AS the world becomes smaller and competition from emerging economies intensifies, the importance of being a Knowledge Economy is pertinent to many countries.

This has always been the case for Singapore, as noted earlier this year by Prime Minister Lee Hsien Loong: 'Singapore has long known that we have no choice but to make the mastery of knowledge our competitive advantage.' (LSE Asia Forum speech, April 11, 2008).

With so many countries now competing to make knowledge a major commodity, Singapore will have to stay ahead of the game if it wants to maintain its position as a thought leader in the Asia-Pacific region. The key to achieving this is knowledge sharing at all levels, from multinational enterprises to small and medium enterprises (SMEs).

For SMEs, developing channels for effective knowledge sharing is crucial. With SMEs under constant pressure to keep costs low, the opportunities for cost savings from knowledge sharing and pooling resources cannot be overlooked. One area in which SMEs can clearly benefit from knowledge sharing is good practice. Implementing the right processes as part of everyday business practice puts a business in the best position for future growth. However, many businesses 're-invent the wheel' each year in developing their good practice policies and procedures.

CPA Australia has recently launched a Good Practice Guide in Asia that will allow SMEs greater access to knowledge exchange. Based on the Wikipedia model, this online resource provides a hub for Asian organisations to upload documented procedures, analytical tools, case studies and policy templates that represent good practice in all areas of business management.

Importantly, however, all content on the CPA Australia Good Practice Guide will be reviewed by a dedicated committee, to ensure it is relevant and up-to-date, so users can rely on the information to make informed decisions.

The guide's online knowledge sharing format enables users to search easily for information relevant to their day-to-day activities and to find out how others employ good practice in those areas. In addition, it allows for feedback and updates, all aimed at helping to build the quality of information available.

The guide addresses a comprehensive range of business functions, including effective reporting to boards and running effective board meetings. It also includes a guide to ensuring effective governance around IT issues, along with broader governance issues as they surface in the corporate world.

Some key tips for small business that can be found in the guide include:

# Analyse your debtors so you know which debtors to concentrate your collection activities on. A surprisingly high proportion of small businesses do not chase up late payers.

# Make sure you undertake reconciliations of not only your bank account but also your creditors, debtors and stock. This provides the checks and balances you need in your business to control these fundamental areas.

# Make sure the assets you hold are recorded in an asset register. This again is a check and balance you should use to control your business.

# Prepare a budget and review it monthly. Preparing and reviewing budgets allows you to identify issues early and respond quickly.

# Use the financial reports that good financial management produces not only to meet your compliance obligations but also to allow you to analyse your business and compare it to industry benchmarks.

# Prepare a cashflow forecast. Without cash, your business will fail. A cashflow forecast will give you an early indication of whether you are heading into difficulties, so you can act early.

# Review the terms of trade you have with customers. With the current uncertainty in key global economies such as the US, it is time to review your terms of trade so late payment does not get out of hand. For example, you could incorporate incentives into your terms of trade to encourage early payment.

This Good Practice Guide is knowledge sharing at its best. With so many CPA Australia members operating as CFOs, finance managers and senior accountants in various organisations, it is likely that these good practices will filter through to all aspects of business activity, from the top level to the everyday.

Good practice can serve to protect a business during less certain economic times, making it more likely to not only survive but thrive. As we move into a period of great uncertainty, the value of resources such as the Good Practice Guide is amplified. SMEs should harness the knowledge sharing environment that exists in Singapore in order to become more effective in all areas of business.

CPA Australia's Good Practice Guide is currently accessible to members worldwide and will be made open to the public in the final quarter of this year.

This article was contributed by CPA Australia and was first published in The Business Times on September 9, 2008.