CPA Australia gives tips to SMEs to fight Covid-19

CPA Australia said businesses must assume that health authorities will ask people to stay home to contain the spread of Covid-19, or that large numbers of the local population will voluntarily stay home.“This will result in people consuming less and purchasing in different ways. It will also impact staff availability, especially for businesses where employees cannot work from home, ” it said.

PETALING JAYA: Improve cash flow, re-do budgets with new assumptions, increase online sales and update your financial statements.

These are among some of the tips that have been recommended by CPA Australia for small businesses in the face of possible disruption to business from the coronavirus or Covid-19.

“For many businesses, likely moves by governments to contain the public health risk may result in a sudden fall in demand for your products or services, labour shortages and supply disruptions, ” the press release said.

CPA Australia said businesses must assume that health authorities will ask people to stay home to contain the spread of Covid-19, or that large numbers of the local population will voluntarily stay home.

“This will result in people consuming less and purchasing in different ways. It will also impact staff availability, especially for businesses where employees cannot work from home, ” it said.

“It is also likely that your operations will be impacted by supply disruptions as your suppliers grapple with the same issues, ” CPA Australia added.

It also warned that the outbreak could place the immediate future of SMEs in jeopardy as there is no way of knowing how long this unfolding outbreak will last.

Among the other steps businesses could take include listing possible impacts on the business, estimating its financial impact and developing mitigation strategies. Have contingency plans and perform reality checks on the business, the release said.

Earlier pre-outbreak assumptions to produce the company budget are most likely no longer relevant. Working with the accountant, take the list of possible impacts and re-do the budgets, CPA Australia said.

“Include a range of possible previously unthinkable scenarios, such as a 50%-80% decline in sales over three to six months, or a supplier being unable to supply a key item for six weeks, ” it added.