Latest Business News
24th October 2019.
James Salmon, Operations Director.
INDUSTRY
Former Thomas Cook boss denies saddling firm with unmanageable debts
Manny Fontenla-Novoa denied yesterday that the debts accrued by Thomas Cook whilst he was in charge were to blame for the travel firm’s downfall. Speaking before the business select committee, Mr Fontenla-Novoa said if his successors were concerned about the debt pile they should have made disposals earlier. Mr Fontenla-Novoa’s immediate successor, Harriet Green, said she should have worked harder to convince the board to transform the company into a more internet-focused entity. Elizabeth Barrett of the Financial Reporting Council said an investigation into the audit of company accounts by EY would consider goodwill accounting. She said the FRC would examine the “sufficiency of challenge” that EY offered to Thomas Cook bosses’ assumptions about its prospects. Conservative MP Antoinette Sandbach criticised the former chief financial officer Bill Scott and his predecessors for failing to write down the co mpany’s goodwill earlier. “At no point between 2012 and 2018 did you consider it appropriate to write down what was a very high level of goodwill. Six months after that, it was written down by £1.1bn,” she said. Questions were also raised during the session about pay for the CEOs and the auditors. Insolvency Service chief executive Dean Beale told Parliament’s business committee that in just over three weeks KPMG and consultants Alix Partners have received around £11m for their work on liquidating Thomas Cook.
The Guardian, Page: 37 The Daily Telegraph, Business, Page: 3 Daily Mail, Page: 73 The Times, Page: 39 The Sun, Page: 45 The I, Page: 38
New FRC boss insists the watchdog will make a difference
Sir Jon Thompson, the new chief executive of the Financial Reporting Council (FRC), has said the regulator has “the ability to make a fundamental difference to the UK economy” despite facing major criticism over accounting scandals, the Telegraph’s Harriet Russell reports. The FRC is being transformed into the Audit, Reporting and Governance Authority (Arga) but critics fear little will change with many senior figures, many of whom are former Big Four partners, staying on, says Russell. Sir Jon said the FRC has three main objectives: setting standards, supervising their implementation and enforcing them. He also defended the launch of a Stewardship Code, aimed at improving governance and transparency across the investment industry. The Times focuses on the launch of the revised code which will require asset managers to report each year on how they have met the needs of investors. Changes include a requirement to report annually on stewardship outcomes, including engagement with companies and the assets they invest in, voting records and how they have enhanced the value of investments. For the first time signatories will be expected to consider ESG factors when making investment decisions.
The Daily Telegraph, Business, Page: 3 The Times, Page: 45
FIRMS
Sports Direct appoints RSM as auditor
RSM has been appointed as auditor to Sports Direct, after speculation that the Government could be forced to appoint one following the resignation of Grant Thornton this summer as a result of concerns over the disclosure of its tax bill. Jonathan Ericson, head of audit at RSM, said: “We have a strong, high-quality audit practice. Our experience, investment and commitment, together with the scope and scale of our international services, mean we are ideally placed for this important public interest appointment.” RSM previously replaced Grant Thornton as auditor to Patisserie Valerie, after fraud revelations at the café chain, which collapsed soon after. The FT notes that KPMG has been paid about £2.3m for its work winding down Patisserie Valerie. KPMG was replaced by FRP Advisory as KPMG could not pursue legal claims against Grant Thornton because the firm also vetted its accounts.
Financial Times, Page: 15 Daily Mail, Page: 73 The Guardian, Page: 35 Financial Times, Page: 19 The Times, Page: 43 The Daily Telegraph
KPMG in talks to sell pensions advisory arm
KPMG has announced that it is looking to offload its pensions advisory division for over £200m to private equity firm Exponent, as the Big Four firms come under pressure from regulators to restructure. KPMG has received a number of bids since it began to consider a sale in June. A KPMG spokesperson comments: “Following significant interest in our market-leading pensions practice, we can confirm we have entered into exclusive talks with Exponent with a view to progressing a sale.”
City AM, Page: 7 The Daily Telegraph, Business, Page: 7 The I, Page: 40
Central Working fallen into administration
Co-working office space firm Central Working, based in London, has appointed Quantuma as its administrators.
City AM
TAX
Mel Stride to chair Treasury Committee
The former financial secretary to the Treasury Mel Stride has been appointed as chair of the influential Treasury Committee. The Conservative MP will be taking over midway through the enquiry into the collapse of Thomas Cook which has seen the auditors EY and PwC and also the Financial Reporting Council appear before MPs. Meanwhile, the FT reports on concerns over a conflict of interest for Mr Stride, who pushed through the controversial loan charge but will now chair the committee investigating it.
Financial Times, Page: 3 The Daily Telegraph, Business, Page: 1 The Times, Page: 44
HMRC doubling resources for tax avoidance
HMRC director general of customer compliance Penny Ciniewicz has announced at a Treasury select committee evidence session that the organisation is increasing its efforts and resources into dealing with promoters and enablers of tax avoidance. Ms Ciniewicz stated: “We have more than 100 current investigations into promoters [and enablers] and we’re keeping a very close eye on the market for avoidance.”
FT Adviser
Brexit deal tough for British and Irish trade
Acting head of HMRC, Jim Harra, has said that the Brexit deal put forward by Boris Johnson would see British and Irish businesses subject to “additional administrative costs” and red tape, even if they were to trade only within the UK. Goods going to Ireland would have customs declarations and potential tariffs imposed on them.
The Times, Page: 9
Get your ducks in a row, with 100 days to go
With 100 days to go before the 31 January deadline, HMRC is reminding customers to complete their tax returns early to beat the Christmas and New Year rush. Last year more than 2,000 people sent their tax returns on Christmas Day.
Yorkshire Post, Page: 9
REGULATION
Ofgem seeks new audit rules for energy suppliers
In order to curb collapses of smaller companies, new regulations would see large energy suppliers be required to be independently financially audited. City AM states that the companies would be required to detail their plans for the event that they fail.
Financial Times, Page: 3 City AM, Page: 18
CORPORATE
British Steel deal in doubt
Talks relating to the rescue of British Steel will be opened out as a 10-week period of exclusive talks between the Official Receiver and Ataer Holding ends today. Although talks with Ataer will continue, rival suitors can now also enter the sale process. Ataer is an arm of Turkey’s military pension fund. Reports have claimed a rescue is in danger of failing because some British Steel suppliers were refusing to accept price cuts. EY is supporting the Official Receiver.
The Daily Telegraph, Business, Page: 1 Daily Mail, Page: 74 Daily Express, Page: 49 The Guardian, Page: 37 The Times, Page: 45
Bell Pottinger partners forced to repay profits
BDO , administrators to Bell Pottinger, have pursued an “aggressive” strategy to recoup about £4m in “excess profit drawings” from former partners, the FT reports.
Financial Times, Page: 19 City AM, Page: 7
SMEs
Funding Secure fails putting investors at risk
Peer-to-peer lender Funding Secure has appointed administrators from CG & Co after it collapsed after failing to secure repayment of £3.2m in loans to a Mayfair art dealer linked with an alleged money laundering scandal. Funding Secure has been engaged in a legal battle with Matthew Green, an art dealer made bankrupt this year, who is alleged to have sold millions of pounds of artwork used as collateral.
The Times, Page: 38
PENSIONS
People confused by pensions
Money and Pensions Service research shows that over six out of 10 people are unaware that they could receive tax relief on their pension savings if they are unemployed, and more than a third do not know that workplace pension savings are protected from an employer collapsing.
Daily Mirror, Page: 36
Doctors dismiss government pensions solution as ‘sticking plaster’
The British Medical Association has said the Government’s solution to the NHS pensions crisis is a “sticking plaster” and stops far short of fundamental tax reforms that are needed.
Financial Times, Page: 3
ECONOMY
Moody’s cautions on Brexit delay
Ratings agency Moody’s has warned that the UK’s creditworthiness could be damaged by the latest Brexit delay, after a House of Commons vote against the Prime Minister’s rapid timetable for passing the EU Withdrawal Bill. Moody’s managing director Colin Ellis said the likelihood of Britain leaving the EU with a deal is higher than it has been recently, but added: “Significant uncertainties remain around the timing and eventual outcome of Brexit, which is likely going to weigh on spending, investment and hiring decisions in the UK for some time, a clear credit negative.” This follows research earlier this month which found that business investment has fallen by 11% since the 2016 referendum.
The Daily Telegraph
Retailers cut 85,000 jobs this year
The past year has seen retailers cut 85,000 jobs with businesses under increasing pressure from weak consumer demand, rising costs and the switch to online shopping along with uncertainty over Brexit. Job losses could increase due to automation too – retail IT bosses expect one in five jobs in their businesses to be replaced by artificial intelligence or automation in five years, according to a survey by the recruitment business Harvey Nash and KPMG.
The Guardian, Page: 35 Daily Mail, Page: 2
OTHER
Female EY executives told not to flaunt it
The Times reports on a training session for female EY executives in the US last year which advised women to “speak briefly”, raise their hands when they wanted to speak and to not flaunt their bodies as “sexuality scrambles the mind”. Details of the workshop were reported to the Huffington Post. EY said the programme had been under review for several months and that this version of the course had not been offered since the event last year.
The Times, Page: 9
Do you sell on credit?
With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.
Those customers will look for the easiest option to boost their cash-flow. Don’t let it be you.
You can’t just assume your customers can and will pay you eventually, no matter how big their name is.
It is essential to have credit management systems in place to monitor and check your customers credit worthiness.
It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.
About CPA
The Credit Protection Association can help!
Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.
At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.
We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.
Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.
If you supply on credit, help us help you identify the risks.
Why use a third party collector?
As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When you customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.
Over the years we have collected billions in overdue invoices for our customers.
Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
CPA is passionate about late payment
The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.
We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.
If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.
As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.
Under little used legislation, you are entitled to compensation for those late payments.
Now you can boost your own cash-flow.
CPA can help unearth the those hidden treasures.
We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.
Yes, CPA can help you boost your business cash-flow.
Don’t let your bankers control you, contact CPA today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you realise you could be sitting on a fortune?
Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.
If you sold B2B on credit then there may be a hidden source of capital you can call on.
If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.
Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.
We can help you uncover the pile of gold, you didn’t even know you were sitting on.
If you trade with other businesses and were often paid late then you could be entitled to significant compensation.
Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.
Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.
You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.
That compensation could provide the cash boost your business needed.
But don’t delay, that compensation evaporates if not claimed within six years of the late payment.
How can CPA help?
CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.
We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.
Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.
CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.
The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit. You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.
We do the work, you receive the cash.
If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.
We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.
We are helping business owners who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.
Those former clients who regularly paid you late can finally be made to pay.
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Keep up to date with the latest news by following us on social media:-
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections