News in Brief – 18 February

IASC to lose Knorr

The embryonic German Accounting Standards Committee has recruited current International Accounting Standards Committee technical director Liesel Knorr to be its next secretary general. Knorr’s five-year secondment to the IASC is due to end in June.

ASB new releases The Accounting Standards Board has published an exposure draft for amendments to SSAP 20: ‘Foreign currency translation’. The standard covers ‘functional’ disclosures of transactions and related hedges rather than financial instruments covered by the new FRS 13 on derivatives and financial instruments. The ASB’s Urgent Issues task force also published a new abstract reiterating the reporting requirements for acquisitions which exceed 25% of the buying company’s assets.

Commission’s annual report The Accounts Commission for Scotland detected almost 50% more benefit fraud last year, according to its annual report. Housing and council tax benefit fraud rose to #4.2m in 1997/1998. The commission said detection had improved.

Tax rules on surplus ACT Tax rules detailing how companies should deal with surplus advanced corporation tax after it is abolished in April are expected to be circulated this week. The Inland Revenue has come under fire for delaying publication of the long-awaited shadow ACT rules.

Shepherd Neame loses EC law case The Appeal Court has ruled against brewer Shepherd Neame, which claimed recent beer duty increases were incompatible with EC law.

VAT rule clarification VAT is recoverable even if it results from expenditure whose benefit is shared with someone else. This clarification came from a case won by housebuilder Redrow, on 11 February. To promote sales, Redrow had paid estate agents’ fees for customers and wanted to recover the associated VAT.

Law firm wins in tax ruling The High Court has ruled against the Inland Revenue in a dispute with solicitor Herbert Smith. The dispute arose in 1990, after Herbert Smith moved to a new office and had to sub-let its old one. Falls in the property market meant the rent it could obtain from sub-letting was lower than the rent it had to pay. The solicitor, backed by auditor BDO Binder Hamlyn, sought to deduct the shortfall in full, in advance, and was backed by the court. The Revenue had agreed that the shortfall was deductible, but said it should be deducted on a year-by-year basis, as it occurred.

Pompey FC chairman goes Portsmouth FC chairman Les Parris, an accountant, has been made redundant. Parris had been leading the club’s fight to stave off bankruptcy since December.

FTSE-100 criticised The Foundation for Performance Measurement criticised FTSE-100 companies this week for not providing enough non-financial information in their annual reports. It also said only 5% revealed their targets for the coming year.

SAP enters portal at Dun & Bradstreet As predicted in Accountancy Age last month, leading ERP software company SAP has linked with business information specialist Dun & Bradstreet to make D&B data available within R/3 modules, for example for online credit checks. The alliance is part of a wider strategy designed to turn R/3 into an online ‘portal’ for business-to-business transactions.

Snyder leads new network Kingston Smith senior partner Michael Snyder is leading a new National Business Angels Network designed to double the amount of venture capital put forward by private investors in the next five years. Investors can join the network for an annual subscription of #85, while companies seeking angels pay #100.

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