Businesses, both big and small, have been hit hard by the effects of the coronavirus pandemic. As a result, plenty of business owners are wondering how to keep their operations going or how to start over once the quarantine restrictions have eased.
While doctors and other medical workers are fighting on the front line to defeat the virus, it’s the accountants who are the frontliners when it comes to businesses. With a lot of financial issues to sort through and decisions to make, accountants are serving as valuable partners, especially for small businesses.
Below are ways accountants are helping entrepreneurs weather the coronavirus storm:
Forecasting Cash Flow
For most business owners, cash flow is the primary source of financial burden right now. Unfortunately, small businesses are seeing the strain in cash flow from the closing of establishments, lockdowns of whole areas, and stay-at-home orders. As a result, cash flow numbers don’t look great, and some companies are forced to lay off employees.
With the help of accountants, though, entrepreneurs can forecast their cash flow and identify what necessary cuts they have to make to still generate revenue. This is essential, as Bryden Johnson says, “In addition to a robust business plan, it’s important to understand your budget and cash flow.”
The data from forecasting cash flow can also help business owners manage their resources. Accountants can help entrepreneurs optimize cash flow by lowering costs, spotting growth opportunities and identifying which customers are profitable and which are not.
Apart from that, they can also consider the value of their employees. Keep in mind that while employees are major cost drivers because of payroll and benefits, they’re also key drivers of value for the business. Accountants can help business owners manage this cost-benefit trade-off.
Providing the Right Knowledge About Financial Support
Once a business knows what their cash flow will look like and have identified how to make it more positive, they can start thinking about the different financial support programs that the government is offering to businesses. Accountants can help business owners understand each financial support option available to them. Some loan options may be better for businesses in one industry, but an entrepreneur may not be aware of that. With an accountant, they can make strategic decisions about financial plans that will meet their business goals.
Taking Care of Paperwork
Once an entrepreneur has a plan for their business, an accountant can execute it and make sure that it happens. This means helping business owners in their application by outlining the financial information they need. This may include monthly sales figures, profit and loss statements, and other key financial reports.
Apart from this, accountants can also help them file the necessary paperwork, ensuring that they are complete, up-to-date, and accurate. With these services, loan applications are more likely to get approved.
In times as uncertain as the present, having reliable accountants is invaluable to businesses. With these professionals’ help, business owners have a chance to come out of this pandemic with as little damage as possible.