As an accountant, you have an invaluable role to play in helping your clients survive the COVID-19 outbreak and its economic effects. With the pandemic and the national lockdown battering nearly every company in South Africa, they need your counsel and practical advice more than ever.
These unusual and uncertain times will challenge businesses to make some tough decisions in the months ahead. The companies you work with will be looking for advice not only about finance and compliance but also about their future strategy in a changing world.
Businesses that work together to weather the storm will have the best chance of survival and future success. Here are a few thoughts about the types of support business owners and managers will be looking for from their accountants in the months to come:
1. Tapping into resources available for immediate survival
For many of your clients that have needed to downscale or close operations during the first phase of the lockdown, the immediate priority is to access cash that will help them survive. You can help clients understand the pros and cons of the schemes on offer from banks and government, and to apply for relief. Examples include the following:
2. Restarting the business as the lockdown eases
As the lockdown eases from the harsh restrictions of Level 5 to the slightly less stringent terms of Level 4, your clients can start looking at how they will operate in the new environment. The regulations are complex, so your clients might be grateful for help in understanding whether they may trade, and which permits and permissions they need.
They might also need advice about adjusting their cost base or their operating model for the new world. For example, a manufacturer may need to run at reduced capacity to meet the physical distancing requirements. A restaurant, meanwhile, will need to crunch numbers to see whether it is viable to open on a food delivery basis or whether it is better to remain closed until takeaway collection and dine-in service may resume.
Others might want to find ways to reposition so they can trade – look at how UberEats and Mr Delivery started to offer medical and essential goods deliveries. At the same time, Netflorist pivoted to fruit and vegetable deliveries to keep their businesses going. You can help clients identify non-essential expenses to reduce (e.g. nice-to-haves like coffee, tea, milk and monthly reception flowers) to ensure middle-term sustainability. Other more practical ways to cut costs include bartering, reviewing rental agreements (you don’t need that much floor space), maximising their tax deductions, and buying supplies in bulk.
3. Planning for the world beyond COVID-19
For now, most of us are in a survivalist mindset – we can be proud of ourselves just for keeping the lights on during such a tough time. But as the pandemic peaks and we begin to find more effective ways to manage the virus, it will be time for your clients to start thinking about long-term growth.
As with pandemics before it, COVID-19 is likely to reshape the world. Businesses should be thinking today about how their customers’ and employees’ behaviour may change permanently and what it means for their business. The e-commerce and remote working habits of the lockdown, for example, may outlive the pandemic.
Once again, your strategic advice will be valuable. Good financial forecasts, budgeting and planning, are essential for any business that wants to pivot to a new way of doing things. You can help clients spot the opportunities to diversify their offering, revise their marketing strategy or move into a new business.
There may also be scope for you to grow your business by adding new products and services to the mix. To become a trusted advisor to your clients you can, for example, join a business software provider’s partner network and expand your current accounting servicesoffering by including payroll services.
Compassion is key
The COVID-19 coronavirus is adding more strain to an already struggling South African economy. The reality is that many businesses will need a miracle to survive the next few months. The best thing to do is to act with compassion and help clients make decisions that will improve their financial resilience in the months ahead.
This article was first published by SAICA on 1/05/2020. You can read the original version here.