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2022 in accountancy: Things can only get worse

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The Lionesses and their AAT trainee captain have lifted the spirits of the accounting community following a dismal start to the year. Richard Hattersley reviews the lows and further lows of 2022 and explores how the second half will only get worse. 

 

4th Aug 2022
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Well, that’s half the year already done. It’s only apt to sum up this year in accountancy using a football expression after the Lionesses’ historic Euro 2022 victory over the weekend: it’s been a game of two halves. We’ve had the “Thank god we got through that” half and next it’s the “And now what?!” second half. 

Yes, unless you’re the chief executive of BP, or you play HMRC’s hold music to chill out on the weekend, the past seven months have been about as enjoyable as sitting next to a colleague adding up a spreadsheet with a calculator. 

2022 so far

The year started with the usual wails of despair from the accounting profession. But at this point, this noise has just become a soothing background soundtrack in accounting practices every self assessment season. I am sure the rest of the office tunes in and out of the suppressed sobs coming from the tax department in the same way they listen to the latest Ed Sheeran song on Heart. Thankfully for some, HMRC waived late tax return filing penalties until 28 February; for others it only extended the pain and tortured noises (and Ed Sheeran songs).

Following a Covid bottleneck of work, practice owners finished January vowing to start their self assessment campaign earlier – while everyone else around the table muttered in agreement before exchanging knowing looks to say, “Same place next year?”. 

Meanwhile, scandal after scandal from KPMG made the profession look about as trustworthy as a client trying to expense a McDonald’s Happy Meal as client entertainment. Each update from the accountancy watchdog detailing the latest Big Four record fine landed in our editorial inbox to the sound of the EastEnders’ doof-doofs. KPMG has since tried repairing its image, but after Silentnight and Carillion, it will be like using a Pritt stick to reattach a car door.  

Then in March, the Spring Statement was billed as a mini-Budget to tackle the growing cost-of-living crisis. Emphasis there on mini. The then Chancellor, Rishi Sunak, cut 5p off fuel duty, increased the national insurance threshold – after introducing a “health and social care levy” – and unveiled a handful of other announcements that it would frankly be generous to refer to as tinkering. The rest of the cabinet was so impressed by these announcements that by the summer they couldn’t wait to disown and discredit Sunak’s measures and record.

So far so grim

So if that was the start of the year, what hope do we have for the rest of the year? Not much judging by today’s increase in interest rates and the news that the cost-of-living crisis is set to spiral like a tornado ripping through Kansas – and probably taking homes with it too. 

The Bank of England chose to cheer everyone up today with the news that things are going to get worse – much worse – with inflation set to hit 13% and we’ll see in the New Year with a recession. Happy Christmas!  

So far, the second half of the year hasn’t been especially kind to our former Chancellor either. The first half ended with the Rishi Sunak Show reaching its series finale in predictable fashion (a resignation and a Twitter video). Now the ex-Chancellor’s new spin-off show, where he hopes to become prime minister, is looking increasingly like it’s going to get cancelled. 

If the current polls are to be believed, Sunak is set to get shunted into second place by the only other person who celebrates finding their way out of a paper bag with a photo opportunity. If Liz Truss is successful she will become the first accountant in Number 10 Downing Street. I am already looking forward to seeing her first Any Answers post as PM…

With recession now a reality, the candidates are one upping each other on what part of the government they’re planning to get rid of next to save cash. Soon they’ll be pledging to bin the Isle of Wight.

Liz Truss’s aim to reform the civil service (in other words, cut salaries) may alarm accountants already struggling to get through to an over-stretched HMRC. Although some are already filling the Dust Blocker 3000-sized vacuum of the “policy” details with hopes that Truss’s civil service pay plan will lead to the eventual canning of MTD ITSA. 

But as news cycles quieten down over the summer holiday, and the tumbleweeds roll on the Making Tax Digital for income tax updates page on gov.uk, the accounting community is rightfully looking for anything to lift their spirits.  

The Lionesses

So, thankfully, we had the Lionesses’ Euro 2022 win to brighten the mood. While some accountants are hovering over the “unfriend” button for Liz Truss, the profession was overjoyed to hear that the England captain Leah Williamson is an AAT trainee

With straws clenched tightly, you have to assume that the super defender’s accounting training played some part in the England team’s barnstorming Euro campaign. She clearly put her training to use, showing a good ability to analyse the current situation, anticipate potential problems, and implement mitigative actions to lessen their impact.

The question on everyone’s lips though, is will Williamson continue with her studies? She is pondering the same question as Nike rightfully dumps a truckload of cash on her doorstep. At least a textbook would double up as a nice shovel to create a clear path to her door. 

She’s probably made the right decision to stick to football rather than pursue a career in accountancy. It took Leah Williamson and her England Lionesses to end “56 years of hurt”, but after the Tax Faculty said the guidance won’t be available for some time, it may take longer to end the years of hurt before MTD ITSA eventually rolls out. 

What else could happen this year?

While the England team may have raised spirits this summer, the UK is still hurtling towards a recession and there is still the uncertainty around the next PM (and Chancellor) to contend with. 

But if Truss is successful, and the rumours are to be believed, she won’t be the only accountant to take charge in Downing Street. According to the Express, CIMA-qualified Truss is lining up trusted supporter and fellow chartered management accountant Thérèse Coffey as Chancellor of the Exchequer. 

You wait forever for accountants to finally take charge of the country and then two come along at once – CIMA has suddenly become a pathway to Downing Street. 

Coffey was finance director for the UK subsidiary of Mars – that’s the confectionary not the planet. If it was the planet, she’d take one step into the Treasury, learn about VAT rules and then immediately board her space shuttle and get off planet Earth as quickly as possible. 

As an accountancy-focused news site we’d like to think that accountants will be able to solve the worst inflation in 40 years. But after moderating spats on Any Answers over divisive and controversial topics such as “Is 10,000 miles 45p limit per person or per vehicle?”, let me tell you: these things don’t end well. 

But, really: can it get any worse? Perhaps we just need Williamson to hurry up with her AAT studies and use her magic touch to steamroll into Number 11. But before she would be ready to save the day as Chancellor, the country may be calling on her to sell off the Euro trophy to help us get out of the recession.

But on the plus side, at least when busy season inevitably comes down to the wire again, practice owners will have no trouble getting the team into the office to work late into the night once they confirm they will have food and central heating. But I have a feeling the sobbing will not just be coming from the tax department this time. So, let’s buckle up and put Ed Sheeran on.

Replies (15)

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By Hugo Fair
04th Aug 2022 17:47

Who are these Lionesses of whom you speak in such awe-struck tones?

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Replying to Hugo Fair:
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By Paul Crowley
04th Aug 2022 20:32

I agree
Richard, mention that the English lassies won the Euros football thing, but do not mention that the lads lost on penalties and came a miserable second, whenever that was.
HMRC so much better at penalties

Looks like 'Liz' could get confusing if PM and Queen share the short version

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By Trethi Teg
05th Aug 2022 08:10

"the profession was overjoyed to hear that the England captain Leah Williamson is an AAT trainee".

That one comment destroys the credibility of all the remaining content.

Please write serious articles about the issues that matter to accountants i.e. the MTD fiasco, overburdening useless regulation in the area of AML, IR35, and a completely disfunctional and corrupt HMRC.

Thanks (5)
Replying to Trethi Teg:
John Stokdyk, AccountingWEB head of insight
By John Stokdyk
05th Aug 2022 15:41

Perhaps just a little perspective might be in order here... In a personal column about the unremitting gloom of the past year (on top of the two years that went before), Richard attempted to lighten the mood by highlighting something a little more positive.

Some people may not be interested in football, which we can accept, but perhaps you've missed the hundreds and hundreds of articles and Any Answers debates that have appeared on the site about the subjects you've mentioned:
https://www.accountingweb.co.uk/tags/making-tax-digital
https://www.accountingweb.co.uk/tags/money-laundering
https://www.accountingweb.co.uk/tags/ir35
https://www.accountingweb.co.uk/tags/hmrc

Sometimes even accountants are entitled to a respite from non-stop compliance and stress!

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By mkowl
05th Aug 2022 10:09

Always look on the bright side of life do do do do

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By mkowl
05th Aug 2022 10:12

Can I add as a football fan of long standing and sufferer of much misery the 56 years of hurt failed to disappear last Sunday. Sorry if that fails to tick the politically correct boxes

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
05th Aug 2022 15:51

The Truss-Coffey Downing Street Dream Team may well herald an new era of influence for those holding a CIMA qualification, but the portents aren't promising: https://www.accountingweb.co.uk/community/blogs/john-stokdyk/have-accoun...

After a string of bungling political performances by accountants including Liz Truss and Therese Coffey, I concluded: "A government packed with finance professionals has struggled to gain command of the numbers at its disposal, interpret forecast models and plan adequately for worst-case scenarios. Having failed to live up to our expectations, our disappointing ministerial representatives have demonstrated that accountancy may not be a great training ground for politics."

Has anyone seen or heard much during the Conservative leadership campaign to suggest otherwise?

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By EbenezerScrooge
05th Aug 2022 19:53

At least the women won something, just wait for the world cup later this year when the men's team achieve their usual humiliation. Maybe if we paid male footballers £25k a year which is the average that the women earn they might try a bit harder.

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By creamdelacream
06th Aug 2022 12:22

I'm not sure what I have just read, completely bizarre.

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Sarah Douglas - HouseTree Business Ltd
By sarah douglas
08th Aug 2022 11:56

Liz Truss can then use her real name

Mary Elizabeth O Leary .

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Replying to sarah douglas:
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By Hugo Fair
08th Aug 2022 13:17

Didn't get the O'Leary component at first ... but Wiki enlightened me:

"In 2000, Truss married Hugh O'Leary, a fellow accountant whom she first met at the 1997 Conservative Party Conference and the couple have two daughters.
Between 2004 and 2005, she had an extra-marital affair with married MP Mark Field, who the Conservative Party had appointed as her political mentor.
Truss identifies herself as a Christian.
In August 2022, while competing for the Conservative Party leadership, Truss said: "I share the values of the Christian faith and the Church of England, but I'm not a regular practising religious person."

So, although I have no issue with her retaining her maiden name, she does seem to be yet another politician in the "do as I say not as I do" mould ... and happy to adopt a 'position' only if it doesn't involve her in any effort.

Thanks (2)
Replying to Hugo Fair:
Sarah Douglas - HouseTree Business Ltd
By sarah douglas
08th Aug 2022 13:42

I am regularly known by my maiden name Needham especially in Ireland however her first name is Mary not Liz short for Elizabeth, why is she just not called Mary then (maybe she did not like Mary ) who knows , but I agree with your point.

Also what is a interesting point with all the debates who backed stabbed Boris . She register her domain name with GoDaddy #Lizforleader on the 8th June 2022 which is before the first no confidence vote.

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Replying to sarah douglas:
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By Paul Crowley
08th Aug 2022 18:50

A bit late in the domain thing
Rishi beat her by mile

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By EbenezerScrooge
08th Aug 2022 23:53

Using a second name is not unusual, I know several people who have used their second name all their lives.
As for her having had an affair at some point, according to the last statistics I saw 25%-40% of women and 50%-60% of men have an affair during their marriage so hardly unusual.
If Sunak had an affair I suspect the woman would be an insomniac looking for a cure.

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Replying to EbenezerScrooge:
paddle steamer
By DJKL
09th Aug 2022 10:21

It was a family habit in my Dad's family, of five siblings he was the only one whose first name was how he was known, the other four had middle names used all their lives.

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