A covid-19 pandemic called for national and international boundaries to close down in order to curb the deadly coronavirus. While the hustle of lockdown continued there seemed only one remedy that best suited the situation and that was implementing a total lockdown. The further extended lockdowns only called for more trouble and companies began to close down their operations. Customers kept waiting for their products, suppliers left with no funds in their hands; And had extra supplies with no takers, employees locked in their homes, everyone was just left high and dry.
What New Normal has done to Accounting:
As there were a growing number of uncertainties with every passing day, employers, management, and the human resource department of large and small enterprises began to put their heads together to find ways and means to get their companies back on their feet. Work-from-Home, the initiative which was at first the privilege of very few, became a reality for one and all. Soon employees became accustomed to the so-called “New Normal” and started performing the same duties that they would once do behind their desks right from the comfort of their home.
Though we all are now calling this the “New Normal”, it still comprises the same activities like servicing clients, providing products and services, generating invoices, receiving payments, recording transactions, preparing reports, investing funds, etc. So, the new change is not totally different but it is just an extended form of a new and better manner of performance of roles, duties, and responsibilities for the benefit of all.
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The New Normal also called for changes in the field of finance and accounting along with all other business operations. Companies have come up with new methods and practices making it easy for employees to record data and information without going through a large pile of documents. Some of the new practices followed by companies to get back to the new normal are listed below:
To ensure continuity of accounting operations, the previous backlogs were cleared and all transactions were recorded in the system remotely by the concerned officers. This helped the management to generate reports and financial statements and submit them to the auditors for necessary advice and also get the said records audited.
As employees started working remotely and technological transformation was on a rise, employees required regular catch-ups and training modules to be updated. Companies promptly provided all the necessary assistance to help their employees to stay in touch with all the latest developments ensuring that they also perform their duties efficiently.
Meet the Deadline:
All statutory compliances like tax filings, reporting which were to be completed within dedicated timelines were given priority. Dedicated teams of professionals and accountants were put up together in order to collate data and queries and complete all compliance-related activities on time.
Usage of Online Platforms:
As direct interaction was close to zero, employees needed to stay in touch through interactive online platforms like Google Meet, Zoom calls, etc. so that doubts, queries, and coordination could be achieved to maintain productivity.
Changes in policies and procedures are being done continuously so that revenue can be recovered from customers in the most strategic manner to cover operational and other costs.
Usage of Accounting tools:
All reports and financial statements are being prepared online using various accounting systems and software; the same is being provided to various stakeholders through emails.
Increase in responsibility:
Auditor’s role has increased as they have to scrutinize documents and transactions with limited information. But ensure that their opinions don’t leave any important issue that may be of material importance to stakeholders. The auditors have to adhere to professional standards and statutory requirements while conducting audits remotely.
New means of Obtaining Funds:
There was a huge impact on liquidity due to the sudden stoppage of operations and services which affected the companies fund position and capital structure. New means of obtaining funds for working capital and other operations were immediately sorted for and pumped in. When the partial lockdown was introduced, businesses could keep running and the same were accounted for and recorded.
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Necessary Policy Changes Made:
Companies have started recognizing risks and making the necessary policy changes in wake of uncertainty towards inventory wastage, increasing inventory storage cost, increase in contingent liabilities, increased bad debts, etc.
Need for Due-Diligence:
Increased need for due diligence especially for the companies who are planning to undertake mergers or acquisitions.
It was at these challenging times that the finance and accounting profession has once again proved its mettle; And made use of existing technology and innovations to make things possible which at one point seemed impossible. Digital transformation in accounting has taken place rapidly, new models of business operation have come into practice, more services are being provided through virtual platforms targeting customers across various regions, more importance is given to cash-flow management considering all the associated risks, sustainable and eco-friendly business goals, and objectives are set-up for the benefit of one and all.
Over to You:
Diligen has used this crisis as an opportunity to service its clients and provide accounting and financial services in an uninterrupted manner. As Diligen uses the latest technology and accounting software, tools, and techniques, it makes it very easy to provide clients with financial services and help them fulfill all their legal and statutory obligations with every extended deadline. With our team of experts in the field of accounting, taxation, legal matters Diligen has provided prompt service and solved many client queries.
Our team of VCFO’s have assisted and provided clients with valuable advice on various business-related issues and ensured that their operations and business function do not come to a halt. Diligen provides round-the-clock service to clients to help them relieve any unnecessary stress especially as they struggle to get into terms with the New Normal.
Diligen has provided its clients with all the required financial statements and reports while ensuring total transparency and following all the relevant accounting standards and practices. At Diligen, we are constantly in touch with its clients to help them achieve their new normal and at the same time ensure that all their business operations are performed smoothly and help them to develop new business working models that ensure sustainable growth.