Accountants representing over 20,500 SME clients in the UK have reported more businesses have decided to dissolve or liquidate in last week, despite a bounce in confidence about the long-term situation due to the Covid-19 pandemic.

The results are revealed in the latest ACCA UK and The Corporate Finance Network’s (CFN) SME Health Tracker, showing 5% of SMEs have decided to close compared to 3% last week.

Glimmers of optimism are apparent: if the lockdown lasts another two weeks, respondents reported that 18% of SME clients would be trading normally, an increase from 14% last week. This is probably due to the furlough scheme which gives employers a lifeline for the short term.

However, when it comes to access to cash during over a two week time-frame, the findings reveal little movement in the tracker, continuing to show CBILS is failing to provide the promised lifeline: 30% of SMEs will struggle to access cash to last two weeks of lockdown, compared to 29% last week.

Claire Bennison, head of ACCA UK comments: ‘Some SMEs are no better off. While the furlough scheme has offered some respite, many small businesses need to be prepared for when the scheme ends in June. SMEs need to be thinking about the long term too, as cash needs to be in place post-furlough – they need to explore all options, including the Bounce Bank loans announced as we closed the survey. This is where qualified accountants can help them navigate the options available as they need to look beyond CBILS.’

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