Welcome to our regular monthly collection of news and announcements that impact accountants and their clients.
You’ll continue to be busy on their behalf as the mornings and evenings darken earlier – which is why we created our Accountants Hub in the first place so you’ll have access to the most important and accurate insolvency information whenever you need it.
But you can’t read everything and be everywhere at once, so we collect the most interesting and important business and insolvency news stories for you every month along with new blogs on a range of topics each and every week.
We’re always keen to hear what you think so please email us ask@businessrescueexpert.co.uk because we really want to write what you want to read!
Despite progress, less than 20% of partners at accounting practices are women
In firms with fewer than 200 employees only 14.6% of partners are women. This figure rises to 22.4% in larger firms but remains significantly lower than the proportion of women in senior manager and director roles.
The “Big Four” firms have the highest proportion with levels ranging from 25% to 50% with Deloitte leading with 346 female partners out of 642.
When it comes to representation in professional bodies, things are better with the average gender balance being 60% male to 40% female. ICAEW has a total female membership and student representation of 32% compared to ACCA’s 48%.
Government to take aim at late payments
As you know, late payments are a significant burden on SMEs, costing each an estimated £22,000 a year.
As a result, the government is introducing some new measures aimed at forcing larger companies to settle their invoices on time.
Companies will now have to disclose their payment practices in their annual reports. This will identify which trend towards late payment with penalties for persistent late payers including twice-yearly reporting requirements and punishments for directors including fines and potential prosecutions.
A new Fair Payment Code will be launched to replace the existing and ineffective Prompt Payment Code which will rank companies with a gold, silver or bronze status level with the aim being to establish 30-day payments as the new standard.
The Department for Business and Trade (DBT) said it will consult on tougher regulations as part of the government’s mission to grow the economy.
Under the Reporting on Payment Practices and Performance (Amendment) Regulations 2024, new reporting requirements were due to be introduced for companies in scope of the reporting requirements that were meant to apply in relation to each financial year of a company beginning on or after January 1st 2025.
It’s unclear if the government still intends to pass this statutory instrument or replace it with their own legislation instead.
According to DBT figures 52% of small firms are impacted by late payments each quarter which is the equivalent of 2.6 million businesses. Some have had to take out loans against their property when invoices are unpaid sometimes for months.
On average UK businesses pay their suppliers 26 days late, which is an increase of four days from 2023’s total of 22 days.
Glenn Collins, head of technical and strategic engagement at ACCA said: “Late payment and unfair practices continue to blight small businesses across the UK.
“We have long called for urgent implementation of proposed improvements to tackle late payment problems, including the expansion of prompt payment reporting and the proposed expansion of powers for the Small Business Commissioner (SBC). We are glad that some initiatives are now being taken.”
Companies House announce fines for register abuse
Maximum fines of £2,000 for repeat failures to comply with registration rules are part of a new crackdown on abuse of the Companies House register as part of the Economic Crime and Corporate Transparency Act 2023.
The new laws intended to fight money laundering, fraud and corruption are rolling out with penalties starting at £250 for first offences of a minor nature rising all the way to £2,000 for repeat offenders who repeatedly ignore registration rules.
There is also scope for civil action, director disqualification and even criminal prosecution for more serious offences.
Martin Swain, director of intelligence and law enforcement liaison at Companies House, said: “The introduction of these new penalties marks another significant step forward for Companies House and our transformation. We’ll take a consistent and proportionate approach to these new powers to firmly, but fairly, enforce the law.
“This will improve the quality of the data on our registers and help us play a greater role in identifying, disrupting and preventing economic crime.”
Financial penalty amounts
| First offence | Second offence | Third offence | Fourth or more offence | |
| Minor offence | £250 | £500 | £750 | £1,000 |
| Serious offence | £500 | £750 | £1,000 | £1,500 |
| Very serious offence | £750 | £1,000 | £1,500 | £2,000 |
Depending on the offence, penalties can be a set fixed penalty based on the offence or previous behaviour; a daily rate penalty for each day the offence continues or a combination of both.
Companies will not receive a financial penalty if they take the required remedial action within 28 days beginning the day after the date of the penalty warning notice. Other measures in the ECCT Act, such as identity verification and accounts reform, will be introduced over a longer period.
Scammers target ACCA members with renewal phishing email
ACCA Accountants have been targeted by scammers trying to impersonate member firms trying to persuade them into paying a fake “one-off” charge.
The scammers have hijacked some legitimate accountancy firms and are sending emails purporting to be from them and their domains asking for these additional membership fees.
The email asks members for an immediate payment of a tax charge of £47.50 in order to renew their practising certificates and licences.
The email includes a link to a scam payment system called pay.gocardless. The email also states that a direct debit can also be set up to make the payment although one giveaway was the use of the American spelling of “authorise” with a z instead of the British spelling with an s.
The ACCA said it had not been sent the scam email themselves but the timing, when professional bodies start sending members reminders about renewals for their annual fees, means that some accountants might have been taken in by the scam. They confirmed that they had contacted affected members and informer card payment organisations.
Their membership fees are increasing from January 1st 2025 so the demand for a small amount of money could at first glance appear plausible. Full ACCA membership costs £297 a year for 2024.
An ACCA spokesperson said: “We’d like to thank ACCA members who alerted us to this phishing email allowing us to take prompt action including emailing practising certificate holders to warn them and alerting relevant card payment organisations.
“All payments to ACCA relating to the administration of membership take place through our MyACCA portal, and we regularly highlight cyber fraud risks to members – for example in our article Protect against cyber attacks. We’d also recommend the National Cyber Security Centre as a good source of guidance.
HMRC Leadership shake-up
For the first time HMRC will have a government minister chairing the board.
James Murray, the recently appointed Exchequer Secretary to the Treasury and effectively the minister responsible for the UK’s tax system, has become the new chair of HMRC.
This appointment is more interesting because it is a non-ministerial department and HMRC is theoretically an apolitical department. The reasoning is, as HMRC set out in its own words, is so it can “ensure that the administration of the tax system is fair and impartial”.
The selection is a statement of intent from the government that it will have the closest possible relationship with the tax department going ahead.
Sir Edward Troup, former executive chair of HMRC thought that the appointment didn’t represent any changes to the legal relationship between ministers and HMRC as the Revenue already acts under the general direction of Treasury ministers.
However he thought the appointment signalled a “more active and hands-on approach by the new government and offered an opportunity to streamline the oversight of HMRC.
“This will be welcome if Treasury ministers use it to obtain a greater degree of insight into the challenges HMRC faces and a greater degree of realism on the deliverability and impact of policy decisions.”
There was also a warning that ministers mustn’t “get so sucked into HMRC’s operational decisions that they lose the perspective and bandwidth needed to operate strategically; and HMRC must feel able to take routine operational decisions without engaging ministers.”
Additionally Bill Dodwell, the former tax director at the office of tax simplification and past president of the Chartered Institute of Taxation (CIOT) has been appointed a non-executive member of HMRC.
It is expected that in his new role James Murray will be tasked with overseeing the implementation of his three strategic priorities for HMRC – closing the tax gap, modernising and reforming and improving customer service.
UK accountancy firms numbers fall again
The overall number of accountancy, bookkeeping and auditing companies operating in the UK has fallen by 3% in the past year and by almost 8% over the past five years.
New analysis from the Global Payroll Association (GPA) found that there are an active 40,275 businesses operating in the sector – equivalent to 1.48% of all UK businesses. In 2018 the same study found that there were 43,575.
24% of the country’s accountancy companies are located in London with 9,670 operating today but this is 15% down on the 11,390 that were open five years ago. In the same period North West firms have grown by 3% to 860.
Melanie Pizzey, CEO of the GPA said: “The decline in the number of active accountancy, bookkeeping and auditing businesses suggests that more businesses are bringing their processes in-house in order to avoid the additional expense of outsourcing these services.
“You can’t blame them given the difficult economic environment we have been dealing with for a number of years, but given the importance of accountancy and bookkeeping, of which payroll plays an essential role, it’s vital that when bringing these services in-house businesses are doing it properly.
This means hiring experienced staff, installing good processes and making use of the right software platforms”