Monday 22 December 2008

With 2008 drawing to a close we have quite a few exciting plans in place for 2009. One of our new initiatives is the introduction of one hour Webinars you can view whilst sitting at your desk. The first Webinar is planned for March and will cover LLPs. More details will be available in January.

In October we told you about our programme of CPD courses for tax specialists. A number of you registered your interest in the courses and we're delighted to say the courses have been organised for March, May and June. See below for more details.

Working with our parent company CLT, we are exploring greater networking opportunities for lawyers, accountants and bankers. We hope to share more early in 2009.

The tax team are currently working on two client letters, 'Changes to Capital Allowances for Cars' and 'The New HRMC Penalties'. Both will be available in early January. The marketing support team are also looking at a Christmas eCards service for 2009. It may seem a long way off now but it will be here before we know it. Read office gossip below to find out more.

Wishing you a very happy and prosperous New Year.

Nicola Hurley
Director
nicola.hurley@mercia-group.co.uk

Charities Conference 2009

Our 2009 Charities conference is being held on 25 February in London and 17 March in the Midlands. It will cover:

• Accounting and Scrutiny Issues
• Managing a Charity during a Recession
• The Charity as an Employer - The Tax Issues
• Inquiry Reports
• Charity Audit Survey 2008
• Charitable Incorporated
• Organisations and Public Benefit - The New Law
• Keeping VAT Costs Down.

Further details can be fund on our website at http://www.mercia-group.co.uk/training/Charities_Conference_2009.pdf.

CPD courses for Tax Specialists

This new programme of courses has been designed with the tax professional in mind. We are delighted to provide you with the opportunity to hear from speakers who are extremely knowledgeable in their chosen field.

Each topic has been given a full half day to enable the speakers to look in detail at what they believe to be the most relevant areas and to share their views and experiences.

Details will be with you early in January but for a sneak preview of programme click here.

Audit and Accountancy Issues

If you've attended one of our Audit and Accounts Update courses recently you'll know that we have been expecting a revision to FRS 8 (Related Parties) to be published. Amendments to the standard are necessary following changes introduced by the Companies Act 2006. The good news is that the revised standard has now been published, along with a standard containing improvements to other FRSs. You'll find an outline of the changes made below.

Amendment to FRS 8

The ASB has issued an amendment to FRS 8, Related Party Disclosures: Legal Changes 2008. The amendment stems from the Companies Act 2006, specifically, The Large and Medium-Sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410). Changes include:

• the definition of a 'related party' - this has been amended in FRS 8 so that it is the same as in company law. The definition of 'key management' has also been replaced with 'key management personnel';
• an exemption for transactions entered into between two or more members of a group, provided that any subsidiary undertaking which is a party to the transaction is wholly-owned by a member of the group. This is a change from FRS 8, which provided a scope exclusion for 90 per cent subsidiaries.

Other matters are clarified, including:

• confirmation that the legal requirement for particulars to be given in the notes to the accounts of transactions which an entity has entered into with a related party, where such transactions are material and have not been concluded under normal market conditions, will be met by complying with FRS 8, which requires disclosure of all material related party transactions.

The amendment is effective for accounting periods beginning on or after 6 April 2008, the same application date as the legal change. Full details of the changes can be found here.

Improvements to FRSs

The ASB has also issued an FRS of Improvements to Financial Reporting Standards. The following FRSs are affected:

• FRS 7 - Fair Values in Acquisition Accounting;
• FRS 17 - Retirement Benefits;
• FRS 21 - Events after the Balance Sheet Date;
• FRS 24 - Financial Reporting in Hyperinflationary Economies;
• FRS 25 - Financial Instruments: Presentation;
• FRS 26 - Financial Instruments: Recognition and Measurement; and
• FRS 29 - Financial Instruments: Disclosures.

The improvements are necessary to maintain convergence between UK and International FRS. Details of the amendments can be found here and are generally applicable for accounting periods beginning on or after 1 January 2009.

APB Bulletin 2008/10

The APB has issued Bulletin 2008/10 - Going Concern Issues during the Current Economic Conditions. The APB comment that the economic environment leads to uncertainty regarding:

• bank lending intentions and the availability of finance more generally;
• the impact of the recession on a company's own business; and
• the impact of the recession on customers and suppliers

and that one consequence is expected to be an increase in the disclosures in annual reports and accounts about going concern and liquidity risk.

The Bulletin supplements Bulletin 2008/1, which deals with audit issues when financial market conditions are difficult and credit facilities may be restricted and goes on to update the risk factors that arise from the current economic conditions. Guidance is also provided on the events and conditions that may affect going concern.

A copy of the Bulletin can be found here.

Tax Issues

HMRC information about how its new approach to debt will work

As announced in the Pre Budget Report, the Business Payment Support Service is designed to meet the needs of businesses affected by the current economic downturn. Businesses that are worried about being able to meet tax, NIC or other payments can contact HMRC to discuss payment options. For further details visit http://www.hmrc.gov.uk/pbr2008/bus-payment-addinfo.htm

Tax relief on business cars

HMRC have issued some draft legislation and guidance on how the tax relief on business cars, known as capital allowances, will be calculated from April 2009. The new rules apply to expenditure incurred on or after 6 April 2009 (1 April 2009 for companies). The document can be accessed at http://www.hm-treasury.gov.uk/taxrelief_cars_technote.htm. As mentioned in our introduction, a client letter summarising the key areas of change will be available week commencing 5 January.

Changes to the advisory fuel rates from 1 January 2009

The advisory fuel rates have been changed with effect for all journeys undertaken on or after 1 January 2009.

Engine size	Petrol	Diesel	LPG
1400cc or less	10p (12p)	11p (13p)	7p (7p)
1401cc - 2000cc	12p (15p)	11p (13p)	9p (9p)
Over 2000cc	17p (21p)	14p (17p)	12p (13p)

www.hmrc.gov.uk/cars/advisory_fuel_current.htm

VAT on leases

HMRC have issued clarification of how the changes in VAT announced in the Pre Budget Report will affect calculation of the net present value of the rent payable under a lease where VAT is charged on the rent.

www.hmrc.gov.uk/so/vat-leases.htm

Excess car parking charges - VAT claims

HMRC have issued a Business Brief which confirms their revised policy on excess charges and other penalties levied in non-local authority car parks.

HMRC now accept that there is a difference between the situation where the contract under which parking is supplied allows for an extension of the original terms, for which additional consideration will be payable, and the situation where the driver is not permitted to extend the original terms and a penalty for breach of contract ensues if this in fact happens. When punitive fines are set these are now treated as outside the scope of VAT and VAT has been over-declared by businesses.

This also affects excess charges retained by contractors who manage the car parks on behalf of the owner where part of the charge is paid back to the car park owner.

This change in policy will affect any car park owner i.e. private owners, universities, airports, shopping centre's etc. The VAT claim will cover the current three year period and also a Fleming claim from December 1996 back to 1973 with no restriction of input tax! This is an incredible opportunity; please contact Sally Duke at IVC for more information.

More VAT news

If you would like to read more about recent tax investigation and VAT developments, please click here for this month's IVC news round-up.

Office Gossip and Idle Chat!

£8,565 generously donated by our totalSOLUTION subscribers

As it is the season of goodwill we thought we would share some heart warming news with you. This year we introduced the creation and distribution of Christmas eCards for all firms using our totalSOLUTION website service. There was no additional charge for the service but there was an option to make a donation to charity so this could be included on the eCards. The great news is that an amazing £8,565 was generously donated to a variety of national and local charities. It was such a success and very well received by all firms who used the service that we are considering widening the offer to all clients next year.

Christmas opening times

Our offices will be closed from midday on Tuesday 23 December 2008 until Friday 2 January 2009.

The answers to this month's quiz are: Franklin Pierce, Christmas Trees, 1882, Jacob Marley, The ancient Romans, the Roman holiday Saturnalia ran for 7 days from the 17th and is said to of initiate the tradition of exchanging gifts to bring good fortune for the New Year

You have received this email as a subscriber to the Mercia Group Ltd Newswire. To unsubscribe please send an email with UNSUBSCRIBE written in the Subject to unsubscribe@mercia-group.co.uk If you would like us to send a copy to a friend or colleague, forward their details to subscribe@mercia-group.co.uk

Nicola Hurley
Mercia Group Ltd
Best House, Grange Business Park, Enderby Road, Whetstone, Leicester LE8 6EP.
Tel: 0116 2581200 Fax: 0116 2581250.
Email: nicola.hurley@mercia-group.co.uk Website: www.mercia-group.co.uk

Mercia Group Limited is a company registered in England and Wales with company number 1464141. Registered Office: Paulton House, 8 Shepherdess Walk, London N1 7LB

This email and any attachments may be confidential and the subject of legal professional privilege. Any disclosure, use, storage or copying of this email without the consent of the sender is strictly prohibited. Please notify administrator@mercia-group.co.uk immediately if you are not the intended recipient and then delete the email permanently. Unless you are the intended recipient or his/her representative you are not authorised to, and must not, read, copy, distribute, use or retain this message or any part of it.