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Tame the budget circus, urges ACCA

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17th Nov 2005
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Eyebrows were raised when the Chancellor informed Parliament that he would present his Pre-Budget Report on Monday 5 December. That's right, Monday, not Wednesday as we have grown used to in recent years, or the more traditional Tuesday.

Monday will be awkward for MPs who have to return to London from their constituencies, but it will be even more awkward for the Conservative Party, which was planning to announce the result of its leadership election on Tuesday the 8th.

"Clearly the decision is related to the Tory party leadership," said ACCA head of tax Chas Roy-Chowdhury, who added that the Budget ritual had become such a "politically driven circus" that tax policies were suffering as a result.

"Because of the circus, or because there was no consultation around political decisions and manifesto commitments, they've got it wrong," explained Roy-Chowdhury. "We had the zero-rated corporation tax rate, which they backtracked on a year later because they hadn't thought through the process.

The have been several policies that have gone into Budgets without being fully formed which then had to be changed, for example the reform of capital gains for income tax. "They changed it one year and than had to go back with changes every other year to get it right," said Roy-Chowdhury.

Because of the messes that have resulted, ACCA wants to see politics taken out of tax reform and to do away with the secretiveness and purdah periods that surround Budget announcements.

"Rather than making it a hotbed of rumours, we should have a much more open regime where there would be a more considered approach to tax strategy," he argued.

The government could set macroeconomic policies and then leave the detailed implementation to a tax committee similar to the Bank of England's Monetary Policy Committee.

"You would have greater transparency. Instead of all the fuss, they could just go ahead and announcement tax changes and adjustments when they were ready to be announced."

Roy-Chowdhury acknowledged the counter argument that elected representatives should control tax, but points out that MPC decisions probably have more immediate impact on mortgage holders than many tax reforms. "They've already given up an instrument of fiscal control to unelected people, but it's not as if there is no recourse to politics. In a roundabout way, they are still answerable to the electorate," he said.

John Stokdyk

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By listerramjet
28th Nov 2005 17:12

disconnect factor 10
politics is politics! We could have a single accountancy body representing all accountants in the world, and the politicians would still ignore us unless it was in their interests not to.

Most of the comments on this thread seem to be abount things entirely unrelated to the article. Not acceptable for those that call themselves accountants?

Chas is correct in his analysis - the budget process is political. It always has been but has become more so since Brown appeared on the scene. Of course Brown is the consummate politician - he could convince you that black is white, allthough by the time he had finished you would not be in a position to care.

But on the other hand he made the momentious decision to take interest rate decisions out of the political arena, so perhaps as his legacy he might like to do the same with the budget - oh must go, just spotted a squadron of pigs flying past the office window!

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By AnonymousUser
21st Nov 2005 13:30

Counter Productive
Why make comments on an article, when the only purpose appears to score points in what is a very long running battle?

I happen to agree with many of Prem Sikka's points but they do not belong in this forum.

Let the comments be made in connection with the article, which I also believe makes very good and valid points, and not in relation to completely unconnected matters.

By "unconnected" I am referring to the content of the article.

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By AnonymousUser
22nd Nov 2005 02:54

This might help, John
damien roche wrote this on another thread titled ICAEW/CIPFA merger fails, which could be useful :

"damien Roche , 11-Nov-2005
A unified profession
I am disappointed that there has been little support from contributors to my idea of a forum of recognised bodies whereby POBA would consult with all recognised bodies equally rather than through CCAB - which is a private grouping.
When contributors talk of the accountancy profession what seems to be the main driver is the perpetuation of a perception of a hierarchy between the recognised bodies. Such discussion does little to advance the accountancy profession as a whole.

I have written to Dr Austin Mitchell MP PhD for him to advance my ideas among his parliamentary colleagues. I have also written to POBA pointing out the possible legal difficulties which could arise if they are seen to discriminate between CCCAB recognised bodies and non CCAB recognised bodies. Many overseas bodies may be granted RQB status and they could argue that they do not have equal recognition if they are not treated equally for consultation purposes.

IAASA in Ireland has established a forum of prescribed bodies, comrising 9 bodies:ICAI ICAS ICAEW ACCA CIMA CIPFA ICPAI AIA and IIPA.

I am requesting POBA to set up an equivalent forum in the United Kingdom comprising ICAEW ICAS ICAI ACCA CIMA CIPFA AIA AAPA and such overseas bodies as have been awarded RQB status.

I have also asked the POBA to research the idea of them taking over the RSB function whereby they would become the sole regulatory body for the accountancy profession and POBA would limit the use of the title accountant in the UK to forum member bodies.

Recent events have shown that a major government inetervention is needed in order to produce a unified voice for the profession.

It is a source of disappointment to me that the profession itself appears unwilling to resolve the matter and it is now left to government as the source of company law to address this issue."


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By AnonymousUser
22nd Nov 2005 08:42

I agree
Without wishing to be hypocritical and make comments unrelated to the article, I will be as brief as possible.

I believe that one of the reasons the profession has been so silent and ineffective in changing Government attitudes and legislation over the past few years is that the various CCAB bodies are too busy protecting their own positions in an effort to ensure the continuity of self regulation and their very existence.

Government is becoming dictatorial so maybe the CCAB bodies have a point.

In my opinion the only logical way forward for the profession is as one body. Many disparate views proferred by different Institutes and Association only weaken the professions standing.

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By User deleted
22nd Nov 2005 09:25

Gentleman please!
Gentlemen,

Are we an accountants circus itself? Perhaps we should take a closer look at the mirror to reflect at our profession. We have had opportunities to amalgamate on numerous occassions but we have not, for fear of dilution of quality and profession, but in this instance we are talking of "Taming the Budget" and not the profession.

True the PBR is a circus and is nothing but a hype of more spin from the political animals within the party pinting a rosy picture when clearly it is not and the failures of various policies eg transport, borrowings etc... We need to more transparency from the Government and each department. If not we will be seeing ruins of the economy all because of spin from the labour government hiding the true picture behind the curtains/net curtains.

Wake up Gentlemen!

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By AnonymousUser
21st Nov 2005 09:14

A UK accountancy worth to commenting?
As the topic on transparency is still 'ON', I wonder if any readers would be interested to comment on another professional body which is heavily commented upon by its members.

This body does not even publish its members location country-wise, its Turnover is Receipt-based (high outstandings from Malaysian members), members complained about 'no-reply' to enquiries even before their CEO in a recent members' meeting in Malaysia, talked about recognition by the accounting regulatory body in Malaysia a long time ago till now no signs of recognition, no reports of evaluation by the regulatory body given to its very keen and interested members, members' commented about their CEO and ED's salary, complaints about its members who passed a college's quality of internally assessed examinations from Modules A to D but passed finals Modules E & F.......

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By AnonymousUser
21st Nov 2005 09:20

No pay , no 'talk'
I guess if you don't pay your subscriptions, then you don't deserve the evaluation report mentioned. Only paying members should get, to be fair.

Is the statement referring to only non-paying or lapsed members and not paying subscription members, judging by the point mentioned giving rise to one think the outstandings mainly come from its Malaysia members?

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By Prem Sikka
18th Nov 2005 18:46

Transparency
Whilst ACCA spokespersons are in the mood for transparency could they please begin by answering some questions about their organisation?

1. Since the ACCA council election voting system enables officeholders to cast hundreds of votes. Could they please explain which of their stooges benefit and why even council members are not told about such favouritism?

2. It is customary for shareholders to vote on chief executive's salary, but ACCA members are not allowed to. Why?

3. Why despite acting as a state sponsored regulator of auditing and insolvency, ACCA does not voluntarily comply with the Freedom of Information Act? In the absence of this, can we really take any of its transparency edicts seriously?

4. How many students registered with ACCA pass all their exams at the first attempt?

5. Why do the ACCA magazine and annual accounts remain silent on the lawsuits faced by the Association?

When the above have been answered I would be happy table more.

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