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A year on from Covid: How finance was affected

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Every business and accountancy firm in the UK has been affected by the Covid-19 pandemic, but Steve Ash reports on how many finance professionals adapted to the challenges.

19th Mar 2021
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The past year has been a challenging and transformative time for many businesses. As an accounting firm, you’ll have seen your clients struggling to deal with the impact of Covid, while helping them to access the available government funding, cope with the cashflow dips and come to terms with the complexities of the furlough scheme.

But how has Covid changed the actual day-to-day operations of your client’s finance function? And how can cloud-based financial management help with this transformation?

The pre-Covid finance function

Think back to the dim and distant past of February 2020. The finance function of a medium-to-large business was housed in the finance office, in a building. In the majority of cases, staff accessed their finance software via a local network, to query a server, most likely housed in the company’s file server room. 

Logging into their Windows PC or their laptop, an application on their machine would deliver their accounting software.

If anyone in the company was working remotely, or even ‘home-working’, the finance team would be the least likely to do so. The finance function’s security requirements and the need to handle physical documents made home-working impractical.

Understanding the Covid and home-working challenges

That’s how a finance team worked in early 2020 – it’s a set-up and methodology that’s been in place for decades prior to this, probably unchanged since the noughties.

Then, bang, Covid-19 arrives on the scene! All of a sudden, we’re in lockdown and people have to work from home. But this switch to home-working creates a growing list of issues for the business and IT functions to overcome.

For example:

  • IT teams suddenly experienced unprecedented levels of requests from staff trying to log into their old software, but outside of the local area network (LAN).  
  • Companies learn very quickly that their ageing software was never designed to be accessed remotely over a broadband connection from the employee’s house.
  • Network speeds are poor and there’s a big question mark over data security.
  • Finance staff, who traditionally used a desktop machine, are forced to use personal devices to access the accounting software remotely, adding to the security risks.

Finding a quick fix

By March 2020, the pressures of remote working were taking a toll on finance efficiency, so a remedy was needed fast – and this provided a headache for the IT team. 

The instant solution for delivering widespread homeworking was to provide remote desktop implementation tools – simulating access to the company’s servers as if they were local. However, the shift in remote working escalated from a pre-Covid average of maybe 10% of the finance team to almost 100%. This placed both logistical and financial demands on the IT infrastructure.

For example: 

  • Banks of remote access servers had to be built and then accessed by a much greater communications bandwidth than had ever been required before.
  • This method of accessing servers as if they were local created significant security challenges and generated real issues around the speed of access for end users.
  • Physical hard-copy documents were still in filing cabinets in the office, with no scanned, digital versions for the team to access.
  • This short-term fix was just a ‘sticking plaster’ on the wider real-world issue of matching up and approving paper documents in a partly digital workflow.  

These issues, and the need for a fully digital solution, made a cloud-based financial management system (FMS) a genuine necessity, rather than just an aspiration for the future.  

Cloud computing to the rescue

Fast-forward to today. We’re now operating in a world where we recognise that the ‘new normal’ won’t be identical to the ‘old’ normal. The escalation of technology has been fast-tracked, creating a post-Covid business landscape that’s very different to the February 2020 model:

  • Remote and home-working are here to stay. 
  • Workflows need to be effective without people being in the same office.  
  • Security and speed cannot be ‘fudged’ for short-term fixes.
  • Documents need to be accessed securely, from anywhere, anytime, on any platform.

Cloud is no longer a future consideration, but the accepted norm for most business software solutions. This assumption applies as much for finance as any other business function.

A cloud financial management solution such as iplicit helps not only to increase the efficiency, data access and productivity of your finance team. It also helps to future-proof and reduce risk for your organisation as a whole.

There’s a need for a finance system that reacts to the unknown challenges that lie ahead. True cloud solutions are the mainstream answer for today’s challenges, not outmoded systems that are hosted “in the cloud”, but are still rife with antiquated design issues and architectural flaws from the pre-cloud era.

The next IT revolution

We’ve all been placed under immense day-to-day strains by this pandemic and Covid has undeniably taken a huge toll on our society and our people. But there may be a silver lining…

The pandemic has been a huge catalyst for change, forcing thousands of businesses to question outdated processes and applications. Systems that were getting by simply couldn’t withstand the challenges that remote working threw at them – and this made a highly convincing business case for switching to a true-cloud FMS. 

Many companies have adapted to cloud-based tools such as Microsoft Office 365 or Google’s G-Suite. So, cloud is not the new kid on the block that it might appear. This period of rapid change will result in systems that run more smoothly, workflows that are more efficient and organisations that are more prepared, flexible and robust – all without the need for the reliance on one central office to act as the company’s operational HQ.

It’s a sobering thought to think that this pandemic could have occurred 20 years ago – at a time when there would have been no true-cloud systems to rescue us.

iplicit is a good example of the opportunity for best-of-breed systems to emerge from new entrants in the FMS market. The future shape of the finance function will continue to evolve and true cloud is a must-have for every shape and size of organisation.