Analysis - Accountancy Age

HMRC court wins come in waves

Fri, 10 Feb 2012 08:49:56 GMT

The failure to convict a football manager for tax evasion after a five-year investigation and then see him tipped as the next England manager only hours later must be galling for HM Revenue and Customs. HMRC's statement that it had "no regrets" after a jury cleared Harry Redknapp on Wednesday of tax evasion is hard to believe, given how high profile the case was and how much effort was put into it. Like...

The lure of Liechtenstein

Thu, 09 Feb 2012 16:32:22 GMT

Accountancy Age

THE EXTENSION of an offshore tax amnesty with Liechtenstein shows that the tiny European principality has become the favoured banking destination for British tax evaders who want to go straight. Earlier this week the UK government extended an innovative offshore tax amnesty with Liechtenstein by one year. Under the Liechtenstein Disclosure Facility, Britons with banks accounts in Liechtenstein can settle tax liabilities on favourable terms. The deal allows Britons who come...

The price is right?

Thu, 02 Feb 2012 08:00:00 GMT

Accountancy Age

ADMINISTRATIONS are coming thick and fast in the UK. The company collapses are boosting income for insolvency specialists but are also challenging the profession's reputation. Angry creditors are accusing insolvency specialists of charging excessive fees and costs. Take the recent collapse of insolvency firm Bridge Business recovery, which has left creditors out of pocket and suggesting that Bridge's administrators have expensive habits. The collapse of the insolvency firm came as a surprise but,...

RSM Tenon's plight puts listed firm model under scrutiny

Tue, 31 Jan 2012 09:46:00 GMT

Accountancy Age

IN 2003 an ambitious chief executive argued that acquisitive accounting firms had a bright future on the stock markets. In an article for Accountancy Age the chief executive boasted that he ran a "profit-led business with own strategies." Future growth would come through "consolidation" and also "abundant opportunities that it would be rude not to grasp," wrote Andy Raynor, the then chief executive of Tenon (which later became RSM Tenon). At...

RSM Tenon's plight put listed firm model under scrutiny

Tue, 31 Jan 2012 09:46:00 GMT

Accountancy Age

Employers should learn from Reed salary sacrifice tax case

Wed, 25 Jan 2012 11:28:00 GMT

Accountancy Age

A RECENT tribunal ruling against recruitment firm Reed in a £158m tax case over a salary-sacrifice scheme has highlighted the need for employers to explain tax-relief arrangements clearly to employees and the taxman, experts say. Reed provided daily travel and subsidence for its temps - effectively deducted from their salaries and free of income tax and national insurance. The scheme was applied to 500,000 temporary staff between 1998 and 2006. HM...

Corporate finance teams cash in on mid-market M&A recovery

Tue, 24 Jan 2012 09:42:00 GMT

Accountancy Age

THE MERGERS and acquisition (M&A) market for medium-sized companies is showing signs of recovery in the UK, although deals are taking longer to complete, corporate finance partners say. The mid-tier firms are finally able to use their corproate finance capacity to advise on deals. The busiest industry sectors for M&As are support services, private healthcare, media, IT, support services, and export-led manufacturers. Most of the deals are valued at between £10m and £100m....

Acquisition strategy blamed for RSM Tenon's woes

Mon, 23 Jan 2012 16:29:00 GMT

Accountancy Age

IN SEPTEMBER RSM Tenon posted a 57% increase in operating profits for the year ended 30 June 2011. Four months on, the chief executive and chairman have been forced to step down from the company. Andy Raynor and Bob Morton, chief executive and chairman respectively, have left the company after it revealed that it expected to report a loss for the six months to 31 December 2011 and that revenue will fall by...

Charity tax scam 'won't survive', says taxman

Wed, 18 Jan 2012 10:38:00 GMT

Accountancy Age

FORMER TAX director at Vantis, David Perrin, who has been found guilty trying to defraud taxpayers of £70m, wrote his own version of the Gloria Gaynor song "I will survive" to boast about a charity tax scam. The 1970s disco song was originally about a spurned lover but, according to HM Revenue and Customs (HMRC), Perrin changed the lyrics to taunt the taxman about the success of a tax scam to tax rule...

Good cop, bad cop: HMRC strengthens fraud investigation

Wed, 18 Jan 2012 09:23:00 GMT

Accountancy Age

ENCOURAGING A TAXPAYER to come clean about a suspected tax fraud by guaranteeing that he or she will not face criminal prosecution can save the taxman time and money. Problems can occur, however, if a taxpayer who has committed fraud reneges on their side of the bargain and doesn't co-operate with tax investigators. If HM Revenue and Customs (HMRC) has begun a civil investigation into suspected tax fraud under current guidelines...

Tough love is the AADB's aim

Mon, 09 Jan 2012 09:15:00 GMT

Accountancy Age

THE ACCOUNTING WATCHDOG may have been given all the fuel it needs to make drastic changes to the way it dishes out fines following a landmark PwC reprimand. The record fine of £1.4m was handed down to the firm by the Accounting and Actuarial Discipline Board (AADB) for failing to flag up non-segregation of JP Morgan Securities Limited's client assets for seven years to 2008. Tom Martin, AADB executive counsel, told...

Were the PAC's criticisms fair?

Tue, 20 Dec 2011 12:02:00 GMT

Accountancy Age

IT MIGHT be the season of goodwill, but HM Revenue & Customs is unlikely to be feeling much of it today. The Public Accounts Committee report into its dispute settlement, released this morning, is a "damning indictment" into HMRC's procedures and leadership, according to PAC chair Margaret Hodge. Anyone who has followed the fiery and, at times, farcical (as HMRC general counsel Anthony Inglese will testify, probably under oath) evidence sessions will not...

Auditors fear loss of influence in Brussels

Tue, 13 Dec 2011 16:26:00 GMT

Accountancy Age

AUDITORS MUST DEVELOP concrete, game-changing reform proposals if they are to have a strong voice at EU level, a group of stakeholders has concluded. Meeting today at the ICAEW the Audit Quality Forum debated - under Chatham House Rules - Brussels' recently released proposals and lamented the difficulty of presenting a cohesive and forward-looking front. The Big Four was accused of 'completely self-serving' in its response to the European audit reform...

Taxi-maker's FD hopes for smooth ride in 2012

Tue, 13 Dec 2011 16:20:58 GMT

Accountancy Age

BOTH PETER JOHANSEN and black cab maker Manganese Bronze will be hoping for a period of stability in his appointment as group finance director, after what has been a less-than comfortable period for both parties. Johansen previously served for six years as FD of long-standing carpetmaker Brintons, prior to it entering a pre-packaged administration in the summer. For Manganese, it will hope that Johansen's experience of working in China will help...

Integrated reporting – friend or foe?

Thu, 08 Dec 2011 10:31:49 GMT

Accountancy Age

FINANCIAL REPORTING in its current form fails to meet users' needs, but integrated reporting is not the answer. This was the message of a panel of investors, auditors and standard setters at a recent Financial Reporting Outlook conference hosted by Ernst & Young. Integrated reporting is a relatively new initiative aimed to make annual reports more useful by linking disclosures, helping both investors and management examine key performance indicators and business...

How big a slice should administrators take?

Wed, 07 Dec 2011 11:28:00 GMT

Accountancy Age

THE LARGEST PRE-PACK administration to hit the UK in recent times raised some important questions. Should a company be allowed to move to the UK to take advantage of the our insolvency tools? And can practitioners ringfence funds for future possible legal action or are challenges a personal liability insolvency practitioners (IP) have to bear? The second question was answered in a recent High Court judgement concerning the collapse of Greek communications company Hellas II...

US considers 'modified incorporation' of IFRS

Wed, 07 Dec 2011 10:01:00 GMT

Accountancy Age

US STANDARD SETTERS are calling for "modified incorporation" of global accounting standards, after national regulator the SEC said it needed more time to decide on convergence. Financial Accounting Standards Board chairman Leslie Seidman (pictured) said international standard setters should be responsible for writing the rules used by US companies, but the name US GAAP should not change due to practical considerations. Under her vision, the FASB would gather input and research,...

CIMA disciplinary highlights office holders' risk

Tue, 06 Dec 2011 10:51:27 GMT

Accountancy Age

THE EXPENSIVE PURSUIT of Margaret May, ex-CIMA council member recently found guilty of misconduct, has highlighted the issue of indemnity and risk for institute office holders. May claims she was eligible for indemnity under the institute's bylaws, which effectively insures officers against any loss incurred in the course of their duties. However, this cover only applies when duties are "carried out in good faith", and when the loss is not due...

Legal chief's departure leaves AADB Scott free

Thu, 01 Dec 2011 16:52:00 GMT

Accountancy Age

ACCOUNTANCY DISCIPLINE chief Cameron Scott packed his bags this week, leaving the world of regulation and wrist-slapping for pastures new. In his eight years as executive counsel of the Accountancy and Actuarial Discipline Board, the Scottish solicitor has presided over a number of big wins. PwC was up against the disciplinary panel on Monday, arguing for gentle sanctions in relation to their JP Morgan Securities audit failure. Earlier this...

Softer audit reforms provoke hard response

Wed, 30 Nov 2011 16:28:00 GMT

Accountancy Age

WATERED-DOWN audit reform proposals have provoked a forceful response from stakeholders, with the Big Four calling for more concessions and the mid-tier up in arms. Internal markets commissioner Miichel Barnier (pictured) has ditched mandatory joint audit – the darling of mid-sized firms – and strengthened mandatory rotation requirements by shortening the maximum engagement period from nine years to six. The pushed-back publication date hinted at changes afoot and Barnier does appear...

Has MF Global changed the insolvency landscape?

Mon, 28 Nov 2011 12:07:00 GMT

Accountancy Age

THE WORLD'S FIRST special administration sees KPMG administrators appointed to the UK arm of MF Global – but has this new regime changed the fundamental principle that ensures all creditors are treated equally? The special administration regime (SAR) was brought about to help creditors caught up in complex insolvencies receive their funds quicker. The collapse of investment bank Lehman Brothers at the back end of 2008 saw the administrators tied up in heavy...

Audit competition inquiry accelerates

Wed, 23 Nov 2011 13:14:01 GMT

Accountancy Age

THE COMPETITION COMMISSION'S inquiry into audit has kicked off with strident statements from some of the main protagonists. Contributions from the Big Four and Grant Thornton are up on the watchdog's website, and BDO's James Roberts said the firm has also made a submission. A commission spokeswoman confirmed there are several more waiting to be published. Ernst & Young were muted in their statement, insisting on the fierceness of...

The GAAR report: was it worth it?

Wed, 23 Nov 2011 10:37:00 GMT

Accountancy Age

THE LONG-AWAITED report from Graham Aaronson QC on the merits of a general anti avoidance rule was published on Monday. Aaronson had given hints to what it would include. It was not expected to rule out the possibility of a GAAR altogether, but it was also unlikely to be too wide-ranging. What we saw was a narrowly focussed rule that would, as Aaronson promised, target the most "egregious" tax avoidance schemes, but would...

Financial reporting conference fears for Euro

Mon, 21 Nov 2011 10:06:00 GMT

Accountancy Age

ERNST & YOUNG'S Financial Reporting Outlook conference started in dramatic fashion with an anonymous vote on the future of the Euro. Almost one-in-five attendees said there was no hope for the single currency, but 69% thought it would battle on, albeit with fewer members. International standard setter Stephen Cooper took the stage to update 600 attendees on the work of the IASB, focusing on unfinished projects and future agenda. Put bluntly,...

Financial reporting conference fears for euro

Mon, 21 Nov 2011 10:06:00 GMT

Accountancy Age

ERNST & YOUNG'S Financial Reporting Outlook conference started in dramatic fashion with an anonymous vote on the future of the euro. Almost one-in-five attendees said there was no hope for the single currency, but 69% thought it would battle on, albeit with fewer members. International standard setter Stephen Cooper took the stage to update 600 attendees on the work of the IASB, focusing on unfinished projects and future agenda. Put bluntly,...