Covid-19: a practitioner’s experience, part 1

PJCO’s Peter Jarman FCCA sets out how his firm is helping clients and staff through the Covid-19 crisis

Published 7 April 2020

As a 20-employee, one office firm, over the last few weeks we have adjusted to the Covid-19 pandemic as follows:

At the beginning of March, our major concern was over the number of contractors that were looking to liquidate their company and move to full time employment because of the off payroll changes coming into play from 6 April 2020 and how we would replace these clients with new small businesses as well as any other changes that might be happening in the Budget on 11 March.

Then at the start of the next week we realised, probably too slowly, that there might be large number of our clients with business difficulties as a result of covid-19. We carried out an internal assessment of the effects might have on our business operations and future planning:

Business overview

We carried out a strategic business overview and decided on a direction for the business should there be a dramatic change to the business environment. We quickly decided that we were willing to invest in the future prosperity of our clients, our staff and our business.

So, our overall strategy was to increase the support we offered to our small business clients even if it was uneconomic in the short term, look to the longer term, and view the crisis as a learning experience.

Cashflow assessment

We carried out some stretch analysis on our internal finances to establish exactly how long we could continue to operate with our current overhead, increased workload but with reduced cashflow as we saw this as the most likely outcome at that stage.

As a firm we have been retaining 20% of our profits to build a capital base and for future investment, so we assessed quite quickly that we could fund the business for at least a year without the need for any significant cuts at this stage.

Staffing assessment

We looked at our team to assess whether we were adequately staffed and trained to deal with increased demand from our clients and saw some gaps in our knowledge in terms of offering advice to clients in financial and business distress.

Most of our team are training to become ACCA-qualified and even our more senior managers had very little experience of dealing with the sorts of HR and funding issues our clients were going to experience.

Operational changes

1. Clients

Very early on, we introduced a requirement to speak in person, on the phone, to every one of our clients to find out what sorts of problems they expected. We did all of this in a timespan of a week.

This meant that the whole team did this, and we carried out very little else during that time apart from urgent tasks like payroll.

It quickly became apparent that most of the questions we were being asked were around three areas and we needed to improve our knowledge on:

  • Damage limitation / Funding for business
  • Human resources
  • Cashflow forecasting for business/ personal

We started to train our staff in these areas.

2.  Internal

We work in a hosted environment and already allow staff to work from home, so we were quite well set up for remote working. Our phone system is cloud based and while we had rarely used the full features of the system, we did get the app installed and running on all our teams’ mobile phones.

Our initial plan was to split into two teams, with one team in the office one week with the other team working from home and then switch round with a view to trying to ensure we did not spread the virus to the whole team at the same time.

The speed of change overtook this plan and no sooner had we introduced it, we reverted to remote working for all staff.

At this stage, we needed better communications between the staff; phone was ok, but we needed to chat and share screens to really work remotely so suddenly learnt to use Microsoft’s Teams to a much greater extent.

We now have daily whole of firm meetings on MS Teams as well as most internal conversations, work queries and file reviews carried out via MS Teams. Without coronavirus we would not have made this technological change quite so quickly.

We are now also carrying out many one-to-one or conference call client conversations via MS Teams’ video web link.

We needed new staffing policies and amendments to our staff manual to deal with considerations like GDPR, working times and conditions. We also needed to make sure that everyone in our team had adequate technology at home (a computer and two screens). In effect, we opened 19 mini offices in one weekend.

Marketing

We have dramatically reduced all our generic marketing (Quickbooks, tax etc) to just concentrate to covid-19 related marketing and helping small business through the crisis with posts around furloughing staff, small business rates grants, funding, self-employed grants, and the Bank of HMRC.

Current position

Now our current working environment is:

  • Flexible availability – choose a start time between 7.30am at 10am and work for 7 ½ hours. Resist the temptation to carry on working at home so that work /life balance is maintained. We do this by being available or unavailable on MS Teams.
  • Morning MS Teams full staff meeting at 10am to discuss the day. Encourage everyone to participate and say what he or she are doing today.
  • Screen share meetings throughout day via MS Teams for work related queries or client reviews.
  • Go to meeting video conference calls for many clients at once (e.g. furlough leave, self-employed grants, small business rates grants)
  • One-to-one MS Teams Video calls instead of client meetings

Future outlook

For many of our small business owners the real problems will start when they are required to repay the loans that they are currently taking from HMRC.

With a complete deferral of PAYE, VAT, corporation tax and self-assessment tax in July 2020, it is very easy to see many small businesses owning HMRC hundreds of thousands of pounds with very little way of repaying.

The real problems may come then.

Recommendations to any accountant struggling to cope with remote working:

  • Get into a hosted environment so that all employees can access from any location
  • Sort out a cloud-based phone system
  • Use MS Teams or Google Meet for team collaboration while working remotely
  • Use WhatsApp group for general internal chat
  • Set up Zoom, Go to Meeting or Teams for client meetings
  • Set the rules for home working in staff manual

Offerings for our business clients following Covid-19

  • One-to-one phone calls to help devise a plan
  • Help with staffing options: explain furlough leave, offer HR consultants
  • Review Suppliers: get rid of unnecessary expenses, there are always a few
  • Use HMRC deferred payment options for PAYE, VAT, corporation tax & self-assessment if necessary, to maintain cashflow
  • Start cashflow forecasting
  • Offer funding options via apps like Capitalise and British Business Bank
  • Continue mentoring your small business clients

Peter Jarman FCCA, Partner in PJCO Chartered Certified Accountants and ACCA Practitioner Panel member