More than 1 in 10 businesses have revealed it is impossible or unviable to open up ahead of the UK lockdown being lifted on 4 July.
More SMEs have reported greater levels of stress and anxiety due to Covid-19, finds the latest results from the ACCA UK and The Corporate Finance Network (The CFN) SME Recovery Tracker: Featuring insights from accountants working with the small business community.
The survey of accountants, representing more than 22,000 SME clients, shows tension and strain on anxious SMEs ahead of 4 July. 71% of accountants reported their SME clients had shared feelings of being more stressed and anxious than usual, up from 69% two weeks ago.
Despite businesses across the country preparing to trade again, businesses are reporting significant concern over future finances. This week’s Tracker shows more than two thirds of businesses will be unable to meet deferred tax liabilities within the next six months.
The results which closed on the 30 June also show:
· 2.9% of SMEs say they’ve decided to liquidate their business.
· 15% say they feel that social distancing requirements as they currently stand will make it impossible/ unviable to reopen their business – a sign of reality kicking-in for many SMEs
· 28% have altered credit terms with customers in a bid to ensure their survival for foreseeable future
Kirsty McGregor, founder of The CFN network comments: ‘The reality for business owners is becoming all the more stark now that a greater number are attempting to grow their business again. Supporting the release of lockdown for the economy in general, albeit whilst potentially still being loss-making, is incredibly stressful. I would encourage all businesses to critically assess both their short and longer-term cashflow projections. A written plan and some clear strategies will allow for a calmer mindset during this period, and should take some of the worry away.’
Claire Bennison, head of ACCA UK adds: ‘The results from this week’s tracker represent the legitimate concerns thousands of small businesses face. Thoughts are turning towards economic recovery and concerns they have over supply chains, tax liabilities and wellbeing in general. Navigating these obstacles requires resilience, July 4th is a significant step in the post-Covid journey.
‘Many businesses await Rishi Sunak’s economic statement next week, and whether there will be an emergency budget or spending review. Businesses owners need to be clear about exactly what they need to do in order to move forward with confidence, save jobs and reboot their business.
‘Uncertainty breeds inaction, this is something businesses simply cannot afford in these difficult times.’
- ends -
For media enquiries, contact:
Notes to Editors
About the ACCA UK and The CFN SME Health Tracker: The expert panel of accountants polled represent 22,189 clients across the UK and the poll closed on the afternoon of 30 June 2020.
About SMEs: SMEs, (typically less than 250 employees), account for 99.9% of the private sector employment in the UK and there are 22 million employees working for these private sector businesses.
About ACCA: ACCA is the Association of Chartered Certified Accountants. We’re a thriving global community of 227,000 members and 544,000 future members based in 176 countries that upholds the highest professional and ethical values.
We believe that accountancy is a cornerstone profession of society that supports both public and private sectors. That’s why we’re committed to the development of a strong global accountancy profession and the many benefits that this brings to society and individuals.
Since 1904 being a force for public good has been embedded in our purpose. And because we’re a not-for-profit organisation, we build a sustainable global profession by re-investing our surplus to deliver member value and develop the profession for the next generation.
Through our world leading ACCA Qualification, we offer everyone everywhere the opportunity to experience a rewarding career in accountancy, finance and management. And using our respected research, we lead the profession by answering today’s questions and preparing us for tomorrow.
Find out more about us at www.accaglobal.com
About The Corporate Finance Network
The Corporate Finance Network – www.thecfn.org.uk - The Corporate Finance Network consists of some of the most proactive and commercially astute regional, independent accountancy firms in the UK. They specialise in providing corporate finance advice for smaller transactions. Kirsty McGregor can be contacted at info@TheCFN.org.uk