Qatar RIG

Hatem Elsafty, Chair, Partner - Risk Advisory at Mazars LLC

In Qatar we haven’t been subject to a full lock down like other countries. Although all non-necessary shops and malls are closed, businesses are still operating with reduced capacity. However, the construction sector is operating under business as usual since there are many key projects that cannot be delayed (on the critical path for Q2022) in preparation for the World Cup in 2022. Yet the impact is heavier in Qatar, since the global pandemic is associated with a significant drop in oil prices, which is impacting the outlook of many organisations and SMEs and their abilities to survive the impact of Covid–19. The main concern now, is the financial resilience and ability of companies to service the financial impact of Covid–19. Cash flows are now the top risk with the reduced revenues and reduced liquidity. In professional services it seems the impact is not as severe, with most of the organisations in Qatar having appropriate IT infrastructure enabling working from home. So professionals are still able to provide advice and consultation to their clients. However, all organisations in Qatar are now under severe pressure to reduce budgets, impacting consulting services significantly. Audit services are still protected by regulations. However, audit firms are pressured by their clients to significantly reduce the fees. While at first professional services firms will be impacted, there are also opportunities that can emerge from this situation. Many consultants now are focusing their services on Business Continuity Management, and pandemic planning services. Organisations are in desperate need of consultants who can help them manage the financial risk of the Covid-19 impact on their organisations. Which will create opportunities. Also with all organisations enabling faster digital transformation and enabling working from home. Cybersecurity risks are increasing which requires support from consultants and professional service firms to support in this field. Risk Managers have a key role to play in this situation. They have to support and coordinate with senior management response plans, they have to assess the financial risks. The current times mandate moving away from traditional heat map and qualitative risk assessments towards quantitative financial risk assessment models. They must support their organisations in assessing the risks of prolonged lockdown, assessing the risk of reduced revenues and delays in cash collection. Furthermore, with the huge budget cuts pressure on management. Risk Managers must support in assessing the risks associated with budget cuts ensuring that these risks are properly managed. Currently being a risk professional is a great privilege with all of management looking up to us and how to support our organisations in such times.