Covid-19 and The Economy

Globally, a once-healthy economic growth outlook has been revised down sharply due to the outbreak and spread of Covid-19. This coronavirus will negatively affect global and domestic economic growth through the first half of 2020, and potentially longer depending on steps taken to limit its spread.

Cecil Kilpin | CA(SA) - Accounting & Auditing Specialists >> March 2020 Newsletter

The Covid-19 outbreak will have a major health and social impact, as well as forecasting global and domestic activity presents significant uncertainty. The Chinese economy, where the virus originated, is expected to contract by 1% in the first half of 2020. Economic activity is likely to also contract in the United States and Europe as governments there take actions to contain the spread of the virus.

In response to all these developments, the US Federal Reserve, alongside other central banks, took various steps to provide further monetary accommodation. Additional steps have also been taken to provide liquidity and ensure the smooth functioning of markets. Some governments have taken fiscal measures to mitigate the economic effects of the virus.

The domestic economic outlook remains fragile. At this point, Covid-19 is likely to result in weaker demand for exports and domestic goods and services, but its impact on the economy could be partly offset by lower oil prices. One can also expect disruptions to supply chains and to normal business operations. It is expected that the economy will contract by 0.2% in 2020. GDP growth is expected to rise to 1.0% in 2021 and to 1.6% in 2022.

Apart from the Covid-19 global pandemic, electricity supply constraints and other sources of uncertainty are expected to keep economic activity muted. Public sector investment has declined and job creation has slowed. Business and household confidence have weakened further. Government and household consumption, and private investment, however, continue to grow, albeit modestly. While export growth is expected to decelerate further in the near term, prices remain high for some export commodities, and could be supported by an early resumption in China’s economic activity.

There is without doubt a hard time ahead, but one needs to look for opportunities in this dark scenario and make the best of a bad time. Should you wish to consult on the way forward please do not hesitate to contact us for professional advice in this regard.


Remote Working

Transitioning your office to remote working conditions can be a challenge – in this article, we’ve rounded up 9 steps to help you make the move as quick and easy as possible.

Cecil Kilpin | CA(SA) - Accounting & Auditing Specialists >> March 2020 Newsletter

(1) Talk to your team:
When shifting your team to remote work, it’s important that you explain why this is an important step in light of the current situation. Some of your staff might be worried about this transition, whereas others may find this improves their productivity. Whatever the case may be, make sure everyone understands what will change establish a sense of comfort and certainty.

(2) Go through your employees’ workflows:
Sit down with each member of your team and go through their workflows from start to finish. Make a list of the tools they’ll need to keep their work processes going, even when working away from the office: from computers and headsets, to a stable internet connection and access rights inside your corporate portal or other work tools.

(3) Create routines and structure:
It may seem that managing and controlling your team and projects will be more challenging once everyone is remote and unsupervised. To prevent any issues and keep things running smoothly when you’re out of the office, make sure you:

  • Establish a sense of routine through short weekly or daily conference calls and one-on-one online meetings to see how everyone is progressing and to discuss any sticking points
  • Encourage employees to self-organize and maintain a structure when it comes to planning out their day – including work hours and breaks, as well as very concrete plans and objectives
  • Set up a system of reports to view how everything (and everyone) is progressing

It’s also a good idea to use a shared calendar to keep deadlines in view and ensure everyone is on the same page

(4) Establish a sense of community – No matter how far from the office:
A sudden change in your employees’ working environment can be very stressful. Human beings are social creatures and spending 8+ hours a day with your laptop as your only companion is distressing, particularly if you’re used to being surrounded by colleagues. Make sure your teams have all the communication tools they need to stay connected to make the switch to remote work as comfortable as possible. Schedule regular online meetups to establish a continued sense of unity and togetherness.

If your team is happy, your business will keep going and thriving, no matter what conditions you have to face.

(5) Stratify your staff based on risk factors:
The World Health Organization (WHO) have warned that those over the age of 60 and with underlying health conditions are more at risk – so make team members that fall into this category your top priority when transitioning your company to remote work. Those who are at higher risk should be sent home as early as possible.

(6) Determine which teams can’t work remotely:
The most basic example is departments dealing with paperwork and documentation. If you have legal papers that need to be signed or stamped, you’ll need to come up with a system that allows the relevant department to do this in electronic form, or re-organize their schedules in a way that cuts down their time in the office to a minimum. For example, schedule one day a week for filling out and signing paperwork. Which brings us on to the
next point:

(7) Create a safe working environment inside the office:
Ensure all those who have to stay at work have an isolated work space and can stay in quarantine conditions – that means spreading everyone out and potentially moving some team members to a different work area. The main goal is to limit physical contact between team members as much as possible.

(8) Inform your clients:
When switching to remote work, some important processes that were office-based may not function as well they did before – and some may be out of service altogether. If your business relies on office-based work processes, come up with a strategy that will inform clients of any issues with support or orders in way that demonstrates sensitivity to any potential problems or frustration this will cause. This is essential to maintaining a strong relationship with your customer base, even during this challenging time.

(9) Educate your team:
Finally, if you have the time and resources, educate teams on how to work effectively in remote conditions. From company- and job-specific guidelines to how to organize their workday and how to make the mental switch to working outside of the office – something that’s often (mistakenly) disregarded.

The most important thing is to ensure your team is safe and well throughout this uncertain time. We wish you all the best of health and hope that this checklist helps make your move to remote work a lot smoother.

For further information on leading and working through a pandemic see the free resource guide from Harvard at https://hbr.org/insight-center/coronavirus.


SARS and Covid-19

In light of the Covid-19 outbreak SARS has announced a number of operational changes as detailed below.

Cecil Kilpin | CA(SA) - Accounting & Auditing Specialists >> March 2020 Newsletter

Social Distancing
Taxpayers are discouraged to come into SARS branches and are advised to make use of on-line digital channels for all engagements.

The majority of business can be done on SARS eFiling platform: www.sarsefiling.co.za

SARS mobiApp in addition to Personal Income Tax functionality provides additional information.

Should taxpayers still require contact with SARS please phone the SARS Contact Centre on 0800 00 7277, instead of visiting a branch.

If you still required to visit a SARS Tax branch, strict adherence to social distancing and general hygiene practices will be applied.

Within the guidelines as set out by the President, a maximum of 100 taxpayers will be allowed in branches at any one point in time and will be managed firmly.

Taxpayers should watch branch visitor volumes and queue times on the SARS website and the SARS mobiApp. This should help you to plan around needing to visit an alternate branch if really necessary.

All SARS branches as well as ports of entry have been equipped with hand sanitizers.

Additional SARS procedures have been put in place and will be utilized to ensure that work surfaces are regularly cleaned and sanitized.

Staff have also been provided with additional protective gear such as gloves, and where required, additional protective equipment such as masks and suits.

Everyone to observe strict 1-meter distances and avoid person to person contact as far as possible.

Service-Related Matters:
A large part of daily visitors to SARS Tax offices are individuals requesting a tax reference number for the purpose of employment.

Until further notice, SARS will no longer issue these tax reference numbers for this category of request and individuals are requested not to visit branches for this purpose.

SARS will shortly provide a solution whereby digital channels (eFiling, MobiApp) will cater for this requirement.

In the meantime, please request your employer to register you online with SARS.

There is no requirement to register with SARS ahead of looking for a job, and a prospective employer may register you as well.

If supporting documentation is required by SARS, you encouraged to follow these guidelines:

  • Upload via eFiling
  • Make use of the SARS mobiApp
  • Drop off documents at a branch drop-box

If all else fails, SARS will provide a drop box in branch offices.

Should you require assistance with any SARS related matter do not hesitate to contact us for professional advice in this regard.


Sincerely,

Cecil Kilpin | CA(SA) - Accounting & Auditing Specialists >>Newsletter Greeting