Hack your clients to better security

Posted by & filed under Annual Conference.

PwC has had hackers on its payroll for the past 20 years. But, in recent years, hackers have become a much more important part of its business.

Indeed, Will Rimington has seen the firm’s penetration-testing team, which he heads up, grow significantly in the 12 years he’s worked for the practice.

“It’s become a bit more front and centre in terms of the firm’s wider consciousness,” he says. “We’re not only doing traditional risk consulting around security policies and controls – there’s more of an appetite to back that up with testing. Essentially, we act like baddies, and have a go at it.”

Use of ethical hackers is becoming more common among accounting firms as clients get more nervous about the vulnerability of their data. According to the latest government statistics, one in four UK businesses experienced a cyberattack last year, with large firms losing an average of £36,000 each, and small businesses and microbusinesses losing £3,100 each.

Know your weaknesses

PwC’s penetration-testing team feels that the best way to identify weaknesses is to find and exploit them using its own ethical hackers (‘white hats’, as they’re known in hacker circles), before malicious hackers (‘black hats’) get a look-in. “We follow the whole process, end to end,” says Rimington.

“How do you get from being a complete outsider to an organisation to actually being able to exfiltrate interesting information? That has become the real test of an organisation’s security, and it can start with open-source-type reconnaissance on an organisation. That includes looking at the people who work there, and examining things like LinkedIn, Facebook, blogs and so on, to identify potential personnel weaknesses.”

Insider threats – intentional or unintentional – from current and former staff remain the biggest weak spot for most businesses. As more people use their own laptops and phones to access work systems, they open up more avenues for hackers to carry out attacks.

Rimington says his team spends a lot of time testing mobile devices to see if they can get into clients’ systems. Some methods of testing employee vulnerabilities are worryingly simple. “You only need to do something as basic as sticking some malware on a USB stick and just watch where that ends up,” he explains.

Evolving threat

Attacks on businesses are varied and increasingly complex, Rimington says.

His team is currently looking at how attackers might access an ‘air-gapped’ computer (one that is unconnected to the web or another computer, for security purposes) using light sensors and sound waves: “We’re looking into the ability to actually pass commands via those sorts of media to extract specific bits of data.”

Add to this the rise of state-sponsored hackers and you have a pretty scary picture for clients. Smaller practices might not be able to hire their own hacking teams, but they can work with freelance ethical hackers or security firms to check clients’ security.

Rimington says most small businesses just want a seal of approval: “We come in to verify whether their security is up to snuff, so they can continue to build up their businesses.” In any event, the need for greater security isn’t going away.

“More regulations, such as the EU General Data Protection Regulation, are increasing the requirements on businesses for protecting their data,” says Rimington. “The consequences of breaches are becoming more governed. I think that’s the space to watch”.
This article first appeared in the March/April issue of Accounting Technician.  

Taxing times as General Election called

Posted by & filed under AAT news.

Outside 10 Downing Street yesterday, the Prime Minister said that Labour had threatened to vote against the final Brexit agreement, the Liberal Democrats wanted to “grind the business of government to a standstill”, the SNP would vote against the legislation that formally repeals Britain’s membership of the EU – and “unelected” members of the House of Lords had vowed to fight the Government “every step of the way”.

The Prime Minister concluded that, “If we don’t hold a general election now, their political game-playing will continue and the negotiations with the European Union will reach their most difficult stage in the run up to the next general election”.

So, it’s clear that a European Union justification is being made for this snap election, and that the decision is heavily politically motivated.

However, there are much wider implications.

When hearing this surprise announcement my first thought was not of the impact on European matters or party political motives but of my prediction just a month ago that the Chancellors U-turn on National Insurance Contribution (NIC) increases may not end up being all it seemed at the time.

Those with a sharp eye for detail may recall that the Chancellor clearly stated in his infamous NICs U-turn correspondence to all Conservative MPs that, “There will be no increases in NICs rates in this Parliament.”

Whilst this was taken to mean at least until 2020, my concern was that “this Parliament” could be much shorter and the changes could still be made in the same, if not a similar timeframe.

We hope that the fall out of previous attempts to alter NICs for the self-employed will result in much more careful consideration of the subject.

The Taylor Review is already looking at the issue of self-employment from an employment rights perspective. It’s time there was a similar review or consultation to consider the tax implications, not least because the recent explosion in self-employment is eroding the tax base and the advent of the gig economy is increasingly making our tax system look outdated.

AAT has long argued that Government should not be focussing on the NICs of the self-employed but instead on employers NICs and ‘gig allowances’.

‘Gig allowances’ should be increased to simplify tax matters and to help those who are just about managing – JAMs as the political classes call them – to make a living by undertaking various “gigs”.

Given the difficult nature of dealing with those who have multiple income streams – from a tax perspective – and that many of these incomes are relatively small, a bigger ‘gig allowance’ would make sense.

As AAT set out in our response to the Spring Budget, if attempts to increase NICs for the self-employed were genuinely about moving towards a level playing field, then it might be sensible to look at reducing NICs for the employed to further narrow or even eliminate the discrepancy between the employed and self-employed. This would simplify matters as well as helping to ensure fiscal neutrality.

The NICs increase is just one of many issues that may now have to be revisited due to the election.

On 23 March 2017 the independent Cridland Review of the State Pension Age “Smoothing the transition” was published. The terms of reference required that recommendations should be affordable in the long term, fair to current and future generations of pensioners, and consistent with supporting fuller working lives.

The final review concluded that the State Pension Age should rise to 68 by 2039 instead of 2046 and that the “triple lock” be scrapped “in the next Parliament”. Again, “next Parliament” was envisaged as 2020 not in a few weeks time. The triple lock means that state pension payments rise every year in line with whichever is the highest of average wages, inflation, or 2.5%.

The Government had committed to responding to the Cridland review next month but clearly that cannot happen now. No Government would be foolish enough to commit itself to a guaranteed vote loser weeks before an election and equally no sensible Government would commit itself to ruling out changes that are likely to be financially necessary. The most likely response is therefore delay.

One final policy proposal that sprang to mind as the Prime Minister stood outside Number 10 on Tuesday was last week’s Labour Party promise to reduce the £36bn tax gap by closing loopholes and exposing “sweetheart” deals between big business and HMRC.

Populist policies like this will face much more scrutiny now that an election has been called and are liable to exposure themselves. Political parties of all colours have been promising to clamp down on loopholes and close the tax gap for decades and yet as HMRC figures show, the gap has fluctuated rather than enjoying year-on-year reductions.

The Labour Party has made various other policy commitments in recent weeks, from providing universal free school meals to a £10 an hour national living wage and promises relating to the Prompt Payment Code. As the election campaign gets underway these will all come under increasing scrutiny.

It’s clear that irrespective of political party, the small print always needs to be heeded, especially when financial commitments are involved.

Auto enrolment: a step by step guide to enrolling

Posted by & filed under Pensions and payroll.

Automatic enrolment of workers is now well underway.

All the large and most of the medium sized employers have been through the process. Now it is the turn of the small and new employers. Below are the timings recommended by The Pensions Regulator (TPR), which, for many small employers, are wildly optimistic and assume that the employer is as interested in pensions as TPR is.

 

Be prepared

As there will be no more staged employers from 1 October, TPR suggests the following series of steps for employers to take:

Step 1: Confirm who to contact

Step 2: Choose a pension scheme

Step 3: Work out who to put into a pension scheme

Step 4: Write to your staff

Step 5: Declare your compliance

Most small employers tend to focus solely on the trading side of the business. It is what they are good at and how they make their money. Because of this focus, the date may be long gone before notification of the staging date is received by the agent. Indeed, staging could be as close as a month away.

So, what can an agent do to minimise the chances of being overwhelmed by the sudden increase in work, and the employer receiving a penalty? Make sure you know the date your clients’ duties will start. By being prepared, having a checklist and costings ready, talking to the client about timings and costs, and following the pre-determined steps.

Checking the client’s staging date

It is to be hoped that this has been done already, but if not, or if the employer is a new employer, one of the first tasks to be done is to find out the date of staging, and this can be found on this TPR page. All you need then is the employer’s PAYE reference.

If you discover that the employer does not have to enrol any staff be aware that is not the end of the matter. They will still have duties to perform, and an outline of those duties are here.

For the new employer, from 1 October 2017, automatic enrolment duties start the day they employ their first worker. They do however have the option of deferring their duties, an option which was previously only open to existing employers.

Point of contact

On the TPR website it is possible to nominate two points of contact. The employer must be one of the points of contact, however as the majority of the work will probably fall to the agent, it is recommended that the agent is the additional point of contact.

Checking who to enrol

In a previous article different types of worker were outlined, so what is included here is a brief summary.

  • Only workers working or who ordinarily works in UK. Of these:
  • Automatically enrol workers aged between 22 years and their State Pension Age, earning more than £10,000. These are known as ‘eligible jobholders’
  • Workers aged between 16 – 74 years old and earning between £5,876 (the national insurance lower earnings limit) and £10,000 may opt into the pension, and if they do, the employer must also contribute. These workers are known as ‘non-eligible jobholders’
  • Workers aged between 16 – 74 years old and earning less than £5,876 may opt in to a pension scheme. The employer does not have to make any contributions and these workers are known as ‘entitled jobholders’

Choosing a pension scheme

There are three steps that follows. Two of which are possibly easy to do (depending on who runs the payroll and how accurate the records are); the third step may be more problematic.

1. Working out the client’s costs

This sounds easy, but, as said, it depends on the state of the records. There may be little work to do, or a lot of work to do. And that will not become clear until the records are scrutinised. Quoting an hourly rate here would be advantageous, at least until the initial assessment has been completed.

2. Checking the records and payroll processes

As the agent running the payroll this will be straightforward. However, if the payroll is run by a third party, accessing and checking the data can take time and effort as the information must be accurate so that the correct workers, and only the correct workers, are enrolled.

3. Choosing the scheme

The employer should make this decision, and unless authorised, the agent is not, under AAT rules, allowed to advise on this. TPR has guidance for agents on what they can do to help clients to choose a pension scheme.

Staging process

This is when the real work begins, and much of it will be repeated every month to ensure compliance with the automatic enrolment rules.

Assessing and enrolling staff

The initial assessment will be to calculate the employer’s pension liability. The minimum employer contribution at present is 1%, but will increase April 2018 to 2% and then again in April 2019, to 3%.

These are an additional staff cost and the employer must be ready to meet them.

People have birthdays, and will fall in and fall out of the various categories. As such, the assessing and enrolling of staff must be performed initially, and then on a monthly basis. There may also be workers who choose to opt-out of the automatic enrolment process so records need to be kept and actions taken prior to every pay day.

Writing to your client’s staff

This could be the most difficult part of the employer’s job. What should be put into the letter? What exactly is written to each type of worker to explain their choices? Fortunately TPR has standard letters, and these can be found here.

Knowing the client’s ongoing duties

This is a continuous cycle of assessing, enrolling and occasionally a worker opting out. After three years there is the re-enrolment process to follow, but that can wait for another time. For now, as confirmation that the process has been followed a declaration of compliance has to be completed. And then you are done. Until next month, when the assessing and enrolling cycle begins again.

Future developments

There has been independent research considering what the effect of reducing or removing the earnings trigger would be. The results showed that 3.3 million or more workers would become eligible for automatic enrolment, many of them women. By removing the earnings trigger, all employment, including part time employment would be included in the assessment, and this could mean that the final pension pot of a worker with more than one part time job could increase by 200%.

For those agents using the government’s Basic PAYE Tools (BPT), the Pension Regulator issues a basic automatic enrolment assessment tool on excel that can be used to assess workers on a monthly basis.

TPR website has very helpfully laid out the steps for agents here. It is recommended that these are followed, in whatever timeframe is available, to meet the requirements of automatic enrolment.

Managing film and production accounting

Posted by & filed under Career.

Every year, on the second Friday in December, Hollywood pores over the “Black List”.

It isn’t an inventory of disgraced actors or failed directors, but a rundown of industry executives’ favourite unproduced screenplays. It can take years for a script to attract funding but once it does film finance professionals must spring into action to help bring the story to our screens.

When a project is given the green light, the studio hires a team to ensure budgets are balanced and financial records are kept. These specialist financiers work behind the scenes throughout a film’s development, from pre-production all the way to distribution. Though major motion pictures have multi-million dollar budgets, it’s still important that they adhere to a detailed spending plan. Production accountants play a big role in ensuring that happens, keeping track of expenditure during often chaotic shoots.

While budget forecasts are usually prepared long before filming begins, not everything will go to plan on set. Some of the most beloved motion pictures ever have suffered unforeseen expenses. Shooting on Steven Spielberg’s Jaws was supposed to last 55 days but ended up taking a mammoth 159, thanks to the poor performance of the film’s most difficult star: Bruce the animatronic shark. The delays and the prop’s repeated mechanical failures pushed the project over budget to the tune of $5 million.

“Productions are not a profit and loss situation,” explains Samantha Scowcroft, general manager and production accountant at Moneypenny Services, which specialises in working with the entertainment industry. “You’re not looking at growth or KPIs and targets. It’s here and now. And it can change in 24 hours.”

During production, accountants must be on hand to deal with a wide array of financial administration and management tasks. The size of the accounting team and the way responsibilities are delegated depend on the scope of the project. No two films have exactly the same requirements but production accountants can expect to deal with cash flow, budget forecasts, insurance claims and payroll.

While they aren’t solely responsible for managing the budget, production accountants have to maintain an ongoing dialogue with the relevant producers. “An experienced professional will be in constant communication with their line producer or production manager, having conversations about where they see issues and raising red flags,” Scowcroft says.

Gaining experience in production accounting isn’t as simple as earning a certificate from an accounting body and applying for jobs at specialist firms. In fact, there are only a handful of companies in the UK that specifically focus on the area. Most production accountants are freelancers hired directly by the studio or line producers for the duration of a project’s development. Holding an accounting qualification can help with securing work but professionals working in other parts of the film industry have often been known to turn their attention to finance.

Working as a freelancer on short-term contracts won’t appeal to everyone but those seeking a new experience may find that production accounting injects some welcome variety and excitement into their career. Most accountants are based in a production office close to the film set. In some cases, that means travelling to far-flung destinations to assist with the making of a movie and dealing with unusual working conditions.

“For example, you might get shipped off to Tahiti and have to do accounting using mobile phone data that only works in one corner of the room,” Scowcroft says. “The adventures that you can have with production accounting are great fun. But it’s definitely not traditional accounting.”

When films are made, special purpose vehicle companies are setup to produce them. According to the Production Guild, it can take up to three years after the delivery of a film before these are shut down. While accountants have usually moved onto other projects by then, they can still be responsible for submitting returns and monitoring costs long after shooting concludes. However, unlike their colleagues in more traditional roles, they are left with more than paper returns and digital records once a job is over – the chance to enjoy a movie they helped bring to life.

“You work on a film, even if it’s just a small independent production, and 12 months later you can go and sit in the cinema and see that you’ve been part of a story that is bringing enjoyment to other people’s lives,” says Scowcroft. “Production accounting is very high pressure and it can mean very long hours but it is rewarding.” It’s a treat that lasts longer and tastes better than any bag of popcorn.

Top five productivity apps to save you time

Posted by & filed under Career.

Everyone wants to be able to do more in less time, and there are a dizzying number of productivity apps promising to help us do exactly that. Dean Evans picks his top five

[List compiled June 2013, update coming soon]

Getting a productivity boost isn’t about having the most advanced to-do list or juggling 10 tasks at once. It’s about streamlining workflow, prioritising tasks and minimising distractions. With the imminent arrival of 4G, new technology is going to become a fundamental tool in the way accountants do their work.

Here are five productivity apps that can improve your working life and save you time.

1. Sanebox, from £1.30 per month

Most of us are swamped with email. Every day we receive messages from friends and colleagues, email newsletters we’ve signed up to, notifications and offers. Wouldn’t it be great if you had a virtual assistant who could sort your mail and tell you what was important?

Sanebox does exactly that. It’s a productivity app that intelligently filters your emails, showing you the messages that matter and sending you a summary of those that don’t. You still see everything, but you don’t get distracted by every new email. The service works cross platform (PC, Mac, iOS and Android) and with a variety of email services.

2. Clear, £1.49

The problem with many to-do list apps is that you often spend far too much time fiddling with them when you should be working.

Clever task management apps like Toodledo and Wunderlist 2 are jammed with features you don’t really need and options most people never use. It’s why Clear for iOS and Mac might seem disappointing at first. There’s no support for dates/times, no sub-tasks, no way to get reminders by email.

Instead, it’s a perfect recreation of a simple, paper-based to do list. Simply swipe down to add tasks to a list, drag tasks into whatever order you like, swipe to complete them with a satisfying ‘bing’. Clear supports multiple lists and iCloud storage to make your to-do lists accessible between iOS devices.

3. Evernote, FREE

Ideas are fleeting. If you don’t write them down straight away, they can evaporate and you’re left with only a small sense of what they were.

The best thing to do is get them out of your head so you can concentrate on other tasks. And the best way to do that is to use Evernote. The appeal of Evernote is simple: you can make a note on any device – iPhone, iPad, Android, Blackberry, Windows Phone, PC or Mac – save it and hoard it in a free Evernote account that is fully searchable, taggable and available to you whenever and wherever you need it.

Store anything – ideas, to-dos, photos, voice notes and web pages. You can store up to 100,000 chunks of info. Upgrade if you need more.

4. Pocket, FREE

One of the simplest ways to increase your productivity is to reduce your distractions.

Do you get bogged down answering emails? Check your inbox 3-4 times a day, not every few minutes. Spending too long on Twitter or Facebook? Turn them off. What about reading articles like this one? Is now the best time to be reading it or should you be working? If you’re busy, the smart solution is to save it for later using a ‘read it later’ service like Pocket.

Install a bookmarklet into your web browser and use it to file away interesting web content to read when you have time. The Pocket app (iOS, Android) gathers everything you’ve saved together into a date-ordered list, and displays articles stripped bare of distracting ads or sidebar links.

5. Google drive, FREE

Cloud storage has revolutionised the way that businesses work online. You can start working on a document in your office and, using the Google Drive app for iOS and Android, continue editing it on an iPad as you travel on the train. Or you can share a spreadsheet with a colleague and make changes without having to save new versions and tediously email them back and forth between you.

Google Drive isn’t the only cloud storage game in town. Dropbox provides excellent file-sharing services, although its mobile apps often restrict editing. Microsoft’s SkyDrive, meanwhile, is a fantastic option for storing and sharing Microsoft Office files. Got a Windows account? Then you’ve already got a SkyDrive account.

Read more on managing your time and getting productive:

How to help a colleague cope with bereavement

Posted by & filed under Career.

Unfortunately, suffering loss is a part of life. It’s almost a certainty that in your career a colleague, a subordinate or an employee will go through bereavement.

This is a very difficult situation and no defining guide exists as to how to handle it correctly – a ‘one size fits all’ approach is definitely not the case here.

“Firstly, there is no one right way to support a colleague after a bereavement,” says Amy Durden, founder of AHD Counselling, providing integrative counselling and psychotherapy. “Every person is different and so is every loss. There is also no one right way to react. There are, however, ways that are more helpful than others.”

Be human

In the first instance, be human, be compassionate, especially as the news can come while the person is at work. “As a manager or colleague, it can initially be most helpful to simply listen and offer empathy without trying to ‘fix’ anything,” says Durden. “Just listening and allowing the bereaved person to talk and cry if needed is incredibly healing. The offer of physical contact such as a hug can also be welcomed, but this is very individual.”

Recognise that this is an exceptional situation and that work comes second. The priority is to be flexible, compassionate and helpful.

“Sometimes people are unable to express grief at work and may wish to leave the building,” says Durden. “Allowing them to do what feels right for them will be most helpful, which may be leaving work very swiftly. In both instances, offer to take over their work, cancel meetings and clear their diary for them. This takes a huge weight off someone’s mind and means they can go home and be with family or friends without having thoughts of work-related tasks.”

Provide clarity

Early on, it’s imperative that the employee is engaged around how they want the situation handled, how much and when colleagues should know, clarity around time off, and how approaching a return to work can be managed. Having as many work-related questions answered early on will diminish such concerns and additional stress during the bereavement process. It is also important to maintain a dialogue during the time away and be open to the situation changing.

While perhaps not immediately appropriate to address, it is important that the employee knows company policy surrounding compassionate leave, as clarity will be a comfort once the initial shock passes. Be clear about how much time they’re allowed to take off, but also let them know that this is a unique case and more time off or flexible working patterns may be possible.

Clarity around confidentiality is vital also. “Ask how much information the bereaved person wishes to have shared with other colleagues,” says Durden. “Don’t speak to other team members about it without checking with the bereaved person first. If you haven’t told anyone, be sure to communicate this to the bereaved person. This helps when they return to work.

“It can be doubly painful for them to return to work, only to find that no-one acknowledges their loss and assumes they have been on holiday, but they assumed everyone was made aware. Or they return to find that everyone knows their personal business and that wasn’t their wish.”

Flexibility and professionalism

Being compassionate and open to change is critical when a colleague returns to work, but so too is treating them like an adult and a professional. As a manager, provide a ‘safe space’ where they can discuss their needs, what they feel they’re capable of and how this can be accommodated.

“They might want time away from clients to allow them to begin to process their own feelings before being of service to others,” says Durden. “If your clients could be impacted by a vulnerable member of staff, then consider the implications for them as well. Sometimes it is better for a recently bereaved person to have space from front-line work and this will need careful discussion.”

Once back at work, as a colleague try to tread the fine line of being aware to their emotional state without being overbearing, supportive without being patronizing and trying to include them and treat them as normally as possible to help give them some stability.

Furthermore, work can be a coping mechanism for some, so while they may appear resilient, remember what they’ve been through. “As a manager, it is vital to keep an awareness of increasing stress levels and signs of burnout or of becoming overwhelmed,” says Durden. “If you notice them disengaged, listless and anxious, or they appear to be struggling in other ways, take action to address this with them and re-offer support and adjustments to their workload.”

Be aware that the death may have caused a major disruption to their financial situation, even losing half or more of a household income; parenting responsibilities may have increased if a parent dies, or losing a sibling may mean the bereaved is assuming the care of older parents.

Extended families

“For colleagues, being supportive can be as simple as offering to chat. For less close colleagues, it can be enough to ask how they are today – keeping the focus on today can help,” says Durden.

In some instances, it is appropriate for colleagues to be available outside of work. Many workplaces are like families where strong and lasting bonds and friendships are made, so recognise that you might be a significant part of the person’s support network.

“If able, and only if you can actually commit to it, offer to support with funeral arrangements or practical day-to-day help,” says Durden. “Not everyone has a large extended family to support them after a loss and colleagues can form part of someone’s ‘chosen family’. This is not always the case, but is worth considering.”

Finally, and perhaps most importantly, don’t judge their process, says Durden. “Everyone grieves in unique ways, and however it manifests is ‘normal’, even if it differs from how you might imagine you would feel in their circumstances. Being non-judgemental allows for the bereaved person to find their own way through.”

I ran away from the theatre to become a bookkeeper

Posted by & filed under Bookkeepers, Inspiring stories.

In his own words, Stephen Levine is probably the only person who has ever run away from the theatre to join accountancy.

After decades of running theatres around the UK, and working on major gigs with Alice Cooper, Kings of Leon, and Ozzy Osbourne, Levine suddenly switched tack to found his own business, Elbess bookkeeping, using his AAT bookkeeping membership as a springboard into a new career.

“I was just about to become a father for the first time in my mid-forties and so where before I had moved around the country, I now had a reason to stay where I was,” he said.

“So I looked at my skillsets and the bits of my job that I really enjoyed and I always enjoyed doing accounting so I thought right, I’m going to get trained in this, and that was the first step into AAT.”

Levine, who always had the ambition to run his own business, revels in the autonomy of setting his own agenda, but he admits that working from his home in Folkestone is a huge shift from the lifestyle he was used to.

“I have actually sat and processed invoices while Motorhead are doing a drum sound-check in the background. That’s very much the environment that I used to be in. I do find I’m having to build new networks,” he said.

I have actually sat and processed invoices while Motorhead are doing a drum sound-check in the background.

But he finds that his interesting background, working for some of the biggest entertainment companies in the country, is a good conversation starter when looking for new clients, and also a boost to his business.

“The theatrical niche gives me an expertise. I also have a bit of experience with catering so I’m trying to get into those kind of fields. What I think works well for customers is when you understand their business and that’s something that I’m trying to work on,” he said.

Levine’s interest in the theatre world began with his father’s own love of amateur dramatics. While he never took to the stage himself, he was gripped early in life by the buzz of organising major events involving household names.

“My mum always told me I should be an accountant because and I think she was probably right but the theatre was much more exciting so I ended up working for a company called Apollo Leisure,” he said.

Levine’s job took him around the country, with postings in York, Manchester, Birmingham and a stint at the London Apollo in Hammersmith when it was starting to become known for its comedy, and hosted major hits like Irish musical, Riverdance.

He was then given the opportunity to run the Beck theatre in Middlesex, a community venue of 600 seats, which allowed him to develop a valuable range of business skills.

“When you’re running a theatre for a big company you have to take on a lot of roles. You’ve got to be the big host and welcome people in. You’ve got to be talking to all the acts and trying to persuade them to come, but a large part of my job, probably 50%, was accounting,” he said.

“So I was doing budgeting and forecasting. I was entering information into ledgers but I didn’t [at the time] understand about double-entry bookkeeping.”

From 2001, Levine was running the Leas Cliff Hall, which was instrumental in putting South Kent back onto the gig circuit for leading performers in the music industry like Ozzy Osbourne and Paul Weller.

In one of his most surreal experiences, his theatre was taken over by the police and special protection officers during the 2005 general election when local Conservative MP, Michael Howard, was pitted against Labour rival, Tony Blair.

“Obviously there was the possibility that he was going to get elected as prime minister and so we had the full prime-ministerial security put in place, with airport-style metal detectors and a ring of fences all around us,” he recalled.

“The police went around and put sensors on all the doors so that you could tell which ones had been opened and that was a very strange world to inhabit for this little while,” he said.

By 2014, when Levine decided to settle in Folkestone and found his own business, he began his AAT bookkeeping qualification with much of the expertise he required already.

“I found a lot of the skills that I already had fitted very well as a bookkeeper,” said Levine. He boosted his knowledge further by volunteering at a local property management firm to get more experience outside of the entertainment world.

After obtaining his AAT accreditation as a licensed bookkeeper, Levine launched his own firm in February.

“It’s still quite new and fresh, but things are going in the right direction,” he said.

He is currently dividing his time between working with his new clients and networking events to draw in more business. “I am starting to have a turnover but there’s still a long way to go,” he said.

Levine’s advice to other bookkeeping  professionals founding their own companies would be to “make sure you’ve got the customers before you make the jump” as finding the first one is always the hardest.

Adjusting to a self-employed routine is also challenging, he cautions. But the lifestyle definitely has its advantages. “I really like that I’ve got self-determination now and I’m deciding which route I’m taking and what I’m doing,” said Levine.

However, even though he no longer works full time in theatre, Levine admits he still has a strong urge to perform.

Could it lead to another career change? “My natural calling was to call the lottery numbers,” he laughed.

The financial cost of fraud

Posted by & filed under Accountancy resources.

The terms “corruption” and “embezzlement” will be familiar to anyone who enjoys a good crime drama.

Even casual viewers know that stories of con artists often end with the fraudster getting caught in the act. But when it comes to real-life financial crimes, outcomes are rarely so neat and tidy. In fact, a large number of frauds are successful — and they’re costing businesses in the UK an estimated £125bn each year.

Reducing fraud losses by 40% would free up an extra £50bn annually, according to accountancy firm Crowe Clark Whitehill’s Financial Cost of Fraud 2017 report. To put this in perspective, the UK’s central government spent £44.8bn on defence last year. Preventing fraud is not just good for individual businesses, it’s important for the economy as a whole.

Of course, detectives and private investigators aren’t the only ones capable of stopping fraud. Accountants also have a vital role to play in helping their clients protect themselves, though they won’t need to pull out a magnifying glass or dust for prints. Sound financial advice and good control processes are the best weapons in the fight against fraud.

Stopping sticky fingers

No one wants to accuse a team member of being dishonest, but it’s important to know that internal fraud is very common. Almost one in five small businesses are defrauded by a staff member in its trading lifetime, according to Action Fraud, the UK’s reporting centre for fraud and cybercrime. Workers can deceive their employers in a number of ways — from pocketing money out of a cash register to falsifying financial statements. Businesses must therefore put controls in place to make it difficult to take liberties with company money.

“We had a client whose payroll person very generously gave herself a pay rise and nobody knew about it until it came to the end of the year,” says Steve Collings, audit and technical partner at Leavitt Walmsley Associates. “When we looked at the payroll expense and profit and loss accounts, we found the numbers had gone up beyond the client’s expectations.”

By the time an accountant has identified fraudulent behaviour in year-end statements, it’s often already too late to recoup the losses. Business owners must focus on preventing fraud, rather than spotting it in action. This is where accountants can step in and help their clients implement control systems. Both parties should work together to determine what a firm’s high-value assets are and what they’re currently doing to protect them. For example, do purchases have to be signed off before they’re made?

Once a company’s vulnerable points have been identified, accountants can offer advice on how to shore them up. This typically involves setting up managerial oversight systems to make sure employees are accountable for their spending. Such controls don’t have to be complicated: sometimes fraud prevention is as simple as getting multiple pairs of eyes on financial statements.

“If you have one person doing the payroll, another person checking it and a director reviewing it before it gets finalised, then there are review stages which will reduce the scope for fraud,” Collings explains.

Cutting cybercrime

Businesses should also be aware of the growing financial threat lurking in the realm of cyberspace. Action Fraud found that businesses lost over £1 billion to online fraud last year. However, the actual number is likely to be higher, as data is only collected on firms who report cybercrimes to the police. The good news is that, like internal fraud, online fraud can often be prevented by deploying the right strategies.

Cyberattacks come in many forms — from fraudulent emails to malicious software that blocks access to computer systems until a ransom is paid. Accountants can help clients by informing them of the latest cyber threats and recommending good security practices. Tech-shy firms will be pleased to know that cybersecurity can be as simple as setting a good password.

“Accountants should advise clients to think carefully about the strength of passwords for online banking and on servers they use to hold sensitive data,” says Collings. “No matter how secure a password is, it’s still important to change it on a regular basis. Some servers prompt you to do this at least monthly.”

In a perfect world, every company in the UK would have rock-solid control systems and cyber defences in place. But the best fraud schemes are difficult to detect, and financial crimes can still slip through even the strongest of safety nets.

Financial fraud is a growing problem for companies of all sizes. As the amount UK companies lose to fraud increases each year, accountants must ensure they’re doing everything they can to protect their clients.

Horse whispering your way to better leadership

Posted by & filed under Career.

Spending a day in a field with a group of horses might not seem like the most likely way to develop and hone your leadership skills but Jude Jennison and Emma Taylor, who set up The Leadership Whisperers four years ago, claim that horses can actually teach us how to become better leaders.

Jennison and Taylor believe that growth and leadership happens when you are outside of your comfort zone and that horses mirror our behaviour and give instant, non-judgmental feedback on it. You can then use this ‘feedback’ to determine what skills you have as a leader or in the workplace and what your core strengths and weaknesses are. Even people who are used to working with horses can learn from it, according to Taylor, as 90% of communication between people is non-verbal.

“For those people who do ride, the challenges are different. They are not afraid of leading a horse but suddenly they feel under enormous pressure to “get it right”. This of course is replicated by the fear of performing under pressure at work too. People often say they feel they are under the spotlight and we explain that when we take a leadership role, we are,” Jennison says.

“The best way to learn how to lead and inspire others is when we are out of our comfort zones. Once people realise this, they become more confident in tackling things they don’t know or understand and that increased confidence leads to substantial changes in behaviour and better results.”

Jennison and Taylor, who both have a corporate background (Emma was formerly an HR business partner for the likes of GE and Sara Lee and Jude spent 16 years at IBM) say that a one-day workshop can help identify a team’s core strengths and weaknesses and how they can work more effectively together.

Emma had ridden for most of her life but Jude had a deep-rooted fear of horses until around seven years ago when she decided to try and overcome her fears and took a short leadership course with horses. “The way that people relate to horses and how horses respond to them can help them understand their personal impact in a range of situations and to understand their team dynamics and default patterns of behaviour,” says Taylor.

The leadership courses can benefit both archetypal ‘extroverts’ and ‘introverts’ according to Jennison. “We begin the day observing the horses in a field in silence. The introverts have a chance to reflect and observe their equine learning partners. It’s a chance to tap into how they feel and be curious about what is happening – both crucial elements of leadership that are often overlooked,” she notes. “Meanwhile, the extroverts often find themselves out of their comfort zone, eager to “do something”, sometimes even bored because the horses aren’t doing enough. At once, we’re on a level playing field.”

Jennison cites a recent example of working with an extroverted ‘brutal’ boss of a large company who wanted to find a more sensitive and collaborative way of managing his colleagues. “He worked with us to explore how he could be more compassionate and get results by building better relationships and bringing his team with him without force,” she explains. “Working with the horses, he realised that being brutal would not make them move. Instead, he found a way of being more kind, caring and compassionate. By combining this with his focus on getting the job done, he was able to be more assertive without being coercive. His team gave him more respect and, once he realised this, he was able to show his caring side more readily.”

Elinor Perry, managing director of Pentlands Accountants, who also recently went on the course, says the horses helped her and her team provide some clarity on where their communication could be improved. “We now have a greater understanding of each other and can provide better feedback to support each member of the team. Many of the team now have more confidence to step up and take the lead more readily,” she notes.

Jennison says the courses can also, sometimes, be more effective for men. “For some men, in particular those who are tall or large, they have probably never met someone who is bigger and stronger than them. They don’t realise that they use their physicality to create a sense of security and safety. Once they realise this, they are able to soften their energy be more collaborative and less coercive at work.”

The world’s biggest accountancy opportunity

Posted by & filed under Tax.

It may be the world’s most ambitious tax reform.

India’s famously convoluted indirect tax system is finally being overhauled. That means fewer headaches for Indian businesses – and a wealth of opportunity for accountants.

If you think the UK’s tax system is complicated, spare a thought for businesses and their accountants in India. India’s 29 states have their own indirect tax systems, including excise, services tax, VAT, luxury taxes and additional customs duty. On top of this, the tax rates differ from state to state. A business in India that sells goods or services in different states faces as much paperwork as if it were selling to different countries. Federal tax must also be taken into account.

Ineed, India’s indirect tax system has become even more complicated since the mid-1950s, when central excise duty was introduced. Car sales are liable to six different levies at different rates, The Economist notes.

And a report by the World Bank and PwC ranks India’s tax system 157th out of 189 economies for simplicity. But, after decades of grumbling about the indirect tax system (and plans to simplify it), things may finally be about to change for the better. The Indian government aims to introduce a national goods and services tax (GST) on virtually all goods and services by April 2017. It’s part of prime minister Narendra Modi’s plan to reduce bureaucracy and corruption.

Indirect benefits

According to EY, the introduction of a single indirect tax will be a “gamechanging reform” for India’s economy. It will create a common Indian market, cut tax costs for businesses and make tax collection more efficient. In fact, some economists reckon the GST will boost India’s gross domestic product. The tax will affect almost all aspects of business operations in the country: prices for products and services, supply chains, and accounting and tax software.

However, the GST rate hasn’t been finalised. Having a standard GST rate in India will help companies to “rejig” their supply chains, which are currently structured to take advantage of “tax arbitrage”, says Sachin Menon, partner and national head of indirect tax at KPMG in India. India will at last have a uniform tax system, with a reduced tax for manufacturing, which will make its economy more competitive, he says.

The preparations for the new tax will create more opportunities for accountants. “There will be teething troubles with implementation. Businesses will have to look again at their entire business structure, and change the levers to optimise their business model,” Menon says. “There is a tremendous opportunity for professionals such as accountants to help industries get ready for the change.”

Long time coming

So why has it taken so long to simplify India’s indirect tax rules? One reason is that governments have lacked a sufficiently large majority to steer the legislation through parliament. The Bill was passed by the Lok Sabha, the lower house of the Indian parliament, last year. It then became stuck in the upper house of parliament, the Rajya Sabha, where Modi’s party, the Bharatiya Janata Party, does not have a majority, before being passed in August this year.

Not all of India’s states embraced the changes either, as they perceived that their fiscal powers would be curbed. Menon says that the majority of states came to support the GST partly because, as “net consumer” states, the new tax will increase their tax revenue. “The net exporting states will be compensated for loss of revenue for the next five years and the industries are wholeheartedly supporting the GST. Hence, it is a win-win situation for all stakeholders.” This is the GST’s best chance of becoming a reality in 12 years, but, with the debate on the rate of GST dragging on, Indian businesses shouldn’t break out the champagne just yet.

GST explained

In keeping with the federal structure of India, GST, it is proposed, would be charged by the central government and the states, both of which would charge the tax based on the ‘destination principle’.

Exports would be zero-rated, and imports would be taxed in the same way as domestic goods and services. Interstate supplies within India would attract the aggregate between the central government charge and the charge of the destination state.

A ‘GST council’, comprising federal and state representatives, will organise details of the new tax.

An extra tax of up to 1%, which would be charged by the central government, has also been proposed. Revenue from this tax would be assigned to the states. It is proposed that this tax would be levied for the first two years or possibly longer.

Benefits of the GST include:

• Widening the tax base

• Rationalising the tax structure and simplifying tax compliance

• Harmonising tax administration between federal and state tax administrations

• Automating tax compliance, which will reduce errors and increase efficiency