Then the Families First Coronavirus Response Act and CARES Act dropped and all of a sudden, everyone was calling with questions again. Accountants and tax preparers had to work fast to learn the facts and understand the new tax and accounting changes hitting the scene. Typically, most auditors and tax accountants are always looking in the past at the year they are auditing or preparing tax returns for, rather than the present day. We now had to stay on top of fluctuations and new developments in an economy and environment that was whipped around like a sapling in a storm. PPP, EIDL and ERTC weren’t just letters floating in our alphabet soup any longer. Our firm added a new department and new staff who became FFCRA and CARES gurus, familiarizing themselves with the requirements, application processes and other details to provide guidance to those who needed it. We had to perform new and different calculations and forecasts for those benefitting from the financial assistance available as a result of COVID-19 and related business interruptions.
Audits were conducted in a remote environment, performing inventory test counts virtually over FaceTime and Zoom, acquiring remote access to client databases or workstations and incorporating other virtual technology efforts to avoid or reduce interpersonal contact. Often a photo snapped on a phone or a video recorded and emailed or texted would provide source documentation or substitute for other forms of audit evidence. We had to learn to “think outside of the box” a little more when it came to finding new and creative ways to obtain the information we needed while still adhering to professional standards.
Forecasting and budgeting work became quite challenging this year. Accountants regularly had to calculate various projections based on different alternatives of operations that hinged upon the state’s loosening or tightening of social/business restrictions. Analytical comparisons to the prior year yielded unanticipated fluctuations. When asking clients about reasons for anomalies or variances, we were often met with “You know… COVID!” as a response that often needed no further explanation.
Financial statements, audit and review reports began to include new items and disclosures for contingencies and uncertainties due to temporary business closures, significant changes in revenue streams, SBA loans, loan forgiveness, tax credits and the like. We had to be aware of these developments and stay on top of new accounting for them.
Payroll tax requirements changed frequently. Payroll tax returns started including more payroll tax credits, refunds, tax holidays and other new challenges. The IRS themselves had to scramble to revise and issue tax forms and to keep up with the new acts passed by the government in 2020. This led to delays in the IRS processing returns, responses to notices and other inquiries.
Extended tax deadlines made this year’s tax season
feel never-ending. Extended reporting deadlines or simple postponements in regularly scheduled work arose more often due to delays in obtaining data from third parties, clients encountering difficulties working remotely, or even having to quarantine for health reasons or to care for family members. Fortunately, many people were understanding of these delays, since they were often uncontrollable or unavoidable.
While many industries and firms utilize technology on a daily
basis, there are always those who are slow to embrace it. Those colleagues or clients previously foreign or reticent to technology now were forced to use it in order to get business done and to keep up with everyone else. In-person meetings gave way to screen- sharing and conference calls. Digital documents and digital signatures became first acceptable then the standard. Document sharing evolved from “I’ll bring you the bank statements and invoices” to uploading the same files electronically through portal software, Dropbox and the like. Even accounting and tax continuing education seminars transformed to virtual online learning sessions with chat boxes and other virtual dialogue methods.
Information technology experts and companies had to spend more time setting up remote work environments or responding to frantic calls when technology didn’t perform as it should have. People needed new and improved devices to handle larger data streams, faster internet for downloads, and the software or applications now required to conduct virtual meetings. Then there were the times software or Wi-Fi went down or lagged due to more people utilizing data at the same time (does anyone else remember the Great Zoom/Google Hangouts Crash of August 2020 as kids remotely went back to school??). Not only did we have to learn to use new technology, but we had to learn how to be patient during times when it wasn’t working!
Cyber security has always been a risk in the past and now, even more so, with more and more people working from home. Working outside of the normal office network or outside of protective firewalls can lead to more cyber threats or compromised data. There has also been an increase in fraudulent emails, calls and texts from scammers pretending to be the IRS offering stimulus payments or online retail outlets allegedly requesting an update of your credentials or payment information (Just a friendly reminder: the IRS will NEVER call or email you asking for personal information or to make a payment – these are almost always scams). There were even emails out there claiming to be invitations to Zoom meetings that contained viruses. Now more than ever it is important to monitor your financial data and safeguard sensitive material.
Business etiquette shifted as well over the last several months as more people were working from home or away from business settings. We had to learn to be more considerate of, and accommodating to, others who weren’t always in an optimal work environment. In the past, a small child or pet noisily entering a room where someone was conducting a business conference call could be met with scorn or disgust, and the offending adult seen as unprofessional. Now the same scenario is excused and produces sympathy and understanding for the embarrassed parent!
Accountants, just like everyone else in the year 2020, had to get used to the idea of uncertainty and to change as a way of life. The facts and circumstances on a Monday were often quite different by the time Friday rolled around and we routinely had to adapt and move on. The Austrian psychologist and Holocaust survivor, Viktor Frankl, has been quoted as saying “When we are no longer able to change a situation – we are challenged to change ourselves.” 2020 was a difficult year for us all. Hopefully you have accepted this challenge in 2020 and will enter 2021 even stronger for it!
www.cai-illinois.org • 847.301.7505 | 45
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