Draft plans recently announced by the European Commission aimed at curbing the power of the Big 4 accounting practices could lead to a hiring spree among the mid-tier firms as they prepare to compete in what may be a far more level playing field. That’s according to Jon Newcombe, Director of the Professional Services Division at of Twenty Recruitment.
“Historically, companies have rarely changed their auditors which has resulted in very few FTSE 250 audits for mid tier firms. The draft EU plans include forcing companies to change auditor at least once every nine years and from a hiring perspective we are already seeing mid tier firms ramping up their audit teams in the hope that if the directive is introduced they will be in a strong position to tender for big ticket work.
"Also, companies are constantly looking at ways in which to improve shareholder value and so mid tier firms, if they have the right staff, could be a viable – and more cost effective alternative - to a Big 4 audit firm.”
Newcombe says that many of the mid tier firms are managing to attract ex Big 4 partners to help build out teams to win larger client audits – and larger fees.
“Another contributing factor to mid tier firms wanting to woo larger clients is the recent changes in the financial services industry. Record revenues from PwC and Deloitte recently (largely as a result of their Financial Services Advisory Practices) have led mid tier firms to look at building their own financial services practices – mainly by recruiting ex Big 4 staff. The recent announcement around the ringfencing of retail banks from their investment banking arms may mean separate audit, tax and consulting advice. The European Commission proposals would mean that many of the Big 4 will be conflicted out of tax or advisory work opening up further opportunities for the mid tier.”
However, Newcombe adds a word of caution. “A FTSE 250 company or large financial institution will only appoint a mid-tier firm if it feels that they are adequately resourced – firms need to act now to recruit top quality people if they are to be ahead of the curve when the changes are enforced.”
The blog for smart businesspeople
Thursday, 29 September 2011
Northern Rock maintains healthy interest rates for Fixed Rate Cash ISA savers
The new accounts, which are fixed over one, three and five years, are available now with a minimum initial deposit of £500.
A strictly limited issue, the fixed rate cash ISAs (issue 174-176) allow transfers from other providers and Northern Rock has increased the interest rates it pays for savers who are happy to lock their tax-free savings away, whether for the short or long term.
The product can be opened either by post or through Northern Rock's branches and additional deposits (£250 minimum) can be made to the cash ISA, within HM Revenue and Customs limits (£5,340 per tax-year). This issue may be withdrawn without notice once fully subscribed.
To ensure funds are accepted they must be received within 30 days from account opening. Any deposits received after 30 days may be returned. This includes any funds transferred in from existing cash ISAs. Subscriptions are not allowed to any other Cash ISAs in the same tax year(s) that customers subscribe to this Cash ISA, even if they have not used their full annual allowance(s).
Interest, which can be added to the account or paid into another account, is paid annually on 30 November. Minimum withdrawals of £250 can be made from the account, subject to a charge equivalent to 60 days' loss of interest on the amount withdrawn (Issue 174), 120 days' loss of interest on the amount withdrawn (Issue 175) and 180 days' loss of interest on the amount withdrawn (Issue 176). If balances fall below £500, our current basic rate of interest will be paid (0.10% tax-free pa /AER).
(EDITOR: Check with Northern Rock and/or your independent advisor before making any decisions regarding investments)
Is the pension protection scheme weathering the storm?
Apparently so, according to the Pension Protection Fund (PPF), which is also responsible for the Financial Assistance Scheme. Good news for troubled pension schemes and their members, independent trustees who must undertake PPF assessment & FAS assessment and other pension-industry watchers.
Although PPF chief executive Alan Rubenstein describes the economic climate of the past couple of years as “challenging”, the PPF had sailed through troubled waters relatively smoothly.
Figures published for the financial year 2009/2010 show the PPF with a surplus of £400m as a result of strong investment returns and a reduction in claims by pension schemes eligible for PPF. Results for the last financial year, which have yet to be published, are expected to show further improvements.
In an upbeat, state-of-play assessment, Mr Rubenstein says, “The past two years have seen challenging times for the economy at large, as well as for the pensions industry more specifically. Financial crises, subdued growth, turmoil in the bond markets - we are all familiar with the story and the underlying causes.“But far from being tossed about on stormy financial seas and at risk of foundering on the rocks of rising insolvencies, the Pension Protection Fund has sailed through these troubled waters relatively smoothly.”
But Mr Rubenstein did sound a note of caution. He warned that the PPF's strong funding position was not something that could be taken for granted.
He said, “In an ever changing world, we need to understand our risks and plan our future funding, so that we can give everyone - members, levy payers and government - confidence that we will be around to pay the vital compensation we provide, not just for next year, or even the next ten years, but as long as we are needed.
That is why the funding strategy that we published last year is so important. This strategy charts a course over the next 19 years, as the risks we face evolve, toward a future in which the PPF can expect to be self-sufficient. That will mean a future in which the levy ceases to be a significant source of income for the fund, with our success or failure increasingly depending on our ability to manage our investments and risks together.”
In the meantime, said Mr Rubenstein, the levy would continue to be an important component of PPF resources. It was right that the way it was raised should be consistent with the PPF's approach to its funding strategy. However, the design of the levy also needed to be a better match with the expectations of stakeholders.
Mr Rubenstein added, “Our changes to the levy from 2012/13 aim to combine these two requirements and the responses that we received to our consultation on our proposals indicated we were on the right track. There was strong support for the broad thrust of our proposals, with stakeholders viewing them as a significant improvement on the current levy framework.
A key change from 2012/13 will be that we will aim to set the rules for the levy for a three year period, rather than changing the way the levy is calculated every year. A scheme’s levy will still vary depending on movements in its risk, which is appropriate, although we are also making changes to smooth the assessment of risks which should help make bills more stable and predictable. Together with the stronger emphasis on scheme funding in the new formula, we believe this gives schemes more control over the levers that influence their levy.”
The PPF raises some of its funding through the pension protection levy. The levy helps towards the compensation payable to members of schemes that transfer to the PPF. All UK defined benefit (final salary) pension schemes eligible for PPF compensation pay the pension protection levy.
Although PPF chief executive Alan Rubenstein describes the economic climate of the past couple of years as “challenging”, the PPF had sailed through troubled waters relatively smoothly.
Figures published for the financial year 2009/2010 show the PPF with a surplus of £400m as a result of strong investment returns and a reduction in claims by pension schemes eligible for PPF. Results for the last financial year, which have yet to be published, are expected to show further improvements.
In an upbeat, state-of-play assessment, Mr Rubenstein says, “The past two years have seen challenging times for the economy at large, as well as for the pensions industry more specifically. Financial crises, subdued growth, turmoil in the bond markets - we are all familiar with the story and the underlying causes.“But far from being tossed about on stormy financial seas and at risk of foundering on the rocks of rising insolvencies, the Pension Protection Fund has sailed through these troubled waters relatively smoothly.”
But Mr Rubenstein did sound a note of caution. He warned that the PPF's strong funding position was not something that could be taken for granted.
He said, “In an ever changing world, we need to understand our risks and plan our future funding, so that we can give everyone - members, levy payers and government - confidence that we will be around to pay the vital compensation we provide, not just for next year, or even the next ten years, but as long as we are needed.
That is why the funding strategy that we published last year is so important. This strategy charts a course over the next 19 years, as the risks we face evolve, toward a future in which the PPF can expect to be self-sufficient. That will mean a future in which the levy ceases to be a significant source of income for the fund, with our success or failure increasingly depending on our ability to manage our investments and risks together.”
In the meantime, said Mr Rubenstein, the levy would continue to be an important component of PPF resources. It was right that the way it was raised should be consistent with the PPF's approach to its funding strategy. However, the design of the levy also needed to be a better match with the expectations of stakeholders.
Mr Rubenstein added, “Our changes to the levy from 2012/13 aim to combine these two requirements and the responses that we received to our consultation on our proposals indicated we were on the right track. There was strong support for the broad thrust of our proposals, with stakeholders viewing them as a significant improvement on the current levy framework.
A key change from 2012/13 will be that we will aim to set the rules for the levy for a three year period, rather than changing the way the levy is calculated every year. A scheme’s levy will still vary depending on movements in its risk, which is appropriate, although we are also making changes to smooth the assessment of risks which should help make bills more stable and predictable. Together with the stronger emphasis on scheme funding in the new formula, we believe this gives schemes more control over the levers that influence their levy.”
The PPF raises some of its funding through the pension protection levy. The levy helps towards the compensation payable to members of schemes that transfer to the PPF. All UK defined benefit (final salary) pension schemes eligible for PPF compensation pay the pension protection levy.
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Apprentices “learn and construct” with Sanicubic
Following their success two new training divisions - Construction and Hair & Beauty have recently been converted from a commercial building on the North Tyne Trading estate, Newcastle upon Tyne.
The addition of this faculty required extra toilet and washing facilities along with the disposal of waste water from the hairdressing department.
Due to the location a small bore drainage system was required. Saniflo the leading experts in this field recommended a Sanicubic twin motored macerator with remote alarm system.
As Saniflo systems are on the NVQ curriculum for apprentice studies so it was decided by the course tutors to install the unit as part of a “learn and construct” programme.
A “Hands on” situation for everyone!
Sanicubic is a high performing macerator pump that can discharge waste and water from multiple WCs and other waste water producing appliances. It pumps waste away through small-bore pipework up to 11m vertically, 100m horizontally or a lesser combination of vertical x horizontal.
For further information please visit www.saniflo.co.uk
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