The Big Four firm said that, unlike other industries, mining companies had
not formed an industry group to establish a common approach to implementing
IFRS. The IASB, meanwhile, had only recently formed an extractive industries
working group to provide guidance for miners, but this group was not scheduled
to produce guidance for some time.
The result is that mining companies are still using disparate interpretations
of IFRS in their accounts.
Brian Taylor, PwC’s UK mining leader, said that, although IFRS had ‘advanced
the transparency and comparability of financial statements’, accounting across
the industry remained inconsistent in certain key areas.
‘There are also some areas in which practice appears to vary across the
industry. In such cases, the disclosure of a company’s accounting policies and
the consistent application of those policies are particularly important,’ said
Like other industries, mining groups have found the hedging and derivative
requirements of IAS39 especially difficult, but a more pressing concern is that
IFRS does not address the accounting issues specific to mining businesses.
PwC said the international standards did not include guidance for the
sector’s need to put up large investment for risky exploration projects, nor the
long lead-in time required to launch new projects.
The existence of significant costs involved in closing a mine at the end of
its life were not addressed by the standards. Also, a number of mining
activities contribute to the development of a mine, which brings long-term
benefits, but also deliver ‘saleable production’ at the same time.
Royal Bank of Scotland is close to agreeing on a settlement with Enron
shareholders after being accused of helping the collapsed US energy giant
conceal its accounting fraud. According to reports, RBS isset to close a
multi-million pound civil action by paying out around £100m. RBS, Britain’s
second biggest bank, operates in the US through its retail arm, Citizens Bank,
which has more than 1,600 branches and generates income of $5.9bn (£3.2bn).
Ross Graham, the former FD of software group Misys, has written to the
company’s board saying he believes that his management team could offer the best
opportunity for it to maximise shareholder value.
Misys has been approached by a number of private equity houses with bids, but
the offer from Graham and other former executives Mike O’Leary and John Sussens
adds a new twist to attempts to take over the software company.
Jacques Gounon, the chairman of channel tunnel operator Eurotunnel, has asked
a French court to freeze its debts so it can continue operating after warning
that it is just two months away from going insolvent. Eurotunnel has a £6.2bn
debt mountain and needs to restructure repayments of this to avoid collapsing.
Gounon warned: ‘If we cannot present plans before the end of September then the
end of the story is easy to write.’
The end result, he said, would be ‘liquidation’. Eurotunnel has been trying
to persuade its bondholders to back a deal to cut its debt pile in half but a
group of creditors has refused to support the proposals. The court is expected
to make its decision on 25 July.
FTSE small cap
Robert Baddeley, the long-serving FD at Holidaybreak, has cashed in on shares
and options in the vacation company. Baddeley subscribed for 17,404 shares at a
price of 287.5p and 20,888 shares of 5p at an exercise price of 325p. These
deals cost him £118,000.
All the shares were sold on for 673p, leaving Baddeley with a profit of
£124,449. Baddeley still has a stake of 32,678 shares in the group and options
on 12,000 other shares. The group has recently closed talks on selling off its
camping division. The camping arm continues to meet trading forecasts.
The FD of Regal Petroleum, Roger Phillips, has takenover the running of the
company after the resignation of CEO and chairman Paul Morgan. Morgan
resignedafter just four months in the chief executive’s chair. Reports in the
national press say his departure follows a clashwith Phillips over the strategic
future of Regal.
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Engineering and technology executives have voiced concerns over the government’s industrial strategy and the need to fill the R&D funding and long-term investment gap in a post-Brexit Britain
This year’s Finance Act is 649 pages, the second longest recorded, and highlights the increasing complexity for taxpayers of an ever expanding tax code
The International Integrated Reporting Council (IIRC) and the CIPFA have launched an introductory guide for leaders on integrated thinking and reporting
Accountancy Age is delighted to reveal the shortlists for the 2016 British Accountancy Awards