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Mark Ellem, TNR Chartered Accountants

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COVID-19 has been a shock to many businesses and in a lot of cases will cause many operations to cease. At this stage, there is no way of knowing how long this health and economic crisis may last. COVID-19 businesses can be broadly classified into the following categories:

  1. Best case – limited impact to usual trading conditions

  2. Likely – some impact to trading. Reduced activity and revenue, increased costs to meet social distancing requirements, disruption to supply chains, employees inability to work due to third party closures, inefficiencies in productivity if they need to work remotely, etc.

  3. Worst case – forced closure periods or complete closure

There are a range of actions that your business may need to consider and implement to manage the risks associated with COVID-19. Actions should be designed after assessing the current financial status of the business so any measures introduced will assist with navigating through the crisis and also position the organisation to take advantage of the eventual recovery.

Below is a list of questions and considerations that we have been discussing with our business clients to develop COVID-19 business strategies to manage the impact on employees and the financial performance and position of the business.

Employees, Business Owners & Human Resources

Employees and business owner health and safety must be a major focus. If someone in the organisation contracts the virus how does the business continue to operate and generate revenue. The following questions arise:

If stricter distancing requirements are enforced, matters to consider may include:

If in the unfortunate event business conditions deteriorate, having an understanding workforce will be key to helping your business ride uncertain times. Contact us if you require specialist Human Resources advice related to managing COVID-19.

Cashflow and Business Management

We have been working with our clients to assess:

Maximising your cash position and building reserves is paramount in protecting your business. Some of the measures you should consider to improve your cash position include:

Technology

Technology is key to continuing operations. Ensure your business has:

Internal Controls

Whenever there are changes to business conditions and / or personnel, the risk of a breakdown in internal controls increases. If your business is impacted by COVID-19 you should assess whether any of the key controls designed to protect its assets (including cash) and ensure accurate financial reporting, are still in place and operating effectively and efficiently. Controls over cash handling, accounts payable, electronic funds transfer and payroll systems are among those that are key to protecting any business from fraudulent behaviour or human error.

If you require advice or assistance on any of the COVID-19 risk management measures discussed in this article, please contact us at your convenience. Refer to our dedicated COVID-19 webpage for information designed to assist you and your business manage in this difficult time.