NEWS – THURSDAY 1ST October 2020


TAX NEWS – THURSDAY 1ST October 2020

ESG groups zero in on tax avoidance

The FT’s Moral Money suggests tax avoidance could become a key ESG theme over the next year as firms look to “build back better” after the coronavirus pandemic.

Financial Times


M&C Saatchi fails to file annual accounts

Advertising firm M&C Saatchi missed Wednesday’s deadline to file its 2019 annual results. In a preliminary financial statement released in place of audited results, M&C said deeper investigation of its accounts had revealed a further £2.4m in misstated profit before tax, bumping up its total accounting error to £14m. The firm said new auditor PwC needed more time to analyse accounts and will complete the audit in a “matter of weeks”. Shares are set to be suspended until the accounts are published.

The Daily Telegraph, Business, Page: 4 The Times, Page: 40 Financial Times, Page: 10 Daily Mail, Page: 75 City AM

Wigan score buyer

Wigan’s administrators have reached an agreement with a Spanish consortium over the sale of the football club, with Begbies Traynor saying a “substantial deposit” has been handed over. A statement said the offer “deals with not only the sale of the club but also allows payment to non-football creditors.” It adds that the preferred bidder “has made it plain they do not wish for their details to be made public until the sale is completed.”

The Daily Telegraph, Sport, Page: 5 The Guardian, Page; 41 The Sun, Page: 54

Cylinder Service Centre jobs saved

The Cylinder Service Centre has been acquired by Hystat Systems in a deal executed by administrators from Grant Thornton that will ensure all 30 jobs are retained.

Yorkshire Post, Business, Page: 3


More staff returned to offices in September

Analysis show s that 45% of UK office staff returned to their workplaces in September, up from 37% in August and 34% in July. The increase recorded last month came before Prime Minister Boris Johnson urged employees in England to work from home where possible to help try and contain a possible second wave of coronavirus. The data, collected by the Alphawise research unit of Morgan Stanley investment bank, reveals that the UK was lagging well behind much of Europe, where 75% of office staff had returned to the office. However, it was shown that 32% of UK office staff were working from home five days per week. Morgan Stanley said this made Britain a “notable outlier” in this area, with just 16-19% of office staff working from home five days a week across continental Europe.

The Guardian

1 in 3 firms expect job cuts

A survey of more than 2,000 managers by conciliation service Acas has found that 37% of employers are likely to cut jobs before the end of the year, with the rate climbing to 60% among businesses with more than 250 staff.

The Daily Telegraph, Business, Page: 7 The Guardian, Page: 33

SMEs NEWS – THURSDAY 1ST October 2020

Government warned of fraud risk on loan scheme

The British Business Bank warned the Government that its Bounceback Loan Scheme carried a serious risk of fraud, with then chief executive Keith Morgan writing to Business Secretary Alok Sharma ahead of the initiative’s launch in May to voice concern that it carried “very significant fraud and credit risks”. Mr Morgan warned that the scheme, which was rolled out to support small firms hit by the coronavirus crisis, was “vulnerable to abuse by individuals and by participants in organised crime.” He cited a draft review by PwC which deemed the risk of fraud as “very high”. Mr Morgan, in a second letter later in May, also raised concerns about the Government’s Future Fund, which invests in start-ups.

The Times, Page: 35 The Daily Telegraph

Ministers look to tackle late payments

Ministers are drawing up plans that would see large firms fined or issued court orders if they fail to pay smaller suppliers promptly, with the powers of the Small Business Commissioner set to be enhanced. It is estimated that SMEs were owed £23.4bn in late payments last year.

The Times, Page: 44 Financial Times

SMEs detail pandemic impact

A poll of UK alumni of Goldman Sachs’ 10,000 Small Businesses programme shows that 99% believe they will survive the coronavirus crisis, assuming there are no further national lockdowns. The poll saw 64% say revenue had decreased, while 44% had reduced headcount and 75% had used the furlough scheme. It was also shown that 45% of firms have changed their business model due to the pandemic, with three quarters expecting this to be a permanent change.

The Daily Telegraph, Business, Page: 5


House prices up 5% to £226,129

Data from Nationwide reveals that UK house prices were up 5% in September compared with a year ago. This marks the biggest rate of annual growth in four years. Month-on-month, prices in September were up 0.9% on August, while quarter-on-quarter, July through September saw prices climb 1.7% compared to the previous three months. The figures show that the average house price hit £226,129 in September. In London, prices were up 4.4% in Q3, with the average price in the capital hitting a record high of £480,857. Robert Gardner, Nationwide’s chief economist, said the rebound in prices “reflects a number of factors”, adding: “Pent-up demand is coming through, with decisions taken to move before lockdown now progressing.” Chancellor Rishi Sunak’s stamp duty holiday, which runs until the end of March 2021, was also noted as a factor in increased market activity. Howard Archer, chief economist at the EY Item Club, described the spike in house prices as “unsustainable”, saying he expects the market to “come under pressure” over the final months of 2020 as the furlough scheme concludes, adding that the pressure could stretch into 2021 as the stamp duty holiday comes to an end.

The Daily Telegraph Financial Times The Guardian Daily Mail City AM BBC News


European shift continues

EY ‘s financial services Brexit tracker shows that firms in the sector are continuing to move staff and operations to Europe in the run-up to the end of the Brexit transition period, with more than 400 UK financial services roles relocated to Europe in the final weeks of the last quarter. The analysis suggests the total number of jobs leaving London is now above 7,500. The value of assets that have been transferred is estimated to be around £1.2trn, up from £1trn at the end of 2019.

The Times The Scotsman, Page: 46


New accounting standard cannot serve two masters

Professor Lee Boyar says that while a single set of standards for ESG reporting would ideally meet the aims of shareholders and other stakeholders, “it is hard to serve two masters”.

Financial Times, Page: 20


GDP slip less severe than feared

Revised figures from the Office for National Statistics (ONS) show the economy contracted by 19.8% in Q2. Although the decline in GDP hit a record level, it is less severe than initially thought, with a previous official estimate suggesting GDP fell 20.4%. The slip in GDP across Q1 was also revised, from 2.2% to 2.5%. The analysis shows that in the first six months of 2020, the economy shrank by 21.8%, exceeding a previous estimate of 22.1%. With the coronavirus lockdown shutting much of the economy, household spending in Q2 was down £80.5bn, representing a fall of 24.2%. The ONS report also reveals that households saved a record 29.1% of their income in Q2, a steep jump on the 9.6% recorded in Q1. Meanwhile, Bank of England chief economist Andy Haldane yesterday said GDP is set for another record quarter in Q3, with the economy set to expand by 20%. Elsewhere, Howard Archer, chief economist at the EY Item Club, ha s warned that low consumer confidence, concerns over unemployment and a second wave of coronavirus could mean Q4 is “more challenging for the UK economy and growth may be limited”.

The Times The Daily Telegraph, Business, Page: 5 The Guardian Financial Times The Independent City AM

Contact Paul Southward