Newswire March 2019

  • By Mercia Group
  • 03/04/2019

Chancellor Philip Hammond delivered the Spring Statement on Wednesday 13th March. The Statement is being somewhat overshadowed by the Brexit uncertainties. A Written Ministerial Statement, issued alongside the Statement, sets out a number of areas which are expected to be the subject of consultation. Read more in the Taxation section below.

Sir John Kingman's independent review of the FRC has prompted the announcement of a number of significant consultations this month. The first sees the government taking forward plans to replace the Financial Reporting Council (FRC) with the Audit, Reporting and Governance Authority (ARGA). Other consultations from the FRC look at ways of implementing Kingman's recommendations before necessary legal changes are made, and also propose other changes in response to recent criticism of audit as a product. Read more in the A&A section below.

The new tax year is fast approaching. Keep your clients up to date with our tax rates products.

AUDIT & ACCOUNTING

 

BEIS consult on Kingman recommendations

The Department for Business, Energy and Industrial Strategy (BEIS) has published an initial consultation on recommendations made by Sir John Kingman's independent review of the Financial Reporting Council. Within the consultation BEIS sets out its proposed approach, being:

  • to proceed at pace with all the reforms that can immediately be delivered, so that the benefits can be obtained without delay
  • to consult, initially within this document, on reforms that can be delivered in advance of legislation, but where there are significant policy choices to make in deciding how to implement
  • to highlight proposals that will require primary legislation, where BEIS is seeking views now but where they will consult later on detailed proposals.

Responses to the consultation are requested by 11 June 2019.

 

Post implementation review - 2016 Ethical and Auditing Standards

The FRC has issued a position paper regarding its intended approach to strengthening both auditing and ethical standards in the light of recent criticisms.

The position paper also outlines:

  • how the FRC's work on the standards responds to certain recommendations made by Sir John Kingman in his independent review of the FRC
  • how proposals are being developed to support the Competition and Market Authority's Market Study of the UK Statutory Audit Market
  • how revisions made to the international Code of Ethics will be incorporated into the FRC Ethical Standard.

The text of revised standards will be subject to consultation over the summer, with the majority of planned changes anticipated as having an effective date of audits of financial periods commencing on or after 15 December 2019.

The position paper also draws the attention of Public Interest Entity auditors to changes that will take place to UK law in the event that the UK exits the European Union with no deal or transitional period at exit date. For more detail, see our article here

 

Exposure Draft: ISA (UK) 570 (Revised)

The FRC has issued a consultation on proposed revisions to auditing standards intended to increase the work required of UK auditors when assessing whether an entity is a going concern. The proposed revisions include requirements that significantly exceed those required by equivalent international standards, including:

  • requiring robust challenge of management's assessment of going concern, encompassing a thorough test of the adequacy of the supporting evidence, evaluation of the risk of management bias and , where relevant, making greater use of the viability statement
  • a new reporting requirement for the auditor to provide a conclusion on whether management's assessment is appropriate, and to explain how they evaluated management's assessment, where relevant, reporting key observations
  • a stand back requirement to consider all of the evidence obtained, whether corroborative or contradictory, when the auditor draws their conclusions on going concern.

As with the above news item, the consultation proposes an effective date of audits of financial periods commencing on or after 15 December 2019. For more detail, see our article here.

 

Methodology and compliance products updates

We have issued an update to our LLPs Specialist Assignment Manual principally to include changes brought about by the LLP SORP 2018 and company law as applied by LLPs.

If you are a subscriber and have any administrative questions about this update, please email our Technical Manuals Team or call us on 0116 258 1200.

 


 

TAXATION

 

Spring Statement

Chancellor Philip Hammond delivered the Spring Statement on Wednesday 13th March 2019. To read more please click here.

 

Written Ministerial Statement

This Written Ministerial Statement provides more detail on some of the announcements in the Spring Statement and sets out details of other forthcoming government policies and consultations. To read more please click here.

 

Businesses not complying with money laundering regulations in 2018 to 2019

HMRC has published a list of businesses that have not met their obligations under the 2017 regulations. To read more please click here.

 

Tell HMRC your organisation failed to prevent the facilitation of tax evasion

HMRC has released details of how to self-report a company or partnership that did not prevent the facilitation of tax evasion if you're their authorised representative. To read more please click here.

 

HMRC warns of landline scams threatening households

HMRC has warned those with landline phones to be cautious due to criminals using phones to contact victims following a rising focus on SMS and email phishing. To read more please click here.


 

OTHER NEWS

 

Our website

Some of you have recently experienced problems with our website and we would like to thank you all for your patience and cooperation whilst we fixed the issues. A number of improvements have been made to the website in the last week or so which mean that you can now purchase course credits and book your courses online. We have further enhancements planned and look forward to sharing these with you over the coming weeks.

Many thanks to those who took the time to send us feedback regarding our website, we have found this invaluable.

 

Share the Hair

Our Training Events Administrator, Ashleigh Cullen donated thirteen inches of hair and raised and incredible £350 for Little Princes Trust Charity which supplies, and funds high quality wigs made of real hair to children who have hair loss as a result of cancer treatment or other illnesses.

 

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