation
For businesses run through a company: Section 588G and insolvent trading, what ASIC RG 217 expects of every director, the safe harbour, Director Penalty Notices and personal liability, and why management reports alone are not enough. Applies in full from a one-person Pty Ltd to a formal board.
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Chapter 2B
If Your Organisation Is a Club or Association — The Committee’s and Directors’ Duty
For not-for-profit clubs, associations and charities, and the accountants, auditors and verifiers who review them: the duty not to run while insolvent for each legal form (Queensland’s 2022 committee duty, section 588G for club companies, ACNC Governance Standard 5), the money traps peculiar to clubs, how their tax differs, who checks the numbers each year, why the AGM is the natural moment to look ahead, and a practical annual routine for the accountant. Written in plain English, with the accountants’ detail at the back.
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Chapter 2C
Clubs and Associations — The Detail for Accountants, Auditors and Verifiers
For the accountant who checks a club’s accounts each year: club companies and registered charities, how stretched the sector is, tax (mutuality and exemption), who checks the numbers and where the reports go, a practical annual routine with questions for the treasurer, and setting a club up in BusinessSolvency.
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Chapter 2D
Clubs and Associations — Bring Your Accountant In From the Start
For committees, club boards and their accountants: why the accountant belongs at the start, the two worked examples with the story and the fix, what BusinessSolvency gives the club and its accountant (with a sample letter to the committee), the duty state by state, and licensed clubs.
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Chapter 3
The Sustainable Cashflow Framework
Why profit is not solvency, how the three financial statements work together, the Sustainable Cashflow Formula, the growth trap, the debt and credit cycle, the two breakeven points that define the danger zone, the Four-Factor Solvency Check, why Ridgeline, Noosa Care, Bayside and Coastal teach four genuinely different lessons, and the practical reference for reading the signals and the levers a business owner has available.
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Chapter 3A
Making It a Habit — Your Quarterly Review
A quarterly review turns solvency from a worry into a habit. After each BAS quarter: import the quarter’s figures, compare them with the plan, read the trend in dollars and percent, and take one action while it is still small. Includes what the checks mean and how to make the habit stick.
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Chapter 3B
Training — Practise First, Then a Real Client
For accountants, bookkeepers and owners: make your own training copy of a demo business, the three habits from the first training session, what to practise (drawings, unpaid tax, margins, a year to Breakeven), building reserves, moving to a real client with “Set up a new client like this”, and who does what.
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Part Two
Accounts and Access
Chapter 4
Getting Started with BusinessSolvency
Logging in, creating your business, entering financial data year by year, and understanding what the platform calculates automatically. Complete field guide for Income Statement, Balance Sheet, and Cash Flow Statement.
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Chapter 5
Accounts, Roles and Access
How BusinessSolvency accounts work — Owners, the business’s Accountant and the Administrator, requesting and approving access, adding or removing people from your own business, leaving a business, and resetting a forgotten password.
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Part Three
Setting Up and Managing Financial Results
Chapter 6
Importing Financial Data
Step-by-step export guides for Xero, MYOB, and QuickBooks. Field mapping, the six validation checks, what BusinessSolvency does when no cash flow statement exists, and the phased import roadmap.
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Chapter 6A
Import & Export: Reference and Troubleshooting
How the three-pass chart-of-accounts matching engine actually works, five real gotchas found building BusinessSolvency's own demo businesses, how to verify an import genuinely worked, and exporting.
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Chapter 6B
Export & Import Integrity: Identification, Versioning, and Verification
What every export now carries to identify itself — business ID, export timestamp, data-last-updated timestamp, and calculation engine version — why it matters, the difference between CSV's raw data and Excel/PDF's calculated reports, and a step-by-step checklist for reconciling two exports with confidence.
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Chapter 7
The Forecast and What-If Module
The three-year forward view, quarterly review and update discipline, equity and reserve provisions, the Quarterly Forecast & Review page, and the July Year-End Checklist (7.12).
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Chapter 7A
Quarterly Forecast & Review
Plan each quarter, compare it with the actual figures imported from the accounting software after each BAS quarter, and read the trend in revenue, cash and money owed. How the page links with the annual sheet, the checks and your goal, and how to keep a record as Excel, PDF or a web page.
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Chapter 8
Worked Example — Ridgeline Landscaping
Complete demonstration of a sole-trader landscaping business where success outpaces cash: profitable in every year, yet overdrawn for four of them — because Owner Drawings outrun profit and the second-year PAYG tax double hit lands at the same time — then a three-year correction — prices rising ahead of inflation — back to positive cash and a funded reserve. Real numbers throughout, calc-engine verified.
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Chapter 8B
Worked Example — Bayside Home & Living
Complete six-year owner-facing demonstration — a retail business that looks successful on paper while a debt and working-capital strain builds beneath it, deepens into a distinct debtor collections failure, and then faces a second, unrelated capital-driven crisis from a store expansion — before recovering through disciplined action each time.
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Chapter 8C
Worked Example — Noosa Care at Home Services
Six-year demonstration of a sole trader who takes on a partner, then staff: a profitable home-care business whose partners keep the drawings of the good years while tax instalments are set on the year before. Profitable every year, overdrawn from FY2027 onward, with no correction made, showing exactly where “carry on as before” leads, how a partnership’s tax really works, and why the year the numbers first turn is the cheapest time to act.
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Chapter 8D
Worked Example — Riverbend Sports & Recreation Association Inc
A volunteer-run Queensland sporting club builds a new clubhouse with grants and a loan, then finds it costs more to run than the club earns: a loss while the bank balance still looks fine. The committee acts in time with a members’ levy, price rises and a solar grant, and the club recovers. Engine-verified figures.
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Chapter 8E
Worked Example — Coastline Leagues & Community Club Ltd
The warning case. A licensed club run as a company limited by guarantee borrows for a $2.6 million renovation, then a downturn arrives. A short-term loan and unpaid suppliers keep the bank balance up while the club loses $717,000, and carrying on as before leads to $1.66 million overdrawn. Section 588G applies to its directors. Engine-verified figures.
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Part Four
Solvency Management
Chapter 9
Reading the Solvency Dashboard
Every metric, ratio, and signal BusinessSolvency produces — in plain English. The four key indicators (DSCR, Cash Trend, Breakeven Gap — the one measuring your Sustainable Cashflow position, not standard accounting breakeven — and Current Ratio), ATO obligations, the traffic light system, and how each monitoring session builds your protection record — a documented history of prudent diligence for sole traders and partnerships.
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Chapter 10
Worked Example — Coastal Freight
Complete six-year demonstration — three years historical, three years forecast. A large, growing freight business that looks comfortably solvent on every conventional measure while a real margin crisis builds underneath it, then shows why a DSCR lifted by fresh capital isn't the same thing as the underlying problem being fixed — plus the real, earned recovery that follows through disciplined pricing, Capex timing, and a properly funded Contingency Reserve.
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Chapter 11
Purchases, Payments & the Working Capital Engine
How Creditor Days, Debtor Days and Stock Days, with sales, purchases and COGS, drive Trade Creditors, Trade Debtors and Inventory under the surface — why editing a balance sheet figure directly won't hold, a worked case study of a debtor crisis resolved through the Days mechanism, and the cash conversion cycle: the days your business funds its own trading.
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Part Five
Solvency Governance
Chapter 12
Solvency Reporting — Seeing Trouble While It Can Still Be Fixed
Using the Solvency Forecast to catch a cash problem early: the eight early-warning signals (Breakeven, forecast overdraft, revenue and drawings keeping pace with inflation, cost headroom, threatened borrowing, ATO cover, DSCR and Current Ratio), the quarterly review rhythm, turning a warning into a plan, presenting the reports, keeping a dated record, and when to escalate.
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Part Six
Reference
Chapter 13
Glossary — Plain English Definitions
Plain English definitions of every financial, legal, and BusinessSolvency-specific term used throughout the platform — without assuming accounting knowledge, legal training, or financial qualifications.
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Chapter 14
Research Sources and Further Reading
The academic, professional, and regulatory foundations of the Sustainable Cashflow framework behind BusinessSolvency — a decade of documented independent research from 2016 through to 2026, plus a recommended reading list for business owners of every structure.
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The BusinessSolvency Story
The Case for Why This Exists
The Problem
Why profitable businesses still run out of cash
The Debt Cycle
The 2020–2025 sequence behind the current crisis
The Formula
The Sustainable Cashflow Formula itself, explained
Innovation
What makes BusinessSolvency's approach genuinely new
Research Foundation
For Governance Professionals
Founder's Journey
Why I Built BusinessSolvency
Stephen Fairbairn's personal research journey, in his own words — a decade of independent research into why Australian businesses fail, told as a narrative with a timeline from the original 2016 findings through to the platform today.
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Position Paper
The Academic and Legal Basis for Business Solvency Governance
A position paper for governance professionals, legal practitioners, and accountants evaluating BusinessSolvency — covering Section 588G, ASIC RG 217, the direct exposure carried by sole traders and partnerships, Christensen, Edmondson, Martin, and the decade of independent research behind the Sustainable Cashflow Formula.
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Appendices
Supporting Reference — In Preparation
A.1 – A.5
Field Mapping, Ratios, ASIC Extracts, Innovation Statement, Disclaimer
To be completed before beta release. Will not be published until verified against the live platform.