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AccountingWEB quizzes Companies House CEO

2nd Jul 2015
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AccountingWEB caught up with Companies House chief executive Tim Moss to find out about the move to open data and its broader digital strategy.

Following the interview at Companies House HQ in Cardiff, here is the full Q&A transcript:

1.       What are some of the latest developments at Companies House?

The two big things coming up, one very soon and one a little bit further out, is by the end of June our move to open data, or free data, so making all our information available for free, all digital information available for free, to all customers by the end of June. That’s the public commitment we gave last July, we’re on track to deliver that and we think that’s a really important thing for Companies House, and a big shift for us as an organisation. When we reviewed our strategy a couple of years back and asked the difficult questions like ‘why are we here’ and ‘what’s our purpose?’, ultimately the purpose of the registry is to provide information. The registration piece is just the input bit, actually how do we support the economy? We support the economy by providing data and allowing people to make decisions, compare companies they’re going to do business with or not, and if nobody looks at the register we might as well pack up and go home in some respect. It’s all about that data provision and so we said well what’s one of the best ways we can do that? Can we find a mechanism to be able to make all of that data available for free? We’ve got some evidence to say some of the information we made for free in the past, unsurprisingly in some respect, we’ve seen huge increases in its use and ultimately that’s got to benefit the economy because people are accessing data and hopefully using it to make better decisions. So that’s the first big thing. And the second big issue coming up is the whole implementation of the Small Business, Enterprise and Employment Act, which has kicked off now and heads right the way through until 2017. So from the immediate bit around the abolition of bearer shares and to various things to be implemented in October and then the big implementation next April which is around the register of people with significant control or beneficial ownership which is the more common name. And changes to our annual return and various other things, so they’re the two really big things we’ve got on our agenda. They sit alongside the day-to-day stuff of running the registry and making sure we can provide a good service to our customers

2.       Where are you regarding timescales for open data?

Well we made the announcement last July and we wanted to, because we know this is potentially a bit of a game changer for the UK business information market and the registry as a whole, we wanted to give as much notice as possible of the intention and that’s why we announced it with the ministerial announcement last July. With the aim that we would do it by the end of the second calendar quarter this year, which takes us to the end of June and we’re on track to deliver that. On the back of developing a new service and changing the way that we run the business, something called Companies House Service, which ultimately will replace all our filing and search services and is based on a new restful API and will allow both third parties and ourselves to build great services on top of that API for both filing and search. We launched that as a beta last October, a private beta, and it has been very well received, and we’re now in the process of moving to full public access. And then also making sure all the information is then released free through that service.

3.       Can you give us an overview of the registrar's digital strategy?

The digital agenda is at the heart of what we have been doing and continue to do. I mean ultimately our strategy is to be a fully digital register. That’s the journey we’re on and on the input side we’re over 80% of what we get in is filed digitally. On the output side it 99.9%, so we’re well on that way. Our aim is to push on the input side to get up to the 90s if not beyond. Very much our focus on that is encouraging take up of the current enabled services, so I think about 93% of everything we get in could be filed digitally by volume, so we want to get the take up of the current services up. And we’ve been very successful, so for example, the annual return that every company has to file, it’s just under 99% of all companies file that online, which is great. So how do we get take up of some of the other services especially accounts, is one of the big priorities for us. And then the other challenge is enabling a whole range of other things we’ve got. Although 93% by volume is enabled, that 7% represents a couple of hundred transactions. We have this long tail of transactions in the Companies Act, the things that could be filed by the registrar, some of them we get a handful a year, others hundreds a week. We’re now in the process of coming up with the best way of enabling some of these things for the future. So it’s absolutely around enablement, encouraging take up. Yes there is still the question around mandation that we may come back to at some point in the future. But our focus has to be around enablement, encouraging people to take up, making sure the services are good and actually we want people to do business this way because it makes sense. And the vast majority of companies are doing it currently now with some of their transactions.

4.       What sort of things are you doing to enable greater take up?

In terms of take up we’re looking at the key areas, so lots of work with the accountancy profession, especially around accounts. That’s one of the key things. That’s the work we’ve been doing with the accounting software providers, so the standard software package to make sure they are enabled to send their information through to us. There’s some good progress there. And then working both with them and the accountancy profession to say ‘look, why don’t you file your accounts online?’ There are lots of advantages to doing it, in particular things like we know if has lower reject rates, because of the online validation. That works better. It also gets rid of some of the issues around delivery, you still get issues around late filing penalties, postal delays, things getting lost in transit. Whereas filing digitally that’s all automatic, you get immediate receipts and confirmation of delivery. So it makes the whole process and the problems around filing accounts late – those disappear with digital filing. So it’s very much around selling the benefits to accountants and companies, both individually through the reminder letters that we send, some of our digital comms, as well as the seminars, there’s the work we do with the accountancy profession as well. So a range things to drive take up and we want to do more. That’s a big issue. We’re then also looking at other things, so a couple of years ago we enabled mortgage transactions to be filed digitally, and so we’re looking at how we can work better with mortgage presenters, whether it be the banks or legal firms, to say ‘right why not file mortgage and charge information digitally?’. Again, there are some really important things around delivery because there’s a time limit for those charges to get registered. So again, digital delivery helps to minimise some of that time and guarantees delivery of those important documents.

5.       What is Companies House’s future vision for becoming fully digital and when is that anticipated?

The strategy and the vision is to be fully digital. Now with all these things, once you get into the bits at the margin, what’s the business case for doing certain things, we’ll look at those. Our strategy is a five year strategy we put in place, which takes us up to 2018/2019 to complete that by. But as with any strategy it’s a rolling strategy, you need to review it as things come along. But at the end of the day it’s about providing really good services to customers and encouraging them to use this route. It’s the way the vast majority of people do business. It’s making sure the services meet the needs of our customers.

6.       How will the register of beneficial interests function along with the complications it poses for company secretaries and accountants?

Again, this is another really significant change for the registry and for companies. It’s worth going back to where this came from. It goes back to the 2013 G8 conference in Northern Ireland, and that was all about tax, trade and transparency, and a really political drive led by the Prime Minister top say we need to be clear over who owns and controls companies. Part of that was saying where there are people other than directors and shareholders, who are controlling companies, that information should be made available. That was the principle behind all this and has led to the legislation which has come in the Small Business Act around the register of people with significant control. So it’s not so much around anyone who has a beneficial interest in a company. It’s actually about understanding who is controlling companies.  So from next year, companies will have to start collecting this information from January around people who are controlling the company. From April next year, that information will start to be registered with us at Companies House. A lot of it is a similar sort of data set for directors, so name, service address, user residential address, date of birth, in addition there will be some information about the nature of control. For example, we suspect that for a large number it will be through shares. So if somebody owns 25% or more of shares, then it’s quite likely they will be a person with significant control. There are other ways to exercise control, so it’ll be the data set similar to directors plus some information about how they exercise that control over a company. Again, we expect that for the vast majority of companies, the average company has two director couple of shareholders, there isn’t anybody else other than the directors or shareholders who is controlling the company, so the data will be very similar to what they currently provide. But there will be other people with different arrangements, and it’s important that information is put on the public register. That’s the other thing the UK is taking a lead on, saying this will be a public register and it’s seen as an important step forward both in terms of transparency but also in line with the proposals coming forward with anti-money laundering, recommendations for things like the financial transaction taskforce and the new directive that will be coming out on money laundering as well. It’s absolutely leading the way in driving corporate transparency which is a good thing.

7.       How has the migration of Companies House content to GOV.UK gone?

I think it’s gone very well. From the early days of the set-up of the government digital service we worked very closely with them. Both in terms of the design of our current services we’re developing, plus also the work on GOV.UK, and so we started planning this quite a while back and worked very closely with them on that migration. Ultimately the desired philosophy was government digital services, with ours it’s about user needs, understanding user needs and then designing your services to meet that. We did things like a prototype of the service we ran in parallel with our own. We did a lot to gather user feedback, we do usability testing and so the migration has gone very well. With any change, not everybody likes change or the way things are done but on the whole it’s gone down very well. The principle of going from hundreds of government websites into one platform is great for the customer. You can go to one place and access information on a vast range of government services and organisations. The principle is good but in bringing everything together there always has to be a bit of compromise. The transition is going well and ultimately they are focussing on meeting user need. It’s not about doing something and leaving it, it’s about how we continue to gather user feedback and say how do we continue to meet the needs of our customers going forward, all the changes we need to make to improve services all the time.

8.       How do you process user feedback?

User feedback is hugely important to us, and we try to collect it on a wide range of mechanisms from direct customer complaints, or comments we get through our contract centre, or customer service teams, we run a number of focus groups around the country two or three times a year, we have director seminars, seminars for accountants, we do a whole range of things, as well as a the direct user feedback and usability testing we do of our services. So we want to gather as much insight, we do independent market research every year or so, we look at segments like the accountancy profession and DIY filers, as well as having Ipsos MORI do  some independent research on how satisfied customers are with our services. So getting feedback is tremendously important and there’s not one way of doing it – you’ve got to try a number of different mechanisms to help bring that together on a regular basis. We’re looking at our top 10 customer issues and how we can improve those and make them better.

9.       Does it make sense to move all the technical guidance to GOV.UK when the efiling systems will remain on the "native" site? Or is the ultimate plan to be to migrate those too?

GOV.UK predominantly is a publishing platform, as was our website, there were links through to the services, but ultimately the website itself was a publishing platform for guidance and information about Companies House. That’s the primary purpose. I think in terms of the underlying infrastructure, the best way of doing that, there are a number of ways of doing it and you look at the best set up. Ultimately I don’t really think that matters to the user. What matters to the user is a seamless journey and whether it’s all on GOV.UK or our services are run by ourselves, ultimately what matters is does the customer journey work and work effectively? Is it seamless, and can people access the information they need to do what they need to do? So the current plans we have are around we host and run our transactions, but the access route through that is GOV.UK. We need to make that user journey as good as possible, whether that changes at some point in the future, like I said I don’t think it really matters ultimately as long as the user journey works. That’s the important bit. So no plans at the moment to migrate the transactions across to GOV.UK in terms of actually running those services, but they access through GOV.UK does happen and it’s the user journey that counts. 

10.   What is the state of play with iXBRL filing mechanisms?

We made the move and started using XBRL and iXBRL back in 2005 because we recognised the value of getting accounting in data format rather than static. It goes back to the first question around the digital strategy, ultimately the strategy is we deal in data, and the world of images and static documents is I think limited. It works for some things, but ultimately we’re in a world of digital data, getting data in and making data available is at the heart of the digital economy and the way forward. So that’s one of the reasons we went for XBRL and iXBRL was to enable us to allow accounts to come in in a digital format, so we’re now at a point where 65% of accounts are coming in using XBRL or  iXBRL and we want to drive that up further. It goes back to working with the accountancy profession, the software providers to enable those things to happen. We’re starting to see people now use that iXBRL data, we started making that available just over a year or so ago and people are now trying to get to grips with iXBRL and be able to analyse accounts. That’s good for the UK, good for corporate transparency and good for the whole business information market for the future.

11.   There's a new FRS 102 taxonomy in circulation - how are you going to process that?

As we’ve done with other things in the past, ultimately they’re the building blocks for accounts and accounts filing, all the accounts standards. So as new ones come along, it’s built into our services and we’re able to take them. We will develop these things, but I think it’s unlikely that many people will be looking to file until 2016 and beyond. But yes we will need to make sure that our services can deal with the new taxonomies that come along in the new standard. We’ve done a lot of work with HMRC, the accounting profession and the FRC to take accounting standards and then ensure that the taxonomies that underpin digital filing services are developed. That’s worked very well and we’ll build those into future services in line with others like HMRC.  

12.   In terms of direct recovery of funds, do you see Companies House going down a similar route to HMRC?

There are no plans for us to do that. We have well established procedures for dealing with late filing penalties. The majority of people pay penalties without having to go through collection procedures, and so it’s a minority that that happens to. As I said we have established procedures for dealing with that and we certainly have no plans to go down the route that HMRC are looking to do at the moment.

13.   You send late filing penalties to collection agents - what is the collection rate? 

As I said the vast majority of penalties get paid already. I don’t have specific data around the agents we use, that’s part of an overall debt collection process where it’s required. Overall I think the collection rate for late filing penalties is about 68%, or was the year before last, but then there’s a whole range of reasons around that. It’s not just about collection, so for some companies we have instalment plans that are put in place to help them pay their penalties, so you don’t collect all in one go, so that influences that. And also there are some companies that choose to dissolve and remove themselves, so there are a number of reasons why the figure is at 68%, but the vast majority of companies pay. The other important thing about the late filing penalty regime is it’s actually done an awful lot of good to ensure people file their accounts on time. We’re now at the point where 94% of companies file accounts on time and that’s steadily increased over the last five years or so. There’s no reason for people to get a late filing penalty, both in terms of if there are difficulties there are options sometimes for filing extensions, and they can apply to us and get a short extension is they hit some problems immediately before filing, but also they have nine months to prepare and get this information in. We’re doing a lot to encourage people not to leave it to the last minute, but also to get in touch with us if there is an issue. There are more options to do things ahead of the deadline than afterwards. The law is quite strict and once the deadline has passed there is a penalty. I’d encourage people to prepare early, file early, and if you do face any problems do get in touch ahead of the deadline.

14.   Such low payment amount for penalties means that the smaller company is disproportionally penalised (the bigger companies think nothing of £750) – could you do more to help the smaller companies not be caught?

There’s nothing we can do over the penalty levels, they’re set in legislation. They were reviewed as part of the 2006 Companies Act where there was debate around it. Interestingly the levels hadn’t changed prior to that since 1992 so proportionately they may have been were considered higher in 1992 than they are today, but they were reviewed and increased slightly and changed around the act. So there was a big debate in parliament about the penalty levels, I have no power to influence those at all, but it comes back to how do we support small businesses and help get them to do what we need to do, which is actually file online. There is a deadline because this information is really important. It comes back to the role of the registry which is to provide information so we need to get it in, and accounts information is one of the most searched bits of data that we have. So whether it be all the work we do on reminders, the work on guidance, it’s all about saying this is important information – do file on time. As I said 94% of companies do, so the vast majority file on time and it’s not an issue. If there are problems please do get in touch with us ahead of the deadline because there may be more options that we can do to help people. Once the deadline’s gone it’s a statutory requirement and there are limits to what we can do. In terms of the level I said that was debated in parliament and the vast majority of companies in the UK are small to medium sized businesses, and the initial penalties are £150 so for the first month it’s £150, but yes if you delay and delay and delay it does go up to £375, £750 and then £1,500. Also if you file late for two years running, the penalties are doubled. The registry is important, you need to get it in on time. We want to encourage good filing behaviour so there’s no need for anyone to get a late penalty, you’ve got nine months to file and that should be sufficient for people to file their accounts to the registrar.

Replies (5)

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By Brend201
02nd Jul 2015 12:25

Very interesting but a lot of jargon/business-speak that grates with me: e.g. the word "around" features 21 times but never in relation to a corner.

Their customer service probably has good statistics for response times etc but when I attempted to obtain a vital page that was omitted from a filing, the answer that I got was: "Unfortunately, to date despite our examination teams best efforts we have not received another [document with missing page] from the company. Unfortunately, we cannot try to contact the company any further regarding the matter." A fully resolved customer query for their stats but still a dissatisfied customer and a company that did not comply with legal obligations - without any enforcement or sanctions.

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Replying to Paul Crowley:
By chatman
02nd Jul 2015 16:45

Vocabulary Fashions

Brend201 wrote:
Very interesting but a lot of jargon/business-speak that grates with me: e.g. the word "around" features 21 times but never in relation to a corner

This seems to have become very common over the last few years. It seems to be used where people previously would have said "about". I think it started around the same time people began starting every new topic with "So", and describing everything not completely simple as "nuanced". "Ahead of" replaced "before" quite a while ago whereas "renter" instead of "tenant" is very new. 

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By chatman
02nd Jul 2015 16:48

Grammar too

It's not just vocabulary that's changing; I just got an email from IRIS saying "we'd love for you to join us"

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By johnacarpenter
05th Jul 2015 19:47


Never mind the grammar

Companies House are still penalising companies for late filing, even if they are dormant.

I appealed the penalty, and was told they only accept exceptional circumstances i.e. a catastrophe just before the filling date.  This is completely different to the approach from HMRC who seem to have the authority to make their own rules!!

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By slarti
16th Jul 2015 12:42

What about MY security?

Now that all is available to anybody, signatures together with names, addresses, dates of birth of company officials are freely available to all and sundry.


I wonder if we are going to see a massive increase in identity theft?


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