The Accounting during the difficult times are there to provide assistance and positivity in businesses. Being an entrepreneur, the key element to focus now a days in the times of downturn is to resist with the tough times that sets business up to be a rapid turning cash flow business, when in the future everything bounces back in a positive manner.
It must be kept in mind that your business will be under control, so will be the cash flow. For the businesses, downturns could be scary because there is no such plan in your business. You will have to build cash that will allow you to trade through upcoming months of complications. Following are the crucial areas that must be considered immediately:
The cash should be preserved at every cost. In order to make your business survive, you should instantly begin with building a cash “war-chest”.
An entrepreneur must upgrade and update the asset protection instantly. It is very crucial to revive the strategies properly to regulate the equity in your home and other assets that are on your name. Moreover, it is also crucial to have revised Enduring power of Attorney (EPOA) and Will.
- FUNDING AND BANKS
If possible, you must contact your bank instantly to arrange the lines of credit. Some of the substitute funding sources must be considered immediately. It will be the accurate time to act, when the banks will be overwhelmed by the loan applications of other banks.
- MANAGEMENT TEAM
With your management team of providing accounting services, you have to work through the COVID-19 Continuity plan. Afterwards, immediately communicate the final decisions with your team.
You have to discuss the working hours with your workers to work from home and to save the cash. Your employees could be scared, but you have to reassure them as they would need to have an understanding of your plans to continue your business to work.
- SUPPLIERS AND CUSTOMERS
The well-versed communication is desired so that the clients have peace of mind that the business is just like the previous one, and also you can rely on your suppliers.
Business Continuity Plan For Coronavirus
At the times of crisis, you have to be a leader of your workers, so you and your team management team have to be positive and you must ensure that you are opting for proficient accounting services.
- Receivable outstanding Accounts
Verify outstanding invoices with customers, so that there will be no sensible reason for a client to postpone any payment when an accurate time arrives.
- Confirmation of Receipt Dates to be Expected
In order to pay your invoices, make sure about the date that your client has in their payable schedule. Then you can set reminders to view whether the payment arrives on time or not or you can also set an alarm bell to be proactive.
- Sell the Unutilized Tools
You must be realistic about the tools that you need in your business. You must decide on that whether you can sell any unused equipment in order to generate more cash.
- Liquidate Stock at Cost Price
Examine to sell excessive or main stock items at the cost price or just slight above than that to build cash. There will be no point at all if your business will run out of cash just within a month, on the other hand the amount of stock In hand must be in excessive amount.
An immediate of at least three month rent free period or half rent for six months must be requested from the landlord. You won’t know what they will say until you ask.
- Contracts for Fixed Term
Discuss the terms of contract with Suppliers, and ask whether these can be cancelled or decreased. It must not be assumed that suppliers will not work with you.
- Terms for Suppliers
You must discuss the terms with your supplier and notice whether you can increase those terms. If you pay early, get a discount or cash reserve request from your supplier.
- Reduction Of Costs
Wherever it is possible, reduce the costs. Many of the businesses have extra facilities that are required only in the good times like training courses and lunches. You must think efficiently to cut any cost that will not reduce your productivity or put you at the risk.
A pandemic COVID-19 outbreak challenges existing business continuity management (BCM) initiatives at any business. Being an entrepreneur, you must make it sure that your business continuity management efforts are up to challenge. As the Government has warned about impact of Coronavirus globally, the businesses shall stand actively for its impact. Rather than fixing everything at once, it is more efficient to follow a thorough plan and the Accountants in Melbourne assist you to do so.