It is illegal for your POS software to offer tools to avoid tax

The federal government passed ;legislation a while back making it illegal for POS software companies to offer tools that facilitate the hiding of business income for the purpose of reducing your taxation obligation.

Here at Tower Systems we have never offered such tools.

We think it is wrong for any business to hide income for purposes of reducing taxation obligation.

We have participated in several panels with the Australian Taxation Office on matters related to POS software including this area of software compliance so as to not facilitate tax avoidance. We are grateful for the opportunity to be part of the conversation that led to tighter rules in this area.

Years ago, we had a competitor that did this, a competitor that facilitated the avoidance of tax by retailers using their software. They promoted it. It was common knowledge in retailer circles at the time. We saw live how a secret facility in their POS software was used to avoid tax. Once we saw it ourselves, we reported the matter to the Australian Federal Police and other authorities. The tax avoidance tools in the software were demonstrated too the authorities.

That experience is not the only time we have seen this. It frustrated us that tax avoidance facilities were being promoted as a differentiator to our software. For sure, it cost us revenue. I sucked then and still sucks today. Those perpetrating the tax avoidance scheme within the software company should have been jailed in our view.

However, we move on.

Today, the message for retailers is that the ATO has a range of tools, benchmarks and more at their disposal that enable the discovery of tax avoidance. Trying to avoid tax is a mugs game.

Retailers are better served focussing on smart engagement and operation, using their software to builds stronger and more successful businesses. This can be done if you use smart software that focusses on new traffic and new opportunities for a brighter future. that is, software that is backed by business advice and professionalism to help retailers achieve excellent results.

Tower Systems helps small business retailers beyond the software to ethically build stronger and more successful businesses. As retailers ourselves it is what we do, with pride and pleasure.

Help for drought affected small businesses

Tower Systems has several businesses in our client base that have been drought affected. We have reached out with help and resources to assist.  We have also spoked with government agencies to understand the resources available so that we can connect our customers with these as appropriate.

One such resource for drought affected small businesses is through the ATO, the Australian Taxation Office. Here are some details of their drought assistance eligibility criteria:

To work out if you are eligible for small business entity concessions, you first need to work out if you are a ‘small business entity’ in an income year. You must review your eligibility each year to check if you are able or required to use a particular concession.

From 1 July 2016, you are a small business entity if you are a sole trader, partnership, company or trust that:

  • operates a business for all or part of the income year, and
  • has an aggregated turnover less than $10 million (the turnover threshold).

From here on, when we say:

  • ‘small business’, we mean ‘small business entity’
  • ‘turnover’, we mean ‘aggregated turnover’.

From 1 April 2017, the turnover threshold for fringe benefits tax (FBT) concessions increased to $10 million.

The $10 million turnover threshold applies to most concessions, except for:

  • the small business income tax offset, which has a $5 million turnover threshold
  • the capital gains tax (CGT) concessions, which continue to have a $2 million turnover threshold.

For previous income years, you are a small business if your turnover is less than $2 million.

Find out about:

See also:

  • Are you in business? – determine the differences between a hobby and a business for tax purposes

Our Tower Systems POS software company helps small business retailers in a range of practical ways from direct assistance to operational assistance. We do this because we believe in small business and because we are grateful to be in a position where we can help. Gratefulness is best expressed through practical help in our view.

Advice on avoiding the impact of a ransomware attach on your retail business

Ransomware / malware can come in many forms. Every computer connected to a network in any way is at risk.

There is no guaranteed protection but there are important steps to take. This advice sheet provides advice designed to reduce the risk to your business. Ransomware often comes in the form of a harness looking business email, seeking you to click on something that makes sense.

Often, if the recipient clicks on the attachment in the email, the ZIP file, on a PC running Windows they would have been locked out of the computer and subject to ransomware.

A ransomware attack is where money is demanded to unlock your computer. Often, the computer is not unlocked even after a payment is made.

More and more businesses including small business retailers are being affected by these malicious attacks, they are being locked out of their businesses.

You can reduce the opportunity of being hit by an attack by taking care with emails.

If you are not sure of the sender, ignore the email. Tell everyone who has access to your email. Lay out your ground rules and demand discipline.

Here is our best-practice advice to protect against Ransomware:

  1. Ensure you use professional, up to date, virus protection.
  2. Ensure you have a good firewall with strong settings.
  3. Do not click on emails or attachments unless you are sure of the sender.
    1. Be particularly wary of ZIP files in emails.
    2. The ATO will not email you.
    3. Your bank will not email you.
    4. Australia Post will not email you, not like the example I have posted.
  4. Ensure all passwords you use are strong.
  5. Consider using an email filtering facility.
  6. Do not allow remote access to your computer unless you are certain of the person accessing.
  7. Ensure you have strong passwords. A strong password should include: some CAPS, some numbers and at least one special character. Check your password at: https://howsecureismypassword.net
  8. Change your password regularly.
  9. Run an up to date operating system.
  10. Have rules on computer use: no games, no online gambling, no porn, no personal emails.
  11. Have an overarching rule: do not open any email or go to any website unless you are certain.
  12. Use a cloud backup service like the Tower backup service. This provides the fastest recovery.
  13. Have multiple backup devices for additional protection.
  14. Do not use automatic file replication programs / facilities such as Dropbox or Google Drive. If a file is encrypted with malware / ransomware it will upload to the account and infect other files.

Most ransomware attacks can be avoided by careful scrutiny of your emails and websites you visit.

We need a Royal Commission into retail shopping centre development and retail tenancies in Australia

We, Australians, small business retailers, suppliers to small business retailers, local towns, all of us need a Royal commission into retail shopping centre development in Australia and the behaviour of shopping centre landlords.

There is enough evidence to indicate that an appropriately skilled and resourced Royal Commission could uncover behaviour that is illegal and harmful to our economy and small businesses and families that rely on the small businesses.

I appreciate that the areas I think the suggested Royal Commission cover are broad and could be better served as two investigations. However, the two issues feed into each other. I think they are best considered together.

WHAT IS A SHOPPING CENTRE?

For the purposes of my proposal, I suggest that a shopping centre is a retail development with fifteen or more shops of any size.

While I am sure there is misbehaviour to consider in smaller centres, for management and focus, a threshold of fifteen tenancies, or similar, is needed. Otherwise, any Royal Commission would run too long and cost too much.

RETAIL SHOPPING CENTRE DEVELOPMENT.

This is the beginning of the issue. Whereas in the US and other countries growth in retail tenancy space is flat or declining, in Australia it continues to grow. Some say we already have far more shops that the population can support.

In regional and rural locations the challenge is that a new centre is usually located outside town and its development can gut the centre of town, diluting or killing off the heart of a small town.

In some cases, mid-size centre development tis driven by competition by the two major supermarkets and aided and abetted by several other anchor tenants and supported by Tatts keen to be in all new centres.

  1. Do we need more shopping centre space?
  2. Should there be controls on approving this?
  3. What is the economic impact of the current growth in retail space in Australia?
  4. What is the social impact of the current growth in retail space in Australia?
  5. What is the impact, specifically on small business retailers of the growth in retail space?

LANDLORD BEHAVIOUR.

Talk to any small business tenant in a shopping centre and they will have at least one landlord story that causes them stress.

There is the landlord who did a handshake deal with a party that was negotiating to buy a business. the landlord squeezed and the family business closed. The new tenant moved in without paying goodwill.

There is the landlord that took too long on centre re-develoopmnent, making decisions that saw a 50% drop in shopper traffic, and refused any compensation for retailers.

There is the landlord that permits one sore to be on a % deal where they pay 9% of turnovers in rent with a shop next door not able to have such a deal and managing and occupancy cost of 32%.

There is the landlord that strong-arms retailers verbally, never in writing, never in a way that can be used against them.

There is the landlord that takes a marketing levy every month and spends this on activities that offer no benefit whatsoever to retailers.

There are hundreds of stories.

The Royal Commission needs to listen to stories, all stories. Tenants need to be able to do this confidentially as the fear of reprisal by landlords is real.

  1. Do landlords act unlawfully?
  2. Do landlords treat retailers differently?
  3. Do landlords act in secret knowingly harming small business retailers?
  4. Do landlords abuse funds they collect from retailers for marketing?
  5. Are landlords fulfilling their obligations in terms of bringing traffic to shops in their centres?
  6. How are the various roles of employees paid in landlord businesses? What are their incentives?

There are many other questions to answer. My goal here is to kick off the discussion.

WHY?

Too many families are losing their businesses, homes and other assets. Too many small business operators are having their personal situations, including health, negatively impacted. Too many small business operators are losing their life. Yes, this issue is that serious.

Small business retailers feel helpless. They want their business. It has been their life’s work. They fear without it they will have nothing. This can see them agree to a lease that is at its very foundation doomed inappropriate for their business.

Landlords have the upper hand. They are in control. Too many people in landlord businesses are bullies and aware of how to bully without being caught.

The best way to resolve this is to shine a light. Only a Royal Commission c an have the authority and power to do this.

I get that Royal Commissions are popular right now. This suggestion, however, is important given that those most impacted are also those most vulnerable – small businesses, run by families. Were are told small business is the business backbone of our country. However, there is evidence to suggest that small business retailers are disadvantaged in terms of shopping centre development and retail teensy negotiation.

Here at Tower Systems we only serve small business retailers with our POS software. In our view, small business matters. This is why we support the push for a Royal Commission into shopping centre development and retail tenancies.

This post first appeared on a blog last week in a post by the CEO of Tower.

Tower Systems helps community groups with POS software

For years, we have gratefully em braced opportunities to support community groups by providing POS software at no cost or low cost to enable the community enterprises to do their good works more efficiently.

The donations of software, time and event hardware by us is part of our social responsibility commitment program where we seek to work with those we see helping to make Australia a better place.

We are able to do this thanks to the support of our customers.

Seeing the benefits community groups to individuals and their local communities is a joy, especially at this Christmas time of the year.

Politicians in Australia to small business retailers: don’t do as I do, do as I say

The federal parliamentarian dual citizenship mess in which we have found ourselves here in Australia for months now shows how politicians treat themselves as elite, special, compared to common folk, the voters who vote them in.

While we in small business are highly regulated, subject to audit and penalised for even simple honest oversight, politicians refuse to permit themselves to be subject to the same.

While individuals are highly regulated, subject to audit and penalised for even simple honest oversight, politicians refuse to permit themselves to be subject to the same.

The moment the first dual citizenship question was raised, an ethical leader keen for democracy would have ordered an immediate full audit of the status of all politicians.

We are bereft of leadership for everyday Australians in Australia.

For months major party politicians have spun their wheels on the issue of dual citizenship and refused to agree to the type of audit that is regular for us in small business. For months they have said politicians should self regulate on this issue while at the same time imposing challenging and enforced regulation on small businesses and on individuals.

Shame on us for allowing your politicians to get away with them setting a standard for their own behaviour that is lower than standards they vote to impose on regular people.

The one party that has provided leadership on this issue is the Greens. From the outset they called for an audit. The are right. Yet their call has been mocked, especially by the government side of the parliament. This side of the parliament that is in control, in leadership, has eschewed leadership and instead engaged in puerile games.

They must think we are fools.

There ought be an audit of all federal politicians immediately, no matter the disruption or the cost.

Section 44 of the Constitution is not new. Its provision have been known for decades. It is easy for anyone to determine their status. Whether they do this comes down to how they see themselves compared to how they see the peril they serve.

We the people deserve honest leadership, leadership that is transparent and for all people, leadership that submits itself to the same standards and level of regulation as they impose on those they serve. We do not have this in Australia at the moment.

Every day, we see small business retailers squeezed by regulation, while at the same time right now seeing politicians refuse even basic regulation. This double standard has to stop, for the good of our country and democracy.

Early engagement with regulators as new legislation is drafted

Tower Systems has been engaged with representatives of a federal government agency as it contemplates new legislation that could impact some areas of retail business operation in which our POS software serves.

We have been engaged in discussions, sharing insights and explaining how parts of our software work, so those drafting the legislation can be better informed about the practicalities in retail business operation.

This work with government departments is not new for us. We have been engaged previously in other areas of business operating, helping to inform legislators to their focus remains on a path appropriate to the needs of the small business retail community.

Our first engagement helping government regulators was mack in the early 1990s when several arms of government were investigating fraud facilitated by the use of POS software developed to make such fraud easy. While our software never had such facilities, we were aware of software that did.

A mental health plan is important for small business retailers and their colleagues

As employers, as retailers and as small business owners, mental health issues are often not far away from any small business retailer. The challenges confronting our newsagency businesses add to the challenges already there.

Sometimes, we don’t know we are experiencing a mental health challenge while other times it’s obvious and on show for all to see.

How we confront mental health challenges is important for us, our business and those presenting with issues.

While we are not trained professionals in the area, our years of working with small business owners confronted by challenges to their mental health have helped us develop some guiding principles.

  1. Mental health is not easily measured or understood. One’s health is not outwardly obvious.
  2. Judgment cannot be part of how mental health is viewed or dealt with.
  3. Action is essential to improve your situation for doing nothing will achieve nothing.
  4. While taking the first step to confront mental health challenges can be difficult, it is relieving and rewarding.

Your GP is an excellent person to speak with. Explain to them how you feel and how this impacts on your life. Ask them to prepare a Mental Health Treatment Plan. This is a government recognised plan. It can usually be prepared in a single double visit to the GP. This plan is the trigger to you gaining Medicare supported access to a psychologist for an initial number of visits, which can be extended depending on your situation.

Some people can feel a visit to a GP or psychologist is not warranted in their situation. While the medical professionals are the best to determine this, there are other resources you could explore:

Beyond Blue has published Business In Mind, a useful resource for small businesses on issues relating to mental health in the workplace. This is a good starting point for learning more. In the resource there are links to other resources that can help.

Finding mental health resources for small business owners dealing with mental health issues is not as easy as it is finding resources for managing the workplace for better mental health. It’s tough running any business and sometimes things can feel overwhelming. This is where networking can help as a first step, talking with others.

Small business retailers feeling challenges within themselves need to treat themselves as employees and use the resources available such as:

  • beyondbluesupport line – 1300 22 4636
  • SANE Australia Helpline – 1800 187 263
  • Mensline Australia – 1300 789 978

We at Tower Systems will help in any way possible.

Small business retail management advice: be David to the big business Goliath – how small business retailers can compete against big business

Small and independent retailers often feel helpless when a big national retailer opens up nearby. There is no match for their range, buying power, advertising coverage or even news coverage.

The sheer size of a national competitor is what scares many smaller retailers. This is often enough for them to give up and close the business.

Giving up and running is the easy way out. There is no lesson learned, just an escape from the fear.

The alternative is to find out how to deal with the national retailer.

Here are five tips for small businesses on how to face and deal with a national retailer moving into the area:

  1. Don’t compete. By not talking about the competitor, pricing against them or pitching your business in any way, you separate yourself. While they may have similar products, it is unlikely that they are targeting your specific business so why target them? Focus instead on your own business.

Not competing should include not advertising price comparisons, not focusing on the competitor at staff meetings, not expanding your range to sell more of what they sell and not obsessing about them.

I was working with an independent retailer recently who decided to offer a product they sold which is also available in a nearby national retailer for 10% less than the sale price in the national retailer. This move gave the independent retailer a margin of 15%. In discussion I discovered that most of the customers who visited the independent retailer were unlikely to shop in the national retailer. So why compete on price?

If you know why customers shop with you, you have the opportunity of not giving up margin out of fear.

  1. Run a better business. From the moment you hear about a new national retailer coming to town, look at every aspect of your business for opportunities for improvement. From the back room to the font counter fine tune your processes, employee training, stock buying and the look of the business. Dramatically improve your business from the inside out. This will improve your business health and help you weather challenges which may lie ahead.

Too often, independent retailers wait until the national retailer is open to react. This is probably a year or two too late.

  1. Be unique. Look for ways to make your business unique. It could be on product range, operating hours, add-on services or something else. Embrace any opportunity to make your business unique. Even a unique niche range of products can give you traffic a big competitor will not chase. Try and focus on products which require a level of retail skill and knowledge to sell – national retailers have challenges hiring and retaining retail employees with specialist knowledge and skills.
  2. Engage the community. Connect with the community at every possible opportunity. Support local groups, speak at functions, get known as someone and a business who care deeply about the local community. Subtly make the connection that you are fortunate to be able to help because of your local business.

Being smaller and independent you are better able to personally engage with the community. You and your team are the business whereas a national chain will always be the corporate. They can throw money around locally, you can throw time, knowledge and more flexible assistance.

  1. Tell your stories. Your retail narrative, your stories, connect you with the local community. Tell these through the people you contact, your own blog, a Facebook page and in the pages of the local newspaper. Tell human stories about your business, the people who work in it and the local stories which connect with it.

Your stories could be about local community connection, convenience of shopping, commitment to range, personal customer service, product niche knowledge … there are many different narratives with which an independent retailer can connect. It is important that one you have your narrative you stick to is, that it inhabits your decisions, marketing and public presentation.

By acting early and in advance of a national retailer opening, you better position your business to weather their advertising and PR onslaught. Get in early, build a stronger business and understand that through this the new business in town will not be your competitor.

Tower Systems invited to be part of an ATO working group

We have agreed to be part of a working group with the Australian taxation Office to help our customers meet compliance requirements. Here are the details of the ATO invitation:

You are invited you to be part of a working group for the Software Assurance project. The intent of the project is to provide your clients with transactional certainty prior to lodgment, reducing the burden and cost of compliance.
 
We want to work with you to co-design solutions for your software products that help to reduce or remove common errors that trigger our analytics and subsequent audit action.
 
Common errors can include:
  1. duplicated invoice or receipt numbers
  2. incorrect or misclassification of supplies
  3. reversal mistakes
  4. discount corrections.
We would also like to explore other opportunities to improve the internal governance and assurance processes your clients use, making it easier for them to get their tax and super obligations right.

SUNDAY RETAIL MANAGEMENT TIP: HOW TO CHOOSE LOCAL COMMUNITY GROUPS AND CHARITIES TO SUPPORT

Local small business retailers are asked to support local schools, community groups and charities on an almost daily basis. While community groups and charitable organisations beat a path to the doors of local businesses, so do individuals engaged on personal fundraising of their own for a cause or for an other individual.

It is tough making the call about which organisation to support or not for there is a real fear that declining will hurt the business. Often, small business retailers do not look for an uptick in business from a charity support decision but they do worry about a decline.

So how do you choose which local business you support?

Requests from schools, charities and other community for donations can be a challenge for any size business. If you do not take a structured approach to this you will find yourself giving away plenty for little or no return.

Requests are often loaded with guilt. People can be passive aggressive in their approach. Often, people requesting help leverage pester power. It can be hard to say no. There are too many stories of retailers giving a gift as a prize, receiving the Thank You poster and achieving no benefit for the business.

Our advice is to manage your philanthropy as you would any business activity.

THE PRIZE / GIFT

Decide the amount in cash or product value or both that you are prepared to donate in a full year, calendar year or financial year.

Our recommendation is you give away cash, but in the form of a voucher to spend in your business. This ensures that value of the gift or prize is greater than the cost of it to your business.

The best mechanism for giving away cash or an amount to spend in-store is to do it by way of a gift voucher. Use your software to manage this as any manual approach is dangerous and time-consuming.

YOUR PITCH, NOT THEIRS

Get on the front foot and write to local community groups outlining that you budget a year in advance. Seek their submissions. With this advice sheet we have included the text of a suggested letter. Please read the letter as it outlines the approach we suggest and why. It is important you communicate this with all community groups.

On the page after the letter is a suggested notice for use in-store when you are asked for donations.

HOW TO PICK GROUPS TO SUPPORT

Focus on community groups that support you. That is, groups with members who support you. The more they support you the better you are able to support the community.

Be prepared to ask where people shop for the items you sell in your business. Ask if they will change in return for your support.

Asking these questions underscores to you the importance of approaching the decision as a business decision.

Be thoughtful and deliberate. Support the groups that support you. This is important as it helps you stay within a budget.

LET YOUR SHOPPERS CHOOSE

If you run discount vouchers and if customers say they don’t want the voucher, invite them to contribute the voucher to a local group – one of three you setup for in the business. Every month, two months or three months, tote up the vouchers and give the group a parentage of the total voucher value ‘voted’ for them.

This idea could be in addition to any giving program you run in the business. It offers a daily reminder of your commitment to local giving.

Grill’d burgers run a program kind of like this where each shopper is given a bottle cap, which they place in a tub to vote on a group to receive a cash donation for the month. The process of groups submitting to be considered is onerous. You can find out more about that program with this link – it is a good place to research what others do: https://www.grilld.com.au/localmatters/

REWARD ENGAGEMENT

In addition to any direct gift, consider an offer whereby anyone who is a member of the group who shops with you accrues an amount you donate to the group. You could manage this through your software. It could be you offer a discount to the shopper as well as accruing a value for the group.

This type of program could also be in addition to your core giving program as the value here is driven by sales – hopefully, incremental sales.

EDUCATE GROUPS ABOUT GOOD ENGAGEMENT

Here are things groups you support can do to help your business. You should ask them to do these things:

  1. Tell members to buy from you.
  2. Write about your business on their Facebook page.
  3. Distribute flyers of your offers.
  4. Have you speak at a meeting.

WRITE ABOUT YOUR ENGAGEMENT

Once you have a decision on which groups you will support, write about this in your newsletter and on Facebook. Not just once but multiple times. Invite them to provide you with content to publish too. Talk about their good works.

Ask them to write about you too.

Your giving has to serve your heart and serve your business. Going about it in a structured way will ensure you meet your objectives.

HOW OUR POS SOFTWARE COMPANY HAS BEEN HANDLING THE WINDOWS 10 CUSTOMER SERVICE SURGE

With more than 3,500 small business retail customers using our POS software we have had to be on top of the push program engaged by Microsoft in the roll out of their Windows 10 upgrade.

The moment we saw the inevitability of the Microsoft roll out, we adjusted our customer service resource allocation to ensure the needs of our customers were well met.

Here is what we did to confront the Windows 10 challenge:

  1. We developed peer-reviewed consistent advice for the most common questions, to ensure that our customers had access to this advice in addition to personal one-on-one advice.
  2. We added to our help desk staffing resources.
  3. We re-allocated help desk time to ensure we had people at the emerging peak times of the day for Windows 10 specific calls.
  4. We doubled our Saturday office-based help desk staffing.
  5. We provided information to our customers via email and snail mail.
  6. We ensured we had Windows 10 knowledgeable escalation points for those with concerns outside those typical and that require management level insight.
  7. As a group we gathered to review progress regularly to take on bard any feedback and leverage any learning opportunities.

Even though many Windows 10 issues are outside providing support for our POS software, we have taken the calls and provided the advice, at no cost.

Indeed, we have processed close to 2,000 Windows 10 calls. That we have done this at no cost to our customers has collectively saved them a considerable sum.

We are proud of how we have handled this and are grateful to our customers for the opportunity to serve them in this Microsoft caused action.

Now if only Microsoft approached their own update roll out with the level of customer care we have shown through our actions.

WINDOWS 10 MALWARE REINFORCES IMPORTANCE OF POS SOFTWARE USER CONTOL

The part about the Windows 10 update (malware) that has angered people the most is that they have had little or no control over the timing.

Tower Systems does not use automatic updates nor will we do this. Indeed, this commitment to our users is a valuable selling feature for us.

We believe small business retailers need to be able to decide for themselves when to update based on the facts relevant to them.

TOWER SYSTEMS LAUNCHES HP RP9 SLIM POS TERMINAL

As an authorised partner of respected hardware company, we are thrilled to have been able to show off the HP RP9 all in one POS terminal to prospects at several events recently.

While we have an RP9 exclusively for an event last week, we filmed this short clip showing it in all its glory.

HP RP9 from mark fletcher on Vimeo.

Not all POS software companies selling HP branded hardware are authorised resellers, not all sell new equipment backed by the respected HP warranty. At Tower Systems you ave access to the real thing.

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RETAILER SUPPLIER RELATIONSHIPS VITAL TO POS SOFTWARE SUCCESS

With the growing number of retailer supplier relationships passing through our POS software, we can see the value of these increasing in the businesses run by our customers.

Whereas for years the electronic data flow was about invoices, now it is about much more. We are grateful to suppliers for working with us to deliver more value to retailers.

From small wholesalers to large, suppliers are keen to help independent small business retailers improve productivity, data accuracy and other commercial outcomes as they know from these achievements will flow more commercially valuable relationships.

We bring a better understanding that other POS software companies to these discussions as we are retailers too on many years standing. We are able to bring a practical element to the consideration, to help suppliers better understand the value to their businesses of engaging beyond electronic invoices and stock files.

In the last two weeks we have been able to participate in several meetings with key suppliers that will take relationships a step further and thereby help drive more value for our customers.

The strategic work we are doing with suppliers is differentiating for us in several retail channels. We are excited for the enhancements coming.