Newswire April 2019

  • By Mercia Group
  • 30 April 2019 00:00

This month HMRC have issued a consultation on changes to private residence relief and sees the start of the new tax year. Why not download a copy of our taxapp to your phone, laptop or other device, so you can have the latest rates, allowances and calculators at your fingertips?

Meanwhile, debate continues about the future of audit, with a new report and recommendations issued by BEIS, and the launch of the Brydon review, which seeks feedback from all interested parties on audit as a product. You can read more about this in the A&A section below.

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BEIS select committee report the future of audit

A committee of the Department for Business, Energy and Industrial Strategy (BEIS) has published the results of its enquiry into the future of audit, including a number of drastic and far reaching suggestions. These include:

  • requiring auditors to make a formal presentation at a company's AGM
  • making amendments to company law such that companies are explicitly required to disclose their distributable reserves
  • requiring an operational split between audit and non-audit firms
  • considering rules on independent appointment of auditors and joint audits.

The report only makes recommendations, though is likely to influence the direction of travel, with reforms already being made at the FRC, the Competition and Markets Authority (CMA) issuing its final report into competition in the audit market and the launch of the Brydon review (see below).


Independent review on the quality and effectiveness of audit

Sir Donald Brydon has issued a call for views on his independent review on the quality and effectiveness of audit. This review is wide ranging in scope, looking at everything from the purpose of audit, through to auditor's responsibilities in respect of fraud and how audit findings should be communicated.

The invitation to comment is open to all, including shareholders, finance providers, members of the public, professional bodies and of course audit firms themselves. The outcomes of this review could signal significant change for all sizes of firm, so it is important that all voices are heard at this stage. See more detail on the review and details of how to respond to this call for views here.


First OPBAS report

The new Office of Professional Body Anti Money Laundering Supervision (OPBAS) recently issued its first report on themes from its supervisory assessments. The report surprised some by how critical it was of a number of practices of the 22 Professional Body Supervisors, including the main accountancy bodies, relating to their AML record keeping, their lack of enforcement action, and supervision that was not rigorous enough.

Firms supervised by any of these bodies should be aware that there may be a response that involves more rigorous monitoring and enforcement, perhaps with greater penalties when AML reporting errors or omissions are found. It also seems possible that costs of supervision will increase if the supervising bodies accept the criticism and respond by increasing their activity in this area. Read more here.


Academies Accounts Direction 2018 to 2019

The Education & Skills Funding Agency (ESFA) has published its Accounts Direction for academy trusts preparing accounts to 31 August 2019. Changes are made in a number of areas, including additional guidance on testing and conclusions on regularity, changes to disclosure requirements in a number of areas and reflecting the application of Charity SORP Update Bulletin 2.

Earlier this month, the ESFA also published its online form and guidance for new related party declaration and approval requirements that came into effect on 1 April 2019.


Methodology and compliance products update

We recently issued an update to our Registered Social Housing Provider Specialist Assignment Manual (SAM) for relevant financial reporting, auditor standards and other relevant legislative changes. If you are a subscriber and have any administrative questions about this update, please email our Technical Manuals Team or call us on 0116 258 1200.




HMRC have published Capital Gains Tax: Private Residence Relief: changes to the ancillary reliefs April 2019

To better target private residence relief at owner occupiers, from April 2020 the government will reform lettings relief so that it only applies in circumstances where the owner of the property is in shared occupancy with the tenant. The final period exemption will also be reduced from 18 months to 9 months. The government will consult on these changes. There will be no changes to the 36 months final period exemption available to disabled people or those in a care home.

The consultation also proposes legislating ESCs D21 late claims in dual residence cases and D49 Short delay by owner-occupier in taking up residence and is also considering amending the interaction of the rules for inter-spouse transfers and PPR.

To read more please click here.


Biggest ever increase to National Living Wage comes into effect

1.8 million workers earning the National Living Wage will receive an additional £690 over the year from 1 April 2019. To read more please click here




See you at Accountex

On May 1-2 we will be returning to Accountex, where we're excited to exhibit alongside the leading businesses in the industry. This will be the first year exhibiting Mercia incorporating SWAT as a sole entity, so please come and say hello to our team who can provide you with the information on why we're the leading training and compliance provider in the UK.

Be sure to visit us at Stand 1070.


Updates to our website coming soon...

We are delighted to announce that there will soon be further enhancements to our website, in particular, the introduction of additional products and services that were previously only available on the SWAT website. Our new combined website will be live in the coming weeks, where you will notice a new and improved online experience. If you have an existing SWAT website account, then please look out for our updates and information on how the transition will happen, these will be with you shortly. Whether you are looking for training, technical support or help promoting your firm, we can help.

Please also look out for our emails informing you of how to access your website account when the new website is live.


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