Lockdown 3: Accountants concerned for 2021
As we settle into the third national lockdown in less than a year, accountants are growing concerned about the prospect of the year ahead.
At the end of 2020, client cashflow struggles topped a survey by Senta as the biggest concern for accountants throughout the year.
This was largely down to the struggles small businesses encountered throughout the influx of the pandemic.
However, after a socially-distanced New Year’s Eve we were all happy to see the back of, 2021 might not be so different. The announcement of the UK’s third national lockdown in less than a year has delivered an (unsurprising) blow to the start of January.
With businesses bracing themselves for the challenging months ahead, there have already been concerns raised from the accounting profession about what this lockdown will bring.
“What am I supposed to do about outstanding tax returns if I am not allowed to go to my office?” asked AccountingWEB reader thompson1961 in light of the shielding guidelines.
Beancounting agreed, asking how everyone else was coping with the news: “I am keeping my office open but have some staff working from home, and some in the office, on the basis that not all can work from home.”
Some readers were debating whether accountants qualified as key workers, with arguments that they provided essential financial services.
“Accountants complete regulatory work,” said reader craigleeds. “What would happen if audits didn’t take place for traded companies? What would happen if no account was completed?”
The key worker debate has fallen hardest on those who have to balance not only work and life, but childcare responsibilities on top of everything else: “Ultimately my mental health is going to suffer terribly,” commented reader imbs. “I feel inadequate in every respect – to kids, to household, to clients, to kids’ education.”
This new announcement has come at a time when accountants are already struggling to manage the aftermath of the previous lockdowns; there has been concern over replacing clients that were lost due to the effect the pandemic had on business owners. The clients that do remain pose the potential threat of being unable to pay for services due to struggles with furlough and employment.
Some readers were also anxious about the prospect of over-supply and under-demand of accountants inevitably leading to cut costs and lowered fees for practices.
However, with so many jobs lost there is bound to be an increase in startups: “There will not be many options for many so they will have to set up their own business,” predicted reader JimLittle.
Ireallyshouldknowthisbut also advised targeting business startups throughout January, as well as the ‘grey’ market who’s accountants were looking to retire: “They will be about the only people with any cash left in 12 months.”
As if another lockdown wasn’t enough, the coinciding Brexit transition is another on the list of accountant concerns for 2021. The new year brought in the end of the UK's place in the EU, creating changes in tax laws and new filing date deadlines for the profession to get their heads around.
There were, however, some silver linings amongst the news – the events of 2020 have caused a huge increase in the number of practices transitioning to cloud working, helping to progress into the future of accounting and enabling them to support clients remotely from wherever they needed it.
The events of the past year have also caused a shift in perspective for some overworked accountants; in reader Moonbeam’s case, they are now “rather less interested in working like a maniac”. Lockdown 3 may allow the small positive of practising this more gentle and kind approach, with the chance to leave 2020 in the past and embrace the relaxed new normal of work.