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The Tracks of my Tiers

Supporting clients as lockdowns change is a challenge. Accountant-In-Resident Kirsty McGregor sheds some light. 

Kirsty McGregor Oct 27, 2020

A couple of weeks ago, regions were grappling with the ins and outs (we hoped ‘outs’) of the new tier system for the second wave and businesses waited to find out what grant support may be available to them. Now we enter the second lockdown in England, whilst Scotland brings in a tier system and Wales and Northern Ireland have their own lockdown rules. And tiers may once again be implemented after lockdowns end. 

Further business support has been introduced swiftly by the Chancellor, but there is no doubt that our clients are once again faced with some uncertainty about the months ahead.

The assumptions which were made when preparing cash flows in March/April, and no doubt refreshed in June/July, will now need to be reviewed again as businesses look forward to their expected trading and cash position for the next six months.  

Is your client affected?

The UK’s business ecosystem is so interwoven around the country and across sectors that even those companies which aren’t directly affected by the latest rule changes, may find that their trade is still impacted in some way. Plus with the Brexit deadline looming, those who have longer supply chains, which ultimately may involve European suppliers or customers, will also have to factor in revised sales, costs or availability restrictions in the coming months.

It’s such a challenging picture and accountants are thrust into the place of having to provide answers. What is the best advice that you can give?

Discussing clients with some brilliant accountants over the past week in readiness for the return of our Advisers Community catch-up, I was struck by, across widely different sectors and businesses, how similar the messages from these advisers were:

  • Know your numbers - both historical MI and projected figures
  • Obtain and preserve cash reserves
  • Make a plan and take swift action


Paul Layte of Next Level Business said he has been advising clients;


“Take more money from CBILS than you think you need, because you want it in reserve for next year & then you can pay it back if you don’t need it.” 

Wise words indeed because we discussed how having that cash reserve of at least 3 months’ runway means that the stress of running the business is hugely reduced for the management team. They can make decisions with a clear head, driven by commercial sense rather than by necessity. 

Checking-in time

As businesses realise that their cash reserves are once again depleting, advisers need to stress to their clients that even if they have previously decided not to use CBILS or take out other facilities, commercial lending will look very different once CBILS ends on 31st January.  

Clients who may want to apply for an increased amount and have already agreed a previous facility with their existing bank, should act quickly, as banks are typically slower to process these applications. Banks with established customer relationships are generally likely to offer lower rates than the challenger and fintech lenders, although these will be quicker to provide an answer. 

This means that there is a small window of opportunity to speak to every business again now, to ensure they have sufficient cash reserves to see them through the next 3-6 months.  

Risk assess your client base to ensure you are able to provide proactive advice to those who need it, and are not overwhelmed by your clients’ demands on your time. This will become ever more important as we approach January. 
As exhausting as this year has been, what a fantastic response there has been from our profession for adapting to the changing climate and stepping up time and again as we continue to support our clients. I applaud you all!

To find out more about the ways Capitalise can assist you in helping your clients, book in a consultation.

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