A recent report by the Association of Chartered Certified Accountants (ACCA) has revealed the crucial role that accountancy firms have had in enabling SMEs to stay afloat during the pandemic and the continued support they will provide in a post-Covid world.
In its most recent report, Responsible Practice Pacesetters, which surveys almost 50 global SMP (small medium-sized practice) leaders, ACCA found how regional accountancy firms, including those in North Wales, have acted as a safety net for SMEs and microenterprises trying to rebuild and steer their way through mandatory lockdown measures. The financial impact of the crisis has been immeasurable on businesses, with many facing disruption to supply chains, staff shortages and restricted commercial activity.
SMEs are a fundamental pillar of the economy. The World Bank estimates they make up 90 percent of businesses globally and more than 50 percent of employment worldwide.
The study shows how agility and innovation have contributed to an unprecedented mobilisation of the SMP community; with accountancy firms working round the clock to keep businesses afloat, all the while facing their own challenges, such as a lack of staff, delayed payments or the physical difficulty in conducting audits. The report also demonstrates how SMPs, now more than ever, provide a vital link between SMEs and the ecosystem they must navigate.
Colin Bell, Director at leading North Wales accountancy firm Williams Denton, said: “80% of our clients are SMEs, with the remainder being personal individuals, and over the past six months or so, many have seen their survival threatened due to lack of cashflow. They have experienced temporary closure or reduced operations and, where limited trading was possible, there have been problems with supply chains, particularly in the construction industry early in lockdown. Reduced staffing has also been a problem with employees having to shield and social distancing restricting staff numbers in workplaces.
“The team in our Bangor and Llandudno offices have been regularly communicating with SME clients during lockdown to provide them with information on how to utilise government initiatives such as grants and loans as well as advising on cashflow saving measures. Our clients have been extremely appreciative of the support we have provided which has helped them through this period and enabled them to formulate plans for the future.
“Our continued support has further enhanced our ‘trusted adviser’ status. Just being there to talk through the issues that they are experiencing is of great comfort and gives them the confidence to carry on.”
The report author and ACCA’s head of SME professional insights, Aleksandra Zaronina-Kirillova, said: “SMPs are a key part of the financial health system for the SME sector. They have proven to be the ‘emergency services’ to small businesses during the Covid-19 pandemic; providing enhanced business support and access to finance, enabling SMEs to contribute to overall economic growth. However, they also have a much broader and impressive role in society, which often remains untold, so we wanted to shine a light on these aspects by publishing this report.”
Other highlights from the study reveal how smaller accountancy firms contribute to the wider community and society, including supporting the charity and not-for-profit sector and playing a leading role in transforming SMEs into robust businesses which behave ethically and responsibly. SMPs also help foster financial literacy among both individuals and organisations in their communities, enhancing financial competence among small business owners, promoting both entrepreneurship and personal responsibility.
Find out more at accaglobal.com