The video and a transcript of the interview can be viewed below.
The end of furlough: what happens next?
James Ashton: So Chris, furlough is tapering off now - are most companies ready to get back to normal?
Chris Newell: Yes, absolutely. It has been well telegraphed that the Government's going to reduce and end the furlough at the end of September and so companies should be forecasting for this to take place.
James Ashton: But I guess there must be some who think these schemes have been extended before, I've got more time, I've got more money, I don't need to make the decisions today.
Chris Newell: There's various kind of business owners that still believe that the furlough will be extended, or there will be further extensions to the support that the Government's offered. I do not believe that's going to be the case. The vaccine rollout has been successful and to date and there's positivity out there in the business environment, so I think it is unlikely that these support schemes will be extended, and so therefore and they really need to properly prepare for what's going to be happening when these support schemes are taken away.
James Ashton: So, given we have seen this level of support I know people in insolvency and restructuring had expected more activity before now. I guess as the support pulls away, it potentially is a very busy second half of the year for you?
Chris Newell: We think so, and it has been an artificial situation over the last few months because of the Government support schemes that have been in place. Everybody thinks that we are incredibly busy dealing with a number of appointments, and that's simply not the case and we're about a third down on a month-by-month basis as to what it would normally be like, and so the government support schemes have artificially supported a number of businesses. That's why it's crucial for businesses now to take professional advice and build their financial fortitude so that they can prepare for what's coming when these support systems are taken away.
James Ashton: And just explain in a distressed situation what Quantuma brings to the party - because you're typically not advising the client company, you're working with accountancy firms and lawyers to solve these distressed situations.
Chris Newell: We'd be introduced by an accountant, solicitor or funder to go and meet a client, and would then spend time with the director, understanding what that business does, what the issues are, and really getting to grips with what's going on within that business. We'd then prepare a range of options that are available to the owners of the business. These might include non-formal options such as raising further funding, and they might go through to formal restructuring options such as a formal insolvency such as administration.
James Ashton: And when companies are planning for the future to try and get a sense of what comes next, I think it's really important for them to get on top of their cash flow forecasts.
Chris Newell: Cash flow is crucial, especially when the support goes and businesses are going to need to understand what their cash flow requirements are on a variety of different basis. They need to take advice - whether that's from their accountant or whether that's from Quantuma, they really need to be seeking out the advice so they can properly prepare.
James Ashton: Chris - thanks so much.
Chris Newell: Thanks James.