By Christian Koch, CA Magazine
As the UK gradually lifts its coronavirus restrictions, Christian Koch looks at what life is currently like for CAs working in countries further ahead in the pandemic timeline. The message? Scrap everything you know: we’re about to enter uncharted territory…
Only six months ago, it was evident that the 2020s would be a tumultuous time for anybody working in accountancy: apocalyptic doomsaying about jobs pillaged by automation; the ledger sheet rendered useless thanks to cryptocurrencies; the headache of negotiating Brexit’s tricky transition period.
Today, these fears seem irrelevant, quaint even, dwarfed by the devastating toll of the Covid-19 pandemic. The Bank of England predicts Britain will plunge into its worst depression since the Great Frost of 1709. Global supply chains have collapsed; some employees may never return to an office again (see Twitter, which has given its staff the option to work from home “forever”). For those in finance, the balance sheets of 2020/21 are unlikely to resemble anything that has gone before: a migraine-inducing mishmash of seesawing payroll figures, sinking revenues, devalued assets and out-of-kilter expenses.
For a glimpse of the shape recovery could take, it’s worth looking at countries that have weathered the storm reasonably well, such as New Zealand, which enjoyed more than 100 consecutive days without domestic transmission, or Taiwan, where lockdown never really happened.
“The future is already here. It’s just not evenly distributed,” writer William Gibson once claimed. And the insight from CAs months ahead in the Covid-recovery timeline (the UK economy is likely to suffer the worst economic damage of any developed nation, according to the OECD) could prove critical for those wanting to stabilise their businesses and withstand future challenges. From jittery clients to asynchronous working hours, here’s what could be coming your way soon…
Expect a tsunami of work when you return
State of the nation
On 8 June, New Zealand was officially declared “virus-free”, prompting Prime Minister Jacinda Ardern to lift restrictions. Its success was largely thanks to the country enforcing an early and stringent lockdown (even partners living apart were forbidden to see each other), but also Ardern’s clear and unifying communication. In mid-August, however, a sudden outbreak in one family meant Auckland went back into lockdown. But for now, most Kiwis can hug, attend rugby matches and even rock concerts. As such, it is currently the envy of the world.
Tracy Shylan CA, Manager, accountancy firm Baker Tilly Staples Rodway, Christchurch.
The office has changed
Everything is wiped down, lunch is eaten at desks rather than communally and we take laptops home at night in case we develop symptoms and need to self-quarantine. There’s also contact tracing: our keycards not only swipe us into the office but monitor who enters the building, too.
Expect a tsunami of work when you return
You’re going to be so busy when you get back: everything from tax changes triggered by government loans to helping with clients’ cashflow.
Harness your commercial acumen
Accountants aren’t just number-crunching. Clients have had a tough time; you’ll need to think commercially about what they’ve endured. ICAS taught us how to deal with adversity, training I’ve summoned a lot recently
Get ready to reassure your clients
Soft skills – which everyone predicts will be important for all in the future – will come to the fore. Be considerate: your clients have been through a stressful time.
Business leaders can learn from Jacinda Ardern
She’s displayed incredible emotional intelligence, bringing the nation together by referring to us as a “team of five million” and effective soundbites [eg “act like you have Covid-19”]. If you want to improve communication skills, learn from Ardern.
Don’t expect a rush back to the office
A late-May opinion poll reported that 89% of New Zealanders working from home want to stay there.
Some bold policies have been proposed to help rebuild the economy
Ardern recently floated a four-day week to help boost domestic tourism.
Good news for people who hate meetings. In the first few weeks after returning, they were banned.
Also in New Zealand…
Ardern took a 20% pay cut to show solidarity with the nation’s workers.
This crisis has shown the importance of cashflow
State of the nation
Taiwan should have taken a huge hit from Covid-19, with the densely populated island being just 80 miles from China, where it originated. But it has swerved infection almost entirely. It never went into total lockdown, and schools and businesses have largely functioned as normal. Past experience with Sars and bird flu, plus swift action such as phone tracking to enforce quarantines, saw this nation of almost 24 million record just 449 cases and seven deaths by mid-July.
Chin Yaul Yu CA, Director of Finance and Strategic Development at educational tech start-up Skyrock Projects, Taipei
The crisis has shown how important cashflow is to businesses
Taiwan has done a fantastic job containing the virus, but companies have still been hit. Skyrock runs camps teaching coding and robotics. Parents have been hesitant to send children, so that has hit sales. I’ve had to ensure we’ve the funds to pay suppliers, staff and rent.
Diversification is essential
Even street vendors at Taiwan’s night markets are on Uber Eats now. It’s another revenue stream. We’ve pivoted our business model at Skyrock too. We created ‘Steam Box’, a product teaching Steam education [Stem plus the arts], coding and robotics that we sell directly to clients. It’s helped to turn a threat into an opportunity
You’ll be looking to lower costs
Expect to help clients with government loans and renegotiate terms with suppliers and landlords. Rather than laying off staff, see if they’ll accept a temporary pay reduction – it’s much cheaper than recruiting and training new staff later
Be vigilant until there’s a vaccine
It’s been strange seeing the world go up in flames while I go into work every day. Even so, when I turn up, I have temperature checks and my hands are sprayed with sanitiser.
Ensure clients have enough cash
A second spike might mean entering lockdown again.
Also in Taiwan…
Visitors arriving at the airport are banned from public transport. They have to take “epidemic-prevention taxis” – special cabs disinfected after every trip.
Employers will need to check on staff wellbeing during these challenging times
State of the nation
Like its Antipodean neighbour, Australia was initially largely successful in suppressing the spread of Covid-19. Strict physical distancing, hibernating entire industries, a low-density population plus closing borders to non-citizens all helped to curb the coronavirus curve.
However, in July, a resurgence of the virus centred on Melbourne, Victoria saw the death rate more than triple in just over a month (on 12 August it stood at 352, up from 106 on 9 July) and a state of disaster declared. The state border with New South Wales, last closed during the Spanish flu outbreak a century ago, was shut.
Gillian Findlay CA, CEO at branded content platform Vamp, Sydney.
Pay attention to staff wellbeing
As a CEO, it’s important I look after the mental and physical health of employees during these challenging times. At Vamp, we offer yoga classes, (virtual) Friday drinks, plus access to [mental health app] Uprise. These are new ways of working, and by listening to and taking the pulse of your team, it’ll aid productivity, too.
Be transparent as an organisation
From the beginning, we’ve been completely transparent and over-communicated as much as possible. During times of crisis, bad things are amplified. If you’re not honest with your team, they’ll see through it straight away.
Spend time poring over your P&L statement
We’ve looked at every single line on our P&L to see where we could cut operations such as subscriptions, travel and entertainment. Because the future is so uncertain, it’s important to conserve cash as much as possible.
The Big Four in Australia have suffered
Deloitte recently cut 700 jobs; PwC and KPMG have also made significant redundancies
Pivot your business towards new clients
We’ve seen some travel and entertainment clients stop spending. But we’ve acquired new ones, such as Dettol and a German company that makes designer face masks. We’ve also had lots of booze clients – people have been drinking a lot of wine recently!
Changing your pricing model can lead to new business
We reshaped the business to offer our technology to customers of any size. We’ve now got a low-cost, self-service solution that smaller brands can access for A$1,000 (£556). Before, we’d only offer campaigns that companies could access for tens of thousands of dollars.
Flexible working is here to stay
Vamp’s office should be open to staff from September. It’ll be deep-cleaned every night and have distanced desks, but coming into work will be optional. If businesses want the best talent, they’ll have to offer flexibility: it’ll be the driver in retaining and hiring the best people
Also in Australia…
With the country’s wheelie bins spending more time outside than Australians during lockdown, many people staged a “bin night” which saw them dressing up (think wedding dresses or Game of Thrones outfits) to take the rubbish out.
Business leaders will need to invest more trust in their employees
State of the nation
Japan has baffled epidemiologists. Its per capita death rate is among the lowest in the developed world (around one-eightieth of the UK’s), despite its high density and large elderly population, laissez-faire lockdown and being an early site of the pandemic, via the Diamond Princess cruise ship. Even a recent upsurge in infections failed to push deaths much above 1,000. One theory behind the low infection rates is its social customs: locals have worn masks for decades, people bow rather than shake hands, and shoes are removed before entering homes. Although Tokyo has postponed this year’s Olympic Games, its karaoke joints and pachinko parlours reopened in June.
Stuart Neish CA, Regional Director, Asia Pacific at advertising giant WPP in Tokyo.
Asynchronous working will become commonplace
WPP reopened its Tokyo office in late June, but we’ve changed the working day to 11am-3pm, so staff can avoid commuting during rush hour. We’re aiming to have a third of staff in the office to maintain distancing. It’s likely to be in place until the end of this year.
Presenteeism could become a thing of the past
The concept of the exhausted Japanese salaryman not returning home until midnight had been gradually fading in recent years, but the remote working patterns of Covid-19 have accelerated the country’s shift towards more flexible working.
Business leaders will need to trust employees
When our staff started remote working, we trusted that they wouldn’t treat it as a holiday. Treating people with decency and respect was a key part of my ICAS training.
Times are tough, but businesses aren’t firing advisers or agencies
As long as you’re doing a good job, you’ll be at less risk of your business being given to somebody else. It’s hard for companies to change advisers at the moment.
Also in Japan…
Tokyo Skytree’s aquarium urged the public to video-chat with its eels after the slippery creatures forgot that humans existed during lockdown.
This article first appeared in CA magazine: https://www.camagazine.co.uk/september2020#!cover