Irrespective of size, sector or country the economic and social impact of the pandemic has expanded, and challenges are growing for business and the accountancy profession, reveals ACCA’s Covid-19 global survey ‘The Road to Recovery’.
Following March 2020’s original report, three months on the picture now crystalises many key issues that need to be addressed by policymakers and governments. ACCA is calling on governments worldwide to review economic rescue packages and enable a return to sustainable growth.
For the UK, the overall picture is one of a slow return to normal according to the respondents from an expert panel of 1066 finance professionals, who were asked several questions specific to their role or organisation sector. The results show:
- 89% are giving employees flexible work arrangements, and looking ahead 80% believe an impact of the pandemic will be the transformation of working practices with less reliance on using physical office spaces
- 85% of business leaders polled have now conducted a financial reforecast, and of those 15% believe negative growth of 50% or more is likely compared with the prior financial year
- 45% are implementing an operating cost reduction strategy, with 48% reviewing organisation processes to identify efficiencies.
Claire Bennison, head of ACCA UK says: ‘We also asked respondents, covering businesses large and small, about government support packages and their relevance – the majority at 53% think the measures so far have been effective, but 13% remain unsure. It’s still important for the government to support businesses for the long term – especially SMEs, which we have been tracking for the last 10 weeks with the Corporate Finance Network.’
Jamie Lyon, the report author and head of business management at ACCA explains the unavoidable challenges many are experiencing: ‘Globally, the problem at the centre of these issues is a collapse in customer demand for many organisations, with 53% of respondents citing purchases as completely stopped or reduced. It’s a domino effect, with both product launches and investment plans being deferred, further compounded by supply chain challenges and issues with customer order fulfillment.’
Jamie Lyon adds: ‘Yet again, our global data sees the impact hitting hardest on SMEs. Almost 60% of SMEs cite customer purchases stopping or reduced, a marked increase from our March survey where less than a third said this was the case. Cashflow is being impacted, and this is highly likely to persist.’
Claire Bennison concludes: ‘The pandemic has had a profound effect that will resonate well beyond 2020. The crisis has raised fundamental questions about the future of work, and our working lives.’
Jamie Lyon concludes: ‘There are other potential long-term implications too – including scaling -up of digital investment, a continued prioritisation of employee and customer health, and possible global supply chain transformation. Through our “roadmap to recovery”, we’re recommending that organisations follow the “three As” – Act and respond sustainably to the immediate crisis in the short term; Analyse the different information sources to start to build the path to recovery in the medium term and Anticipate how strategies need to evolve over the longer term.’
ACCA’s roadmap to recovery is available here. This June survey of over 4,500 ACCA members follows the publications of ACCA’s report COVID-19 Global Survey: Inside Business Impacts and Responses in April 2020, and continues to track ACCA sentiment around the world on the impact of COVID-19 and examines how organisations are responding.