At a time when many businesses are reconsidering their operations and organisational structures, Finchley-based accountancy firm Richard Anthony Chartered Accountants is reminding Directors to tread carefully and seek advice when it comes to business restructuring.
The firm, which provides tax and accountancy services as well as strategic business advice, said that businesses need to be 100 per cent certain that a restructure is in everybody’s best interests before making any rash decisions, as restructuring can cause a lot of upheaval for staff and directors.
Michael Barnett, a Partner at the firm, said that Directors needed to have a “clear restructuring purpose in mind.” He added that depending on a business’ goals and intentions, Directors would face very different challenges throughout the process.
“If downsizing is your main goal, you will need to systematically remove specific services from your organisation. This requires thinking very carefully about the impact this will have on your cash flow and members of staff. If relocation is required, you will likely need to consider the wider impact this may have on productivity and redundancies,” he said.
“Conversely, if you are planning a management reshuffle, you will face very different challenges. Under these circumstances, you will need to re-assess Directors’ duties, how these will continue and how they might need to change or be incorporated into new roles,” he added.
Michael said that the one thing all kinds of restructuring ventures had in common was the need for water-tight communication – which he described as “vital” to a successful business reshuffle of any kind.
“Communication is key, as everyone involved needs to know, at the right time, what is happening to the business and how they will be affected,” he said.
“Depending on your plans, you may need to re-draft contracts, shareholders agreements, partnership agreements and other vital documents as part of the process.”
Michael said that businesses should always seek specialist advice from the earliest possible opportunity, in order to ensure a sensible and strategic approach and to minimise any hardship or upheaval caused.