More power to Revenue
Several barrow-loads of claptrap have been delivered and gallons of crocodile tears shed over the proposed new legislation for one-person service companies.
We in the profession came up with the wheeze of saving our clients some tax and National Insurance, and at the same time enhance our own income by creating what everyone could see was an artificial situation.
Now that the Inland Revenue has said enough is enough, we should be holding our hands up and saying ‘It’s a fair cop, guv’. But no – we have scare stories of thousands of computer nerds emigrating (to where – the Cayman Islands?) and then we have an article by someone from the KPMG employee issues group (boy, what will they think of next?) implying that, because a non-executive director’s tax status changes from a tax-saving service company to an employee in respect of their consultancy earnings, it would threaten their independence – in the words of Jeremy Paxman, ‘Come off it’.
I say more power to the Revenue’s elbow in eliminating the unfairness that we in the profession have exploited – let’s have a look at offshore companies next.
Colin Faulkner, Cambridge
No backroom technician Sir Peter Kemp’s article (‘Come on, lets all be friends!’, 27 May) makes out all public sector accountancy to be in the dark ages. That may be so for parts of the central civil service, but the rest of us in the NHS or local government or a number of the Next Step agencies have always done this accruals accounting stuff.
I’ve always found the interest in public sector accounting to be not all that technical stuff, necessary though it is, but the involvement in the service itself and with the people who provide those services.
In this I hope I am no different from any other accountant who wants to be part of the organisation, not just a backroom technician.
Chris Jeffries, FCA, Cheadle Hulme, Stockport
Misplaced comments I assume that Peter Williams’ article (10 June) was tongue in cheek.
With comments like ‘The current audit exemption regime is working well’, ‘The £350,000 limit makes sound commercial sense’ and ‘Small business will lose valuable advice’, who could think otherwise?
Would Mr Williams care to put those comments to directors of small companies whose turnover is currently in the £350,000-plus bracket and reconcile their answers with his assertions? Would he care to do likewise with a selection of registered auditors? The response would be the same. The statutory audit for small companies serves no purpose.
Certainly, if a majority of shareholders (51% plus) elect for an audit, or a bank or interested third party insist upon one, then the law could cater for this. But other than this, for heaven’s sake, lets cut the red tape and put these meaningless statutory audits to bed once and for all.
As for the selfish and futile argument made by many members of our profession that the audit should be maintained so as to protect our fee income, this does not address the issue at all and a good accountancy practice will always be in demand for its other, more meaningful and value-added services.
The sooner the threshold is substantially raised, the sooner our profession will have something, for once in a long while, to celebrate.
Steven I Marsh FCA, Epping, Essex
…Peter Williams’ article (10 June) strangely missed the point.
Surely the argument should be ‘Why have an arbitrary audit level, whatever the level, at all? Make audits voluntary’.
Why should private small companies be obliged to have an audit? Let the owners make their own decision as to whether they require the added value an audit can provide. Major creditors and lenders could also require an audit if it was in their interest.
We should be seeking to remove Big Brother regulation wherever possible.
Graham Ledger, Ledger Mead & Sparks, Croydon
Big Five must not dictate I am a member of the English ICA and a sole practitioner training a student.
I voted against electives because I believe that the time for specialisation is after qualification. Training is primarily for the benefit of students and forcing specialisation too early will limit their career options.
The Big Five may train 60% of students, but they are not a majority of the membership, so have no right to dictate to the rest of us. I do not want to belong to an Institute of Auditors, which is what they seem to be trying to create.
David Pattinson, FCA, Newark, Nottinghamshire
Business specialisation I have recently retired after a full term (40 years) as a CA in business.
Throughout that period, each and every year I have received student staff of auditing firms. Mostly they are from firms which are now constituents of the Big Five.
For several weeks of each year I have had to ‘train’ their staff, not only in the practices of the businesses but also in the varied areas of accounting procedures, computer conversions and their ongoing application, and special areas of legislation as it applied to a variety of business sectors.
I resent the suggestion that those of us who care enough about the continuity and constant improvement of examination standards to (a) vote and (b) to vote against what we perceive as retrogressive early specialisation are some form of dinosaur, unaware of the apparent overwhelming requirements of those major firms. The training of their students is not insignificantly in the hands of and at the expense of their audit clients.
It is time that the institute and its members in practice paid equal heed to its membership in business, where a wealth of specialisation has been achieved after qualification.
WJN Thomas, FCA, Farnham, Surrey
Sister paper allegations I’ve sussed it! You are the sister journal of the Sunday Sport with equally incredible wind-up stories to give the poor accountant a release on Thursday night.
Tonight’s (10 June) corkers were:
‘Big Five threaten to leave rest of peasants behind and put own training interests first’ – but we know they did that years ago!
‘Peter Williams uncovers DTI plot to deny small owner-managers of one of the best potential sources of advice – the statutory audit’ – even I laughed hysterically at that.
Antony Fawbert, Walton, Chesterfield
Chancellor Blobby Brown On the basis that he is pink, plastic, portly, that he speaks in meaningless repetitive phrases and creates chaos all around him Gordon Brown, the chancellor, has long been known as Mr Blobby.
William Lambeth, via email
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