As businesses start to reopen and return to their physical spaces, what does this mean for employees and employers?

What will the new workplace look like and will flexible working continue?

For employers, the return to work will permit them to have more staff back in the workplace, which may be good news for companies that have struggled with remote working.

Employees may be asked to return to the workplace, likely for the first time in months, and this could be a nervous prospect for them. To this end, employers must be willing to listen and respond to any concerns they may have, says Alan Price, CEO at HR software and employment law advice service firm, BrightHR.

“However, they will need to make sure they follow Covid-secure guidelines for as long as they remain in place, including social distancing measures such as spacing out employees and one-way systems,” he says.

How the new workplace will look will, again, depend on the latest rules surrounding social distancing, he says. Currently, it is expected that restrictions will be completely lifted on 21 June in England. However, it remains to be seen if social distancing, such as reducing contact between staff, will need to continue past this date.

Guidance on working from home is not expected to change any time soon, meaning that staff should still work from home when they can.

“As we advance, as guidance changes, it will be down to employers if they will permit flexible working arrangements put in place during the pandemic, such as homeworking, to continue on a long-term basis,” he says.

A hybrid model could be the solution

“I’d anticipate most businesses, where possible, will look to adopt a hybrid model in their workplace,” says says Matt Crook, MD, Wolters Kluwer Tax & Accounting UK.

While remote working has been a success in many ways, there is an argument that it falls short when it comes to fostering innovation and relationship-building.

“This could be the case especially for those colleagues who might have joined your business in the last year – they might not have met a single colleague in person as yet,” he says. Employees will be looking for a great work/life balance and they will want flexibility to become the new normal.

“If you trust your people, why wouldn’t you give them that?” he says. “We have never operated on the basis of the hours people spend seated at their desks. It is their output, expertise and contribution that matters. If the last year has shown me anything, it is the importance of that trust and having the confidence in the culture of your business and your people. That’s what will see companies through the most testing of times.”

This model of working will certainly continue for progressive companies who value staff culture, happiness and wellbeing.

“We expect to see a shift to a hybrid model, some companies opting for a 50/50 split across office and home, and others exploring 70/30 options,” says Lucy Cohen, co-founder of Mazuma, an online accountancy service for small and micro businesses.

“Flexibility and a work-life balance have become more important over the past 12 months, especially as the lockdowns have proven productivity levels can remain high even when employees work remotely,” she says.

“I wouldn’t be surprised if more companies take this one step further and follow Spain in the adoption of the renowned 4-day week.” 

What should you offer your staff, or if you are a member of staff, what are your rights to continue working flexibly?  

Alan Price says theright to flexible working, including being able to work from home, did exist pre-pandemic, and this has not changed. Employees who have worked for a company for at least 26 weeks can request a change to their working hours. While employers do not have to agree to the change, they need to provide sound business reasons for their refusal.

Lucy Cohen says the first thing to do is assess how well people have worked from home in terms of productivity, cost and effectiveness. Secondly, check-in with staff and gather their opinions on working from home – it is not for everyone.  

“A balanced response would then be to offer a choice; provide an office if people want one but also consider allowing people to work from home if it suits them,” she says. Assess the situation on a case-by-case basis and make your company as flexible as it can be to suit all needs. 

What other issues should you consider?

With flexible working comes new things to consider; are you providing adequate technology and desk set-ups for your at-home staff? Are you getting the most out of your office overheads? Can you monitor staff productivity fairly?

“It’s important to find a way to evaluate performance justly between those at home and those in the office to establish what the best working model is for your business and employees alike,” says Lucy Cohen. Ensure all grounds are covered and your insurance and liabilities are updated dependent on how you move forward with your working model post-pandemic.

“We’ve always offered our people a good level of flexibility and it’s thanks to that (in part) that we have been able to perform so effectively since we started working from home just over a year ago,” says Matt Crook, MD, Wolters Kluwer Tax & Accounting UK.

“That said, human beings are social animals. We want to meet up, discuss, collaborate and interact with others,” he says. There are some instances where it simply makes more sense for colleagues to be in an in-person setting.

“For me, it’s about getting the balance right, but I can say with confidence that, while our people are really looking forward to getting back together in our office in Kingston, we’ll continue to offer them the flexibility that’s formed the bedrock of our business.”

How will the hybrid model work in terms of mentoring and helping younger staff in their careers?  

“Feedback is invaluable, whether it’s virtual or not,” says Lucy Cohen. Mentoring undoubtedly boosts staff retention and career progression. Research shows that Millennials who plan to stay with an organisation for more than five years are more likely to have a mentor than not. 

“This shouldn’t be affected by a hybrid working model – if consistent and regular communication is there, it can still work,” she says. “It will also teach younger staff how to work in both settings which will be a valuable and necessary skill for the future. Setting accountability and having someone to ask the difficult questions is a huge part of mentoring and this can, and should, be done remotely.”

How do you keep up morale as staff return?

“To increase staff morale, I believe you need to have regular, open and honest career conversations with your employees to understand what skills they’d like to develop and what aspirations you can help them pursue,” says Liz Sebag-Montefiore, Director of 10Eighty and executive coach. 

“An employee who feels they have a voice and that their contribution counts is more likely to go the extra mile; they are also likely to take less time off, thereby increasing productivity and generating greater shareholder value.”

David Gormer, a chartered accountant and founder of Square Mile Accounting, which particularly works with tech and ethos-based SMEs, says physical human connection continues to be sorely missed and nothing in the virtual world can compensate for that. 

“Having some co-working time each week is important.  When staff are working from home, it is harder to understand whether they are procrastinating or struggling with their work,” he says.

“It’s harder to work collaboratively on creative projects where one would brainstorm and map out complex issues. However, not commuting has many benefits including significant cost savings for the team, especially when train or Tube which can amount to £400 per month – which is not an insignificant amount.”

In an office environment, conversations with senior staff would include brainstorming about commercial ideas and direction, leading a shared clarity over the direction of the business, he says.

“Successes were shared and our team would celebrate these with team events and lunches. This has been sorely missed since lockdown.”

High morale depends entirely on the culture of your business, says Matt Crook.

“There are certain values which we, at Wolters Kluwer Tax & Accounting UK, try to embody and we actively encourage our people, through our Culture Ambassadors, to do the same. It’s about trust, having honest conversations, giving data-rich feedback (even when it feels difficult to do so) and accountability.”

Plan for the future new ways of working

Think about the people you are hiring – the future talent of your organisation. Do they have a positive mindset? Are they authentic? Do they demonstrate emotional intelligence? These are skills which will be needed in the new post-Covid-19 working environment.

“As a business leader or owner, you also have an obligation to ensure that your people have access to robust learning and development opportunities,” Matt Crook says. “When these are freely available, your people will feel greater loyalty to the business, be more productive and you will retain top talent for longer.”

Among the initiatives Square Mile Accounting has introduced for employees to help with home working are:

• Creating a working from home allowance to optimise their professional environment and contribute to upgrading broadband.
• Ensure that they have the right equipment at home, desk chair, hardware etc
• Online meet ups and games to maintain cohesion. 
• Rules of engagement on group chats and platforms, such as the MS Teams and Slack, to ensure people have sufficient thinking and working time and there is a mutual respect for boundaries to prevent too much interruption.

Further reading:

• Four accountants share their successes from a year of lockdown
• 7 tips from a psychologist to redeem your mental health
• Supporting positive mental health in the workplace

Converting to a limited liability partnership can be attractive, but partners need to carefully consider objectives, preparation and the transfer of business

By Zulon Begum and Wendy Chung, partner and senior associate, CM Murray.

A limited liability partnership (LLP) is a legal entity that has some of the features of a traditional partnership and some of the features of a private limited company. Many accountancy practices have already converted to or been established as an LLP, while a few have chosen to stick with the traditional partnership structure. Given evolving working practices and changing attitudes of the younger generation of accountants, many practice managers are asking if they should consider converting to an LLP and how to do so.

When should you consider converting to an LLP?

A partnership structure is often desirable for accountancy firms that wish to:

• Keep their financial accounts confidential from their clients, suppliers and competitors. LLPs need to produce and disclose annual financial accounts and other information relating to the ownership interests of its members.
• Encourage a more collegiate ethos between partners who have duties of good faith to each other and are connected by joint and several liability for the debts of the partnership. There is a perception that members of LLPs tend to have a weaker collegiate culture due to the absence of an automatic duty of good faith between the members and the safety net of limited liability for the members.

However, there are three scenarios where an accountancy firm should consider converting to an LLP:

• The partner numbers have increased and the partnership structure has become more complicated. As a partnership grows, the partners are often divided into different classes with differing capital interests, profit-sharing rights and management responsibilities. Junior partners tend to have a fixed profit share with relatively limited voting and decision-making powers, whereas equity partners tend to have the largest profit shares and greater voting and decision-making powers and responsibilities. The collegiate ethos between the different classes of partners may become weaker, which can reduce the attractiveness of the partnership structure, especially for junior partners whose perception may be that the risks of joint and several liability are outweighed by the rewards.
• The firm’s clients become larger and generate higher levels of fee income and/or the firm takes on greater financial liability, for example, a longterm and expensive lease. The level of financial risk from a successful negligence claim against the partnership or the potential inability of the firm to meet its financial obligations then becomes a major personal risk for the partners and can deter new partners from joining the firm and/or cause existing partners to move to another firm that can offer limited liability protection. This scenario can stifle opportunities or even reverse the firm’s expansion plans.
• A firm that intends to sell or merge with another firm may find the process easier and that they are a more attractive merger partner as an LLP rather than as a partnership. This is because a partnership is not a body with a separate legal identity from its partners, which often complicates the merger or sale.

How do you convert to an LLP?

To ensure that the conversion process runs as smoothly and as efficiently as possible, you must devote time and resources to properly consider and plan for any issues that may arise. The planning phase will involve:
• a review of the existing partnership agreement to ensure that the conversion is likely to be approved by the requisite majority of partners;
• a review of the partnership’s existing contracts with suppliers, clients, employees and any landlord to deal with any restrictions that would prevent the conversion;
• and consideration of any prior approval or clearance required from a regulator or lender.

Partner communication

A new members’ agreement will need to be drawn up for the LLP. The LLP agreement will need to be approved and signed by each of the partners who are to become members of the LLP. There should be no issues if the LLP agreement substantially replicates the existing partnership agreement. However, it is not uncommon for partners to take the opportunity to renegotiate terms and for management to try to introduce new terms. This can involve significant management time and effort in consulting and negotiating with the partners.

Incorporation of the LLP

Unlike a partnership, the LLP is a separate legal entity that needs to be formed by making an application at Companies House. This will involve a small fee and can be done in one day, but some time will need to be invested in preparing the relevant application form.

Business transfer

The business of the partnership will be transferred to the LLP pursuant to a business transfer agreement. The employees of the partnership will be transferred to the LLP pursuant to legislation, which may require employee consultations to be held and specific information to be given to the employees.

The partnership’s existing contracts will need to be assigned or novated. If the terms of a client engagement allow for the client contract to be transferred automatically in the event of a business transfer, the client will simply need to be notified by a letter or email.

Legal and regulatory compliance

Time will need to be invested in preparing for and ensuring the LLP’s ongoing compliance with laws and regulations, which may not have previously applied to the firm as a partnership.

The LLP will need to:
• file and make notifications to Companies House;
• prepare and submit annual financial accounts; and
• update its website, emails, business letters and documents and its business premises with its new name and registration details.

LLPs are required to have at least two designated members who are personally responsible for ensuring the LLP’s compliance with relevant administrative obligations under the Companies Act 2006.

Dissolution and winding-up of the partnership

The partnership may be retained for a short run-off period to deal with any remaining liabilities that were not transferred to the LLP.

After the end of the run-off period, the partnership will be dissolved and any surplus assets after payment of any liabilities will be distributed to the remaining partners

Guy Dakin MAAT knows how daunting it can be to change careers, but his varied career history shows that it is possible to be both an accountant and a paramedic.

There aren’t many of the NHS’s accountants who have also worked as paramedics, but Guy Dakin can say just that. His varied career has taken him from finance to the ambulance service and back again, and his AAT qualification has provided him with the confidence to explore.

“By the time I decided to go full-time into the ambulance service, I knew I had my AAT qualification, so it didn’t feel like such a risk. Because I knew that if it didn’t work out for whatever reason, I still had that as a key to help me back through the door into finance.”

A varied career history Dakin wasn’t sure what he wanted to do when he left school, but he knew he wanted to be earning. He began working in a bank and started studying the early stages of the banking exams, the BTEC national certificate in business and finance, which took two years.

“Conveniently, that qualification was a way into accountancy as well, and gave me an exemption from the first two years of AAT,” he says. “In those days (this was about 1985) there were three levels to AAT, so I only had to complete the third year. I studied in the evenings at Farnborough College of Technology. A few years later, I was able to tick off enough experience to become a full member of AAT.”

After completing his studies, he eventually moved on from the bank and spent time working for car dealerships – working in accounts payable, accounts receivable, management accounts and reconciling control accounts. When he was in his early twenties, while also still working full-time, Dakin started volunteering as a Special Constable.

“That role was the making of me,” he says. “It really helped me to develop and improve my self-confidence.” Guy enjoyed his work with the police force and wasn’t quite ready to go back to a desk job – then a friend inspired him to join the ambulance service.

“I think my AAT qualification helped to demonstrate my capacity to study for the course ahead of me. That together with my new found self confidence, probably helped them to decide to take me on.”

Dakin worked on emergency ambulances in the Reading area for about five years, starting as a trainee technician and eventually working his way up to paramedic. Achieving his ambulance technician qualification was especially important to him, he explains, because he proved to himself that he could be practical and not just academic.

“It was the best job I’ve ever had. I’m sure my line managers in accountancy wouldn’t mind me saying that. It’s a real privilege to have people turn to you in their time of need, including at those times when they’re going through something they thought would never happen.”

Although the job was rewarding, Dakin eventually realised he didn’t want to be working in the ambulance service forever. He was concerned that night shifts and the physical work involved in the lifting and handling of patients might take a toll, plus he wanted more regular hours so he could spend time with his wife, Carol.

Dakin is passionate about keeping up with his continuing professional development (CPD), and he says his CPD helped him greatly when he was trying to get back into finance, as well as to gain promotions throughout his career.

“I kept up my CPD while in the ambulance service and even took AT magazine out with me in the ambulance to read at quieter times,” Dakin says. “My AAT qualification helped me to be attractive to the next employer. It wasn’t difficult getting back into finance, but it’s hard to replicate the experience and rewards of the ambulance service”.

After working in the private sector for a couple of years, Dakin was able to combine his love for the health service with his financial acumen. He secured a position as a management accountant for the same ambulance service which he served as a paramedic.

“I continue to be employed in the NHS in finance to this day. I currently work for the Berkshire healthcare NHS foundation trust as a senior management accountant.” Dakin also enjoys the additional opportunities his job has provided. He was elected by his colleagues to be a staff governor, which involves representing the interests of staff at a board level.

“That post has exceeded my expectations,” he notes. “It’s very interesting and challenges you to speak out on behalf of your colleagues at a high level on a wide range of important matters.

“My clinical experience helps me to see the challenges of the NHS from a wider perspective.”

From regularly reinventing businesses to being a shoulder to cry on, accountants have been at the very forefront of steering businesses through a turbulent 12 months.

Here, four accountants tell of their achievements and challenges during a year of lockdown.

“We turned our bars into bottle shops”

Jo Wilkinson is head of finance at Leeds-based North Brewing, whose taprooms have been closed for much of the past year.

“One of North Brewing’s best-selling beers is our coconut coffee porter, Full Fathom 5. Yet, it’s been impossible to fully fathom recent events. It seems I’ve spent much of the past year forecasting, then reforecasting, before another announcement on the news forces me to reforecast yet again.

“Back in March 2020, things looked bleak. We had no forecast revenue stream as our taprooms were closed, while distribution disappeared because the bars we supply were also shut.

“We have seven sites in Yorkshire, and as soon as the government’s rate reliefs were announced, we contacted our landlords to reduce rent. We also spent time talking with the council to get all the reliefs that we were entitled to. North Brewing used furloughing and we took out a Coronavirus Business Interruption Loan Scheme (CBILS) too.

“All that time spent on spreadsheets modelling scenarios paid off in May. This is when we switched our bars/taprooms to bottle shops. As only one staff member is needed to manage a bottle shop, it’s kept costs low. They’ve done an amazing trade because they’re based in suburban areas. With everybody working from home, customers regularly visit on their daily walks.

“Even though some sales channels dropped off, new ones have arisen. Last year we started selling beer through click-and-collect apps and home delivery services, as well as establishing subscriptions and online tastings.

“At the same time, my workload has changed. I spend less time poring over accounts, and more time speaking with people. Because we’ve adapted so rapidly with closings/re-openings, our finance team has been in constant communication with HR and operations managers. It highlights the crucial importance of hiring people, not calculators.

“All our sites are closed, but there are opportunities once we make it through the crisis. Our online services have boosted brand awareness, and we’ve enhanced local community links. Plus, when we reopen, everybody will be desperate for a pint. Make mine a Full Fathom 5.”

“We used data to help clients pivot”

Warren Munson is the founder of Dorset-based Inspire Accountants.

“In the past 12 months, the accountant’s role of being a trusted adviser who supports clients through tough times has become more important than ever before.

It’s something that’s been evident from the very first days of the pandemic. Back then, we were managing a juggling act between supporting clients and running our own business, wondering how the pandemic will affect us.

We got on the phones and spoke to every client – trying to gather information and put our arm around them. Many of them were worried about running out of cash, but also had concerns about business models. ‘How am I going to operate virtually?’ ‘Do I have the technology to do that?’

“By using data analysis skills, Inspire helped support our clients in pivoting. In those uncertain first few months, we made some simple introductions between clients so they could help each other out. We have a nursing home client that struggled to get PPE. We put them in touch with an engineering client that had a cutting machine, and produced their visors. Likewise, one of our distillery clients started making hand sanitiser, but lacked dispensers. We introduced them to Muc-Off, a client that makes bicycle cleaning products, which provided them with containers.

“Throughout the year, we’ve acted as a sounding-board, listening to clients and asking challenging questions to make them think differently. Communicating to clients via content has also been critical – we’ve been sharing knowledge through webinars, emails, social media posts and our website. At one stage last year, we were running a webinar once every three days.

“As a managing director, it’s been difficult because I want to have conversations with clients and staff, rather than leading from behind a laptop.

“In the same way Covid-19 is an opportunity for clients to reset, it’s also an opportunity for the profession to start again, particularly smaller firms that haven’t thought about the years ahead. Supporting clients through good times and bad will be key. It’d be crazy for any firm not to build that into its service model.”

“It’s so important to get clients to think ahead”

Ria-Jaine Lincoln MAAT is director of Milton Keynesbased Ria-Jaine Accounts, with clients in the hair and beauty sectors.

“All of my clients are in the hair and beauty industry, spanning sole traders to super-salons. It’s been difficult for them – a constant struggle. Since March last year, I’ve been helping them with cash flow and staying positive. The recent January lockdown was the worst, with lots of tears from my clients. It’s been really sad.

“The sole traders who didn’t qualify for government grants because they’re newly self-employed have been hit hardest – they’ve lost 100% of their income overnight, and many can’t afford to pay their rent. These businesses can’t innovate or pivot – you can’t really do your lashes over a Zoom call.

“Aside from helping clients with grants, I’ve also been reviewing costs levels, budget controls and tax flows, and doing more forecasting than I’ve ever done before – lots of management accounting. I’ve also regularly referred to the books from my AAT studies 12 years ago.

“But it’s just as important to get clients to think ahead about how long their cash will last. Much of this is using content to get information out to people to focus on their cash flow skills – social media posts, videos, reaching out to trade organisations such as the British Beauty Council. I’ve also been busy signing my clients up to Float, a cloud-based cash flow tool. It shows data in graphs and looks pretty. It’s perfect for my visual-focused clients who aren’t engaged by using spreadsheets.

“In fact, I’m having more conversations with my clients about managing personal finances, payment holidays and income/expense assessment. Sometimes I use my personal experience of living in a domestic abuse refuge. Ringing up your gas company to tell them you can’t afford to pay your bills takes its toll. Ultimately, it’s reminding clients they’re not alone. I’ve also been talking more with clients about mental health.

“This year has been horrendous, but the resilience we’ll learn from this experience will only serve us in the future – whatever that looks like. Some of my businesses are worried they’ll have to start over, but when they rebuild, they’ll know more about marketing and business management, who their customers are, and the ups-and-downs of business than ever before. This year won’t be for nothing.”

“Use this pause to put useful things in place”

Ele Stevens is founder of Hertfordshire-based The Barefoot Accountant

Ele Stevens has more than 250 clients, mainly in the creative arts and music sectors.

“With so many of our clients deriving their income from gigs and festivals, it’s been heartbreaking to see what’s happened to them this year with the shutdown of live music. Yes, some musicians have made money from live-streaming or merchandise, but others have given up, dipped into savings, or worked for no money or as Ocado drivers.

“The prospect of another summer without live music could cripple them. Then there’s the newly self-employed, who have received no government grants. Telling them there’s nothing they can do, other than claim Universal Credit, has been awful. When the pandemic first hit, all of our clients emailed us at once, asking for help. Giving advice is the best thing we can do, such as signposting them towards government grants or HMRC’s Time to Pay. We’ve also encouraged them to use tools that’ll help them run their businesses in the future. It’s about using this pause in business to put things in place that’ll help them when things pick up again.

“We’ve also been checking in on clients’ mental health more. The Barefoot Accountant has been a shoulder to cry on.

“As long as the government keeps extending the furlough scheme and SEISS, we can muddle through. But I don’t think we’ll see the real financial fall-out until next year, with potential increases in business tax rates. Until then, we’re here to help them.”