COVID-19: Risk assessment and tax planning

–Evaluatealternative sources of financing.

–Developthe business strategy to be followed once the current health emergency is over.

Operations

Impacts on operations are difficult to predict. However, companies should mitigate the risk associated with the interruption of their production activities as follows:

–Conductan operational risk assessment considering the impact of potential disruptions on core production functions.

–Considerusing data analysis to identify patterns that may be indicators of risks or opportunities.

–Identifysupply chain alternatives.

–Exploreand activate the possibility of substituting the main raw materials.

–Builda business continuity plan.

Financial information

“Companies may need additional support in their administration and finance departments. This in order to be able to fulfill their normal and customary functions or to support other areas of the organization.”

–Evaluatecompliance with reporting requirements.

–Estimate the impact that COVID-19 may have on the main estimates contained in the reports.

Estimating the impact that COVID-19 may have on the main estimates contained in the financial reports.

–Assistin the accounting closing process.

–Adviseon disclosure policy of financial and non-financial effects in different communications (financial statements, sustainability reports, integrated reports, communications to the market and regulators).

Tax

Many of the decisions that different sectors are making have fiscal and tax implications. Therefore, it is necessary:

–Assessthe impact of national and regional tax measures derived from COVID-19.

–Considerthe direct and indirect tax implications arising as a result of the impact on the value chain.

–Evaluate thecustoms implications of government measures and restrictions arising from the sanitary emergency.

–Reviewprojected cash flows related to advance payments, withholdings and forecasts at national and/or regional level.

–Monitorpossible additional deadlines for the payment of tax obligations.

–Carry outtax planning; reevaluate criteria that could be discussed in the event of an emergency situation.

Employees

While the priority is to maintain the welfare of employees, the expansion of COVID-19 poses other challenges, such as enabling large-scale remote work. For this, it is appropriate:

–Definea work and operation protocol that studies the current circumstances, as well as the standards and recommendations of the government authorities.

–Evaluatethe remote work strategy, considering the possibility that employees may stop working, work remotely or work from other locations.

–Analyzethe possible overloads that may occur in the communications and technological infrastructure when supporting remote work during the emergency situation.

–Takeinto account compliance with labor regulations.

Source: Actualícese