In a conversation with Accountancy Age, Tim Sarson, head of tax at KPMG, discusses using the tax system to support the leveling up of infrastructure and living standards in the UK, and the new prime ministers tax cut promises. Do you agree with Prime Minister Liz Truss’ proposals to make tax cuts? Most of the proposals affect businesses in one way or another. The reversal of the health and social care levy, for example, impacts individuals. But ultimately, it is something that is administered by businesses, and it is something that affects the cost of employment. So, I think all of the propos ..read more

The International Federation of Accountants (IFAC) has published an action plan to help the accountancy profession tackle economic crime and corruption. The Action Plan for Fighting Corruption and Economic Crime sets out more than 30 specific actions for IFAC and the accountancy profession related to education, evidence-based policy, global standards, partnership, and thought leadership. The global accountancy profession is a “central ally” in the fight against corruption and economic crime, according to IFAC CEO Kevin Dancey. “Corruption and related economic crimes, such as money laundering ..read more

Liz Truss is set to become the next UK prime minister, but business leaders and tax experts are questioning whether she will deliver on her promise to cut taxes. The new prime minister has promised to slash taxes for British SMEs and said her government would “stop putting so much red tape, so much tax on business”. As a “pro business” prime minister is pledging tax cuts she claims will cost £38 billion annually, including a cancellation of the recent national insurance (NI) increase and scrapping a planned six percentage point hike in corporation tax for the UK’s most profitable companies. Co ..read more

Accountants across the UK are urging clients not to “panic”, despite new data from the Office for National Statistics reinforcing the threat of an impending recession. On August 12, the ONS announced a 0.1% drop in quarterly GDP figures, cementing fears of an impending recession later this year. The Institute of Chartered Accountants in England and Wales (ICAEW) has predicted that a winter recession is “unavoidable”, but accountants are aware there is a risk of the sector talking itself into a slump. Dominic Bourquin, head of the tax consultancy and corporate finance team at Monahans ..read more

The Bank of England’s (BoE) Monetary Policy Committee confirmed that interest rates will rise 0.5% percentage points to 1.75% in a bid to curb inflation. Suren Thiru, economics director at the Institute of Chartered Accountants in England and Wales (ICAEW), warned that raising interest rates is “more likely to nudge the UK into recession than curb the current spike in inflation”. The Bank of England is facing a “near impossible” trade-off between soaring inflation and an economy on the brink of recession, he said. “Higher borrowing costs will likely drag on business investments by exacerbating ..read more

HMRC is promising to crack down on “hidden employees” as it suspects big firms are underpaying £1.4bn in employments taxes through IR35 rules. The Revenue is concerned that some large businesses are underpaying Employers’ National Insurance contributions by hiding employees as self-employed when they should be classified as employees for tax purposes. This could include both workers who are paid by businesses on a self-employed basis and those who are paid through a personal service company (PSC) and fall within the IR35 rules. “Off-payroll workers are one of HMRC’s biggest priorities at the m ..read more

In a recent poll of 136 accountants, when asked how confident they felt about the future in their roles, 30.1% said they were “not at all confident”, however, just a quarter of those surveyed (25%) admitted to feeling “totally confident” about their future within the profession – a reflection of the complex challenges and unique opportunities which face the sector in the coming months and years ahead. Swift digitalisation Without doubt, the pandemic has accelerated the process of digital transformation. It’s a reality that has been thrust upon the accounting world – and everyone else – sooner ..read more

Remote working, compliance rules, and mundane responsibilities are feeding into the silent crisis of burnout, creating an overwhelmed and overloaded workforce within the accountancy industry. A new survey has revealed the alarming extent of burnout among accountants and its impact on critical accounting processes, with 99% of survey respondents admitting to suffering from chronic workplace stress. Considering the consequences burnout has on accuracy and reliability, Mike Whitmire, co-founder and CEO of FloQast, says it is “time for a massive shift”. “Growth is made in times of friction. With f ..read more

Improvement is still required despite good results in the Financial Reporting Council’s latest audit quality review, as performance at Mazars and BDO remain “unacceptable”. The FRC revealed in its latest audit quality review of the largest audit firms, that 75% of audits inspected were good or required “limited improvement”. However, a quarter of the overall audits inspected were below par. “While it is encouraging to see some improvement in audit quality at the largest audit firms, consistent, long-term improvement is still required across the market,” said FRC chief executive, Sir Jon Thomps ..read more

The UK’s accounting watchdog has called on audit firms and professional bodies to ensure exam cheating does not occur in the UK following reports of staff at Big Four firms cheating at exams in the US, Canada and Australia. The Financial Reporting Council (FRC) wrote to the CEOs of the largest auditors of UK listed companies last week, to express how “deeply concerned” it is about these events and “the potential impact” on UK audit firms. “Given the severity and repeating nature of these issues we have decided that we need to ensure we have a deep understanding of the controls you have put in ..read more