Accountancy firms are trying to protect their clients from the worst of the pandemic’s effects. And, like many people in business, they are finding their resilience, flexibility and leadership being tested as they respond to unprecedented drops in income.

David Smith FCA, a former president of the Institute of Chartered Accountants in Australia (now CA ANZ), works as a consultant to accountancy firms through his business Smithink. He remembers Australia’s 1990-91 recession and says this current episode makes that “pale into insignificance”.

Insolvency practitioners, he notes, are “frantic”.

Debra Anderson’s accounting firm, Anderson Tax & Consulting, has a range of small business clients; she also serves on the Australian government’s Tax Practitioners Board. Recently she has noticed mentions of suicidal clients among the posts on accounting forums.

“I don’t recall the last time I heard that kind of thing on one of those boards, but they’ve been coming through quite a lot over the last week and a half,” she said in late March.

Accountants have a crucial role in guiding clients through these extraordinary circumstances.

Trimming expenditure

As a first step to solving problems, Smith suggests focusing clients on the basics. Many firms are dealing with the same issues: “I've got all these expenses and all of these commitments, and my revenues have disappeared.”

He recommends firms do modelling “to actually determine how bad the situation is, to help the client run through their expenditure and see how they can trim it.”

Accessing government payment

Practitioners also need to help businesses access government assistance, but both Smith and Anderson agree that as new announcements come one after another, accountants have struggled to deliver advice that is specific enough for clients.

Says Smith: “We've got so much going on, so much change, and new announcements, new packages from the government, virtually every week. It’s nearly impossible for accountants to keep on top of this, let alone anybody else.

“A lot of the clients are thinking: ‘Look, this is just all too hard. There's so much stuff coming at me. I'll just ring my accountant; they’ll know what I should do.’”

(Get up to speed by reading Coronavirus relief measures in Australia and Breadth and depth of NZ coronavirus response applauded.)

Accountant as counsellor

In many cases, accountants are becoming counsellors to people who are seeing their life’s work threatened. “People are leaning on their accountants during these times,” says Anderson. “We are the central point of their financial lives.”

As a result, she finds herself facing the same pressures often faced by psychological counsellors. “People are letting it out on people that they shouldn’t be,” she says. “I've actually had to turn off my email because it’s been so overwhelming and people are so stressed.”

With the situation so fluid, firm answers can be hard to come by. And some clients react badly to the answers they do get. Anderson reports responses such as: “This isn’t fair; I’ve been paying tax.”

How to help when you’re worried someone is suicidal

If you believe a client or colleague may be suicidal, you can and should take practical steps to intervene. 

• Read and act on these guidelines from mental health group SANE: How to help when someone is suicidal
• Urge them to ring the Lifeline counselling service on 13 11 14 (in Australia) or 0800 543 354 (in New Zealand).

Staff questions

Some firms find themselves confronting HR questions they’re not used to solving. Anderson had one catering industry client close down operations and put all their staff off. Now, she says, the client wants to go to the bank as quickly as possible seeking funds to pay out employee entitlements. But such returns take time to process.

Desperation questions

For the first time, Anderson has found herself fielding client questions that stretch the limits of legality. Her client base is “always happy to abide by the laws,” she says.

“Yet even some of them are now saying, ‘OK, how can I get the most out of this?’ Because nobody knows what’s coming. Nobody knows what’s going to happen tomorrow, never mind six months from now.”

Stepping up

Anderson expects the pressure on accounting firms to grow even further come April, as clients in Australia rush to get their BAS paid, a precondition to accessing many government payments. But she also sees an opportunity. “This is our time as a profession to really help our clients,” she says, “and really be their heroes.”

“This is our time as a profession to really help our clients, and really be their heroes.”

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