In this episode the self-proclaimed podcountants attempt to play good cop bad cop for a moment, but their inherent good cop nature shines through soon enough. The Director of Fun and Lifestyle Accountant share how they grew up together but also not at all, and how they ended up going from the pub to the podcast studio via purchasing an accountancy firm together. With their focus on small business and sticking to their roots, it’s safe to say CATS Accounting will continue to be a well-known name on the Coast for decades to come.

Timestamps:
00:05 | Introducing: Podcountants!
04:27 | Same Same, But Different
07:41 | No Boredom, Just Beer
10:05 | Creative Accounting
12:47 | Accounting, But Make It Lifestyle
18:02 | I’m Gonna Be King
22:48 | One Teacher’s Pet, and One… Not So Much
26:03 | Dr. Dan, or The Dark Side?

Resources and Links:

[00:15:46] And very quickly, once I was here, it was sort of made clear to me after a few years that that opportunity does exist. And that one day, Tim and I would be sitting here as we do right now, and we'd own this business and try [to] have that lifestyle, lifestyle work balance that we're trying to get. 

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode we’re speaking with Dan Osborne and Tim Garth, who are either CATS Accountants or Two Drunk Accountants, depending on the time of day. So much like their accounting work, their daily workings are quite varied, but they ended up working together in very similar surroundings— and inventing a brand-new occupation along the way.

Tyrone Shum:   

The duo behind CATS Accounting wear many hats in their day to day work, and are seasoned podcasters too. Osborne and Garth initially went to school together, however they didn’t travel in the same circles until one fateful night the stars aligned— at the pub. While they’re certainly not always drunk, you can always count on them to be entertaining!

Dan Osborne:   

[00:00:05] Hi, my name is Dan.

Tim Garth:   

[00:00:07] I'm Tim, and we are here for... 

Both:   

[00:00:10] Property Investory!

Dan Osborne:   

[00:00:42] My name is Dan Osborne. I'm a director here at CATS Accountants, but also co-host of the Two Drunk Accountants podcast. We'd like to shorten that to be a podcountant. And so that's my role at the moment.

Tim Garth:   

[00:00:58] My name is Tim Garth. I am also a director and co-host of the Two Drunk Accountants podcast. We did create that, podountant! I'm not sure if anyone else uses that on their LinkedIn CV or anywhere else. It may mean nothing to other people. But it means a lot to us.

Dan Osborne:   

[00:01:14] It brings a smile to my face every time I say it or read it.

Tyrone Shum:   

[00:01:21] I love it. You guys are so much fun just already. We haven't even started the podcast! We're already kicking off with great energy here. Maybe we're all drunk at this point in time.

Tim Garth:   

[00:01:32] Yeah. We're drunk on podcasting. I mean, that's what it is.

Tyrone Shum:   

Although they’re both directors at their firm, CATS Accountants, the pair play different roles in their day to day duties. Based on the NSW Central Coast, they mainly focus on taxation for small businesses, but always leave room for fun on top of hard work.

Dan Osborne:   

[00:02:18] We do a lot of advisory work, business planning, what traditionally you may have called coaching. But being accountants, it's slightly different to what you might have experienced with a business coach in the past. 

 

[00:02:32] But then also all the compliance side. So tax returns, end of year financials and tax, bazzes, setting up entities, structuring advice... basically, you know, everything. Start at the foundations and work your way to the top. We do it all. We also do a smattering of individual tax work. 

  

[00:02:54] In the past, my role has been very much focused on compliance. I've been here for 12 years this year. And for a long time, we were very compliance focused, and that was my job, working with businesses and individuals on their end of year tax work. 

 

[00:03:12] But over time, my role has evolved. I'm co-owner and director of the business now. I manage the team, and a lot of the work I do is around that advisory sort of work with small businesses and helping them grow and achieve whatever it is their goals might be. Which sometimes includes making plans to ensure there's enough money for investment.

Tim Garth:   

[00:03:36] We also do a smattering of self managed superfunds as well, which is one thing you're missing there. So there's a bit of property-related clients there.

Tyrone Shum:   

[00:03:47] Fantastic. And Tim, for yourself, what do you mainly focus on in the business?

Tim Garth:   

[00:03:51] I like to bring the fun vibes. And a relaxed attitude.

Dan Osborne:   

[00:03:58] Tim's Director of Fun.

Tim Garth:   

[00:04:00] We do a bit of good cop bad cop here. Dan is definitely the bad director, I'm the good director. No, no! Actually, if anything, I think we're a good team. We generally reach similar outcomes. So we're both nerds and love maths. It's not why we got into accounting—

Dan Osborne:   

[00:04:24] It's why I got into accounting! Speak for yourself, Tim. 

Tim Garth:   

[00:04:27] Mathematicians will tell you the most important thing is your workings. So actually, Dan, and I will come up with very different workings. But we'll find similar results. And we found this early in our career in accounting. We'd be talking about a different problem that a client is having, and actually giving each other the same answer. 

 

[00:04:48] And then we'd go, 'Actually, hold on a second. We're saying the same thing here! We came to it in a different way'. And I think in business that's been really valuable. We do similar things. Actually, we do the same thing. But we may just approach it a different way or look.

Tyrone Shum:   

The name CATS Accountants typically brings to mind either the AFL team or the feline, but the origin of the business name is much more technical than you might expect. True to their personalities, Osborne and Garth have kept the name but added their own spin to it.

Tim Garth:   

[00:05:42] CATS Accountants is a family business. It was my parents that opened it up back in the '90s. And in the '90s, computer accounting was a bit of a buzzword. So actually, CATS stands for Computer Accounting Taxation Services. 

 

[00:06:02] They were using this really whiz bang software called MYOB. And that was designed to help people deal with this new tax called GST, which came out in the early 2000s. So a lot of the origins of the name were in that. It was just a bit of a mouthful. So we now just refer to it as CATS Accountants, and that's been like that for decades. 

 

[00:06:28] We like that it's different. It's not someone's name. And often people think either we're a massive Geelong Cats fan, or we love the feline. And you know, those things... well, we're not Geelong Cats fans. But cats are cool.

Dan Osborne:   

[00:06:44] What do you say, Tim?

Tim Garth:   

[00:06:47] I like to say— this is when I'm with someone that I'm having a bit of fun with— I'll say, 'Well, we like to refer to ourselves as CATS Accountants, because all of the other accountants are dogs'. 

  

[00:07:00] But that's a joke. I do like other accountants, they're great. So the name is kind of outdated now. We've toyed around with calling it Cloud Accounting and Taxation Services.

Dan Osborne:   

[00:07:11] It's just CATS. There's no real acronym anymore. It's just cats. It's just a funny name that is memorable.

Tim Garth:   

[00:07:18] It just sort of stands out. And the thing I like about it is it's not tied to our surnames. And I think people should always be building a business that's going to outlive them. That's something that my parents did really well.

Dan Osborne:   

[00:07:31] Yeah, absolutely.

Tyrone Shum:   

As for the name of their podcast, Two Drunk Accountants… Well, your first guess for that one’s probably correct. While their podcast definitely brings the fun vibes, they also ensure it provides the information they needed as a small business themselves.

Dan Osborne:   

[00:07:41] We'd been wanting to start a podcast for a while. We've been doing the podcast [for] three [or] four years now, for a long time. And for years before that, we were both really into podcasts. We listened to a lot of it. And there just wasn't that great free information for small businesses. 

[00:08:00] And we just sat there thinking, like, 'We get asked the same questions by our clients every day. We answer them every day. There's the need for this out there. We think we're pretty funny and entertaining. So let's combine those two things and just see how we go'. 

 

[00:08:15] So we sat there for a while trying to think about it and we kept procrastinating. 'We need a name, we need a theme. What are we going to do?' And one night we were sitting there having a few drinks and I don't even remember which one of us said it. And we just sort of came up with, 'Well, we're two drunk accountants. Let's call it the Two Drunk Accountants'. 

 

[00:08:40] A lot of small business podcasts can be quite boring. Or on the other hand, they tell you how to make a billion dollars in your first year and that's also not realistic or helpful. So we wanted to initially give people the impression that this is going to be something that they can listen to and digest and be useful and a bit of fun while they're doing it. Four years later, the name stuck.

Tim Garth:   

[00:09:03] We don't drink with every podcast—

Dan Osborne:   

[00:09:04] That's a lie!

Tim Garth:   

[00:09:06] We did in the early days, because we needed to loosen up a little bit. But now, like we said in the beginning, we just get drunk on podcasting. We're podcountants, so it's our alter ego.

Tyrone Shum:   

[00:09:22] I love it. I mean, honestly, no one knows, you know, in terms of getting drunk. It doesn't have to be alcohol. It could be you know tea or could be anything else you guys could be holding in that cup there.

Dan Osborne:  

[00:09:34] A bit of caffeine.

Tim Garth:   

[00:09:38] If you've only slept a few hours last night then you have a coffee, you do feel a little bit drunk. So it's not lying!

Tyrone Shum:   

Osborne and Garth dive into their backgrounds, which followed different paths along the same roads— literally— before converging as young adults.

Dan Osborne:   

[00:10:05] I was born here on the Central Coast and grew up here on the Central Coast, in various parts. Typical childhood, just went to school, had friends, hung out, went to the beach on the weekends. That was many years of my life, just doing that. 

 

[00:10:25] Tim and I actually went to the same high school together. It's how we first met. The senior campus. I went to a school that was [years] seven to 10. And Tim went to the other side of that school that was years seven to 10 and they both feed into the senior campus. So we met in senior high school. 

 

[00:10:43] But yeah, typical childhood, nothing really out of the blue here on the Central Coast. I spent a year in the US actually, when I was, like, 10. My family moved over there for some work things. And I spent a little bit of time skiing and learning to ice skate and a bit of fun there. 

 

[00:11:05] When I was a little bit older I went to uni in UNSW in Sydney. So my uni degree was spent sitting on the train and traveling to Sydney from the Central Coast and coming back and then working here a few days a week. 

 

[00:11:21] Before here, I worked in a bar. I've got a few hobbies, I was into film, I used to make a lot of short films and music videos for people and things like that, which really helped with the podcast. 

Tim Garth:   

[00:11:33] Yeah, I don't think there's many accountants that do that. 

Dan Osborne:   

[00:11:36] No, probably not. 

Tyrone Shum:   

[00:11:39] That is a very interesting mix. You know, I don't really hear [about] accountants who have that creative outlet, I guess. That's fantastic, and hence the reason why I think the podcast suits you really well, because you guys are able to talk about particularly dry subjects in something that's interesting and entertaining as well. We really need that in a different way.

Dan Osborne:   

[00:11:59] Exactly. So I think all [those] things kind of helped. And as Tim said before, we're huge nerds. I was a massive nerd. I was the top at maths at the school and all the things! But I always had that creative outlet as well. I was heavily into music in high school, I was in bands and played guitar and drums and sang in bands, did all sorts of things. Which I think has all led to this point where those two things are now combined in my life. Creativity and accounting. 

Coming up after the break, we’ll get some more insight into how the two went from acquaintances to pub friends to business partners…

[00:13:55] My whole thing was just about building lifestyle. So I wanted to have my cake and eat it too. And I've been lucky to find a business partner in Dan. 

We discover how Dan got into accounting despite not being born with a pen in one hand and a calculator in the other, unlike certain others…

Dan Osborne:   

[00:26:06] You ask any 16 year old kid, 'What do you want to do when you're older?' And unless your name's Tim Garth, not many of them say, 'I want to be an accountant'. 

Osborne reveals how Garth reeled him in to the business, which only involved a very small amount of catfishing.

Dan Osborne:   

[00:27:39] He didn't actually say that. He just told me we're looking for someone. So I said, 'Oh, great! I'm working in a bar and I hate it. I'd love to go get a desk job somewhere'. And so I did.  

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

Tyrone Shum:   

Garth’s early life differed from his business partner’s in that he always knew where he would end up, however he didn’t take the path that others had laid out for him.

Tim Garth:   

[00:12:47] I grew up on the Central Coast as well. My childhood was interesting, because my parents were in a small business. So I loved the coast, I loved the local sport, the beaches. Unfortunately, growing up in the Central Coast, back in those days, people saw it as, like, a regional area. So a lot of my friends moved off to Sydney or internationally to get jobs and further their careers. 

 

[00:13:18] I always saw a massive opportunity to get into the family business. So I didn't really know what accountants did but I always wanted to do it. But much to the disgust of some of my teachers and things like that, because I always tried very hard at school. But to get into uni to do accounting, I think I only needed a UI of, like, 64 or something like that. 

Tyrone Shum:   

[00:13:41] It's changed a lot.

Dan Osborne:   

[00:13:44] I had to get a 94.

Tim Garth:   

[00:13:48] I stayed local and went to [the University of] Newcastle. Which was great, because there's an Ourimbah campus and Newcastle campus. My whole thing was just about building lifestyle. So I wanted to have my cake and eat it too. And I've been lucky to find a business partner in Dan. And that was just by chance, I guess. We were at the pub one... we tend to spend a bit of time drinking! 

Dan Osborne:   

[00:14:13] We believe in the name.

Tim Garth:   

[00:14:15] We were, like, 20 [or] 21. It was Dan's birthday. We were at the pub. And I was like, 'Dan, what are you doing these days?' He was studying accounting, which I couldn't believe because he was, like, singing in bands and recording videos and stuff like that. 

 

[00:14:30] He came and worked [with me] and very quickly I realised, 'I might have the business partner of the future here! I can go away on holidays and I can be the cool boss, and he can crack the whip!'

 

[00:14:42] It's worked out well because we can really tag team on the business and share stress and share responsibility and try and build our lifestyle in what was a regional area and is now becoming a bit more metro. 

Dan Osborne:   

[00:14:59] It's quite interesting actually, because this wasn't my family business. So growing up, I didn't have aspirations to.... I was very interested in business, but I never really had the thought in my head that I'd actually start one so soon after uni. I assumed I'd go get a job somewhere. My family has worked in the corporate world all through growing up. And so I kind of assumed— yeah, CEOs and things. And so I assumed, yeah, I'd go do that. It's easy to do, why not? 

 

[00:15:30] And then it wasn't 'til I did start going to uni in Sydney. And then I realised that it's not what I wanted. I think what I actually wanted was just to have this lifestyle that Tim's talking about. So I think we were lucky in a way that our values really lined up on that one. 

 

[00:15:46] And very quickly, once I was here, it was sort of made clear to me after a few years that that opportunity does exist. And that one day, Tim and I would be sitting here as we do right now, and we'd own this business and try [to] have that lifestyle, lifestyle work balance that we're trying to get. 

 

[00:16:05] And that's something we try to do for our clients too. We try [to] coin this term 'Lifestyle Accounting'. It's a bit wanky, like podcountants, but it's all about trying to match what your lifestyle goal is to what your business actually provides you. 

 

[00:16:21] It's similar [to] investing as well. The whole point is trying to get a level of wealth that then you can be comfortable with and have the lifestyle that you want. It's very similar. 

Tyrone Shum:    

Garth’s parents were ahead of the times in that they wanted to create a positive work atmosphere for their fewer than 10 staff. They focused on giving their team opportunities and improving the systems, which Garth had always wanted and planned to continue.

Tim Garth:   

[00:18:02] I always knew I wanted to take over the business. I didn't know how that would look, or how the transaction would occur. But I knew at some point, I wanted to run it. So I always felt a big degree of ownership myself. 

 

[00:18:18] For Dan, Dad sat us down years out from when it all transpired and said, 'I'm keen for you guys to buy in. Whether that be a small percentage to begin with, or all of the business, that would be my succession plan. Just putting that out there now for you guys to think about. This is probably what it looks like in terms of dollar value. And this is my timeframe of [when] I'd be keen [for you to take over]'. 

 

[00:18:51] It probably was another two to three years after that first initial chat, which was now probably 2019, I think, July 2019. We felt like we owned the business from that point. 

  

[00:19:05] He did a very smart thing there, because we grew the business in those years before we actually bought it. And so he benefited from that, which is great. He's been generous with the vendor finance terms, so we didn't need to go to a bank. And for him, it's generating an annual income stream which is effectively tax free. So being an accountant, he figured out how to retire and structure that up tax effectively. 

 

[00:19:44] He was so smart with it, really, looking back. Because he worked himself out of a job basically. He let everyone else take over and rule the roost, and it felt great for us and fulfilling for us, but he was always there to support us if we ran into a brick wall, or if something went wrong. 

Dan Osborne:   

[00:20:03] From my point of view, starting in the business when I was 20, I think in the initial interview with your dad, he told me two things. Accounting is a people business, and you need to be people focused. And that he doesn't want to do this forever. And his plan is to retire in 10 to 15 years from that point.

 

[00:20:27] Being a 20 year old, I don't know what that meant. And then I continued with uni, while working here. Finished uni. And then it was sort of around that point, I think we'd started our CPA. Because we both studied that around the similar time, going through that, and then that where he sat us down and said, 'This is my plan, if you guys are interested'. And of course, we were interested. 

  

[00:20:58] We spent the next few years doing the requirements that needed to be done to get our public practice certificates in order, to get the business to a point that we were able to take charge. And as Tim said, from that moment onwards, we walked around with our heads held high. You know, 'We can do what we want here!' And luckily, so far, it's been a success. So a few years ago now, we officially bought the business from Warren and never looked back.

Tim Garth:   

[00:21:30] It's been a ride. I'm sure we'll continue to learn lots of things, but [it's been] a good journey. 

Tyrone Shum:   

Osborne and Garth break down how they met each other at school, but didn’t go to the same school, but also did go to the same school, all at the same time.

Dan Osborne:   

[00:22:48] It's called a college, essentially. But there's two schools that are in different areas, different suburbs, that only go year seven to 10. And they finished at year 10. And then you have to go to a separate school in another suburb that only does year 11 and 12. So they're the two feeder schools that feed into the senior school. So we went to two separate junior high schools and then met at the senior high school, which was The Entrance.

Tim Garth:   

[00:23:16] Which is funny, because it wasn't like we were best mates at school. We weren't hanging out every day all day. We shared a class, business studies, funnily enough.

Dan Osborne:  

[00:23:26] Tim was a huge nerd. The teacher loved Tim, actually, because they knew Tim was an accountant, his family was [in the] accounting business. So every lesson they just kind of looked at Tim, like, 'You'd know all about assets! You know all about the balance sheet equation, wouldn't you, Tim?' And Tim would be like, 'Yeah, of course I do!'

Tim Garth:   

[00:23:45] That teacher was also the one that was encouraging me to go and work for the Big Four, for, like, the first 10 years of my career, which I'm so glad I didn't do. He was saying 'Yeah, you've got to go to Sydney, mate, learn the ropes, and then go back and work in your family business'. It's interesting, but...

Dan Osborne:   

[00:24:01] He doubted me. 

Tim Garth:   

[00:24:10] It is interesting how we kind of just fell into a similar circle. And here we are.

Dan Osborne:   

[00:24:17] It's funny. We've got a lot of the same friends now still. I think we've been very... I've had a lot of luck in my life. And one is being in the right place at the right time for this business. And the other is I think the group around us, we've been fortunate with our friends and our family around us. 

Tim Garth:   

[00:24:36] Definitely.

Tyrone Shum:   

Family life was quite different between the two households. While the Garths were big into small business, Osborne’s mum found herself a Jill of all trades trying her hand at all types of odd jobs, while his dad ran large international companies— but not as an accountant.

Dan Osborne:   

[00:26:03] So accounting wasn't something... you know, you ask any 16 year old kid, 'What do you want to do when you're older?' And unless your name's Tim Garth, not many of them say, 'I want to be an accountant'. 

[00:26:17] I didn't have any influence in my life to say, 'Go do accounting'. So when it came time to apply for a degree and go to uni, I was lost. I had all these creative endeavors. But also I did have an interest in business. And I had an interest in running a business. My brother and I always used to joke through our teens about owning businesses together. And we always called it Osborne Group of Companies. 

  

[00:26:45] So that was always part of my life a little bit. So I didn't know what to do. And my dad said, 'Why don't you go do a commerce degree? You'll learn the business fundamentals. And then when you’re there, you can pick your major out of those things'. And I said, 'That's a good idea'. So I did a science degree. And a commerce degree. 

 

[00:27:07] I was doing two degrees, and then very quickly dropped the science. And for some reason fell into accounting. I was like, 'I don't mind this. This is all right. I can do this, I think'. 

Tim Garth:   

[00:27:19] That's how he came to the dark side.

Dan Osborne:   

[00:27:21] And then that's where I was out at the pub with Tim and said, 'What are you doing?' I said, 'I'm doing accounting'. And he said, 'Well, I'm looking for someone to replace me in my role, because I want to progress'.

Tim Garth:   

[00:27:34] Yeah, that was the reception. Making coffees for people and answering the phone.

Dan Osborne:   

[00:27:39] He didn't actually say that. He just told me we're looking for someone. So I said, 'Oh, great! I'm working in a bar and I hate it. I'd love to go get a desk job somewhere'. And so I did. 

  

[00:27:52] I didn't really have much influence in the accounting space. But definitely in the business sort of area of my life. My dad was very much into running businesses and the strategy and all those things. And my brother always had an interest in, he now does it as well. He was running hotels and things all around the country for years, but now he's just started up his own ventures as well. So yeah, it's in the blood I think.

Tyrone Shum:   

Turning to property, Osborne sums up his experience in one word. While it’s not quite the word you or I would use, his property journey will resonate with many of the millennials out there.

Dan Osborne:   

[00:29:29] My property journey, personally, is terrible. Going through the story, then you can see our focus for that time was really building this business. And so there was definitely sacrifice on our end in that we could have gone and worked for one of these big four firms and earnt a lot of money and would have had all the money in the world to invest. 

  

[00:29:58] But instead, we decided to stay here and build what we had. And that did come with some sacrifice. My partner is a psychologist— now she is— but for the previous six years up until recently, was studying. So we didn't have a lot to invest. So our property journey was on hold up until recently. 

 

[00:30:22] And then when I saved up my deposit and went to go [to] buy, the house market jumped 30%. That was awesome. 

Tim Garth:   

[00:30:30] Especially on the Central Coast.

Dan Osborne:   

[00:30:32] On the Central Coast, it's gone crazy. So personally, my property journey, I don't have anything wrong with investing in property and buying it, it's just that it hasn't been on the cards for me for the past 10 years. It is now, but it hasn't been in the past. 

 

[00:30:47] However, the journey for me with my clients has been very different. There's a lot of clients that come to me for advice around the tax side of things, around the investment side of things. Being an accountant and not a financial planner, we can't actually tell people whether or not a property is a good investment for them. But we are allowed to talk about the tax consequences of it, structuring it, and all that. 

  

[00:31:09] So I deal with property a lot. And there's a lot of clients who own warehouses or factories or shop fronts in their business, in different entities, in their Super funds. Personally, they're in residential properties. So capital gains, tax, negative gearing, pensions— all these things I deal with quite a fair bit. So although I personally don't own a property at this particular moment in time, I've dealt with it a lot.

 

[00:32:05] We've set ourselves up. We're in a point now where things are different to what they were. So I'm keen to dive into the journey. But, Tim, what's your journey?

Tim Garth:   

[00:32:16] Well, I was just gonna say, Dan, a little bit less avo on toast, a little bit less smashed avo, maybe you'd have a property by now. But hey.

Tim and Dan’s story, including their ongoing roasting of each other, continues in the next episode of Property Investory. We’ll hear about Garth’s property journey…

 

[00:00:38] When we bought our house, we felt like we were buying in a massive peak. Some people like potentially even like, Dan, for example, was like, 'I'm just gonna wait for it to maybe just come down a little bit, then I'm gonna buy'. Which it did do, for a couple of years! It came down maybe 10%. 

 

Just how super Super can be…

 

[00:05:21] When you retire, that is when it really comes to fruition. Because depending on the value of the property and how much other money you have in Super, that property could potentially be sold tax free. 

They offer their taxation insight regarding investing in property.

[00:11:11] But the other funny thing I find is targeting investments purely for the tax advantages. So what I'm talking about here is negative gearing. 

 

And that’s next time on Property Investory.