In the first of a series of accounting blogs, Debbie Boulton, director of Richardson Swift, offers some practical tips for local businesses to ensure they’re in the best shape possible to make it out of the crisis.
A brave new world
Few businesses will be left untouched by the impacts of the Coronavirus pandemic, but despite these dark times, there is still a determined entrepreneurial spirit.
Currently, many of our clients are adapting their business strategies and there are numerous opportunities that we’re helping them with, which may be relevant to you.
- Being strategic – a visionary and commercial approach is going to be essential to succeed in the new economic world. Previous business plans will need to be revised to take account of new market changes and opportunities.
- Raising finance – many businesses will need to secure additional finance in the coming weeks, if they haven’t done so already. To be successful, you’ll need to know the right bankers to go to and prepare a package of information that demonstrates your need for finance and a watertight plan to repay it.
- Accessing government support – consider the government support schemes you’re eligible for and submit applications ASAP. These include the Coronavirus Job Retention and Self-Employment Income Support schemes, Business Interruption loans, Statutory Sick Pay and Business Rates Relief.
- Cost cutting and forecasting – shape and strengthen your cost base in sync with your turnover and be realistic about how savings will be achieved (premises, service and loan costs are a good starting point). Also, use short-term cash flow forecasts to plan around any financial pinch points.
- Outsourcing – if your accounts team is furloughed, consider outsourcing your bookkeeping, management accounting, VAT or payroll. This can save money on in-house costs and gives you additional expertise as and when needed.
- Deferring tax – VAT payments should be delayed through the automatic deferral offered by HMRC. To apply to extend payments further, or if you’re unable to pay your Corporation Tax or PAYE bills due to COVID-19, you should call HMRC’s Time To Pay helpline on 0800 0159 559.
- Rental and loan holidays – businesses should be arranging rental and/or loan repayment holidays and deferrals as a matter of urgency. We do not know how long this crisis is going to last and businesses need to retain as much working capital as possible to pay staff and suppliers.
- Insurance – you should review your company’s insurance policy (if you haven’t done so) to see if you have cover in light of the national lockdown and government enforced business closures.
- Cloud accounting – if you have a desktop accounting system, you may want to consider moving to a Cloud-based one. This will give you access to real-time financial data, whilst increasing the automation of basic accounting tasks to save time and money.
- Performance management – businesses should have a clear idea of what they’re aiming to achieve and a management team aligned with this vision. There will be tough decisions on furloughing and/or redundancies, whilst remaining staff will need to be motivated to work more effectively and flexibly than before.
For further guidance, or for information about Richardson Swift’s business support services, including strategy planning, outsourcing, cash flow management and Cloud Accounting, please see their website, or contact Debbie Boulton on 01225 325580, or email: firstname.lastname@example.org