Preparing for all the Brexit eventualities
Today marks 101 days until Brexit day, March 29, and the chaotic political events over the past week could be likened to those usually found in Room 101.
As Prime Minister Theresa May has postponed last week's 'meaningful' vote in Westminster until the New Year and with no difference to the Withdrawal Agreement following last week's EU summit, an 'accidental' no-deal Brexit is looking more likely than ever.
Outside of the political wrangling, behind the scenes preparations for a no-deal scenario are being ramped up by local government agencies.
Across the border, Dublin is stepping up its no-deal planning and governments in France, Netherlands and Germany are passing emergency legislation to manage that possible scenario.
We have been working with many businesses and organisations across both sides of the border. Some have very detailed plans and have begun implementing them already. Based on these experiences we have identified three main phases of planning:
Preparation - preparing now for a no deal and what measures should be put in place before March 29 to ensure continuity of business, retention of employees and compliance with legal and regulatory requirements.
Disruption - from 11pm on Brexit day, businesses will need to navigate the immediate disruption to their supply chains caused by freight and transport delays, disruption to new processes, IT, and data.
Adjustment - the second to fourth quarter of 2019 will see businesses adjust to their new environment as a result of the economic impact of a no-deal with cost mitigation measures to reduce the impact of increased tariffs and regulatory requirements.
While the ongoing uncertainty looks set to continue, businesses should not wait for the politicians to reach agreement but rather plan for all eventualities, if possible.
Local businesses within all sectors should undertake scenario planning.
This can include assessing how the different options impact their market and suppliers, identifying opportunities that uncertainty and disruption in the market may create, considering where there may be competitive advantages to be found and whether there are opportunities to increase exports in the rest of the world or to acquire undervalued assets.
At this stage in the Brexit process, businesses should, if nothing else, plan for no-deal and work out when plans need to be implemented to ensure business continuity.
We stand on the threshold of a huge change to the economy and society, but we still do not know exactly what form that could take, how fast it could happen and how big a change it may be.
Above all, businesses should focus on basics such as protecting their cash flow; insulating balance sheets; retaining and attracting talent; meeting customer needs; and removing unnecessary costs, to ensure they are as prepared as possible when the political deadlock finally breaks.
Get in touch with our Brexit team to get started with your preparations, review your current plans or to assist with implementation.
For further information or advice, Lorraine Nelson can be contacted at Lorraine.email@example.com Grant Thornton (NI) LLP specialises in audit, tax and advisory services