ACCA is providing ongoing support for members during this challenging period
ACCA’s Policy team is working to develop recommendations and lobby for government policy to support members and the businesses they advise. The team maintains close relationships with a number of government departments and ministers to ensure that members have clear and relevant guidance.
Members have been sharing a range of helpful insight and experiences, which we have reported back in response to government requests for business intelligence and our targeted lobbying, and we continue to welcome a broad range of views and insight from members to shape lobbying at UKPolicy@accaglobal.com.
ACCA’s Technical Advisory team fields technical and general business queries from members, offering case-by-case responses as well as broader guides and factsheets relevant to clients and employers in all sectors.
ACCA is receiving a high number of queries from members supporting businesses to claim the available support. Technical Advisory is working hard to maintain the usual three-day response time as services continue to be available to members in the UK via the email helpline firstname.lastname@example.org.
ACCA has taken steps to support its 219,000 members and 527,000 students all over the world via a Covid-19 online hub with resources and updates for students, employers and staff as well as guides to aid business planning and insights from members in international markets.
To find out more, take a look at our monthly updates, available on this page.
Activity update: 15 April 2020
Meeting with Department for Business Energy and Industrial Strategy
On 15 April, ACCA joined a small roundtable with Paul Scully MP, Minister from the Department for Business, Energy and Industrial Strategy (BEIS) to discuss Covid-19 support for business. ACCA was able to submit questions for the minister from our practitioner network and invite a further 10 ACCA members to join the meeting.
The minister stressed that the department is working to find simple solutions to support businesses that could operate at scale and was dealing with a very high volume of correspondence.
ACCA fed back that applications for the Coronavirus Business Interruption Loan Scheme (CBILS) were not working as intended, with members reporting onerous applications and requests for information from lenders. Additionally ACCA highlighted that employers were running low on cash and were concerned that Coronavirus Job Retention Scheme (CJRS) payments were not being released in time to meet April payroll commitments.
The minister reported that efforts to increase the number of accredited lenders was a department priority. Additionally, lenders were experiencing difficulty getting smaller loans (less than £25,000) approved but BEIS was taking steps to address this.
The minister stressed that government officials understood the immediacy of the issue. Due to the updated lockdown timetable in line with scientific advice the minister welcomes insight from businesses about how they plan to come out of lockdown and what is vital for them to make the transition.
SME Cash Flow Survey
In April, ACCA UK launched a survey in collaboration with the Corporate Finance Network (CFN) to identify the short- to medium-term cash pressures on businesses.
On Wednesday 15 April we released results from the first week of the survey, which you can see more on here. Our survey found that a third of practitioner clients were likely to be unable to access the cash they would need for another two weeks of lockdown. Additionally, one in 10 business clients were likely to have already liquidated or dissolved their company.
Our findings, based on member feedback, were covered in the Financial Times and on Radio 4.
To inform our conversations with government and lenders on urgent capital support, we will continue to collect responses and produce a weekly analysis.
We urge members from practice and private sector to share their views and client experiences here.
ACCA policy positioning
ACCA is discussing pragmatic responses and policy developments on a continuous basis. However, we have a number of key policy areas that we believe will be crucial for members and the businesses they support:
Expanding provision of CBILS
A recent survey of our private sector members found that 7% of organisations had applications for CBILS rejected and a further 42% had not yet applied for funding but intended to do so. For many with cash flow concerns, fixed costs and existing debts, securing finance or refinancing existing debts is essential. Based on feedback from members that those with pre-existing relationships with lenders are more likely to gain approval for funding, CBILS should be extended to include all Financial Conduct Authority-regulated providers in order to bolster the number of deals being agreed and ensure that economic stimulus is used to provide security to those who need it urgently.
Member feedback has demonstrated that to aid cashflow for those concerned about short-term liabilities, fixed costs and staff costs, government and lenders should consider an amendment to the CBILS process to provide immediate liquidity support in the first stage of application, which allows firms to draw down a percentage of their annual revenue immediately on an interest-free basis until the facility is agreed.
Support for self-employed
From an economic and public value perspective it makes sense to target support for businesses on the basis of their function as economic actors, rather than their legal form. Government should consider how support could be extended to directors of SME-incorporated entities to ensure the survival of these businesses, naturally taking into account caps on support that exist for employees and the self-employed.
We welcome the measures by Companies House to offer filing deadlines for businesses. However, further relaxation of rules must be extended, allowing Companies House to grant extensions to filing deadlines for as long as necessary for businesses hit by Covid-19 disruption, bypassing the three-month limit on extensions and automatic penalties, which would be applied across the board.Read more
Meeting with Department for Business Energy and Industrial Strategy
On 15 April, ACCA joined a small roundtable with Paul Scully MP, Minister from the Department for Business, Energy and Industrial Strategy to discuss covid-19 support for business. ACCA was able to submit questions for the Minister from our practitioner network and invite a further 10 ACCA members to join the meeting.
The Minister stressed that the Department were working to find simple solutions to support businesses that could operate at scale and was dealing with a very high volume of correspondence.
Activity update: 15 May 2020
Meeting with Kevin Hollinrake MP, Chair of the All-Party Parliamentary Group on Fair Business Banking and PPS to Michael Gove MP
In May, ACCA joined a roundtable with Kevin Hollinrake MP. ACCA cited our member survey results, showing that just 2% of businesses applying for the Coronavirus Business Interruption Loan Scheme (CBILS) and low approval rates from lenders. ACCA also raised member feedback highlighting SME reluctance to assume debt, and enquired whether alternative finance support measures would be made available.
Hollinrake said that grants form a significant part of business support and, naturally, government would be looking into further support. He invited ACCA to a follow-up meeting to share examples of members/clients struggling to access loans.
ACCA will be sharing member feedback with the minister; members are invited to send any further information to UKPolicy@accaglobal.com.
Meeting with Kwasi Kwarteng MP, Minister of State for Business, Energy and Clean Growth
On 11 May ACCA attended a meeting with Kwasi Kwarteng MP, who spoke about the government's commitment to the pre-Covid-19 path of making the UK a green finance centre and making sure capital markets have the right information on climate risk exposure, which is comparable and consistent. Jimmy Greer, ACCA's head of sustainability research and policy, spoke about the role of chartered bodies in green finance education and the role of accounting standards in improving climate risk disclosures.
SME Cash Flow Survey
At the beginning of the Covid-19 lockdown period, ACCA UK launched a survey in collaboration with the Corporate Finance Network (CFN) to identify the urgency and prevalence of liquidity concerns for businesses. Member feedback has received coverage in the Financial Times, BBC Radio and The Accountant online. We urge members from practice and private sector to share their views and client experiences here.
ACCA policy positioning and progress
ACCA is discussing pragmatic responses and policy developments on a continuous basis. The following positions have recently been adopted and raised by ACCA in our regular market intelligence briefings to key government departments:
Agent eligibility to act on behalf of clients for SEISS
ACCA is concerned about HMRC’s announcement that agents would not be able to make Self-Employed Income Support Scheme claims on behalf of clients. Often clients require professional support to set up account details with HMRC, check calculations and use office tax portals. The inability of agents to act on behalf of their client, as is routine with tax returns, could lead to an unnecessary proportion of incorrectly submitted claims and delays. Self-employed individuals may also be left exposed and unable to identify scams and phishing emails, of which we are receiving increased reports in the current period.
Annual director PAYE claims
ACCA has raised the issue of directors on annual payroll who, despite having made RTI submissions in previous years (2018/19 and earlier) and notifying payment to HMRC before 19 March 2020, are not being picked up by the Coronavirus Job Retention Scheme (CJRS) application system. Additionally, many directors are receiving no support at all, as no FPS have been made in the 19/20 tax year ahead of the 19 March cut off. Urgent clarification and assurance is now required on this issue for many directors of limited entities whose only source of government support will now be the CJRS.
Support for self-employed: From an economic and public value perspective, it makes sense to target support for businesses on the basis of their function as economic actors, rather than their legal form. Government should consider how support could be extended to directors of SME- incorporated entities to ensure the survival of these businesses, naturally taking into account caps on support that exist for employees and the self-employed.
ACCA policy successes
- ACCA’s recommendation to postpone the introduction of the off-payroll working rules was adopted, and we look forward to continuing the conversation with government on fair and transparent application of the rules.
- ACCA’s recommendation that government relax home-working allowances to extend the tax relief already available to home-based contractors to all employees asked to work from home by their employer was adopted, as announced by Jesse Norman MP on 13 May.
- ACCA recommended bank loan schemes be adapted to include a higher level of government guarantee with immediate liquidity support for smaller loan volumes so businesses might receive cash in days rather than weeks. We were pleased to see the introduction of the Bounce Bank Loans at 100% government guarantee and hear from members receiving loan approvals in much shorter time frames. We will continue to lobby for improvements in approval rates and delivery of funds for higher loan volumes.