While the global spread of the coronavirus significantly affects organisations and individuals alike, knowing how to reduce risks is key.
The dynamic development of the spread of COVID-19 and the uncertain developments ahead of us are causing all of us a hard time. Along with its effects on people, the coronavirus is rapidly disrupting business and consumer activity in affected areas and beyond.
With more risks arising such as cyber attacks, cashflow challenges, concerns with resilience of primary service providers, project delays or struggles with maintaining levels of services and supply it is key to organise your business well and take the right actions.
For this purpose we have created an overview with scenarios, suggested activities and guiding questions.
The impact on the business of the current uncertainty is complex. Adequately reflecting the impact on periodic financial statements is a key element of the communications to stakeholders. For listed companies, for which capital market rules have not relaxed, it is important to maintain compliance with regulations and consider the need for additional communication.
Organisations in regulated industries need to follow regulatory requirements and honour the commitments even when impacted by COVID-19. At the same time, Compliance organisations are impacted and may be experiencing restrictions with working remotely, reduced workforces, technical disruptions or increased volumes.
As a side effect of the coronavirus many companies have allowed their employees to work remotely and have therefore increased or set up the required IT infrastructure. Unfortunately, this circumstance is also a good opportunity for hackers to attack your IT infrastructure.
Due to the current global crisis of COVID-19 business operations are critically impacted. Especially in the project management area these circumstances might delay decisions which can lead to overspending and wrong resource allocation. The consequences are higher costs and potential unsuccessful go-live.
Risk Management functions are at the heart of the current crisis management efforts. The board of directors, management, regulators, clients, and other stakeholders expect an up to date view of the risks the company is exposed to and the effectiveness of the measures taken. Timely risk information and reporting is critical to enable timely decision making and has been an issue in crises in the past.
Organisations that are typically dependent on their vendors’ and suppliers’ ability to deliver in compliance with their requirements are likely to be impacted as third party providers may deal with remote working, supply chain interruptions, distribution delays, service level instability and many other potential developments.
The impacts of COVID-19 are devastating, and Internal Audit is no exception. The virus is prohibiting many Internal Audit professionals from conducting audits on-site due to travel restrictions. Others are seeing resource shortfalls due to Internal Audit Team Members becoming ill. As the duration of this status quo is still unknown, a number of critical areas will need special attention.
Cash is highly relevant, in particular during these special times. Ideally your focus is on identifying all short term (and longer term) actions that can be taken over your accounts receivables, accounts payables and inventory to protect your cash positions but also collect sufficient liquidity to keep your operations running and ultimately survive.
Partner and Leader Risk Assurance, PwC Switzerland
Tel: +41 58 792 27 84
Director, Risk, Compliance, Internal Audit, PwC Switzerland
Tel: +41 58 792 46 28