There is no argument that established, virtual firms had a leg up on the competition. Although it may seem that we have made it through the initial part of the crisis, we still have a long road ahead of us. Now is the time for firms to seek out resources and implement tools to bolster team engagement and streamline client processes and communication.

Promote Team Engagement

Staying connected and engaged with your team is a real challenge in a virtual firm. Fortunately, there are tools and resources to help stay organized, on-task, and in touch with the rest of the team. Even better, many of these tools are included in the business management software suites of apps your firm already uses and are relatively easy to set up and implement. Resources such as Microsoft Teams, Google Hangouts and Groups, and Slack can be useful to improve communication in your firm.

Reinvent Your Client Experience

The most impactful change we’ve experienced during the pandemic is the loss of in-person meetings. The reality is that our clients have a wide range of technical aptitudes, and what may seem simple and easy to use to some can seem overwhelming and difficult to others. It’s up to us to design a client experience that is as easy as possible and makes our clients feel comfortable. One way to do this is by proactively communicating your expectations and providing support to help them acclimate.

Ways you can help your clients feel comfortable using technology to communicate with you include:

• Creating both a written and a visual guide to share with your clients before they join a meeting
• Be patient and have screenshots of their experience ready and on hand to help
• Allow extra time for technical difficulties during each meeting.
• Offer online training webinars where you introduce new technology and processes to your clients and record them so you can share the video with them to review afterward.

Streamline Your Processes

By taking the time upfront to set up automated processes and templates, you can provide superior service without much on-going effort. Taking advantage of these automations can free up time to improve your client’s experience. Below is a list of easy to implement automation you can set up now to help you stay on track during the busy season while still delivering stellar service to your clients:

1. Create canned email templates for frequently asked questions and requests.
2. Create predefined folder templates for your document management software.
3. Utilize templates and other resources from your associations and partners. The AICPA has a whole library of free letter templates and workflow templates available to its members.
   

Conclusion: The 2020 pandemic has changed the way we do business, and our clients depend on us to lead the way. We hope these tips and tools will make your journey just a bit easier.

For more information please visit: https://www.accountingweb.com/technology/trends/make-better-use-of-technology-and-resources

The post How Firms Can Take Advantage of New Technology and Resources appeared first on Salt Lake City's CPA's.

You can see this epidemic first-hand in coffee shops worldwide. Workers have one eye on Slack, one eye on email, and no eyes left for the work they came to the coffee shop to get done in the first place. It takes 23 minutes and 15 seconds to recover from each and every interruption. So, we firmly believe the fewer notifications the better, and deep work always beats scattered toggling between tabs.

But decluttering your tech is a marathon, not a sprint. Here are 4 steps you can take to begin to take back your time, work, and sanity. 

1. Turn Off Notifications

The notification explosion is one of the biggest challenges to productivity in the modern age.

You know how it goes. You’re in the middle of a productive work session and your phone lights up to tell you that someone new is following you on LinkedIn and the 200th email has arrived for the day. Your focus quickly shifts to your phone and your concentration is shot. These distractions essentially eliminate your ability to do any deep work or focussed thinking.

There’s a reason these notifications seem so inescapable. Remember these notifications are designed for selling things, not making your life easier. The single easiest digital habit to help you get more done is to simply turn notifications off.

Your family can get in touch with you when they need to, but you really don’t need to know that someone updated files in Dropbox — trust me.

2. Track Your Time

Time-prioritization techniques can be a huge boon to productivity.

1. Track your time. 

2. Plan your weeks. Identify when, where and for how long you’ll do your most impactful work.

3. Report weekly on how you went, how you can improve, and what your most impactful work next week will be.

When you’re more aware of how you’re spending (or wasting) your time, you’ll gain valuable insight on how to be most productive.

3. Turn On Grayscale

Technology is engineered to be addictive and hijack our attention.

And when your phone is in color, everything looks that much more enticing. That’s why it’s so easy to spend hours scrolling Instagram. If you find you’re whiling away the hours scrolling aimlessly, try enabling grayscale on your phone. It might not cure your addiction completely, but the Internet is much less fun when it’s not rendered in vivid technicolor. It may not seem like a major change, but it can make a big difference when it comes to reclaiming your time. 

4. Get Off Social Media

In recent years, Facebook has been scrutinized for a variety of privacy concerns — most famously the 2018 data scandal, when it was revealed that the political consulting firm Cambridge Analytica had harvested the personal data of millions of people’s Facebook profiles without their consent. Privacy concerns have catalyzed a mass exodus from Facebook. 

In fact, 34% of Gen Z, or people born between the mid-1990s and early 2000s, say they’re permanently leaving social media, and 64% say they’re taking a break from it. Reasons included worries about time-wasting (41%), feeling it was too negative (35%), privacy concerns (22%), too much pressure (18%), too much commercialization (18%), and that it makes them feel bad about themselves (17%).

In other words, the social media craze may be on its way out.

Some even believe that social media is causing a decline in mental health all over the world. People are realizing you don’t have to be on Instagram or Facebook to connect with people — and in fact, these platforms may make you feel even more lonely and disconnected than you would without them.

The post Turning off the always-on economy: How to take back control of your time, work, and sanity. appeared first on Salt Lake City's CPA's.

With each interim financial statement release, accountants gain greater visibility into the COVID-19 impact on company balance sheets and the need for credit during a time when otherwise healthy businesses may face prolonged challenges. 

The time has come to think beyond COVID-19 financing and loan forgiveness applications. Many have found that their focus has been shifted from long-term to short term goals. If your company has turned inward it’s time to redirect and plan on how to move forward.   

So where should you look for needed capital? Consider the MSLP as a viable option.

What is the Main Street Lending Program?

The MSLP was established by the Fed to provide healthy small-to-midsized businesses access to capital during the height of the pandemic, even if lending becomes more constrained through traditional lending sources. The MSLP was designed to support companies with sound financial standing pre-COVID that would otherwise be approved for loans through traditional underwriting.

Main Street loans have attractive features for companies re-capitalizing after emerging from the crisis, including:

1. No principle or interest payments in year 1
2. Interest-only payments in year 2
3. Up to 15 percent of principal repaid at the end of years 3 and 4
4. Principal balance repaid at the end of year
5. Interest rate to float at 30- or 90-day London Interbank Offered Rate (LIBOR) + 300 basis points

Who Should Apply for the MSLP?

Critics have pointed out that the MSLP is only available to a small subset of businesses. Both size and solvency are critical to approval. Qualifying businesses must have fewer than 15,000 employees or revenues of $5 billion or less.

Unlike the Paycheck Protection Program (PPP), MSLP was not designed to serve distressed companies. In fact, participating lenders must use standard underwriting criteria to evaluate creditworthiness.

At the onset of the crisis, borrowers must have been evaluated in good fiscal health and deemed to remain so at both the inception of the loan as well as ninety days subsequent to origination.  For this reason, we think of MSLP as a liquidity program providing an additional source of capital for COVID-impacted businesses.

Companies looking for capital infusions and the accountants that support them should take stock of all lending options. Consider the following:

1. Qualifications: Based on size and solvency, does the entity qualify for traditional bank loans, PPP, or MSLP?
2. Covenants and conditions: What are the conditions that come with each of the borrowing alternatives? What are the repayment terms? Will the funds be forgiven? How much cash will be required to service the loan?
3. Use of funds: How does the entity intend to use the proceeds? Are the funds intended for employee retention or other qualifying expenses that would render a PPP loan forgivable?
4. Reputational risk: If Federally-sponsored money is accessed, is there a risk that the business is perceived by stakeholders to be struggling or unscrupulous? 

As a matter of good fiscal planning, businesses that qualify for a PPP loan by meeting the Small Business Administration’s size standards, and that intend to use the funds for employee retention, should consider applying for PPP monies ahead of repayable debt since the grants are forgivable.

If the PPP program is not available or additional funding needs exist, an entity may explore alternatives for the source of funding, such as MSLP. While the Main Street Loan terms are borrower-friendly, the loans do come with covenants:

 1. Federal Reserve Covenants

• Limitations or restrictions on the following may apply:
• Compensation
• Shareholder/partner distributions
• Equity transactions
• Use of funds
• Bank Covenants

2. Lending Institutions May Impose Additional Covenants

• Minimum EBITDA thresholds
• Fixed-charge coverage ratios
• Leverage ratios in addition to those imposed by the program

Preparing for Lender Application

The MSLP application is similar to applying for a traditional commercial lending product. Depending on the lender and the loan size, required documentation may be extensive or minimal at the lending institution’s discretion.

However, the borrower should expect to produce a schedule of COVID fiscal impact, historical financial statements, projected revenue and the use of the proceeds. There is no Federal Reserve requirement that the financial statements be in accordance with U.S. GAAP unless statements are already prepared in that fashion, nor is there any requirement for any level of attestation on the submitted financial statements.

The lender, however, may impose those requirements. Once approved, the borrower should institute a formal loan compliance program that is continuously monitored for the life of the loan plus twelve months to ensure that none of the loan covenants are breached.

Borrowers will be required to submit quarterly financial statements to the lending institution for review, as well covenant compliance certificates. Covenant compliance certificates attest to both federal and lender-mandated covenants.

Four Steps to Reporting Readiness

Many of these mandates are detailed, and they require the borrower to gather records on a contemporaneous basis and subject them to controls for completeness and accuracy. Any time funds or benefits are allocated from the government, it is a best practice to plan for transparency, reporting, and oversight.

Organizations should take the following steps for thorough record-keeping:

1. Document the programs being participated in, including the internal approval and key terms of those programs

2. Develop processes and responsibility for recordkeeping and actions necessary to comply with the requirements under each program

3. Determine ongoing eligibility and compliance requirements that must be tracked and reported

4. Designate a senior leader with the charge to consider business impacts and to assess the conformity of business decisions with program requirements

Conclusion

The Federal Reserve is planning ahead and leading the way, we just have to take advantage of their programs. Finally, federal programs are under constant review and are subject to change. There is also a possibility that the Main Street Lending Program will be extended beyond the current September 30, 2020 end date.  

For more information please vist: https://www.accountingtoday.com/news/main-street-lending-programs-gets-underway-as-alternative-to-ppp

The post Planning Beyond COVID-19: the Main Street Lending Program appeared first on Salt Lake City's CPA's.

We know the level of liquidity in the marketplace is at unprecedented levels. The pressure to create investment in business assets can be expected to increase. The issue for business owners is “how can I learn to be more effective at raising capital or selling my business?” The pressure for investors and lenders will be “how do I get the information I need to put money to work while effectively managing risk?”     

• Tell the story. Start with available cash, add or subtract the results of company operations, add or subtract changes in balance sheet accounts and solve for ending cash. When done properly, it is telling a story with numbers.
• Use a 13-week cash flow
• Use a sensitivity analysis. A sensitivity analysis is a method for modifying inputs or assumptions in a financial model based on different expected economic outcomes or levels of performance. When an initial forecast is based on good historical information, these modifications, when entered into a model, provide alternative views of the future and help users to draw more educated conclusions.  It may also be useful to use an outside third party
• “Due Diligence” is the Standard. Due diligence is widely known as the investigation of a business before signing a contract, or “an act with a certain standard of care.” 

It is a process best devised and begun years before a crisis, but it needs to be done as soon as possible. For lenders and investors, a cash flow forecast is kind of an insurance policy against catastrophic oversight and a tool to help match the capital availability they offer with the true capital needs of the company. The smart business owner is wise to recognize and embrace the power of due diligence and the power of cash flow forecasting.

For more information visit: https://www.accountingweb.com/bookkeeping/multiple-cash-flow-scenarios-that-help-adjust-for-uncertainty

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A video conferencing solution such as Zoom is brilliant for replacing in-person meetings, and instant messaging tools like Slack or Microsoft Teams can be useful for hashing something out quickly or as a virtual ‘water-cooler’. However, these tools alone do not equip your firm to work remotely. If this is what your firm is relying on, it is extremely likely that you are now emailing more than ever, having more frequent emails, feeling stressed, and worrying about things slipping through the cracks. To work effectively as a distributed firm without creating more stress and work for everyone, you need fewer tools, no siloing of communication, and better team behavior.

Communication is at the core of remote work

For all the discussion about changes and the right tools for working remotely, your primary focus needs to be on how you communicate. You’ve likely already been using cloud tools for account reconciliation and email which have not changed. You are also likely already using video chat on occasion.  The crucial challenge in remote work for your business is effective collaboration within your team. 

Instant messaging and the illusion of communication

An instant messaging app such as Slack or Microsoft Teams makes a lot of sense at first glance. In reality, most of the time, messaging is not the best communication tool. Some of the pitfalls of messaging include: 

• Constant interrupting. The constant blink of notifications can be disruptive and most simply can’t ignore a new notification and look into it immediately. This leads to decreased productivity as well as confusion when it comes to priorities.
• Out of context from the actual work. Instant chat is a whole new system, completely separate from the tools your team uses to get their work done. It is hard to discuss something when the critical details aren’t front of mind. Or to talk about the response to a difficult client email when that email isn’t right there. Or to draw on a colleague’s comment from last week that you just can’t locate right now.
• It’s exhausting. Following a group conversation with no clear direction is tiring, inefficiency, and stressful.
• Chopped?up thoughts. Just because everyone is typing a lot and multiple messages are being sent doesn’t mean that everyone is communicating or even on the same page. The nature of instant messaging isn’t conducive to sharing complete thoughts.

A better way to work together when you’re apart

Instant messaging may not be the answer, but asynchronous communication could be. Asynchronous communication is when you communicate without the expectation of an immediate response. The shift to a more asynchronous type of communication results in employees having control over when they reply back and increases chances for uninterrupted deep work. 

Context is critical for collaboration

Even with all the fundamental elements to communicate, no one can function at 100% without the proper context. Using multiple tools and forms of communication must be easily organized and seen in the context of the broad plans and projects of your company.

Communicating about work on the same platform your team does the work is exactly how remote teams gain context. 

Opportunity for Change

We do not know how long the current situation will last, but all indications show that this is going to be the new normal for some time. Don’t introduce tools or practices as a stopgap. The smartest firms will be treating this period as an opportunity. Use this as an impetus to make some proper change. Add the right systems that will benefit you in the long term. Introduce positive work habits. Keep your staff happy. And allow them to do their best work.

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