In need of protection
As a ?counter of the dead? I would remind the turncoat Sean Fitzpatrick (30 April, ?Taking Stock?) of the definition of a banker as one who gives out umbrellas when the sun is shining and takes them back when it is raining.
Tony Ellis FCA, Northwood, Middlesex
Need skills? Call the aged!
A major employment agency announced recently in a national newspaper that a desperate shortage of accountants had been uncovered by its survey.
Imagining I had spotted an over-50s employment opportunity, I sent a CV to the local branch with a mild covering letter suggesting that the usual age limits imposed by agencies might be in the process of being relaxed, owing to the ?skills shortage?.
I did not receive a reply.
Michael Newland, ACCA, London NW5
The choice, sirs, is ours
In ?View from the House? (2 April), Jim Cousins reports that the ACCA president casts some 25% of all votes for council.
This is true – however, he omitted to say that those votes have been voluntarily assigned to the president by members using their democratic right to vote personally or ask the president to vote on their behalf.
Those of us who wish to do so cast our votes using our own selection criteria.
It is each member?s choice: to vote, not to vote, or to allow the president to use his discretion on our behalf.
Peter John Rice, FCCA, Leeds
NICs: the real story
Brian Worboys (30 April, ?Letters?), queries the result of this firm?s ?national insurance contribution reform model? which you published in my recent letter (16 April).
Mr Worboys asks (quite reasonably) why the abolition of individual NICs (that is, employee NICs together with NICs paid directly by the self-employed) would require an increase in the basic rate of income tax of 14p to finance such abolition.
He has difficulty in seeing why, in order to finance the abolition of a levy which bites at a maximum rate of 10% on a relatively narrow band of income, the basic rate of income tax has to go up by so much; when I first looked at the figures, I had the same difficulty. Perhaps I could explain further.
Treasury figures show the yield from individual NICs is around #26.5bn a year; 1p on the basic rate of income tax raises #1.8bn a year. To fill a #26.5bn hole would thus require a hike in the basic rate of income tax of 14p.
The key point to grasp is that the basic rate of income tax falls on a comparatively narrow band of income.
This follows the gradual extension of the band of income which is taxed at 20%, together with (since 1996) the fact that savings income (in the hands of basic-rate taxpayers) is taxed at only 20%.
In fact, Treasury figures released at the time of the March 1998 Budget suggests that, of the UK?s 26 million people who pay income tax, barely two-thirds of them enter the 20% rate band.
I trust this clarifies the position and sets Mr Worboys? mind at rest.
MC Fitzpatrick, head of economics, Chantrey Vellacott, London WC1
Jibe talking misfired
I read your report about Sean Fitzpatrick and his definition of accountants (30 April, ?Taking Stock?).
I have heard this definition before, but it related to auditors – who always turn up after the battle to count the dead and bayonet the wounded, as opposed to other branches of the accountancy profession.
Hence, if your report is accurate, the main point (a joke at the expense of auditors) was probably lost.
Jonathan Morris, FD at HCAT, Hastings
Change the scriptwriter
Mr Peter Wyman alleges (30 April, ?Letters?), that I am sadly ill-informed. In particular, he says that I am wrong to suggest the education and training directorate is calling a special meeting.
Perhaps Mr Wyman should read the E&T consultative document, Recognising achievement, in which he has signed the foreword as ?chairman of education and training directorate?.
This reads: ?Members will then be asked, at a special meeting later in 1998, to vote on a resolution allowing the establishment of a scheme for the granting of a first-stage award.? Either Mr Wyman should read the documents that he signs or he should get a new scriptwriter. Or both.
On the vexed question of democracy, Mr J Denza (30 April, ?Letters?), maintains the voting should be done by persons who know something – preferably a great deal – about the candidates, not least their abilities as chairmen.
Our ginger group would place more emphasis on their abilities to effect change. The motion I have put for the agm on members voting for the president does not mean that I or John Cook or any other ?dissident? will be up for president. The nominees will still need to be council members and to get the same number of council member backers as at present.
With these built-in safeguards, there is no chance of what happened at the Law Society happening with the English ICA.
The intention is for members to receive a manifesto from each candidate so that we know which of them, for instance, is in favour of mergers, or streaming of examinations.
Jeff Wooller, London WC1
Get in at the cutting edge
I would have no problem with Peter Wyman?s thoughts on the future of education and training (30 April, ?Letters?), were it not for one fundamental issue: specialisation.
His thinking about the new syllabus is muddled. Few chartered accountants would dispute the fact that all students need a broad band of knowledge and a far greater understanding of business than has been the case in the past.
But Mr Wyman believes that, in addition to following a commercial syllabus, students need to be taught specialist skills. Making the syllabus more business-orientated is an excellent strategy on its own. Specialisation for students is unnecessary.
The desire to include specialist subjects appears to be driven by the Big Six firms. The education and training directorate should revise the consultation document to take into account the interests of the sole practitioners and small firms who form the majority of its practising members. They need their employees to have at least a good understanding of a wide range of business issues.
They can not employ accountants who can only conduct audits or only work on tax. Perhaps Mr Wyman should spend a week in the average small firm and see what use specialist tax knowledge is at the cutting edge of general practice.
Sarah Deeks, FCA, Walliswood, Surrey
HMRC has outlined a change in VAT policy to the treatment of dwellings that have been formed from either the construction of new buildings, or from the conversion of non-residential buildings
Let us hope that valuable asset protection vehicles are not made prohibitively burdensome or abolished in the desire to “simplify” IHT
The government is pressing ahead with changes to the way it taxes individuals with a foreign domicile
I will feel slightly awkward when I write to the client who is about to receive a large invoice from the PAYE expert, offering him the fee protection going forward