Financial Management (UK) articles from June 2004

Financial Management (UK) archives from June 2004

Editorial comment.
June 1, 2004... Last summer, Europe recorded its hottest temperatures for 500 years. Despite forecasters' caution in predicting similar statistics for this year, we have already enjoyed a few consecutive days of sunshine, as any glance around the work place...

Firms pressured to come clean: shareholders are mobilising on climate-change issues.(Corporate Social Responsibility)
June 1, 2004... Climate change is being driven rapidly up the corporate agenda, both by government initiatives and by investor concern that its effects may damage shareholder value, according to new research. The annual Carbon Disclosure Project (CDP) has...

UK companies 'play into the hands' of hackers.(News Round-Up)
June 1, 2004... Businesses have misplaced confidence in their information security measures, according to a government study. Last year around three-quarters of UK firms' IT defences were breached, even though most had rated security as a high priority. ...

Firms make do with bad data.(News Round-Up)(Brief Article)
June 1, 2004... Big companies routinely base major commercial decisions on "remarkably inaccurate" data. Research by Gartner has found more than 25 per cent of critical data within Fortune 1,000 businesses will continue to be inaccurate or incomplete through...

Call for increased NAO role.(News Round-Up)(National Audit Office )(Brief Article)
June 1, 2004... The National Audit Office should regulate the regulators, including the Financial Services Agency and the Financial Reporting Council, according to an influential House of Lords committee. Its report has called for the NAO to be given statutory...

Part-time FDs dominate NHS.(News Round-Up)(Brief Article)
June 1, 2004... Part-time finance directors are administering 40 billion [pounds sterling] earmarked for the NHS. An NOP poll surveyed 50 primary care trusts in England and found that two-thirds of FDs were not full-time employees. Almost half of the trusts...

BVCA issues pensions caution.(News Round-Up)(British Venture Capital Association )(Brief Article)
June 1, 2004... The British Venture Capital Association has warned the government to drop its proposed amendments to the pensions bill because they could prove "disastrous" for the private equity industry. The changes would make private equity fund investors...

CIMA director lands Swiss role.(News Round-Up)(Chartered Institute of Management Accountants)(Brief Article)
June 1, 2004... Robert Jelly, CIMA's director of education, has been appointed visiting professor of accounting at the University of Geneva. He will teach part-time on the finance module of its international organisations MBA. This new course is aimed at...

Conference to focus on fraud: delegates will hear that crime prevention begins at home.(CIMA Conference And Awards)
June 1, 2004... A key theme of this year's CIMA annual conference will be detecting financial crime, which sets British business back more than 14 billion [pounds sterling] a year, according to the latest government figures. The Home Office and Treasury...

Institute puts the Golden Mango up for grabs.(News Round-Up)(Brief Article)
June 1, 2004... The CIMA and Financial Management Awards 2004 will feature two new categories this year. The Golden Mango international development award will be presented jointly by the institute's nominated charity, Management Accounting for Non-Governmental...

Tax avoidance rules change.(News Round-Up)(Brief Article)
June 1, 2004... The Inland Revenue has published new rules for the disclosure of tax avoidance schemes. They will force companies that use avoidance schemes and market them to clients to disclose their details. The inland Revenue may then allocate a...

EC seeks views on disclosure.(News Round-Up)(European Commission )(Brief Article)
June 1, 2004... The European Commission is to consult accountants on a new directive intended to boost transparency and financial disclosure. Brussels plans to define the responsibility held by all board members to ensure that correct company information is...

Pension standard hits BAA profits.(News Round-Up)(British Airports Authority )(Brief Article)
June 1, 2004... The annual results of the British Airports Authority show that profits of 616 million [pounds sterling] were dented significantly as a result of FRS17. The charge, combined with what BAA called a "significant investment" in its operation base,...

GSK CFO pockets huge pay rise.(News Round-Up)(GlaxoSmithKline)(Chief financial officer)(Brief Article)
June 1, 2004... GlaxoSmithKline's chief financial officer, John Coombe, has become one of the best-paid accountants in Britain after his remuneration package for leapt by 31 per cent to 1,237,000 [pounds sterling]. The company's AGM revealed that the bulk of...

Audit ban for Ernst & Young.(Regulations Update)(Brief Article)
June 1, 2004... The US Securities and Exchange Commission (SEC) last month banned Ernst & Young from taking on new audit work for six months. The move was a punishment for allowing a "blatant" conflict of interest to arise with its former audit client,...

Varney to take on tax role.(Regulations Update)(HM Revenue & Customs)(HM Customs & Excise )(Brief Article)
June 1, 2004... The chancellor took the first step in merging the Inland Revenue and HM Customs & Excise last month by announcing the appointment of a chairman and deputy for the new, unified tax department. It will be known as HM Revenue & Customs, and mm02...

Andersen fined 1.1 million [pounds sterling].(Regulations Update)(Brief Article)
June 1, 2004... The remnants of Arthur Andersen's UK partnership has been hit with more than a million pounds in fines and costs by the accountants' joint disciplinary scheme, The fines arose from its shortcomings as auditor of the Wickes DIY chain, The two...

Law Society slams incomplete finance bill.(Regulations Update)(Brief Article)
June 1, 2004... Delays in the publication of a large number of provisions in this year's finance bill are making it difficult for businesses to assess the full impact of the legislation, the Law Society has warned. As the bill reached committee stage last...

New regulations weigh heavily on business.(Regulations Update)(Brief Article)
June 1, 2004... Only 22 per cent of UK companies are confident that they are now fully compliant with the latest UK, European and US anti-money-laundering and corporate governance legislation, according to a survey of 300 companies by Cass Business School in...

Elections to CIMA Council 2004.(Institute News)
June 1, 2004... The following people have been re-elected to serve for another term on Council from the close of the annual general meeting on 12 June 2004 until the close of the annual general meeting in 2007: * Alixe Bainbridge Spring--Area 1 (Central...

Presidential engagements.(Institute News)
June 1, 2004... 12 June CIMA AGM, Cafe Royal, London 24 June New members' celebration, London 25 June Members in practice dinner, Oxford 26 June Membership assessment session (deputy ...

Malaysian best-practice award.(Institute News)(National Award for Management Accounting)(Brief Article)
June 1, 2004... CIMA's Malaysia division, in collaboration with the Malaysian Institute of Accountants (MIA), is organising a National Award for Management Accounting (NAfMA) Best Practice. This is intended to promote the use of management accountancy and to...

Database to store CIMA's position on a range of issues.(Institute News)(Brief Article)
June 1, 2004... CIMA has released a new database of all the consultations since 2000 to which it has been asked to respond. The consultations are from a wide range of policy-makers, including the UK government and British or international accounting...

Correction.(Institute News)(Correction Notice)
June 1, 2004... "The benefits of registering as an MIP" (Institute news, May) contained three inaccuracies. Readers should note that the annual MIP registration fee is 50 [pounds sterling]; a modified CIMA logo can be used only by practising certificate...

Obituary: John Nixon.(Institute News)(Obituary)
June 1, 2004... John Nixon, an FCMA and member of Council, died unexpectedly on 18 April, aged 59. John became an associate member in 1970 and a fellow in 1978. He joined the committee of the Sheffield and District branch in 1982 and was branch president...

Vive la difference.(Letters)(Letter to the Editor)
June 1, 2004... I have been sent a CIMA member census which asks, among other things, how I'd rate the advantages of being a member of CIMA compared with any other body? As I'm retired, the question is somewhat conjectural, but when I had a future to look...

Alliance & Leicester: a clarification.(Letters)(Letter to the Editor)
June 1, 2004... CIMA wishes to clarify that it is not in agreement with a letter published in FM's April issue ("An OFR you can refuse?", from David Murray ACMA), which referred to Alliance & Leicester. CIMA has no reason to believe that Alliance &...

Moving on up.(Letters)(Letter to the Editor)
June 1, 2004... In "Spent force?" (April), Bill Aiken offers support to the introduction of resource accounting and budgeting principles to central government. But in doing so he uses a report from the National Audit Office (NAO) that sought to identify how...

Value-added facts.(Letters)(Letter to the Editor)
June 1, 2004... CIMA Insight of December 2003 carried an interesting article on value creation for stakeholders. It noted that "only the fittest will survive": those that create "real value". Unfortunately, this otherwise impressive article did not explore...

Immune system.(Letters)(Letter to the Editor)
June 1, 2004... Business people who travel outside the boundaries of their company's firewall run into big problems when a computer or e-mail virus strikes. Repeated attacks make it almost impossible to perform the simplest of tasks. Unless the latest patches...

Cartesis[R]: increased shareholder activism and corporate governance regulation are making the provision of sound information to all stakeholders more crucial than ever. Jonny Cheetham answers your questions about the role of IT in rising to this challenge.(Questions & Answers)
June 1, 2004... At a push, we can get group IFRS reports out of our existing system. Why should I consider changing it? We've got used to the continual evolution of reporting standards and most firms are adept at assessing the impact of each change and...

To hull and back: the Court of Appeal has decided that tribunals can award compensation for injury to feelings where an employee has suffered from the manner of an unfair dismissal.(Legal)
June 1, 2004... Unfair dismissal compensation under the Employment Rights Act 1996 should be "such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the...

The science of compliance: the task of adjusting to IFRS may seem a major burden from where most of us are standing, writes Chris Field, but it's a golden opportunity to rethink business performance management systems.(Technology: International Financial Reporting Standard)
June 1, 2004... It's fair to say that most finance professionals are facing significant costs in terms of time and resources to comply with regulations such as international financial reporting standards (IFRS), Sarbanes-Oxley and Basel II. The effort to...

Pull your SOX up: Jon Abolins considers the global impact of Sarbanes-Oxley on the provision of transaction tax services and highlights the law's demands on the audit committees of all US-listed companies.(Tax: Sarbanes-Oxley Act of 2002)
June 1, 2004... The Sarbanes-Oxley Act 2002 (SOX) carries potentially significant personal liabilities for all directors, audit committees and auditors of companies that list their shares on US exchanges. The critical section for tax compliance specialists in...

Fete accompli: come rain or shine over the next three months, entertainment institutions such as Glastonbury, Wimbledon and Edinburgh are the true ingredients of a great British summer. Louisa Roberts finds out what the challenges and rewards are for the organisers of these seasonal money-spinners.(Summer Events)(Cover Story)
June 1, 2004... When all 120,000 tickets for this year's Glastonbury festival sold out in less than 24 hours last month, internet message boards were jammed with postings from frustrated music fans such as Jim. He wrote of how he set his alarm clock to go off...

Alms and the man: accountants in search of a quiet life need not apply. Oxfam is seeking professionals who crave a real challenge and the satisfaction of seeing the difference their work makes on the ground. Ruth Prickett finds out why the charity is competing directly with big business for financial talent.(Finance Third Sector)
June 1, 2004... For those of us in the UK who equate the name Oxfam with the ubiquitous high-street charity shops, it's easy to forget that the organisation employs 3,000 people across 80 countries in addition to its fundraisers. The charity's workforce...

Medicinal purpose: a firm that's enjoying a purple patch could be forgiven for thinking 'if it ain't broke, don't fix it', but this attitude is unlikely to prolong its success. Jim Heaney describes how his company, Norgine, reacted when it realised that, although its organisational model had been getting good results, it would be unable to sustain them in future.(Case Study Norgine)
June 1, 2004... Norgine, a privately owned pharmaceutical firm with sites in west London and south Wales, has performed exceptionally well over the past few years. Its sales have increased from 21 million [pounds sterling] in 1999 to 44 million [pounds...

Draft excluders: when management accountants get closely involved in the process of designing new products and services, the results tend to be highly beneficial. But this message doesn't seem to have got through to many designers. Povl Larsen and Alan Lewis describe their CIMA-backed study of the two disciplines' differing views of the role of financial management in design.(Business Design)
June 1, 2004... One key finding of a recent research project to identify best practice in integrated design and management accounting was that medium-sized firms whose performance improved over the time of the study had financial managers who were more...

Critical maths: a young business will tend to encounter funding problems at certain key stages of its growth. Mike Brooks offers his guide to raising enough finance to get through these make-or-break situations intact.(How To Raise Finance)
June 1, 2004... There are two myths that all start-up entrepreneurs believe in implicitly without a moment's hesitation. The first is that no one should be allowed to repress the natural exuberance of the nascent businessman with their petulant misgivings...

Exodus and genesis: what skills and qualities do financial managers need in order to start up their own companies? Ruth Prickett asks CIMA members who have made the break successfully to share their secrets of entrepreneurship.(Business Start-Ups)(Certified Investment Management Analyst )
June 1, 2004... Ah, the joys of running your own business. No one to tell you what to do, the chance to take time off when you feel like it, the opportunity to work on what you really enjoy and the immediacy that means you can watch your efforts make a real...