Should we be worried

Barry

We were talking about this article written by Steve Collings in our office last week
http://www.accountingweb.co.uk/article/tax-simplification-proposal-receives-critical-response/519494
Should we be worried about our jobs as it would seem that Steve is saying that accountants are going to lose their clients or am I barking up the wrong tree?

Bluewednesday

I don't think you're going to lose clients, it's absolute madness, if anything I think clients' will need an accountant more as they will have to prepare income statements under one premise and a list of assets/liabilities under another - and all in 12 weeks to boot!!!

I sincerely hope this gets chucked out - I can't see that it's workable

deanshepherd

It's only a discussion paper. It won't get through as legislation in it's current form.

If the powers that be go for submission of a P&L only (no balance sheet) just using cash accounting then I don't see any harm in that. Makes our job easier.

In economic terms, profits = cash in the long term any way.

I just don't buy that profits (and hence tax take) are suddenly going to drop as companies try to manipulate their payments. If a company wants to reduce profits when cash accounting then it has to advance its payments to suppliers and delay being paid from it's customers. Do you really think anyone is going to turn away cash just to delay their inevitable tax liability? This could be a win win for everyone once the discussion paper has er.. been discussed!

Bluewednesday

Hi Dean

I thought I read that although they don't want a balance sheet as we know it they want a list of assets and liabilities which have to be prepared under accruals basis anyway?

Have I got that wrong?

It's the 12 weeks that gets me, I'm trying to look at it from the client's point of view and am struggling to see how it benefits any of them.

Monsoon

surely HMRC are still going to want a CT600 with statutory accounts? Isn't that where these whole things fall down? That is to say, fall down even more than the ludicrous 12 week suggestion.

deanshepherd

Hence why they want a discussion on the proposals.

Your thoughts can be directed to Julian Thompson at julian.thompson@bis.gsi.gov.uk, or:
Department for Business, Innovation and Skills, Spur 2, 3rd Floor, 1 Victoria Street, London, SW1H 0ET, or: ranted about to no effect on here.




If HMRC had written this discussion paper then I would have been more worried as their discussion papers usually end up in the legislation verbatim!