Back to cover page »

FEATURES
Six tips to help you become the ‘go-to’ expert
Heather Townsend gives her six top tips on how to achieve ‘go-to’ status in your marketplace.

Heather Townsend gives her six top tips on how to achieve ‘go-to’ status in your marketplace. 

Differentiating yourself from your peers is the challenge that every accountant faces. With today’s clients more inclined to look for a better service or deal, the pressure is on for every firm and professional to justify their fee levels and increase the value they bring to clients. 

One way of curing these commercial headaches is to grow a reputation as the ‘go to expert’ within your marketplace and firm. Heather Townsend, co-author of How to make partner and still have a life gives her six top tips to achieving this status. 

1. Identify your niche and commit to it
It’s common sense really, but it’s much easier to be ‘the expert’ on a small subject or niche than a large specialism. Your aim is not to piggy-back on someone else’s expertise, but to develop a niche that helps differentiate you - in your firm and the marketplace at large. 

What sector or technical specialism will become important for your firm and clients in the next five years? Where are there specific gaps within your firm’s expertise? Clues could be: over-loaded partners or practice areas, rapidly expanding departments, or partners on the retirement track. 

Don’t just look for clues internally: what’s happening within your market which will cause a requirement for new skills or expertise? For example, ten years ago (outside of the film and music industry) no one had heard of crowd-funding. 

Your niche does not need to remain static over time – it will grow and develop as you become more successful. For example, you could decide to focus on becoming the ‘crowd-funding’ expert for your firm and then develop into the expert in raising business finance outside of the normal routes, eg banks, private equity, angel investors etc. 

Many people decide to have a niche, but fail to truly commit to it. If you are not passionate about what you do, then it’s unlikely you’ll ever actually achieve ‘go to expert’ status. 

2. Identify your sound bite
If I asked you, what do you do? Or, why do clients choose to work with you? Could you articulate this in one short sentence? For example: 

  • ‘I help property developers get the best possible price for their business on exit’ 

This is your ‘sound bite’, and, ideally, it will become your suffix – what people attach to your name when they talk about you. Some other excellent sound bites used by accountants include: 

  • ‘I help big brands get value for money from their marketing agencies’
  • ‘I help family owned groups of company grow and protect their wealth’
  • ‘I advise retail companies helping them pay the lowest legal and ethical amount of tax’ 

A good sound bite should include who you work with and the value you bring to these clients. 

3. Write about your subject
It’s often said that a book is the best business card you can ever have. However, before you sharpen your pencils, you don’t need to go the whole hog and become a published author. You can write blog posts, white papers, articles for online and printed magazines or even your own e-book. Publicly communicating your expertise in this way will help get you noticed by the right people. 

Many accountants worry that they will give away their crown jewels if they write about their topic too extensively. Let me assure you that most information is already freely available. The value that you bring is your ability to demonstrate your understanding of the topic and apply it to the issues/needs of your audience – this is what clients are hiring you for. The more you write about your specialism and share this knowledge, the more interested parties will come across you and therefore associate your name with this area. 

4. Use social media to build up your presence
It’s actually your clients, introducers and prospects who award you the crown of ‘go to expert’. To get that crown, you need to build up an online footprint that oozes credibility and compels others to want to engage with you. Using LinkedIn, Twitter and your blog, or the firm’s blog, is an excellent way of building up your online footprint, sharing your content, connecting with influential people and building your target audience’s awareness of what you do. For example, use Twitter to share articles your niche would benefit from reading and join a LinkedIn group frequented by your clients and peers. 

5. Speak about your subject
While social media may be the ‘new-fangled’ route to becoming the ‘go to expert’, speaking and presenting about your subject is still a tried and trusted way to gaining acknowledgement as an expert. Therefore, dust off your public speaking skills and offer your services to speak at events, conferences or tele-seminars where you know existing and potential clients might be. 

6. Build strategic alliances
One of the best ways to create word-of-mouth recognition is to build strategic alliances. Actively look for people who either have a complementary skill to you, or work in the same niche. Getting referred to clients by a small, close-knit circle of introducers can help you extend your own reach significantly. To increase your commitment to building strategic alliances, give yourself a target for the amount of new business you want to win via this process. 

In summary, becoming the ‘go to expert’ will take hard work – you won’t get there overnight. However, stick at it – the rewards are well and truly worth waiting for. 

Heather Townsend helps professionals become the ‘go to expert’. She is the co-author of ‘How to make partner and still have a life’ and the author of the award-winning and best selling book on networking, ‘The FT Guide To Business Networking’.

Heather regularly blogs at ‘
How to make partner and still have a life’, and ‘Joined Up Networking’.





The complementary role of the business coach
Accountants and business coaches can offer complementary services to small business. Michael Shea explains how.

Accountants and business coaches can offer complementary services to small business. Michael Shea explains how. 

Micro businesses (those with fewer than 10 staff) and SMEs are the backbone of any economy. From them comes an enormous contribution to GDP, and it is from small start-ups that mighty corporations grow (think Microsoft, Google, Facebook and Apple). 

Of course, the reality is that an extremely small percentage of those start-ups eventually grow to straddle the globe, and what is more, it has been said that only 50% of new businesses are around two years after being founded, and only 20% after five years. 

Therefore anything that can be done to enable higher percentages to survive can only be good for the business owners, good for the economy in general and for their financial advisers (including their accountants). Once surviving, it would be equally beneficial that they thrived – by which I mean that they grow in turnover and profit, employ more people, pay more taxes and give their owners a well-deserved income far above that which the average employee might expect. 

Why do so many fail? There are many reasons: a person may be an expert in widget making, but not an expert in running a business; the business concept may be founded on a pipe dream, a pet hobby for example, that has an insufficiently large marketplace; the business may be under-capitalised, or simply losing track of cash flow – the curse of unexpected success. The chances are the owner has been focused on the day-to-day minutiae and not focused on the business’s three and five year horizons. 

For many businesses that survive and produce an acceptable income for the owner, there is a glass ceiling of revenue potential created by doing what has always been done, letting the business run the owner instead of the other way round. No forward planning for growth, no analysis of the past, just business as usual. 

It doesn’t have to be like that. 

For some businesses the prospect of increasing their net profit by over 60% in their next trading year is attractive enough, and for most small businesses highly achievable. For others, restricting their ambitions to just the next year is not enough: they have a sense that things could be much bigger than that. For both types of owner the business coach can help, but for the purposes of this article I’ll focus on the second type. 

First job
The first job that a business coach does is help the owner to objectively appraise their business and themselves, and to develop a vision of where they would like the business to be in, say, five years’ time – what will it look like, how large will the revenue be, how will customers and competitors view the business and its products, what will be the gross and net profitability. 

These aspirations are then expanded upon as coach and client work out the steps and measures that would be needed to move from the status quo to the vision. The product and service range is evaluated by the profitability of each and the contribution of each to the net profit (surprises are common when owners find that their favourite product causes them the most grief and produces the least profitability). The clientele is analysed and categorised, again for profit analysis purposes, and the sources of clients measured by volume and profit. 

For businesses with staff, an assessment of their performance is included and any training needs identified and training planned. Skill shortages are identified and recruitment plans with job and person specifications created. The owner will be encouraged to think about what sort of person is needed to do the jobs that need to be done, not what sort of jobs are suited to the people he already employs. Tactical and strategic marketing plans are worked out and short-term goals set. Throughout the intervention, the emphasis is on helping the owner to develop insights and the confidence to change their habits into more productive ones. 

Habits
And here we have a key word – habits. Amazon is awash with business books advising owners how to build a bigger and better life for themselves, and in truth most of what is in them is applied common sense. In fact, they don’t even have to buy a book to get the common sense commentary – they can phone their friendly accountant! So why is it that, having read the book/talked things through, so many then continue as they did before, as if they had received no advice at all? The answer is human nature. Habits are hard to break, and it is easy to rationalise a failure to make changes by saying ‘I’ll do that tomorrow, in the meantime I have today’s issues to deal with’. 

This is where the second, most important job of the business coach comes in. By regular contact – a weekly telephone conversation, a monthly or bi-monthly visit - the coach will persist in dragging the owner’s attention back to his or her commitment to achieve those short term goals, so that the long term success becomes inevitable. Every contact will result in new short term goals, and gradually the discipline of planning to work and working the plan will be internalised and become a new, more productive, habit. 

An important feature of the new habit regime is monthly financial reviewing. By checking if the revenue, gross and net profits are on target every month, corrective actions can be planned if the figures are not right. By looking at aged debtors and creditors and doing a cash flow forecast, early warnings of problems can be raised and action planned to alleviate them. If a shortage of cash is forecast, perhaps a visit to the bank to ask for a short-term overdraft facility, or negotiation with suppliers to defer payment for a week or two is in order; a campaign of chasing aged debtors might be carried out. 

Financial review
The financial review is normally something that a coach will include as part of the coaching service. However, it can be very helpful to the client if their professional services work in harmony. A tried and tested method of doing this is for the coach to ask the client’s accountant to conduct the monthly financial review in exchange for a portion of the coach’s fees. Such a co-ordinated approach has several advantages: having two people making the owner focus on every aspect of the business every month drives home the importance of the activities; the accountant has a closer understanding of the progress his client is making and can make valuable suggestions when it becomes time for expansion, for example; the accountant is compensated for his time, but only indirectly by the client – the client is only paying fees for the service to the coach. 

This is how the two services, coaching and accounting, can complement one another. 

Michael Shea – director, EnCours Ltd

 

Michael Shea is a director of EnCours Ltd, a management training and business coaching company, and can be contacted at michael.shea@encotrain.com, or by telephone on 01494 583 050.

 

 

 

 

 





University challenge
A significant number of students are leaving university looking to start their own businesses. What can you learn about these potential clients?

A significant number of students are leaving university looking to start their own businesses. What can you learn about these potential clients? 

Research published by StartUp Britain, carried out during its recent tour of Britain’s universities and further education colleges, suggests 63% of students ‘are now looking to start a business’. More freedom (29%) and wanting to ‘be their own boss’ (29%) are the key reasons. 

The research, based on feedback from 400 students aged 15-24, also suggests that a fifth of respondents believe starting their own business will be a route to higher earnings, but only 4% believe self-employment is their best way to avoid certain unemployment. A quarter of respondents hope to start a business in the technology sector. 

Tellingly, more than 70% of respondents cited the laptop as ‘the most essential piece of equipment for starting up’, followed by a mobile phone, but the preference for working remotely or from home really is popular, as only 0.3% believe that ‘having an office was important’. 

The survey was conducted as part of the 2012 StartUp Britain bus tour, which ‘aimed to inspire and support young people who are interested in starting their own business’. The tour stopped off at 40-plus colleges and universities in Britain (‘from Plymouth to Cardiff to Edinburgh and everywhere in between’). 

Should we find any of these figures surprising? Not at all. As a recent piece on Start Up Donut pointed out, graduates are now four times more likely to be unemployed shortly after leaving university than they would have been six years ago. At the end of 2011, 18.9% of those who graduated in the previous two years were unemployed. Not good, but not as bad as the beginning of 2010 when the figure peaked at 20.7% (source: The Guardian). 

Arguably, the very idea of being a successful entrepreneur is more appealing and more achievable than ever to young graduates. They’re inspired by the success of other young people who’ve started and grown enormously successful ventures, such as Facebook founder Mark Zuckerberg and a host of other extremely rich young entrepreneurs. Business reality TV programmes such as The Apprentice have also played a part, of course. Business is certainly not as naff or nerdy as it might once have been on campus. 

Thanks to technology, businesses can now be started very easily and quickly, at little cost and with relatively little effort required to run them (if you come up with the right idea, of course). This site features numerous case studies and profiles of many fantastic businesses started by young people, often by uni mates who go on to become successful business partners.  

A few weeks ago we published another very interesting blog entitled What is being done at British universities to inspire budding entrepreneurs? that, based on a Viking commissioned survey of 1,000 students, suggested that 70% of students found ‘the prospect of starting a business appealing, given the difficulty of the job market’. 

The piece also shed light on some interesting support programmes, namely BaseCamp at Bristol University, The Hatchery at Sheffield Hallam University and HeadStart at Nottingham Trent University. There are many other such programmes in other seats of learning in the UK – and long may they continue. 

Since launch, the Donut sites have also been a highly popular source of information for students and lecturers on university campuses and in schools and colleges, too. The challenge for government, universities, colleges, StartUp Britain and our very own website is to make sure that graduates get the information and support they need to help them start and grow their own successful businesses.   

Mark Williams is editor of the Start Up Donut 

This article was first published in December on the Start Up Donut, provided by BHP Information Solutions. Why not check out their Tax Donut or IT Donut now?  





ACCA SAYS
What makes you proud?
What does ACCA membership mean to you?

What does ACCA membership mean to you? 

What does being an accountant – and a member of ACCA – mean to you? We’re running a three month campaign exploring what makes members ‘ACCA and proud’. 

Share your thoughts
Do you remember what it was like when YOU become an ACCA member? How has being an ACCA member benefited your career? Do you feel more valued within your organisation? 

You can share your views with fellow members – and us – via LinkedIn. Simply search for ‘ACCA Official’ group and contribute to the discussion. 

While you think about it, here are some reasons why you should shout about your membership of ACCA: 

  • it is truly global, allowing you to take it with you and work around the world
  • the ACCA qualification is portable and valued by employers across all business sectors
  • ACCA Careers provided you with unrivalled access to career advice and job opportunities
  • our extensive programme of networking events allow you to connect with like-minded professionals across the country
  • we provide free technical advice via our website, telephone (020 7059 5920) and email

We’re currently putting together a short video of members explaining what membership means to them. Look out for it at our members’ network events across the country from March. 

We’re working on plans which encourage members to act as advocates and encourage future accountancy students by engaging with local schools etc. Can you help foster the next generation of accountants?





FOR YOUR PRACTICE
Help your clients secure a business loan with Barclays
Improve the chances of securing a business loan from the banks.

Improve the chances of securing a business loan from the banks. 

To give your business – or those of your clients – the very best chance of securing a business loan we asked Barclays to explain the criteria it uses to assess applications. Given that forewarned is forearmed, familiarising yourself with Barclays’ lending requirements should improve your chances of success when applying for finance. 

Information gathering
Barclays’ approach to lending is defined by its need to understand the potential borrower’s business. It will want to know about the borrower’s commercial history, its current financial position, and where the business will end up if it’s given the loan that’s being asked for. 

To do this Barclays looks at the facts that can be extracted from the potential borrower’s record keeping and planning, such as the business’s financial statements, management accounts, statement of assets and liabilities, bank statements, budget planning, business plans and financial forecasts. 

It is perhaps to be expected in today’s economic environment that the amount of information needed by the banks is fairly comprehensive. For accountants, this can create an opportunity to add value to the application process – either to carry out information gathering on behalf of the client, or to help the client understand how they can collate what’s needed. 

Follow up questions
Information gathered by the prospective borrower is then used by Barclays Business Managers to answer a few simple but important questions. Broadly speaking, these break down into the following four areas: 

  • the business’s banking history. Do the finances of the firm over time support the application?
  • what is the loan to be used for, and will the amount requested be sufficient to realise the borrower’s stated ambition?
  • can the borrower afford the loan? What will be the impact of the repayments on cash flow over the term of the loan?
  • and finally, the borrower’s personal investment in the business. Are they likely to stick around if the going gets tough? And what security can they provide for the loan facility? 

If the answers to any of these questions aren’t clear it’s likely that the Barclays Business Manager handling the application will contact the prospective borrower for clarification. Obviously the more information that can be provided up front, the less likely it is that the Manager will come back with supplementary questions during this phase. 

Assessment and decision
The final decision on the loan application will – in Barclays case at least – be taken by the Business Manager, perhaps in conjunction with one of the bank’s regional credit teams. 

Whoever takes the decision will need to be convinced that the purpose of the loan is sound, that the borrower is able to service the loan, and that there is sufficient security in place to protect the bank in the event of default. They will also want to know that the borrower’s business has a credible fall back position if their plans do not bear fruit. 

It is possible that, despite your best endeavours to adhere to the guidelines set out in this article, your application for finance will be unsuccessful, so apply to a bank that is prepared to explain its decision. Lenders are sometimes able to suggest simple changes to how borrowers manage their business finances that will help future loan requests. 

Barclays offers cashback on business loans
As part of the Bank of England’s Funding for Lending Scheme, Barclays has introduced Cashback for Business. Businesses that take out a loan of £10,000 or over or a commercial mortgage over £25,000 could be entitled to an immediate, upfront, cash injection of 2% of the loan amount.

Cashback for Business is available for new and existing Barclays customers. Business loans and commercial mortgages with a term of three years or longer are eligible and funding is subject to availability. For a full list of terms and conditions, visit the Barclays' site

Further information
Learn more about Barclays business loans, overdrafts and mortgages or, if you’re an existing customer, speak directly to its lending specialists on 0845 300 9641. 1 

Barclays has produced an eight-step guide to help owner-managers make successful applications for business finance. You and your clients will find it on the Barclays Business Lending page of Barclays site. 

Barclays have contributed to an extensive guide to obtaining business finance on ACCA’s website. 

Important information1
Lines are open Monday to Friday 8am-8pm and Saturday 9am-1pm. To maintain a quality service, Barclays may monitor and record phone calls. Read our call charges and information





Need to renew your PI or other insurance?
Lockton offers insurance solutions tailored exclusively for ACCA members.

Lockton offers insurance solutions tailored exclusively for ACCA members. 

Lockton is privileged to have a long standing working relationship with ACCA and its members for over 20 years. 

Therefore, next time your professional indemnity cover is due for renewal why not obtain an alternative quotation from our exclusive ACCA Scheme which is the preferred choice of over 2,400 firms? Underwritten by Royal & Sun Alliance, one of the premier insurers operating within this specialised field, the ACCA PI scheme is the UK’s largest insurer of Chartered Certified Accountants. 

As a market leading provider to the accountancy profession we offer cover for: 

  • Professional Indemnity (PI)
  • office
  • working from home
  • directors’ & officers’ liability (D&O). 

There are considerable benefits to member firms insured on the scheme, including: 

  • legal expenses cover
  • increased cover for court attendance
  • increased cover for loss of documents
  • Quality Mark firms receive a further 10% discount
  • employers' & public liability cover available at reduced rates
  • directors’ & officers’ insurance available at reduced rates
  • competitively priced and broad-based office insurance cover
  • 18 month policies available
  • roll-over policies available for most firms – eliminating the need to complete lengthy forms each year
  • interest free instalments. 

By choosing to insure with the endorsed scheme, all member firms are underwritten on an individual basis but will also benefit from the improved rates associated with the size of the Lockton client book and the bulk buying power that goes with it. 

Members are able to select the level of cover most appropriate for their particular practice – whilst confident that all options are fully compliant with both ACCA and ICAEW Practising Regulations. 

Directors’ & officers’ insurance
Directors' & officers' liability (D&O) is an incredibly important protection in that it provides indemnity to all past, present and future directors & officers (any one in a managerial/supervisory role) for any personal liability that they may assume while carrying on their business. 

It may surprise you to know that your personal liability is unlimited if pursued individually for exposures that emanate from your professional life and that the company’s limited liability status does not protect you or limit your liability in this regard. 

Individuals (directors/officers/partners/members) can be pursued for a variety of actions most commonly arising from three areas: 

Breach of health & safety policy:

  • in the event of an injury or illness to an employee or third party, where an allegation can be brought against the business for negligence, it is increasingly common for law firms (particularly on ‘no win no fee’ arrangements) to name an individual as a second defendant to guarantee some success and avoid the phoenix company scenario
  • corporate manslaughter is now very real and there are case examples of businesses and individuals being prosecuted
  • legal costs in this area can be considerable and a company can only provide assistance to individuals if successful in defence – therefore you must ask, could your business afford to provide legal assistance and what happens if your defence fails, can you afford to repay the company? 

Financial mismanagement:

  • allegations of wrong doing can be made against individuals for negligent management which results in a loss 

Employment law:

  • individuals are increasingly pursued by career claimants and disgruntled employees/ex-employees/unsuccessful applicants and others for allegations of wrong doing in respect to:
    • bullying
    • harassment
    • discrimination. 
  • we must stress that actions can arise from any allegation no matter how spurious and as employment law is a procedure dominated environment, it is possible for a claim to succeed due to the business falling foul of procedure having essentially done nothing wrong. 

Many of the claim examples mentioned above may also be subject to the company reimbursement as permitted by the articles / memorandum of association. 

Cover can be arranged on a fully retroactive basis so provided you are not aware of an action at this time all past liabilities will be covered. Such a policy will also provide indemnity to the ‘entity’ (business) in addition to the individual from claims made in respect to the same allegations. 

Office insurance and working from home
The ACCA office insurance policy offers all risks protection for your business assets. The policy is highly flexible and can be arranged to suit companies of all sizes. Cover is available for buildings, contents, computer equipment and the cost of replacing business books and work in progress. Some cover is offered for equipment in transit and members working from home can also obtain appropriate protection. Protection is automatically included for employees, as required by statute, and for public liability of up to £2.5m; this is over twice the usual limit for this type of insurance. 

In addition, members may arrange cover for loss of income and for the cost of hiring alternative premises and equipment. Staff overtime payments can also be insured, adding up to a complete package for ensuring minimal disruption to your business affairs. 

There is much that we can offer to protect your business in its widest sense. 

Contact Lockton’s ACCA team for further information on 0117 906 5000 or email catherine.davis@uk.lockton.com

 





Survey: lifting the lid on SME business savings
Aldermore – one of the UK’s best known ‘challenger banks’ – invites ACCA members to complete a short survey on SME savings.

Aldermore – one of the UK’s best known ‘challenger banks’ – invites ACCA members to complete a short survey on SME savings. 

During 2013, Aldermore aims to champion SMEs in the UK. In order to accomplish this, it is listening to what businesses are saying: what SMEs are saying about their market, their relationships with banks and their business savings. 

You can contribute by completing this short, anonymous survey.





Business Finance Advice Scheme – how to sign up
The new Business Finance Advice Scheme is signing up accountants now, ahead of its launch. Find out how it can benefit your firm.

The new Business Finance Advice Scheme is signing up accountants now, ahead of its launch. Find out how it can benefit your firm.  

The Business Finance Advice Scheme is a new government-backed initiative which aims to ensure small businesses have access to all the information they need about the most appropriate financing option for their business – from bank loans to equity finance or crowd funding.  

Part of a wider initiative to encourage entrepreneurship, it ensures businesses have access to a wide choice of professionally qualified advisers across the UK who can offer relevant, independent advice on the whole range of business finance options. 

Qualified accountants from ACCA, ICAEW and ICAS will be providing this critical service to small businesses – you now have an opportunity to offer ‘kite-marked’ financial advice to your clients with the minimum of red tape or expense. To date, over 2,000 practices have signed up. 

How to participate
To join this free scheme, ACCA members in practice are required to complete an opt-in form, which lists four specialisations:  

  • business plans
  • business start-ups
  • small scale equity issues
  • bank loans and overdrafts.  

You can opt-in now by completing this form.   

Further information on the scheme and specialisations is available on our website. If you have any queries, please email us.  





Make a head start on your CPD
Details of ACCA's Saturday CPD Conferences, plus the 2013 Budget Breakfast.

 Details of ACCA's Saturday CPD Conferences, plus the 2013 Budget Breakfast.

To register and book any of the events below, visit http://events.accaglobal.com

 

Saturday CPD Conference One 

London
16 February

Bristol
23 February

Glasgow
2 March

Swansea 
9 March 

London 
16 March 

Sheffield 
23 March 

London 
6 April 

Birmingham 
13 April 

Manchester 
20 April 

2013 Budget Breakfast

Budget Breakfast
 
21 March 





Looking to improve your Anti-Money Laundering procedures?
Now is the time to see if we can make your anti-money laundering checks easier. Save 10% on your first year fees when taking our service before 31 March 2013.

Compliance Assist vector A_01v2

Now is the time to see if we can make your anti-money laundering checks easier. Save 10% on your first year fees when taking our service before 31 March 2013.

Worried it may be too complicated? Our quick and simple to use system undertakes checks in seconds and is available to practices of any size. The service is fully backed by analysts who are available to answer all your questions and provide support. 

The Money Laundering Regulations and their risk based approach have been around for a while, along with a number of services to assist with your 'Know Your Customer' procedures.  Launched in January 2012, ComplianceAssist has been designed to take due diligence support to a new level, helping business of all sizes to reduce the impact of regulation while improving compliance. 

Our service is more than just a technical solution: in addition to enabling access to data from a wide range of leading providers we have analysts available 8:30 – 5:30, Monday to Friday to support your business. No matter what the challenge, from reviewing potential sanctions matches to undertaking additional bespoke checks required as part of your risk based approach, we have it covered. 

For larger volumes we can provide access to integrate direct to our service at no extra cost, saving you even more time. 

After a successful 2012 we would like even more companies to experience the benefits of our service. Therefore, we are offering any practice signing up before 31 March 2013 a 10% discount on all fees for their first year. Just quote 'in practice' when you contact us. 

Call us now to discuss your specific requirements and see how we can help your business. 

Contact: Darren Hickman
Telephone: 0800 07 87 421
Email: dhickman@complianceassist.co.uk
Or visit our website at www.complianceassist.co.uk


Anti money laundering guidance

For further guidance, view ACCA's Technical Factsheet 145: Anti-money laundering guidance for the accountancy sector





TECHNICAL MATTERS
Companies limited by guarantee
Often a source of confusion, this guide to what constitutes a company limited by guarantee should help.

Often a source of confusion, this guide to what constitutes a company limited by guarantee should help. 

Companies limited by guarantee is one aspect of financial reporting that causes more confusion than it should when, in reality, it is fairly straightforward. 

A company limited by guarantee is just a limited company, but with the obvious difference to the usual company entity of there being no share capital. The company’s members are guarantors rather than shareholders. 

This form of company entity is often used by charities, but not all companies limited by guarantee are charitable in nature. Other common uses for this type of company are membership organisations and clubs, including sports associations. It is less likely to be used by a normal trading business, as profits cannot be distributed to members by way of a dividend. 

The same rules and regulations apply to companies limited by guarantee as to companies with a share capital. This means that the company will have to file accounts at Companies House within the usual deadline, file annual returns, keep proper accounting records, appoint directors and file returns with HMRC. If the company is a charity, registered with the Charity Commission, it is likely that HMRC will not require a CT600 and there will be no corporation tax to pay. But this is not a blanket exemption, and the status of being limited by guarantee does not, of itself, allow a company to escape the liability to corporation tax. The company is required to have at least one director. 

Main difference
The main difference between a company limited by guarantee and one limited by shares is that the liability of shareholders is limited to the amount unpaid on shares, whereas the liability of guarantors (the members of a company limited by guarantee) is limited to the amount that they guaranteed. In most cases the amount guaranteed will be £1 per member (similar to the ordinary £1 share in a company limited by shares). 

Members cannot receive dividends, and will usually be involved due to their commitment to the company’s objectives, rather than to benefit financially. The memorandum and articles will usually differ from those of the standard share capital company and will generally include a defined list of specific objectives, and also a clause that prohibits the distribution of surplus profits. 

The balance sheet of a company limited by guarantee will be the same as that of a company limited by shares, apart from the fact that it will have no share capital. The bottom section of the balance sheet should be headed ‘Reserves’ rather than the usual ‘Shareholders’ funds’. There is no requirement, but it is common practice, to also include a note disclosing the guarantees; something simple such as: ‘The company is limited by guarantee of members and does not have a share capital. The liability of members is limited to £1.' 

The usual rules about related parties will apply, and the director(s) will be related parties in the usual way. Whether or not a member falls into the definition of related party will depend on the circumstances. 

Payments to members can only be by way of remuneration, as no dividends are possible. If the company is a charity, the members may also be trustees, and there are of course rules about payments to trustees. If the company limited by guarantee is a charity, the disclosure requirements, rules and requirements laid down by the Charity Commission, the Charity SORP and the Charities Acts will also need to be adhered to. 





Simpler income tax system for small businesses
HMRC has published draft legislation which includes the transitional rules for the cash basis and simplified expenses rules for small businesses.

HMRC has published draft legislation which includes the transitional rules for the cash basis and simplified expenses rules for small businesses. 

The cash basis
From the 2013/14 tax year, self employed individuals or partnerships carrying on a small trading business will be able to choose to be taxed on the cash basis rather then being asked to do accounting adjustments designed for more complex businesses. 

However, the new rules will not be available for every small business. The excluded persons are companies, limited liability partnership, Lloyd’s underwriters, a person with a section 221 ITTOIA profit averaging election or a business with a current herd basis election. 

Also excluded from the cash basis are certain trades such as dealers in securities, lease premiums, managed service company, waste disposal, intermediaries treated as making employment payments, ministers of religion, pool betting, cemeteries and crematoria. 

Businesses can enter the cash basis if their receipts for the year are less than the amount of the VAT registration threshold (currently £77,000) or twice that (currently £154,000) for recipients of universal credit. Businesses must leave the cash basis after their annual receipts exceed twice the amount of the VAT registration threshold (currently £154,000). 

The key aspects of the cash basis are that: 

  • it is an optional scheme which small unincorporated businesses can elect to use
  • it will work on cash received (including all amounts received in connection with the business such as disposal of non-durable assets and VAT refunds)
  • cash spent on expenses that are wholly and exclusively for the purpose of the trade, including capital expenditure on non-durable assets (but excluding business entertaining and purchase of property or other ‘investment’ assets). However, interest payments are allowed up to a limit of £500 without the need to establish that the borrowing is financing capital employed in the business
  • there is a mandatory requirement to use a fixed allowance for business mileage (rather than deductions for actual expenditure on purchasing, maintaining and running a motor vehicle or motor cycle, apportioned between business and private use). This is mandatory for the use of cars or motorcycles by businesses using the cash basis
  • expenses are inclusive of VAT and include payments of VAT
  • business losses may be carried forward to set against the profits of future years but not carried back or set off 'sideways' against other sources of income
  • there is an optional flat rate allowance for business use of home (rather than deductions for actual amounts, apportioned between business and private use)
  • there is an optional three tier banded rate for the adjustment for private use of business premises (rather than a deductions for actual amounts apportioned between business and private use)
  • the legislation provides the framework for transitional rules on entering or leaving the cash basis, the purpose of which is to ensure that income and expenses are only taxed/allowed once. The transitional rule also includes the usual adjustment of spreading the income over the following six tax years when the business leaves the cash basis. 

Simplified expenses
The draft legislation includes the framework for three types of simplified expenses. Under the new rule the allowable expenditure may be calculated using a simple flat rate allowance rather than a potentially more complex apportionment of actual expenditure. 

Businesses that do not elect to use the cash basis will have the option to use any or all of the simplified expenses as they wish. The simplified expense rule is entirely optional and outside the cash basis. The three types are highlighted below. 

Expenditure on vehicles
Businesses that do not use the cash basis have the option to use the mileage rate for cars and motor cycles. Businesses using other vehicles, such as vans, can use the mileage rate if they wish or can claim the purchase, lease and running costs as a deduction, as they do currently. 

Use of home for business purposes
Businesses that use the home for business purposes can opt to use a standard monthly deduction (of £10(for 25-50 hours per month), £18 (for 51-100 per month) or £26 (for 101 or more per month)) based on the amount of time spent working at home. Alternatively businesses can choose to claim an allowable portion of actual expenses. 

Business premises used both as a home and for the business
Where business premises are used partly for private purposes as a home a standard monthly adjustment (of £350 (one occupant), £500 (two occupants) or £650 (three or more occupants)) can be made based on the number of occupants using the premises as a home. Alternatively businesses can choose to identify the allowable portion of actual costs if they prefer. 

It appears that the new rules are aimed atreducing the administrative burden of a business and shows the government’s intention to make it easier for small businesses to calculate their taxable income, as well as providing them with more certainty over their tax affairs. 

Further guidance on the simplified rules for small businesses is available.

 





Finance Bill 2013: at a glance
A summary of the key parts of the Finance Bill 2013.

A summary of the key parts of the Finance Bill 2013. 

The Finance Bill 2013 was published on 11 December 2012. The majority of measures were announced in Budget 2012, with further measures being announced in the 2012 Autumn Statement.  The final contents of the Bill will be subject to confirmation at Budget 2013. This article summarises the main provisions introduced in the Bill. 

Income Tax: 

  • Personal tax allowance – increased from £8,105 to £9,440 from April 2013.
  • Basic rate income tax band – being further reduced from £34,370 to £32,010 with effect from 6 April 2013.
  • Additional rate income tax band – reduced from 50% to 45% with effect from 6 April 2013
  • Universal credits – to be introduced from 1 October 2013; will be exempt from income tax.
  • Cap on unlimited tax reliefs – legislation will be introduced to cap unlimited income tax reliefs to the greater of £50,000 or 25 per cent of income. For details of the reliefs that will be subject to the cap, please click here.
  • Pensions tax relief – the standard lifetime allowance will be £1.25m for the 2014-15 tax year onwards. The annual pension saving allowance will be reduced from £50,000 to £40,000 for the 2014-15 tax year onwards. 
  • Statutory residence test – legislation will be introduced to provide a statutory residence test for individuals from 2013-14. The legislation will also provide for a tax year to be split into a UK part and an overseas part in certain circumstances, and contain new rules for the taxation of certain income and gains arising during a period of temporary non-residence. For further details of the new statutory residence test, please click here.
  • Ordinary residence – legislation will be introduced to eliminate the concept of ‘ordinary residence’ for tax purposes as far as possible. In particular, overseas workday relief, which has previously been available to taxpayers who are resident but not ordinarily resident, will in future apply for a fixed period, regardless of whether or not the individual intends to settle in the UK
  • Remittance basis for non-domiciled individuals – changes are being made to the remittance basis to prevent inadvertent remittances to the UK being taxed. Legislation will be introduced and put into SP1/09 on a statutory basis. For our Guide to the Remittance Basis and Non-Domicile Levy, please click here.


Capital Gains Tax: 

  • Annual exemption – this remains unchanged at £10,600 for 2013/14. The annual exempt amount will increase to £11,100 for 2014/15 and to £11,100 in 2015/16.
  • Exemption for gains on disposals of ‘employee shareholder’ shares – the government will create a new employment status, to be known as the ‘employee shareholder’ status. Individuals adopting this status will receive a minimum of £2,000 worth of shares. To support the policy aims of the ‘employee shareholder’ status, legislation will be introduced to exempt all gains made on disposals of up to £50,000 worth of ‘employee shareholder’ shares from capital gains tax. This exemption will commence on 6 April 2013. 
  • Enterprise Management Incentives (EMI) – entrepreneurs’ relief on shares acquired through the exercise of EMI share options is to be improved. Legislation will be introduced to extend the relief to EMI shares by removing the 5% minimum shareholding requirement and allowing the 12 month minimum holding requirement to commence on the date the option is granted. This measure applies to shares acquired on or after 6 April 2012 that are disposed of on or after 6 April 2013.
  • Review of tax advantaged employee share schemes – legislation will be introduced to give effect to the Office of Tax Simplification’s proposals to simplify aspects of the tax advantaged employee share schemes: Share Incentive Plans, Save As You Earn Option Schemes, Company Share Option Plans and Enterprise Management Incentives.
  • Capital gains on disposals by an offshore non-natural person – the legislation introduces a CGT charge on the disposal proceeds of high value residential property held by an offshore non-natural person from April 2013. The rate of the CGT will be 28%, with a tapering relief for gains where the property is worth just over £2m.  Due to their non-resident status, offshore non-natural persons would not currently subject to the CGT regime. However, this charge will apply only to that part of the gain that is accrued on or after 6 April 2013

Business Tax: 

  • Annual Investment Allowance – increased to £250,000 for expenditure incurred in the two year period from 1 January 2013 to 31 December 2014. For further details on the Annual Investment Allowance, please click here.
  • Personal services companies and IR35 – following the consultation on the ‘Taxation of Controlling Persons’, the government has decided not to proceed with this proposal. Instead, legislation will be introduced to put beyond doubt that the intermediaries legislation (IR35) applies to office holders for tax purposes. HMRC will still be using the IR35 Business Entity Tests.
  • Tax simplification for small businesses – legislation will be introduced to enable eligible unincorporated small businesses to choose to use the cash basis when calculating taxable income.  All unincorporated businesses will also have the option to use certain flat rate expenses when calculating taxable income. These measures will be available to unincorporated businesses whose turnover is below the VAT registration threshold. The measures will have effect from the tax year 2013-14. See also Simpler income tax system for small businesses
     

Corporation Tax: 

  • The main rate of corporation tax – reduced from 24% to 23% from 1 April 2013 and then to 21% with effect from 1 April 2014. The small companies’ rate remains at 20%.
  • Disincorporation relief – legislation will be introduced to allow small companies to claim disincorporation relief. Disincorporation relief will allow a company to transfer goodwill and an interest in land to its shareholders so that no corporation tax charge on the company arises on the transfer. The relief will be available for a limited period of five years effective for disincorporations occurring on or after 1 April 2013 and to companies where the value of the qualifying assets transferred does not exceed £100,000.
  • Gaming, animation and ‘high-end’ television industries – the legislation introduces an additional deduction of 100% qualifying core expenditure and a payable tax credit of 25% for losses surrendered, up to a maximum of 80% of the total core expenditure by the qualifying company.
  • Above the line R&D credits for large companies – the legislation will introduce an ‘above the line’ tax deduction on qualifying R&D expenditure for larger companies from 1 April 2013. Following consultation, the following has been agreed:

    Following consultation, the government has decided that the ATL credit will be:
    • a taxable credit paid at a headline rate of 9.1%
    • fully payable, net of tax, to companies with no corporation tax liability 
    • available for qualifying expenditure incurred on or after 1 April 2013 
    • introduced alongside the existing super-deduction in April 2013 and will replace the super-deduction in April 2016  
    • available to surrender to group companies
    • safeguarded from abuse through the introduction of a Pay As You Earn (PAYE)/National Insurance Contribution (NIC) cap on the payment of the credit to companies with no corporation tax liability.

View our existing guidance on R&D tax relief

Anti-Avoidance:
General Anti-Abuse Rule (GAAR) – the GAAR will come into effect in relation to abusive tax arrangements entered into on or after the date of Royal Assent to Finance Bill 2013. HMRC’s guidance on the GAAR comes in three parts, although this is still subject to the consultation process:


Other Taxes:
 

Inheritance Tax – extension of nil-rate inheritance band for non-domiciled spouses – the general rule is that anything passing between spouses is exempt from inheritance tax. However, where a UK domiciled person passes assets to their non domiciled spouse the inheritance tax-free allowance is limited to £55,000, a figure which has been unchanged since 1982. Based on current rates, the maximum that can be passed to a non-domiciled spouse free of tax is £380,000 (being the nil-rate band of £325,000).   

With effect from 6 April 2013, the inheritance tax free sum that can be paid to a non domiciled spouse will be increased to the amount of the nil rate band, ie £325,000, meaning that the maximum that could be bequeathed to a non domiciled spouse will increase to £650,000. From 6 April 2013, an individual can make an election to be treated as UK domiciled for IHT purposes.

Inheritance TaxIncrease in the nil-rate band – the nil-rate band is fixed until 5 April 2015 at £325,000 but, with effect from 6 April 2015, it will increase to £329,000. 

Stamp Duty Land Tax – a new 15% rate for purchased properties worth more than £2m from 20 March 2012

Annual residential property tax – a new annual tax charge on residential properties worth more than £2m owned by non-natural persons. 

For a link to all of the draft clauses and explanatory notes, please click here

For further guidance on taxation matters generally, please visit the taxation section of ACCA UK’s Technical Advisory website.





Don’t ignore the credit!
Universal credit is likely to have a significant impact on small businesses. Help them prepare – now.

Universal credit is likely to have a significant impact on small businesses. Help them prepare – now. 

When working tax credit and child tax credit were introduced, many tax practitioners chose not to advise on these benefits. This is unlikely to be an option when universal credit comes into force. 

HMRC’s welfare responsibilities are to be moved back to the Department for Work and Pensions (DWP), but the welfare implications of tax advice will become more important for tax advisers. 

One reason for this is‘real time information’ (RTI), where employers are required to report their employees’ pay, tax and national insurance deductions to HMRC online, on or before payment, and HMRC makes the data available to the DWP to calculate the employee’s entitlement to universal credit.  

There will be no penalties for the first year of operation of RTI, but when the majority of persons become entitled to ‘universal credit’, this may no longer be the case. 

Universal credit will start to supersede tax credits gradually between Autumn this year and 2017. From April 2014, it will no longer be possible to make new claims for tax credits, but the bulk of tax credit or benefit claimants will not be in the new system until 2015/16, just over two years’ time. 

Tax credits, working tax credit in particular, support many business owners when starting out or experiencing difficult times. Disabled persons in particular have been helped from welfare into work by these credits, which are aligned with the tax system. Many of these may be people who have never needed to complete a tax return; this is about to change. 

However, whereas there are problems with employees, not least in relation to the higher income child benefit charge, it is the self-employed who will need most assistance and these are the client base of many practitioners. 

Gainful self-employment
‘Gainful self-employment’ means that the claimant is carrying on a business that is ‘organised, developed, regular and carried out in expectation of profit’ and the claimant is taking active steps to increase their earnings. This would usually be expected to reach the equivalent of 35 hours at the minimum wage per week. In this case, the claimant’s earnings from self-employment are subject to the minimum income floor (a minimum level of profit per month). 

Where they do not meet this requirement and the claimant continues in self-employment, they will be subject to conditionality requirements; they must attend interview courses and take steps to increase their earnings. 

Calculation of self-employed earnings
It is the calculation of self-employed earnings that will place the greatest burden on small businesses. Self-employed earnings are based on the ‘gross profit’ of a monthly assessment period. Unlike the normal accounting definition of ‘gross profit’, the figure will be based on the actual receipts of the month, including tax, VAT or NICS repayments from which are deducted tax, Class 2 and 4 NIC, ‘permitted expenses’: amounts wholly and exclusively incurred for the purpose of the business, except any that were ‘incurred unreasonably’ (not defined)! 

No deductions can be made for payments of capital or interest on a loan. 

Unlike normal accounts, there is no provision for accruals or carry forward of a deficit from one month to another. Thus an annual expense (insurance is a prime example) incurred for a year in advance can only be deducted in the month in which it is paid, even though it relates to a whole year. 

Universal credit is based on an assessment period of one month. The requirement to account monthly on a different basis from HMRC and within seven days from the end of the month will create an enormous burden on small businesses and they are the most vulnerable. The basis of reporting will also create distortions and the accountant who can explain the differences will be needed more than ever. 

Employed: self-employed?
Under these provisions a self-employed person can be doing the same tasks as an employed person and working the same hours for the same money and be deemed to be earning more. 

The good news is that the legislation has yet to be debated and pass into law. We can only hope for some changes, but be prepared: the commencement is not far away. 

Prepare now!
Members are well-advised to ensure that their engagement letters can cope with this addition to their services; in the case of tax credits, the composite letter may well be the recommended choice.

ACCA’s engagement letters and Technical Factsheet 173 may help. 





HMRC’s VAT campaign
HMRC is running a campaign which allows businesses with outstanding VAT returns or payments to bring them up to date by 28 February 2013.

HMRC is running a campaign which allows businesses with outstanding VAT returns or payments to bring them up to date by 28 February 2013. 

This campaign is aimed at businesses that are already registered for VAT and have either outstanding VAT returns or outstanding VAT amounts due. To encourage compliance, HMRC will give the best terms available when calculating penalties and default surcharges if applicable. 

To fall within the remit of the campaign you need to submit outstanding or corrected VAT returns and make any payments due by 28 February 2013. HMRC has stated if your VAT returns are still outstanding by this date then your ‘tax affairs’ will receive closer attention from them. Please note the term ‘tax affairs’: this should to be interpreted in its widest scope, ie not just restricted to VAT. 

ACCA has produced Guides To… on a number of helpful schemes for small businesses. These free guides can be reproduced by practitioners (with space to add your company logo) and shared with clients. Relevant Guides To… include: 

A business should not forget to use the bad debt relief, the ability to reclaim the VAT on previous accounting is invaluable. 





FRC consults on amending ISA 720
FRC invites comments on ISA 720.

FRC invites comments on ISA 720. 

The Financial Reporting Council (FRC) is looking for comments on an exposure draft of ISA 720 The Auditor’s Responsibilities Relating to Other Information in Documents Containing or Accompanying Audited Financial Statements and the Auditor’s Report Thereon

ISA (International Standard on Auditing) 720 is issued by the International Auditing and Assurance Standards Board (IAASB) and is used as the basis for the FRC’s ISA (UK and Ireland) 720 Section A which has the same title. 

The IAASB has published an exposure draft of ISA 720 which includes significant changes to the current standard, and the FRC is looking for comments from interested parties about the proposed modifications before it finalises its response to the IAASB. 

The revision proposed by the IAASB reflects a number of developments in the corporate reporting environment in terms of changes to the type and scope of the information included in documents containing financial statements and the associated auditor’s report. The developments in question include: 

  • annual reports that generally convey more narrative and qualitative information than in the past, such as description of the entity’s business model, risks exposure and uncertainties
  • integration of information in different parts of a corporate reporting package
  • larger use of electronic distribution for annual reports
  • increased and different use of documents other than the annual report for external communication of matters connected with audited accounts; in particular relevant information is often presented in documents accompanying the financial statements rather than containing the financial statements. 

The exposure draft of the new ISA 720 addresses these developments with the following main changes to the current standard. 

Extending the scope of the standard to include documents accompanying audited financial statements
The auditor, as well as reading and considering other information included in documents that contains the audited accounts, should also do the same for other information included in an accompanying document that has the primary purpose of providing commentary to enhance the users’ understanding of the financial statements or the financial reporting process. 

For example an entity may distribute, along with its financial statements, additional documents such as the chairman’s statement, management reports or statements on corporate governance, internal control and risk assessment etc., that may fall within the scope of the new standard and should be read and considered by the auditor. 

Extending the auditor’s responsibilities to include reading and considering the other information for consistency with the auditor’s understanding of the entity and its environment acquired during the course of the audit
This is in addition to reading the other information for consistency with the audited financial statements. The draft requires the auditor to respond appropriately if, by reading the other information, he identifies that there may be a material inconsistency in the other information or that the audited financial statements may be materially misstated. 

An inconsistency in the other information exists when incorrect, unreasonable or inappropriate information is included in it or when other information is presented in a way that omits or obscures information that is necessary to understand the matter being addressed. If the auditor identifies that such a material inconsistency may exist, he is required to discuss the matter with management and, if necessary, perform other procedures to confirm whether that is the case. 

If a material inconsistency exists, the auditor shall ask management to correct the other information and consider either withdrawing from the engagement or reporting accordingly if the correction is not made. If conversely the auditor identifies that the financial statements may be materially misstated in light of the other information obtained, he should review his risk assessment in accordance with ISA 315 and potentially revise his planned procedures. 

Enhancing transparency of the auditor’s work in respect of the other information through new suggested reporting responsibilities
In particular the auditor would be required to include a statement in the auditor’s report indicating a description of his responsibilities about the other information, the identification of the specific documents read and considered, whether he has identified material inconsistencies and, if so, a description of them and a statement that the auditor has not audited or reviewed the other information and accordingly does not express an audit opinion or a review conclusion on it.             

The specific questions on which the FRC is seeking feedback can be accessed from the consultation paper, while the IAASB exposure draft is also available.





HMRC running ‘direct selling’ campaign
HMRC is running a campaign for ‘direct selling’ until 28 February 2013.

HMRC is running a campaign for ‘direct selling’ until 28 February 2013. 

Direct selling usually involves door to door selling or selling in a customer's home or in a customer's workplace. Direct sellers are commonly referred to as: 

  • agents
  • consultants
  • representatives
  • distributors. 

The actual process of selling may involve demonstrating products to customers at their home, workplace, at a party or by using catalogues which may be given to friends, relatives or anyone else. The income earned by the ‘seller’ will usually be a commission on the sales made. The time involved will not be relevant, so it could be part time or a full time commitment. 

HMRC generally views direct sellers as self-employed and therefore the seller is responsible for informing HMRC what they earn and for calculating and paying any tax and national insurance due. This is the general view: not all direct sellers are considered to be self-employed, a simple way to test is if you – or a client – say yes to all of the following questions: 

  • do you have responsibility for your business?
  • can you decide how and when you do your work?
  • are you paid on a commission only basis?
  • do you risk your own money in setting up and running your business?
  • do you receive no holiday or sick pay from the company you represent?
  • can you hire other people to help you or do the work for you? 

It is worth noting that an individual can be both self-employed and employed at the same time. 

The campaign targets direct sellers who started trading before 6 April 2011 and have not informed HMRC. To encourage compliance, HMRC will give the best terms available in terms of penalties if income is disclosed voluntarily and any tax and national insurance owed is paid. HMRC may also allow payment of any outstanding tax and national insurance by instalments; however, this is discretionary. 

If you have any clients who are direct sellers, they can contact HMRC by post, via email or via the online form on HMRC's website. They must tell HMRC about: 

  • all income, gains, and other liabilities owed
  • following the guidance the amount of interest due for the late payment
  • assess the correct level of penalty to reflect why the right amount has not been paid in the past
  • pay what is owed. 

Details of HMRC’s direct selling campaign, access to the online form and how to calculate any sums owed is available on HMRC’s website





How secure is your phone line?
Are you doing enough to prevent your phone system being abused?

Are you doing enough to prevent your phone system being abused? 

While we have all heard stories about computer hackers and do our best to ensure that confidential information on our computer systems is secure, do we do enough to prevent hacking of our telephone systems? 

There have been cases recently where a firm’s telecoms system has been hacked, and calls costing thousands of pounds have been made. The service provider might not notice the fraud for some weeks. In one case, the calls were made overnight when the premises were empty and the voicemail system activated. The fraudsters hacked into the mailboxes to enable call forwarding and then made calls overseas. 

One solution is to secure the system by barring all outgoing calls each night or whenever the premises are empty, and then lifting the restriction each morning.  This would prevent the lines being used and save the ordeal of a legal fight over a phone bill of thousands of pounds.

Email Software by Newsweaver