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Small businesses turned to their accountant three times more than they would usually during the height of the COVID-19 pandemic, new research has found.
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Accounting demand tripled during pandemic, survey finds
23 December 2020
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Only one in 10 small businesses said they went their own way and did not seek out external advice, while a smaller cohort of 4.5 per cent said they relied less on their adviser than before the pandemic.
The latest ScotPac SME Growth Index found that 54 per cent of small businesses approached their adviser an average of 13.3 times each quarter, up from the average 4.4 times pre-COVID.
The research, which surveyed 1,252 small businesses, found that 82 per cent of those who sought advice said that it had a positive impact on their business.
Areas of assistance most sought after by SMEs included reducing costs to help improve their bottom line, helping them access government support and stimulus measures, providing confidence about their business direction, helping improve customer relationships, and accessing funding.
“SMEs faced so much in 2020. The pandemic created hard internal borders, temporarily devastated certain industries, interrupted supply chains and led to a government stimulus package of unprecedented size and scope,” said ScotPac senior executive Craig Michie.
“To cope with the turmoil and keep things on track, businesses turned more frequently to their trusted advisers.”
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Of the businesses that chose not to seek out an accountant, 40 per cent said it was because they had no time, while 21 per cent said they felt like they did not need advice, and a further 18 per cent said the cost was too prohibitive.
Looking ahead to 2021
Mr Michie believes SME owners will need to seek out professionals more than ever over the next 12 months as the economy looks to recover from the pandemic.
“Successfully navigating through the recession caused by the COVID crisis requires SME owners to make the hard decisions about their business — without delay,” Mr Michie said.
“These hard decisions include assessing business viability, researching the best way to fund the business, working out how to deal with the end of JobKeeper (if not for themselves, for the impact this will have on their supply chains) and planning for what happens when ATO debts are enforced and other deferred debts fall due.”
He has also encouraged accountants to tap into the Australian Small Business and Family Enterprise Ombudsman’s Business Funding Guide to help their SME clients source appropriate funding and increase their chances of getting their finance approved.
The guide, developed in partnership with Scottish Pacific, was recently updated to reflect the impacts of COVID-19.
“Given that many SMEs indicate they don’t know how to fund their business in 2021 and given the high degree of change and uncertainty about how to go about business, it’s a lot to ask traditionally time-poor business owners to go it alone,” Mr Michie said.
“Cash flow management and funding advice will be more important than ever in steering SMEs through the pandemic aftermath.”
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