COVID-19 & Accounting firms: Will only the agile survive?

The impact of COVID-19 is impacting everyone, including accountants. As discussed in the last post, the crisis has made video calling normal to the point that people are experiencing fatigue. It speaks one of the adjustments people have had to make due to the "new normal"

But what is the wider impact on the profession? How are firms handling the COVID-19 Crisis?

Accounting Today published a survey, "The accounting profession and the coronavirus: The crisis in number" that gives some data as to where the accounting firms are at.

Economic Impacts: Bad News and the Good News

Not surprisingly, nearly three-quarters of the firms surveyed, felt that the pandemic was going to reduce their revenues. In terms of magnitude, 37% of those surveyed are predicting a 10%+ loss in earnings. The good news, however, is that most had not let staff go. Only 7% had laid off staff, while 4% were planning to do so.

The other interesting find is that the most popular service to come about due to this crisis was CARES Act Consulting, with 73% offering this service. The next closest was business continuity consulting at 36%. 

There were also some interesting finds around the tech front. 

• Working Remote: Over 60% of firms had challenges with closing their offices, with nearly half of those having some challenges with the "online approach". The survey found that only 10% had no remote capabilities. See the graphic below for more details
• Closing offices: Closely related to the previous result, only 13% fully shut down their office. The survey did not reveal why this was the case.  But if you can't work remotely, what other choice do you have? 
• Communications: Although more than half used traditional means of communication, 33%were looking at new forms of communication. 

https://www.accountingtoday.com/list/the-accounting-profession-and-the-coronavirus-the-crisis-in-numbers

CPA firms provide COVID-19 services free of charge
Many small businesses have been drastically impacted by the coronavirus shutdown. As reported by the Wall Street Journal, "about 20% of them had enough cash saved to operate normally for only two months if their revenue were to dry up. Among less financially secure companies, only 10% could operate normally on savings alone for two months". The survey found that 1/3rd of CPA firms are stepping up to help by not charging for COVID-19 related services. 

Agility in time of uncertainty

Virtual firms, like Live.ca, seem to have been well prepared for this pandemic. With no offices to speak of, the firm was online from day one. The firm was featured on this CPA Canada promotional video:

Being agile in times of adversity is key to success. Understandably, tech can be daunting for small firms. However, it is also daunting for small businesses. Consequently, the tech-savvy CPA firms are able to offer consulting services like business continuity planning. But before getting there, firms need to ensure that they have the underlying capabilities to be agile. For example, if the firm has limited capability to service clients remotely it not only reduces the ability to service clients but also prevents the firm from being viewed as adaptive by current and prospective clients.

That being said, it's a matter of will. With nearly three-quarters of the firms already offering CARES Consulting, just shows how agile firms can be when the mindset is there.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

Have you heard of Zoom Fatigue? Killing the commute is not all it's cracked up to be

We are all probably familiar with "Zoombombing" by now.  This is where nefarious hackers (FBI has a warning about this) or Australian comedians (like Hamish Blake) invade your Zoom calls.



But have you heard of Zoom Fatigue?

Well, according to the BBC, USA Today, and The Wall Street Journal (WSJ), it is real.

COVID-19 has forced a locked-down, requiring people to work from home. That is, those who are fortunate enough to work from home during this pandemic, can use Zoom, Skype or other video chat apps to conduct business as usual. Except there are challenges. As noted in the USA Today article:

"From having to focus on 15 people at once in gallery view or worrying about how you appear as you speak, a number of things may cause someone to feel anxious or worried on a video call. Any of these factors require more focus and mental energy than a face-to-face meeting might, said Vaile Wright, the American Psychological Association's director of clinical research and quality."

BBC echoes something similar:

"Being on a video call requires more focus than a face-to-face chat, says Petriglieri. Video chats mean we need to work harder to process non-verbal cues like facial expressions, the tone and pitch of the voice, and body language; paying more attention to these consumes a lot of energy. “Our minds are together when our bodies feel we're not. That dissonance, which causes people to have conflicting feelings, is exhausting. You cannot relax into the conversation naturally,” he says"

To mitigate these impacts, both articles suggest being judicious on what calls should have the video turned on. USA Today quoting Vaile Wright (see above): "Be thoughtful about how you're using Zoom calls. You probably don't need video chat for all your work."

The WSJ sees this new reality differently.

They looked at the premise that working from home would result in free time for people. One of the individuals they interviewed for the story, thought that they would learn how to crochet. That didn't happen. What they found instead was that the inability to physically separate oneself from the work environment has enabled an "always-on" mentality. We all know no one is going anywhere, so the default assumption is that you are available. This is both for work as well as non-work meetings. For example, another individual in the article noted that they had to maintain an online calendar for their social life just to manage things.

For me, it's the commute. It takes about 20 minutes to drive to the commuter train station, then about an hour on the train. Then another 10 to 15 minutes to walk to the office. What I hadn't fully realized until now is a couple of things. Over time I have learned to use that time productively. It was during these gaps in my day that I could catch up with audiobooks and podcasts.

But there was another thing that was surprising.

The changing of scenario from home to the car to the station to the streets of Toronto and then the office gave me a chance to take a mental break automatically. At each point in commute, I was refreshed. With life at home, you can just be stuck behind a computer. (I am fidgety, so I guess that helps!) My podcast and audiobook consumption has collapsed, but I am writing more blog posts :)

Is this what the future holds?

I think that after this is over, the mental barrier that some executives had against working from home will be reduced dramatically. Even prior to the COVID-19 shut down, I knew of a fellow Hamiltonian who worked at a start-up where everyone was online. There was no office to speak of. With this being the new normal, weighed with the cost savings may convince some businesses that it's worth it to abandon the office lease altogether. That being said, there will need to be some kind of periodic physical meetings. But that can be accommodated in free public spaces like parks.

We often see in futuristic scenarios, how someone rolls out of their bed, slips a microphone/earpiece into their ear and then starts working with the hologram downstairs. Who would have thought it would have taken a pandemic to bring this future closer.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

How can blockchain help us deal with the COVID-19 pandemic?

One of the post-peak challenges, we will face with COVID-19 is to determine who is immune and who is not. Assuming that people can get immunity (and there are reasons to believe that this may not be the case), there needs to be a way to determine who is capable of being in "high contact" area.

In other words, how do we verify that you have the COVID-19 anti-bodies that would enable you to work at a restaurant, grocery store or drive a bus?

Now the infrastructure to deliver this type of testing is still not there. For example, in "Laredo, officials discovered the tests they received were woefully inadequate. The local health department found them to have a reliability of about 20 percent."

Assuming we can get a test that works, then we would need a way to certify that the person has achieved the desired immunity.

Think about how this process could work manually:

1. The walk-in or doctor/lab will process the test.
2. The person waits for the test results.
3. They will then need to produce the results to the government.
4. The government will need to issue some type of official certification. 

There could be an incentive to fake the certification. Well, let's rephrase. That there will be an incentive to doctor these things. Not just to get a job. But also to defy quarantine orders using fake certificates. Consider the people protesting the quarantine that blocked healthcare workers in Michigan:

And so that's where blockchain comes in.

To be a bit more specific, this is the permissioned blockchain (unlike bitcoin which is a public blockchain) that is implemented between trusted parties. As noted in the process described above, there are many parties involved - the doctor, the clinic and the government - all these parties would need to be on-boarded through a KYC process that would give each participant a private key that enables them to "sign" the "digital paperwork" at each phase of the process.

This would then allow "digital immunity certificates" to be issued instantaneously. No need to wait for test results. No need to get an official document from the government.

As it turns out, Vottun is working on some type of "Immunity Passport" that "can be verified at any time using cryptography by any mobile phone that can read a QR code". The company is working in Spain and is in discussion with Dr. Fauci of the CDC.

There are a lot of assumptions on how this could work. But it could be the killer app that helps saves lives.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else