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Restarting Canada’s economy after a break of at least 2-3 months can be a huge challenge. This is after the COVID-19 pandemic that has shocked the whole world. Canada is the third most hit country in the continent of North America after the United States and Mexico. According to stats, the USA is the worst-hit country in the entire world. It also shares the world’s largest land border with neighbors Canada. Regarded as one of the most developed in the world. Hence, Canada is fully aware of the health and safety laws and procedures in place. The Govt. has made a gradual i.e. slow restarting of the economy. This is similar to restarting a car after days of mechanical works.

The most recent shutdown in Canada has literally changed the way most things used to happen in Canada’s economy. Health researchers have already indicated that managing this virus shall be a long term game, especially in North America. Huge in size in North America is both the countries i.e. Canada and the USA. Also, the number is decent for those affected in Canada. This also means significantly that COVID-19 will impact the economy for months, maybe years. However, restarting businesses can’t wait otherwise it shall hurt more in terms of financial losses. The reopening of businesses a step-wise process also can’t until the virus is completely eradicated.

Financial experts have claimed that lost wages from locked-down have ranged from $3billion to $6billion monthly. These are huge figures and shows the significance of the pandemic COVID-19 and its devastations. Restarting the business is also important for the social well-being of Canadians in the economy. Hence, also for the restoration of investor confidence in the market.

PHASE 1- REMOTE WORKING:

The first phase of step-wise COVID-19 is the remote working phase. In most parts of the COVID-19 affected world as well as imposed in Canada. It was under strict monitoring as the phase was followed under Canada’s laws. Remote working i.e. working from home mainly has helped a lot. This is especially in Canada regards to the social distancing laws and procedures in place. ‘Social Distancing’ is a new phenomenon of the modern age. It has laid huge emphasis on how to react and fight a pandemic. Many professional and business-to-business companies have learned to facilitate. Especially, working from home using digital media i.e. web-based technology over the past few weeks.

A process that should be done scientifically. Remote working is a process that has emerged with prominence during COVID-19. Remote working has really helped many companies recover from COVID-19 intense effects that have been a cause of higher-level losses. With consistency and persistence, COVID-19 risks can be handled effectively. This is especially during the restarting of the businesses & economy.

PHASE 2: RESUMPTION OF SMALL-SCALE OPERATIONS:

The next phase in the step-wise is the next stage in the restarting process and is a slightly higher level in opening operations. It is considered as a suppression approach. A process that involves reopening and supporting businesses. Hence, where virus transmission can be controlled easily. Achieving higher levels during a game. With better steps and an acknowledged approach, similar steps are taken.

The nature of businesses that can be open should have proper facilities that are mandatory for health and cleanliness measures. These include workplaces where social distancing is adequate and getting back to work can be managed through following distancing laws. The availability of easy access to soap and water is necessary. As well as the ability for continuous cleaning of all public areas must be encouraged in reopening. All these businesses can have a learning lesson from those that remained open during the lock-down.

The regulations also require that businesses can operate with reduced hours if there is a need during restarting. Furthermore, also until they can assure regular and thorough cleaning of their workplaces. As far as the precautions against the pandemic are concerned short-term age discrimination is justified. This is primarily because people with lesser ages have good immunity to fight against the pandemic as compared to those with more age.  Govt.’s support for older workers will make enough measures for them to stay at home until the pandemic gets over with. Companies should have a strict check on employees and keep telling them if they are not feeling well they must stay away from work. In addition to this, Govt. of Canada must give provisions for easy and quick access to insurance for lost wages.      

 PHASE 3: EXPANDING TO SOCIAL EVENTS:

The expansion to social events is phase 3 in the re-opening process and is of higher importance than the rest of the two. This phase begins within a month of lowering the infection rate to acceptable levels. In Canada, there are still some on-going developments regards to the models of transmission that are in different-sized and types of groups. Hence, as more is determined in the step-wise process on how to decrease the levels of infection rates. Ironically, businesses and organizations can expand their operations more carefully. The key behind this is lowering the amount of risk. With events and social gatherings, the associated risks should be minimized.

Phase 3 in the step-wise means allowing more customers into stores and restaurants at one time. Making a limit for social gatherings i.e. 15-20 people in a gathering in all provinces and imposing fines on violations. Sports leagues that are followed professionally and are a source of income for many people can resume with few or no spectators at all. It doesn’t matter at all what the expansion looks like, the maintenance of new cleaning and social and physical distancing practices needs to be ensured.

PHASE 4- DOMESTIC TOURISM:

The next phase is the most critical in the restarting phase and holds huge importance in terms of revenues generated in the tourism industry. This relates to Canadian domestic tourism, as it is a huge country with many landscapes and locations that are worth seeing. This phase should look forward to reopening and re-building domestic tourism and holds significance in regards to Canada’s reputation in regards to the tourism industry. The reopening of airlines, hotels, and restaurant industry is mandatory with health and cleanliness measures as well as hygiene practices ready to go. The public trust in the tourism industry is vital for the health and safety of tourists.

The Govt. and health care experts should continuously monitor in step-wise and keep providing updates on transmission rates. The public trust holds huge significance as Canada has responded well to the pandemic. People should be ensured that their health is a huge priority of the Canadian Govt.

The Govt. focus needs to shift towards the controlling of risks through shutdowns to taking health measures that are mandatory in the reopening process. Prevention is the best way to control the happening of the pandemic again as its devastations are evident in the form of COVID-19 affected statistics.

After the departure of Coronavirus or COVID-19, the immigrants already in Canada will be most important for the recovery procedures. Canada’s economic recovery, unlike many other countries, is dependent on immigration policies. Secondly, how these policies shall shape up for the future. A strategy is always dependent on the current course of events. Hence, COVID-19 is a virus that has highly affected these strategies to a great extent. As the IMF predicts the economy will come into a contraction of 3%. Statistically, this is the worst economic downturn since the great depression.

Although, Canada is huge area-wise with at least 10 provinces and territories. But, they shall have to overlook their policies for a positive change in the future. More reliance shall be imposed on taxation by the Govt. A necessity for the accumulation of funds in overcoming the recovery challenges. Hence, it is very necessary that the Canadian Govt. makes the best utilization of the manpower resources available in Canada.

A bit of a thought process and pondering regards to the education sector & the number of international students coming to Canada.  This reform & thinking procedure is a necessity to initiate the recovery change in the Canadian economy.

Travel restrictions were imposed in Canada and days before the imposing of restrictions was an announcement regarding the immigrants. Surprisingly, the Canadian Govt. announced 1 million immigrants into Canada from 2020-2022. Hence, it is for the good prospects of the Canadian economy especially Post COVID-19. However, since then things have changed slightly due to the emergence of pandemic COVID-19.

SHOULD CANADA WELCOME MORE IMMIGRANTS?

According to the current scenario, there shall naturally be a change in policy for immigrants as expected. At least there is a slight adjustment that is expected. COVID-19 has been the cause of some distinct changes in Govt. policies.

However, it wouldn’t be a wise or sound economic policy to bring significant reductions in the number of immigrants due to COVID-19. As a matter of fact, these are the times when Canada needed to bring an increase in immigrants coming to Canada. Something that was affected badly due to the pandemic. The pandemic proved to be highly dangerous than it was initially predicted in its early days.

The upcoming 2-3 months, i.e. Post COVID-19, will decide the fate of future migrant policies and immigrants coming to Canada. It highly depends on how fast and immediate steps can be taken by the Canadian Govt. for the recovery process.

WHY CANADA NEEDS MORE IMMIGRANTS?

Canada definitely needs more immigrants especially in the education sector for the promotion of Universities, research, academics, and jobs in various sectors in Canada. The country is vast, i.e. 2^nd in terms of area in the world after Russia. Naturally, the amount of land available should be in proportion to the number of people living irrespective of the immigrant ratio. Hence, for the sake of competition in the developing world as they have proved the population density must be on a higher side.

Job saturation in many industries is important as well as for the sake of global expansions & tourism. It’s the Govt.’s desire to welcome 300,000 immigrants per year to help alleviate the demographic challenges. As more Canadians are retiring fast due to the increasing old population in Canada. Therefore, the need to fill in the labor market & the services sector is on a higher side post-COVID-19. Immigration comes into play here as a catalyst in balancing the number of people working in Canada. Stats have also shown that the country is not having enough children, hence the need for immigrants is far more than earlier counts available. Immigration and migrants will be the key drivers of the Canadian economy in the next decade, i.e. 2030. This is similar to the way it has been driving the economy of Canada since the early 90s.

Today, even in times of Coronavirus, pandemic immigration tends to account for all of Canada’s labor force growth. The welcoming of more migrants Post COVID-19 shall be a big boost for economic growth in the future. However, the process must take place with due considerations.

IMMIGRANTS CAN HELP CREATING MORE JOBS POST-COVID-19:

 As we have discussed earlier immigrants can help in the fast recovery by creating more jobs after the COVID-19 pandemic. A disaster that is still hurting the Canadian economy and has been a cause of many job losses. There is no doubt that the economy is facing tough times. However, there are most chances that the immigrants will help in bringing stability to the newly created jobs and also support job creation in many other ways. Previous stats have shown that immigrants have a high potential and propensity to start businesses.

SMEs or fresh businesses are good for the economic recovery process and can sustain the economy at a far rapid pace. In terms of job creation, immigrant entrepreneurs have done a fantastic job from 2003 to 2013 according to previous stats. According to stats, these jobs account for 25% of new private-sector jobs within the decade period. Hence, immigrant entrepreneurs can contribute heavily to the economy of Canada in terms of the creation of jobs, part-time & full-time vacancies, and giving a big hand in the recovery process.

According to the Federal Govt. statistics, over 600,000 international students in Canada are contributors to over $22 billion in economic activity every year. This is also a huge contribution in terms of placements being 200,000 jobs annually. The country already has over 8 million population that is immigrants and their contributions to the economy of Canada are even bigger.

Accounting challenges are the most common ones that come up in new startups. Therefore, fixing them up can be a big financial issue. At the same time when starting a business, solid accounting practices are a necessity to have success initially. Some examples include Payroll, taxation, and bookkeeping.

Accounting and bookkeeping hold paramount importance in the initial phases of a business. As business is in their early days. Therefore, accounting analysis, ratio analysis, and recording of all activities regard to the businesses are a must. This is all because of the investment in the business that requires an ROI i.e. a Return on Investment.

WHAT IS A ‘ROI’ IN ACCOUNTING?

An ‘ROI’ or Return on Investment in accounting is the Return you are getting on the initial investments. This is the return that you have incurred on the business. Hence businesses usually demand high returns so that they can establish themselves at a faster pace. Therefore, it is necessary to get hold of the ROI or Returns on Investments in a fully functional way.

However, as we discuss the issues and challenges when starting a new business. Here are some of them;

1. Maintaining a Healthy Cash Flow
2. Keeping track of financial information
3. Bringing in enough capital
4. Handling Payroll
5. Paying The Taxes

1. MAINTAINING A HEALTHY CASH FLOW

Maintaining healthy cash flows and with consistency is a litmus test for startups. Cash flow in accounting terminologies means the Net Flow of cash at the end of the month. Hence, in more financial terms a Cash flow is an important financial metric that determines the liquidity of a company. Positive cash flow is an indication that a company’s liquid assets are increasing, enabling it for debt settlements. Listed in three different sections detailing the activities is a company’s cash flow in a financial statement. The three sections are cash flow from operating activities, investing activities, and financing activities.

Maintaining a positive cash flow can be a huge challenge for fresh companies and new startups. The new companies usually avoid cash flow problems by staying on top of their finances. The best solution for such an issue is minimizing the expenses, and maximizing the revenues. The best way is to minimize the expenses and risks associated with businesses initially. Lowering the inventory costs and reductions in cost payments are the solutions to minimizing the expenses.

2. KEEPING TRACK OF ACCOUNTING & FINANCIAL  INFORMATION

While running a small business and a new startup one can easily miss keeping track of financial information. As an owner or a CEO of the enterprise keeping track of the financial information is a risk assessment exercise. It always allows us to optimize the cash flow, pay the taxes on time & success evaluations of the businesses. Furthermore, the standings, and attracting new investors through profitability. All these activities are important to be successful and reductions in initial phase accounting challenges.

3. BRINGING IN ENOUGH CAPITAL

Enough capital means enough investments and making yourself secure for future investment options. A new investment obviously demands big initial capital investments. However, at the same time, there should be a proper risk analysis to make goals sustainable. Most businesses accomplish these tasks by getting hold of or acquiring investors. You have to convince the investors that their investments are risk-free. In addition to this that they shall not be incurring losses in the future.

As an owner of the business, you have to be very determined, focused, and must have a solid business plan. These must be clear, having concise financial records, and identifying potential investors.

4. HANDLING PAYROLL

Payroll, a key function in accounting and financial management for keeping track activity of employee payment records. In a startup business handling payrolls can be a huge challenge. This is primarily because initial profitability is something that doesn’t come that easy. The payroll is an unavoidable task and it needs to be accurate. Important as well, because getting the trust of employees is immensely crucial for a startup business.

In what cases it can be a challenge, that’s the question?  It can be a significant challenge when startups don’t have the ability to handle tasks in-house. Hence, there can be some major calculation errors that can take place. Thus, in that case, the best solution is outsourcing payroll activities. Outsourcing holds positive impacts on a company’s profiling, but it can be something that is cost consuming.

5. PAYING THE TAXES

Last, but never least is paying the taxes on time. Almost all businesses have to file and pay taxes. It can be a huge accounting challenge to understand the taxation system initially. Particularly, the owner of the startup should have a dedicated accountant. However, if the accountant is not there, they must fully understand the taxation system.

Filing of tax returns on time, maintaining offline and online records, and consistent interactions with the tax department. Hence, all these measures are important to overcome accounting challenges. Having adequate tax knowledge is important to overcome the accounting challenges in a startup business.  A good solution is the outsourcing of taxing services. Taxation issues can be overcome by hiring a tax consultant.

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