Bottom Line Winter 2006

WINTER 2006
The official Moore and Smalley LLP magazine
TALKING FINANCE
Pre-sale investment advice
PINCH OF SALT
Health and safety
CORPORATE FINANCE
Pre-sale planning
VAT
Company car bonus
SMALLEY SHORTS
Moore and Smalley short-listed for awards
LATEST BUSINESS NEWS
www.mooreandsmalley.co.uk
THE KEY TO SUCCESS
John Timpson is In The Chair
Welcome
Rob Salter
AT the time of writing, I am delighted to
have learned that the firm has been
short-listed for a number of prestigious
industry awards. The awards include the
North West Society of Chartered
Accountants Annual Accountancy and
Business Awards, the Accountancy Age
Awards and the Red Rose Awards. What
makes these nominations even more
satisfying is that many of them have
involved input from our clients, and
peers across the banking and legal
fraternities. I believe that this a testament
to the fantastic effort and skill that our
people apply to the job in hand. Fingers
crossed for the finals!
There could be a number of issues
to address towards the end of year in
what should be Gordon Brown’s final
pre-Budget statement. Will his last
statement help or hinder his chances of
becoming PM? Whatever the case, Tony
Medcalf, Stuart Hinnigan, Lynne Holmes
and our tax team will be on hand to
decipher what the proposals mean for
you and your business.
Have a great Christmas and holiday
period and thanks to everyone
connected with Moore and Smalley for
their support during 2006.
(L-R) Danielle Shorrock, Rebekah Holt, Natalie Eames, Lisa Pennington,
Alana Smith, Jane Woods and Chris Parkinson
Making the grade
N Firm and clients reap the rewards from
Moore and Smalley’s training investment
IT’S been a significant quarter for Moore
and Smalley’s future with two graduates
joining the firm’s renowned graduate
training scheme and 11 members of staff
passing industry-recognised exams.
Promising new recruits, David Hackett and
Paul Farrington have secured contracts on
the firm’s graduate training scheme and
have begun studying for the ACA
(Association of Chartered Accountants)
qualification.
David Hackett, 21, from Morecambe, has
a first class degree in Mathematics from
Lancaster University, where he was
treasurer of the Entrepreneur Society. He is
interested in working with fledgling
businesses.
Paul Farrington, from Wigan, is also 21
with a first class degree in Mathematics
from Lancaster University. He is a keen
sportsman and a qualified FA football
coach as well as the editor of Wigan
Athletic FC’s website.
As James and Paul begin their route
towards qualifying as accountants and
business advisors, a number of their
colleagues are celebrating having recently
taken significant steps along the same
journey.
Rob Salter
Senior partner
2 bottomline | winter 2006
Jane Woods has become a fully qualified
member of the Institute of Chartered
Accountants in England and Wales (ICAEW)
after passing the final advanced stage
paper of the ACA exams. Meanwhile, Becky
Holt is just two papers away from
qualification after passing another key
element.
Matthew McShane, Cheryl Fynney and Lisa
Pennington have all passed key stages of
the Association of Chartered Certified
Accountants (ACCA) exams and will sit
further papers in December.
Natalie Eames is now Association of
Accounting Technicians (AAT) qualified after
passing her technical level exams. She will
now start the ICAEW Fast Track course and
sit top-up papers in December. Danielle
Shorrock is now also AAT qualified and will
embark on her ACCA studies next year.
Chris Parkinson, Alana Smith and
Catherine Hough have all passed their AAT
intermediate level exams and will start the
technician level training, while David
Chamberlain has passed the AAT
foundation level and will now study for the
intermediate level.
Adrienne Collinge, Moore and Smalley’s
human resources partner, said: “Moore
and Smalley are dedicated to recruiting,
retaining and developing the highest
possible standard of staff in order to deliver
the excellent levels of service that our
clients expect. Our excellence in training
and development was an essential element
in our being shortlisted for the national
Accountancy Age magazine Employer of
the Year award 2006.”
Talking Finance
N Pre-sale investment advice – Graham Gordon
THERE is far more to think about when
selling a business than simply collecting the
cash and living a jet-set lifestyle in the sun.
Owner managers need to consider whether
they can fund this lifestyle over the coming
years.
important as if they are more
aggressive investors they may well be
able to obtain a higher return on
investments than someone who is more
cautious of nature.
a vital early stage of planning should be determining how much
money they need, in order to maintain their required standard of
living following the sale
For any owner-manager considering selling
their business, a vital early stage of
planning should be determining how much
money they need, in order to maintain their
required standard of living following the
sale. A number of owner-managers will
have been guilty of being blinded by what
they see as a fantastic offer for their
business, only to find that following the sale
they are struggling to maintain the lifestyle
that their business used to provide.
From this discussion, I can then put
together a set of reasonable assumptions
and draw up a Wealth Management Plan
for the owner-manager based on these
assumptions. This plan will compare their
future income requirements with expected
income from existing pensions, investments
and the net business sale proceeds to
indicate the required level of sale proceeds
to maintain their necessary level of income
in the future.
From speaking to my colleagues Rob
Kenmare or Stephen Gregson, the
owner-manager is able to obtain an
indication of the likely sale value, and the
post-tax sale proceeds, importantly though,
this will not tell them how this value will
translate into a regular income for them for
the rest of their days.
By putting such a plan in place, it will make
it much clearer whether or not the
indicative net sale proceeds fall short,
meet, or in a few very rare cases, actually
exceed the owner-manager’s future income
requirements. If the indicative proceeds do
not meet their requirements, they may need
to rethink their future lifestyle or their
attitude to risk, or consider strategies to
raise the value of the business. Specialist
corporate finance advice can identify ways
to increase the perceived value of a
business to potential investors.
This critical aspect of pre-sale planning
involves me sitting down with the business
owner to determine the answer to a
number of key questions about their life
following the sale. Issues considered here
include:
• The value of pensions and investments
they currently hold.
• Their expected standard of living and
the cost of maintaining this.
• Any substantial items of expenditure
they currently have or are planning for
the future (for example, children’s
private school fees or purchase of
foreign property).
• What they expect to do post-sale and
whether this will bring in an income for
them or involve additional expenditure.
• Their attitude to risk, which is very
the amount you have to fund your future
income. You should also not be afraid to
spend capital post-sale (subject to a
number of considerations), as holding on
to large amounts of capital is only likely to
increase the Inheritance Tax bill on your
estate in the long-term.
Finally, the plan should factor in inflation,
as the sale might meet your income
requirements now, but not in ten or
20 years time.
Post-sale planning can be an extremely
complex process, involving a number of
potential taxes, charges and legislative
considerations. With our team of specialists
in Wealth Management, pensions and
investments, corporate finance and tax
planning, Moore and Smalley are ideally
placed to achieve business sales that meet
the personal financial goals of the
owner-manager.
Graham Gordon is a partner and
head of financial planning. He can
be contacted on 01772 821021 or
gdg@mooreandsmalley.co.uk
consider the income tax,
capital gains tax and
inheritance tax implications of
the business sale
It is important to ensure that as part of a
Wealth Management Plan, you consider the
income tax, capital gains tax and
inheritance tax implications of the business
sale. These personal taxes can all be
reduced with specialist advice, increasing
Graham Gordon
winter 2006 | bottomline 3
In The Chair
N This issue, John Timpson, chief executive of Timpsons, bares his ‘sole’
on business success
NOT everything in business is clear cut –
that is unless you work for John Timpson,
CBE.
change for pay and display machines.
Customers come first – for real – its
common sense.”
The chief executive of Timpson, the high
street shoe repairs-to-key cutting service,
firmly believes his staff and the way they
treat their customers are the key to the
company’s success.
John knew from an early age that he
wanted to follow in his father’s footsteps
and join the family business founded by his
great-grandfather, William, in 1865.
“We only have two simple rules: that our
staff look the part and put the money in the
till (they are given the trust and freedom to
give a fantastic service to customers.)
“We don’t have a company policy – we let
our staff get on with running the business
the way they see fit, provided they look after
their customers. There is something rather
pleasant about sticking two fingers up to the
more traditional way of running a
business,” says John.
“At Timpson we want to get the best out of
our people and we depend on them being
nice to our customers and giving that bit
extra – whether its giving directions, letting
customers use the loo or giving them
He joined the family footwear business as a
shop assistant in 1960, and after
graduating from Nottingham University he
honed his retail skills as he rose through the
ranks.
But 12 years later, following a board room
disagreement, the company was acquired
by the UDS Group, which later became part
of the Hanson Group.
By 1975 John had been appointed
Today, Timpson has more than 550
branches nationwide with plans for 200
more, a turnover of £100 million and
profits of over £10 million.
Timpson is still a private business, whollyowned by John Timpson and his family,
who are currently expanding the business in
Northern Ireland and Eire. Besides
concentrating on the shoe repair and key
cutting business, they have also expanded
into engraving, watch and jewellery repair,
as well as a 24 hour locksmith service.
managing director of William Timpson – the
original family business – and in 1983 he
achieved his ambition of buying it back
through a £42 million management buyout.
Like the three generations before him, John
tours the shop floor, which sees him visit
more than 400 stores a year, travelling well
in excess of 35,000 miles a year just in his
car.
The 63-year-old explains: “Buying back the
business through the MBO was a real high
point for me, as was the acquisition of the
Automagic shoe repairs chain with its 110
shops in 1995, which was a pivotal deal
that changed the shape of the business and
paved the way for significant growth.”
He added: “With a mobile phone and a
Blackberry and good staff behind you, you
don’t need to be stuck behind a desk to run
a business. And if you don’t trust the people
you’ve got there is either something wrong
with them - or you!
So in 1987 he took the difficult decision to
sell Timpson Shoe Shops and concentrate
on the shoe repair business.
John reveals: “One of the biggest
challenges was having to sell the shoe
shops which were started by my greatgrandfather. It was a very difficult time for
me personally.”
4 bottomline | winter 2006
In 2003, Timpson bought the Minit Group,
which included Mister Minit, Supasnaps and
Sketchley, adding another 200 shoe repair
shops to the portfolio.
“We only have two simple rules: that our staff look the
part and put the money in the till”
However, as you would expect there have
also been challenges along the way. He
predicted that problems were in store for
shoe shops from increased competition,
cheap imports and rising high street rents.
John Timpson
chain of heel bars to Britain’s Quality
Service People.
Fortunately, the decision proved to be a
catalyst which propelled the business from a
“You can’t run a business without trusting
people. The character of this business and
its success is all about its people.”
And the business and its people are exactly
what make John tick. “I enjoy it – it’s as
simple as that. I don’t need to watch
Coronation Street or Eastenders because
there is always something going on around
me and I feel very privileged to meet lots of
different people from all walks of life.”
WHEN ROB MET JOHN MALLEY: Rob Salter (left) interviews John Malley on health and safety
A pinch of salt: Health and Safety
N In the second of his regular columns, Moore and Smalley managing partner, Rob Salter, talks to
John Malley, from Rawtenstall-based First Business Support, about health and safety law.
EVERY year there are around 1.6 million
workplace injuries in the UK, and more than
a staggering 25 million working days lost
because of accidents and ill-health.
Health and safety failures currently cost
Britain’s employers up to £6.5 billion every
year – and it is often the small to medium
sized enterprises that pay the highest price.
But more worryingly, according to First
Business Support’s John Malley, it is the
complete lack of awareness and
understanding of health and safety
legislation by many small businesses.
Today, every business with five staff or more
must have a written health and safety policy,
which must be reviewed on a regular basis
Businesses must also carry out risk
assessments, covering everything from fire,
first aid and chemicals to all machinery,
lifting operations and workplace
transportation, to name just a few. Risk
assessments must also be carried out in
offices to consider slips, trips and falls and
for all those working with computer screens.
for improvements to be made within 21
days.
“Basically, every employer with five or more
staff needs to be aware of the law and how
it impacts on them.”
John Malley explains: “We have known
enforcement officers say that a Health and
Safety policy not reviewed annually is out of
date and issued formal written requirements
However, one of the burning issues of the
moment is the Regulatory Reform (Fire
Safety) Order 2005, which came into force
on October 1, 2006.
every employer with five or more staff needs to be aware of the
law and how it impacts on them
Firms that breach health and safety
legislation can face unlimited fines and even
up to two years in prison.
Recently, DA Carter Ltd was fined £7,500,
and ordered to pay £5,000 costs, when a
foreman fell to his death through a fragile
roof whilst replacing lights. It was later found
there had been no risk assessment on the
scaffold, edge protection or crawling boards.
While international tyre giant, Michelin, was
fined £100,000, and ordered to pay
£12,500 costs, after a worker lost part of
three fingers clearing a blocked hopper.
health and safety failures currently cost Britain’s employers
up to £6.5 billion every year
Finally, businesses must also be registered,
depending on the nature of their business,
with either their local Environmental Health
department or the Health and Safety
Executive.
Health and Safety at Work regulations 1999.
During the Michelin case Judge William
Everard used the HOWE principle and said:
“A fine should be large enough to hit the
matter home to the company and its
shareholders and in this case also take
account of Michelin’s £12 million profits.”
The key legislation that companies need to
be up-to-date with is the Health and Safety
at Work Act 1974 and the Management of
The reforms, which are aimed at
rationalising and simplifying the legislation,
mean that in most cases fire certificates will
no longer be issued by the fire authority.
Basically, the responsibilities of employers
have been increased and they need to look
at all the people fire could effect other than
their employees, from visitors, contractors
and passers-by to fire-fighters safety, as well
as the business continuity of their
neighbours.
John Malley added: “Employers are great at
what they do but health and safety is often
overlooked because it is not their primary
concern.
“However, businesses really need to be
aware of the law, how it affects them and
how they can comply with it to avoid falling
foul of the law - and that is when expert
health and safety advice can help guide
them through the minefield.”
For further information, contact
Mark Brennan, on 01772 821021
or mb@mooreandsmalley.co.uk
winter 2006 | bottomline 5
Cash in on capital allowances
N Written by Tony Medcalf, partner and head of taxation
WHEN it comes to buying and selling a
property it can pay great dividends to make
the most of any potential tax breaks.
Substantial savings can be produced from
tax allowances for both investors and
owners of property to alleviate the levels of
tax paid on profits.
All businesses can claim tax deductible
capital allowances on certain property
purchases - this means that a proportion of
these costs can be deducted from taxable
profits to reduce tax bills.
Substantial savings can be
produced from tax allowances
6 bottomline | winter 2006
Fortunately, capital allowances can be
‘great little earners’ which are often
overlooked by many businesses.
companies are eligible to claim a one off
allowance in the year of expenditure of
50% and 40% respectively.
capital allowances can be ‘great little earners’
which are often overlooked
There is a wide range of capital allowances
available, on expenditure relating to plant
and machinery included in buildings.
Common items of plant may include air
conditioning, CCTV, central heating,
security systems, kitchens and toilets.
Capital allowances are available on plant
and machinery at a rate of 25 per cent,
however small and medium sized
For instance, a showroom worth £1 million
may have up to 20 per cent of its assets
that would qualify for capital allowance.
Therefore, if the company was medium
sized, allowances of £80,000 (£1m x 20%
x 40%) could be claimed in the year of
expenditure. This would translate into a
first year tax saving of £24,000 for a
company paying tax at 30per cent.
VAT is another major transactional issue in
the purchase or construction of a property
which businesses need to get right first
time.
Moore and Smalley’s specialist tax
team including Tony Medcalf, head of
tax, and Stephen Adams, head of
In order to optimise the tax
benefits available through
capital allowances it is essential
that before you purchase a
property a survey is carried out
In addition to allowances that are available
on plant in buildings as detailed above
there are currently enhanced capital
allowances available, at a rate of 100per
cent, on certain categories of expenditure.
This includes expenditure on energy-saving
plant and machinery, water efficient plant
and machinery, flat conversion allowances,
cars with low CO2 emissions and gas
refuelling structures and the construction of
industrial and commercial buildings in
designated enterprise zones.
This can also be done at the negotiation
stage when accountants can change the
price of the property.
Moore and Smalley can make retrospective
claims and capital allowances can be
claimed back indefinitely, but it will only
effect the tax liability for the last two years.
VAT, have combined expertise in
surveying properties, and
maximising direct tax and VAT
savings on all purchases, construction
or sale of properties. Therefore
before buying or selling any
commercial property talk to Moore
and Smalley’s specialist property and
construction sector tax team and see
just how capital allowances could
provide a great return for you and
your business.
Basically, there is much more scope for tax
relief before and during a property
transaction than afterwards, but at
whatever stage the process is at, expert
Basically, there is much more scope for tax relief before and
during a property transaction than afterwards
In order to optimise the tax benefits
available through capital allowances it is
essential that before you purchase a
property a survey is carried out such that
we can liaise with the vendor and their
There is a wide range of
capital allowances available
accountant to agree that the qualifying
expenditure within the building is set at the
maximum level through a joint election.
This fixes the level of plant in a building
and therefore predetermines the capital
allowances available.
advice will always help make the most of
all the tax allowances that are available.
Moore and Smalley has acted on a wide
range of property and construction tax
issues, including a recent £4 million
acquisition which saw Moore and Smalley
make a £112,000 tax saving in the first
year alone for one client – with a further
£280,000 saved over the next eight years.
VAT is another major
transactional issue
Tony Medcalf
For further information, contact
Tony Medcalf, head of tax at Moore
and Smalley, on 01772 821021 or
tm@mooreandsmalley.co.uk
winter 2006 | bottomline 7
Pre-sale planning
N by Stephen Gregson, assistant director of corporate finance
IN the last issue we looked at the funding
challenges facing start up businesses and in
particular the help which is available in the
form of the government backed Small Firm’s
Loan Guarantee Scheme. We now shift our
focus to the other end of the business life
cycle and consider the issues faced when
preparing your business for sale and how to
plan for this to ensure a successful exit.
This piece will focus principally upon an
eventual sale to a trade buyer or investor;
although many of the steps outlined will also
be appropriate for an ultimate sale to a
management team via an MBO.
Why exit?
The reasons for exit can be as varied as the
types of business which are available for sale
at any one point in time. However, a
common theme is the owners desire to free
up personal time to do, and generate an
amount of capital to fund, other things.
Understanding your reasons for exit are
crucial because they will influence the steps
you need to take to get your business ready
for sale. For instance, if you want to totally
exit from the business and spend your days
in the garden then make sure that you have
created a strong second tier management
team and that the business will happily
function without any input from yourself.
8 bottomline | winter 2006
When should you exit?
As in life generally, timing is often everything
in achieving a successful sale which
maximises the value you will receive. You
need to understand your market, its likely
future trends and also your business’ growth
profile. Always aim to sell out before you
can see that your market or business has
peaked. True, this may mean that you sell
out early and so miss out on profits you
otherwise could have banked – but in any
successful sale you must have something to
sell. Obvious perhaps, but the thing you
really have to sell is the future profits of your
business. Potential buyers must be able to
conclude that there are clear future
opportunities to generate further profits from
your business once it is under their control –
only this way will they place an ‘attractive’
value on it.
Establish a financial track record
But here’s the rub. Whilst you want to sell on
the expectation of future profits, you also
want to ensure that the expectation is as firm
and reasonable as possible. Hence the ideal
is to have started to deliver profitability
increases already – and have ‘banked’ these
and had them validated by at least one set of
audited accounts. If you can have audited
accounts which demonstrate the profit growth
in your business – and there is clearly still a
lot left to achieve - then, everything else
being equal, this will serve to maximise
the value of your business. You will not
simply be selling hope value off the back
of one set (or several) of lacklustre audited
financial results.
Also, make sure that at least your last set,
and preferable last couple of sets, of audited
accounts accurately set out the underlying
profitability of the business. Strip out all
non-business revenue and expense items
from them so that the underlying
performance is as transparent as possible.
Deal with your skeletons
‘Know thyself’ is an extremely useful maxim
to have in mind when starting your disposal
process. You need to ensure that you and
your advisers have thoroughly identified,
understood and quantified any skeletons
which might be lurking in your corporate
closet. Such things might include formalising
unofficial supplier or customer contractual
arrangements; resolving any outstanding
tax and/or legal issues and carrying out
any necessary repair or renewal work
on business critical areas. The reason for
this is that it is prudent to assume that a
potential acquirer will discover such skeletons
and whilst they may be one offs, such
discoveries can only serve to create doubt
in the mind of the acquirer over the quality
and hence fundamental value of the business
being sold.
Employees
leases with overly long break clauses. This
As we noted earlier, if you desire a complete
exit from the business make sure that it has
demonstrated an ability to function without
you. Additionally, depending upon your
particular circumstances, you may need to
create suitable ad-hoc reward structures to
ensure that any key staff are incentivised to
help the sale proceed smoothly. This can be
particularly relevant if you are selling to a
competitor who might well have
redundancies in mind as a way of quickly
generating post deal synergy cost savings.
could make a disposal to a trade buyer more
complicated if the buyer intended to move
operations to another site.
The plan
Above all, make sure that you have talked
your plans through with your advisers before
you actually want to sell the business. They
will know aspects of your business very well –
perhaps, dare I say it, even better than you
do in some instances. They can help identify
Other commitments
Of course you must continue to run your
business ‘in the normal course’ but it would
be imprudent not to consider the likely
implications of entering into medium to
long-term commitments in the run up to a
sale. Obvious ones are entering into new
the issues to be dealt with and how to do
this. Once you have your plan, don’t think
that the hard work has been done – it will
now need to be actioned, for as Goethe
said: “what is not started today is never
finished tomorrow”.
Stephen Gregson
For further information, contact
Stephen Gregson on 01772
821021 or
sg@mooreandsmalley.co.uk
We achieved great results for these clients
Tangerine Holdings
Advised Fylde-based £9 million turnover
Group, Tangerine Holdings, on £3
million acquisition of Quay Equestrian
Moore and Smalley advised Tangerine
with negotiations and fund raising.
The Moore and Smalley team was led
by Rob Kenmare
Hillendale Land
Rover
Advised the management team of East
Lancashire-based Hillendale Land Rover
it’s management buy out (MBO)
Moore and Smalley advised the
management team on fundraising,
negotiations, cashflow forecasts and
business planning. The Moore and
Smalley corporate finance team was
headed by Stephen Gregson
Taylor Patterson
Advised two long standing majority
shareholders of Preston, Sheffield and
Carlisle-based independent financial
advisers, Taylor Patterson, on second
stage of share sale to fellow directors
and shareholders
Moore and Smalley advised Nigel Taylor
and John Patterson on the share sale
We can do the same for you
Are you thinking of selling your business? Do you want to know how much your business is worth? Do you want to take a step back and
restructure your business? Have you any merger or acquisition plans? Call Rob Kenmare or Stephen Gregson on 01772 821021.
Speak to one of the North West’s leading corporate finance teams today for a free no obligation discussion.
winter 2006 | bottomline 9
FD Corner VAT back on cars
N Disclosure of tax
schemes: are you at risk?
DIRECTORS who have previously
entertained elaborate tax saving schemes or
who have been involved in complex tax
planning are now in danger of falling within
Mr Brown’s expanding anti avoidance net.
From August 1 2006, the direct tax rules
concerning financial products and
employment related arrangements have
been replaced by new rules potentially
covering all income tax, corporation tax
arrangements and capital gains tax. The
new ruling requires a disclosure to be made
where any of the following applies:
• standardised tax products;
• leasing arrangements;
• loss schemes;
• premium fee;
• confidentiality in cases involving a
promoter;
• confidentiality in cases not involving a
promoter.
There are, as ever, some exclusions and the
rules involve a number of tests. However,
the combined effect of these changes is that
we should see a greater number of
disclosures and the time limit for making
them being reduced particularly for
companies designing their own tax planning
initiatives. I strongly recommend that
should you have any concerns you
immediately contact our specialist tax
department who will guide you through this
ever increasing tax maze.
THERE is good news about
claiming VAT back on
company cars following recent
VAT tribunals says Stephen
Adams, head of VAT in Moore
and Smalley’s specialist tax
department.
The vatman always used to win if he
could show that the car was “available”
for private use even if there was no
actual private use. This usually meant
that if the car was even insured for
private use then it was “available” for
private use in the eyes of the vatman.
Everyone also needs to be aware that:
• the Revenue have increased the tax
free mileage rates for (fuel only)
claims up to a maximum rate of 18p
per mile which means that up to
2.68p per mile can be reclaimed as
VAT and;
• the vatman now requires VAT receipts
for petrol which shows VAT actually
paid that will at least cover VAT
claimed back on mileage rates
claimed.
However, one of the claimants in a recent
case argued that:
• “business only” insurance was
actually more expensive than
“business and private” insurance,
and;
• his combine harvester was also
insured for “business and private
use” (because it was cheaper than
“business only” insurance) but this
could hardly be used as a family car!
James Treadwell
For further information, contact
James Treadwell on 01772 821021
or jst@mooreandsmalley.co.uk
10 bottomline | winter 2006
On a serious note, there is greater scope
now for getting VAT back on cars –
particularly where the company car driver
has his own private car and all required
documentation (to tie in with the recent
VAT cases) is correctly prepared and
maintained.
Stephen Adams
Anyone who would like any
further information on any of the
above can contact Stephen on
01772 821021 or
sra@mooreandsmalley.co.uk
The informer
N Work and Families Act 2006
THE Work and Families Act 2006 received
royal assent on June 21 2006 and extends
paid maternity and adoption leave,
provides for statutory maternity pay to be
extended, introduces additional paternity
leave as well as extending the right to
request flexible working to those who have
caring responsibilities for adults.
The main changes made by the Act will
take effect in April 2007. Many of these
have been implemented via the Maternity
and Parental Leave and the Paternity and
Adoption Leave (Amendment) Regulations
2006 which came into force on October 1
2006 and apply to women whose expected
week of childbirth is on or after April 1
2007 and to adopters whose children are
expected to be placed with them on or after
that date.
Key Changes:
• all pregnant employees will be entitled
to take up to 52 weeks’ maternity
leave;
• statutory maternity pay and maternity
allowance is to be extended from 26
weeks to 39 weeks from April 2007.
From a payroll perspective this means
you will be running parallel SMP/SAP
schemes for some time;
• power has been taken to extend the
maximum period of paid maternity
leave to one year from April 2009;
• SMP will be able to start on any day of
the week and we will see a published
daily rate for SMP;
• women will still need to have 26
weeks’ service to qualify for SMP/SAP
but service will no longer be relevant
for qualification for maternity leave;
• all women will now qualify for
Additional Maternity Leave allowing
them to take a maximum of 52 weeks
off work;
• with an employee off for up to 52
weeks an employer needs certainty as
to expected return dates, as it is likely
that they will have had to engage
cover. The regulations acknowledge
this by increasing the notice that an
employee must give if they want to
change their date of return in any way
from 28 days to 56 days;
• KIT (keeping in touch) days will be
introduced allowing employees to
come into work for up to ten days
during their leave. Previously, if an
employee came into work during the
maternity pay period they had to lose a
week’s worth of SMP. With KIT days
this will no longer be the case,
although of course, the employee will
expect to be paid under their contract
of employment for any time worked.
Mutual agreement is the key here as
you cannot insist that the employee
attend work, nor can she insist that
work be offered.
If you are unsure about any aspect
of these new rules, please contact
Tina Clayton on 01772 821021 or
tmc@mooreandsmalley.co.uk
Office banter is ‘good
for business’
Small firms ‘facing utility
bills time bomb’
International worker
warning
ALTHOUGH companies are losing £43bn
a year as a result of employees gossiping
at work about non-work matters, it is
actually good for business, new research
claims.
SMALL businesses are struggling to cope
with rising utility costs, new research claims.
The report commissioned by internet phone
company Vonage said the average utility
costs for UK small businesses have risen by
a record 9.8 per cent during the past 12
months.
HUNDREDS of businesses could be
breaking the law by not checking the rules
regarding the employment of overseas
workers.
Insurance firm MORE TH>N BUSINESS
said over 18 million working hours per day
are lost when workers discuss the previous
evening’s football match or the latest reality
TV show eviction. The time lost amounts to
£43bn, it claimed.
But the report said office banter is actually
beneficial for firms because it helps to
boost staff morale.
Gas prices have risen by an average 91
per cent since June 2003, closely followed
by electricity at 81 per cent and fuel costs
which hit a record high of just under £1
per litre earlier this year.
Almost two thirds of small businesses told
YouGov, which carried out the poll, that
they were paying up to £300 per month on
landline bills.
Workers from across Europe have found
employment in Blackpool’s tourism and
retail sector but according to Moore and
Smalley many businesses are unaware of
the strict rules in place.
Debbie Wood said: “We have seen a vast
amount of Eastern European workers come
to the UK, many of whom are willing to
work longer hours for less money than their
English counterparts. However, employers
must conform to minimum wage and
working time rules. It’s a minefield and if
businesses are caught ignoring the rules,
they face possible fines and even
imprisonment.”
winter 2006 | bottomline 11
S H O R T S
firm news… firm news… firm news… firm news…
MOORE AND SMALLEY has been short-listed
alongside several national firms for a
prestigious industry award.
The firm has been nominated for the Employer
of the Year category in the 2006 Accountancy
Age Awards, run by the profession’s leading magazine. Moore and Smalley will compete
against PricewaterhouseCoopers, KPMG, Deloitte, BDO Stoy Hayward and Robert Half
International in the reader-voted honours.
Meanwhile, the firm has also been short-listed for the Corporate Finance Deal of the Year,
Young Accountant of the Year and Accounting Firm of the Year categories in the 2006
North West Society of Chartered Accountants Annual Business and Accountancy Awards.
What the
papers say
AS the cold dark nights draw in Moore
and Smalley’s recent press coverage
should provide some heart-warming
reading over the winter months.
Stephen Gregson secured several
pages of coverage in the Blackpool
Gazette, Lancashire Evening Post and
Rob Sturzaker (right)
with Damian Walmsley
Mohammad Nadeem
with Debbie Wood
Business 550 for his work on the sale
of a KFC restaurant in Blackpool.
He also made headlines for the sale of
newspaper distributor North West
Wholesale News, which featured in
North West Enquirer, EN magazine,
Insider, Lancashire Business View and
also the Lancashire Evening Post.
Not to be outdone, corporate finance
colleague Rob Kenmare appeared in
Lancashire Business View for his work
on the Ravenscroft Group’s acquisition
of Practicare. He also featured in
PENWORTHAM Cricket Club fast bowler, Rob Sturzaker, bowled himself to the August
Moore and Smalley Palace Shield player of the month award. The 22-year-old took 17
wickets during an inconsistent month for the Middleforth outfit. Meanwhile, Mohammad
Nadeem’s prolific run scoring helped Great Eccleston win the double - and land him the
Moore and Smalley Palace Shield player of the month award for September. The double
victory was especially pleasing for Moore and Smalley consultant, Peter Metcalf, and David
Walker from the Blackpool office. They are both players and members at Great Eccleston.
Lancashire Business View’s round table
article on management buy-outs, as
well as the Blackpool Gazette and
Preston and Leyland Citizen for
securing his Corporate Finance
Qualification.
The minimum wage came under the
spotlight in the Lancashire Evening Post
ALMOST a third of Lancashire’s business
bosses have compared their managerial
style to ex-England chief Sir Bobby Robson,
according to a survey conducted by Moore
and Smalley.
The firm conducted a special online poll to
coincide with the start of the new
Premiership season.
Veteran coach and one of England’s most
successful managers, Sir Bobby Robson,
received 32 per cent of the vote in the
survey. His loveable personality was the
vote winner in the website poll, which
asked: ‘which football boss would you
compare your managerial style to?’
Manchester United gaffer and one of
English football’s most successful club
managers, Sir Alex Ferguson, described
as a father figure and winner, with a great
track record of nurturing young employees,
took second spot in the survey with
26 per cent.
However, former England coach Sven
Goran Erickson, seen as a cool, calm
thinker, steady under pressure and very
approachable, only received 11 per cent of
the votes.
which gave a full page to human
resources consultant Tina Clayton’s
comments on the issue.
While a story on partner Christine
Wilson’s visit to a Royal Garden party
at Buckingham Palace appeared in the
Preston Citizen.
Finally, Moore and Smalley appeared
in Accountancy Age magazine after
being short-listed for the publications’
Employer of the Year award.
Preston: Richard House, 9 Winckley Square, Preston, Lancashire PR1 3HP Tel: 01772 821021 Central fax: 01772 259441
Blackpool: Fylde House, Skyways Commercial Campus, Amy Johnson Way, Blackpool, Lancs FY4 2RP Tel: 01253 404404 Central fax: 01772 259441
www.mooreandsmalley.co.uk
“Moore and Smalley LLP is a limited liability partnership registered in England and Wales: No. OC313896. Registered Office: Richard House, 9 Winckley Square, Preston, Lancashire PR1 3HP. The term
“partner” indicates a member of Moore and Smalley LLP who is not in partnership for the purpose of the Partnership Act 1980. A list of members is available from our registered office.
Registered by the Institute of Chartered Accountants in England and Wales to carry out company audit work. Authorised and regulated by the Financial Services Authority.
Managing Editor: Rob Salter Editor: Danny Houghton Created and written by Freshfield. www.freshfield.com
S M A L L E Y