17 Dec 2018
Wylie & Bisset, the leading Glasgow-based chartered accountants with a national reach, is advising SMEs to exercise caution ahead of the looming Brexit deadline as the ongoing political debate drives stagnation, uncertainty and a lack of investment.
Scott Gillon, partner at Wylie & Bisset, suggests that, come March 2019 – whatever the outcome of the prevailing political debate surrounding Brexit – SMEs will be better placed to determine what Brexit means for them and, consequently, what investment decisions they are able to make.
“The end of March is not long to wait, and I think the passing of that date will spur many SMEs into making investment decisions,” he said.
“Our advice to SMEs is to examine what Brexit means for their own organisations and then, given how close we are to the Brexit deadline, to exercise a cautious approach until March 2019 then act accordingly.”
According to Gillon, a lack of clarity about what Brexit will mean has led many SMEs to delay making significant investment decisions, whether in people or capital investment in plant and machinery.
And he advises companies that trade cross-border in the EU to invest in the euro in anticipation of the pound taking a dive in value.
“For companies trading in the EU, if the pound falls in value, which I suspect it will, they would be affected for a short period while it recovered,” he said.
“I would advise such companies to ensure they have ample funds in euros if they are in a position whereby they have cash to do so because the short term outlook is for a weakening pound. That means that a delay to investing in euros now will likely result in having to pay more in the future.”
Gillon said that some SMEs with a cosmopolitan workforce harbour concerns of a talent drain as some overseas employees and foreign nationals seek to return to their country of origin. The replacement of such employees operating at senior positions within businesses could prove to be an expensive exercise.
“Most business sectors across Scotland will be affected by the ongoing political debate about Brexit and the current uncertainty about this issue is harmful for the economy.”