40th anniversary: editors’ favourite front covers

Damian Wild: ­ 21 March 2002

History is, of course, emphatic. But as we went to press with this cover ­
late, as I recall ­ on the night of Tuesday 19 March, 2002, there was anxiety in
the newsroom that we may be pushing the story a little too far.
After that day’s tumultuous press conference ­ which revealed merger talks
between Andersen’s non-US firm and KPMG ­ there was no shortage of front page
material knocking around.
And while we knew we were on the cusp of something significant, we were less
clear about how to treat it. Especially as every national paper and news
bulletin would cover the story before we could.
I think three of us had been on television that day, talking ­ not for the first
time ­ about the Enron and Worldcom fallout and its impact on Andersen. And, by
the time I got back to the office from the firm’s HQ on The Strand everyone on
the team had an opinion.
Nevertheless while the choice of image ­ an emotionally charged John Ormerod,
head of the UK firm ­ was easy, the accompanying text was anything but.
Even by this advanced stage of the story no one was talking publicly about how
the structure of the accountancy profession might change forever.
After all Andersen may have found a suitor, but a marriage was far from secure.

Regulators could block it, partners could block it and KPMG’s legal advice might

yet claim just cause for not allowing it to go ahead. (And so it proved;
Deloitte picked up the UK firm in the end, with no neat global solution.)
What’s more, only a month earlier, Ormerod still saw a future for the firm.
‘We’re not shifty,’ he had told Accountancy Age. ‘The events that are
causing anxiety are, quite frankly, happening in North America. They are not
happening here.’
If it sounds hopelessly naive now, at the time it didn’t sound impossible.
By 14 March we used our front page to ask: ‘Is this the beginning of the end of
the Big Five?’
Within a week it was. And, as we ran through all the possible permutations of
the story in the pub that night and on my favourite front cover from that heady
period, there was only one conclusion.
It was the end of the Big Five.
Damian Wild was editor from 2000
to 2005

Peter Williams: ­ 20 June 1991

A leaked audit tender document from Price Waterhouse to the Prudential
confirmed the practice of lowballing. A practice that Accountancy Age
was convinced went on and the large firms and their professional bodies had
always denied.
The story broke exclusively in Accountancy Age at a time when the
economy was mired in recession and the big audit firms seemed intent on jostling
for position and growing their management consultancies practice at all cost.

The highly glossy audit tender document arrived unannounced in the
Accountancy Age office and clearly stated that ‘Half Price Waterhouse’
or ‘Cut Price Waterhouse’ ­ take your pick both names stuck for a while ­ were
prepared to cut the audit fees by almost 40% to win the work. After all these
years the bare facts remain shocking.
It was one of the most significant front page stories in the history of the
newspaper and both the anonymous sender ­ whose identity was never revealed ­
and the journalists on Accountancy Age knew what an explosive story it
Lowballing is unethical and unacceptable, mostly because of the increased
likelihood of poor quality auditing, although at the time the ICAEW refused to
investigate because it hadn’t received a formal complaint.
However it would be wrong to say that the story had no impact. It sent shock
waves through a profession which was still grappling with combining relaxed
rules on marketing, the explosive growth in ‘other services’ and the genuine but
seemingly contradictory desire of many in the profession to maintain
professional standards.
Accountancy Age has a tradition of national papers and other
publications following the stories it breaks and this was such an example.
The PW/Prudential saga marked a low point for the audit profession and, since
then, the path has been mostly uphill. It was one a series of scandals of the
80s and 90s ­ BCCI, Maxwell and Polly Peck were others ­ which led to a
determination to improve corporate behaviour and so gave birth to the corporate
governance movement which seems so established today.
Indeed, many of the so-called radical changes Accountancy Age called
for at that time are now accepted practice. When the auditing profession
recently appeared before the treasury committee to explain its role in the
banking crisis, much emphasis was placed on audit quality. An unrecognised
tribute to that front page story nearly 20 years ago.
Peter Williams was editor between 1990 and 1992 and has worked on the paper at
various other times

Anthony Hilton: ­ 23 August 1974

The headline I remember most clearly from the five years I was editor came
relatively early.
There was a recession on then too and what was then the largest tour operator,
Court Line, had collapsed. Today’s equivalent would be the demise of EasyJet or
We were particularly interested because prior to its failure we had dissected
the accounts and highlighted the bias towards optimism which ran all the way
through ­ capitalising expenses and so on.
There were no cash flow statements in those days, but it was pretty obvious the
business was in trouble.
Our headline was ‘Court Line: Benn was warned six weeks ago’. We had got hold of
a report carried out prior to Court Line’s collapse by Price Waterhouse. It had
been commissioned by the Department of Trade & Industry, where Tony Benn was
secretary of state, and it said quite clearly that the firm was very deep in
trouble. This was at odds with the government’s professed surprise when the
business did go under, leaving holidaymakers stranded across the continent.

The story caused uproar in Parliament and was picked up by all the nationals
because Accountancy Age was, at that time, owned by Michael Heseltine’s
Haymarket Publishing Group. He was Benn’s shadow and, waving the magazine on the
floor of the house, he gave the Labour front bench a very uncomfortable ten
minute roasting for failing to have a clear strategy to deal with businesses in
Things don’t change much.
Anthony Hilton was editor between 1974
and 1979

Gavin Hinks: ­ 30 October 2008

Why on earth would we put Barack Obama on the front page of Accountancy
? He couldn’t possibly have anything to do with accountants in the UK.
That was the opinion of one former publisher of the magazine when they saw the
30 October issue. Despite those comments, it is, in my opinion, quite simply the
most dramatic front cover we have ever published.
It shows Obama emerging from between dark curtains, a hint of stage lights
behind him and a determined and purposeful look in his eyes. Our headline and
sub head: ‘Asset or Liability? What an Obama presidency could mean for you.’

It probably has the fewest words of any front page the Age has ever run and yet,
published as it was just before last year’s presidential elections, seems to
carry more weight than if we had allowed every inch of page one to be covered in
text. It’s worth noting that this was the first time Accountancy Age had allowed
a photograph to take over its entire front cover.
And to answer the doubtful former publisher, Obama was, and is, hugely important
because a change in regime from Republican to Democrat, from Bush to Obama, had
the potential to change so much that accountants relied upon, not just in the
US, but in the way it might influence the UK and the profession across the rest
of the world.
What would his attitude be to fair value, given the credit crisis? What would he
do with limited liability agreements and the ongoing issue of Big Four
dominance, and the risks that come with that? Would the US support the int
ernational accounting standards project? Our cover wasn’t simply jumping on a
bandwagon, there were significant issues for accountants everywhere.
There’s another thing I like about this cover. No one person can claim full
credit for it. The picture was agonised over by our production desk. The
headline, in a moment of inspiration, written by our features editor. It was a
collaborative effort and all the best publications are like that.
Gavin Hinks, editor, 2005-

Bob Willott: ­ 12 March 1971

Initially I was attracted to the cover of 28 August 1970 because it
highlighted the famous clash between Price Waterhouse (as it then was) and
auditors Chalmers Impey about their differing views on the loss incurred by
Robert Maxwell’s Pergamon Press. Chalmers’ departing defence was that hindsight
is a wonderful thing.
But the front page of 12 March 1971 brought more wry smiles with its varied and
more controversial content, including a picture of a senior accountant still
wearing a bowler hat.
The ICAEW announced it would permit firms of chartered accountants to advertise
for staff on television and cinema screens ­ provided they used a box number,
didn’t identify their firm’s name or give too full a description of its services
when explaining the duties to be performed. Even more daring, colour could be
used, but only if the rest of the page also included some colour!
Albert Frost, finance director of the then giant chemicals group ICI, threatened
not to comply with the first definitive accounting standard because he thought
the inclusion of income from associated companies in the profit and loss account
would imply that the parent’s management had more influence over the activities
of the associate than was the case.
But the two main stories were about company controversies. The receiver of
Rolls-Royce, Peat Marwick’s Rupert Nicholson, was demanding more money from the
government for the assets of the insolvent aero-engine manufacturer being
acquired by a new state-owned successor and threatened to go to arbitration if
he didn’t get it.
And alongside that story Accountancy Age revealed how a loophole in the

Insurance Companies Act 1958 had allowed failed insurance company Vehicle &
General to bolster its solvency margin by £5m in its 1969 accounts.
Recessions always trigger company scandals and 2009 will doubtless be no
Bob Willott, editor between 1969 and 1974

Related reading