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 comment PQ

CONTENTS April 2018 And the PQ goes to…

News
06ACCA exams We run the rule
over the latest set of exams
08ICAEW advice PQs reminded
about the importance of practice
10ICAS alliance Scottish institute
signs deal with US counterparts
12Independent AAT Association
is just fine on its own
Features, etc
04Mind your Ps&Qs CIMA and
the WhatsApp exam cheats; the
accountants’ ‘Hippocratic oath’;
and why PQ is great
13Activity based costing
Making this important topic as
easy as, well, ABC
14The write stuff Meet Jean-
Paul Noel-Cephise, former
accountant and author of dating
guide ‘7 Deadly Dates’
15ICAEW spotlight A round-up
of what chartered students need
to know this Spring
16PQ Awards 2018 Once again
accountancy’s top awards was
the party to be at!
18CIPFA focus The CIPFA
Student Network is looking for
volunteers, so why not help out
and help yourself in the
process?
20Leadership ACCA’s Alan
Hatfield has some top advice on
improving your skill set
22Wellbeing Sumo could change
your life – honestly!
24Blockchain explained How
blockchain could impact on your
career; and the dates of CABA’s
wellbeing workshops
26Micro-economics Supply and
Demand curves explained
28Financial statements The
whys and the wherefores
29Careers Life at Explore
Learning; our Book Club review;
and the best of social media
30Fun stuff – and our giveaways
The columnists
Robert Bruce Why the Big 4 can
carry on regardless 6
Prem Sikka We must heed the
Carillion warning 8 Some 74% of people trust the
Zoe Robinson Learning at the
point of need 10
Subscribe to PQ magazine
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www.pqmagazine.com
ABC July 2016 – June 2017
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Publisher’s statement: We send a
digital issue of the magazine to an
additional 6,785 requested readers
Free to subscribers who fulfil our
terms of control
Annual subscription: £35 (£50 overseas)
Welcome to our PQ Awards special issue. It was another
great night at the Café de Paris, but you don’t have to take
my word for it – check out our one-minute highlights video at
https://www.facebook.com/pqmags/videos/1743042679089971/
Nigh on 1,000 people have
already had a look, and we
hope it inspires you to enter
next year’s awards!
We were interested to read
recently that local newspapers
are three times more trusted
for news than social media
platforms such as Facebook,
according to a YouGov poll.
information they read in their local newspaper, compared with 22%
who trust the local news they read on social media. It really is about
trust, and we hope you see us as your local accountancy newspaper!
As always there is plenty to read in this issue – stuff you can’t get
anywhere else. We have a great article from CIPFA’s student leader
Chris Roberts (see page 18). The CSN really is a fantastic, independent
voice for PQs. And you can see how, with Chris, it is upping its game.
PQ now even has a dedicated a special ‘corner’ for all your Carillion
news (page 10). Our favourite quote that didn’t make it into the
magazine came from Peter Kyle MP when he told KPMG partners: “I
wouldn’t hire you to do an audit of the contents of my fridge.” That
made me chuckle.
Finally, if you can’t get enough of me, I have started to write a
monthly blog for Osborne Training. My first one is all about eating your
way to success. Check it out at https://www.osbornetraining.org/eat-
way-success/
Graham Hambly, PQ magazine editor (graham@pqaccountant.com)

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PQ have your say
Has CIMA gone soft?
I read with interest about the
mass cheating at the recent CIMA
exams (PQ front page story, last
issue). Surely CIMA should have
expelled the students who ‘shared’
their exam questions or pleaded
with their fellow students to spill
the beans on what was in the
exam they had just sat.
For me, these cases are black
and white – if you are caught
cheating you don’t deserve to
become a member of a chartered
professional body. CIMA must also
have a duty of care to protect the
public and businesses from
unscrupulous employees. Many
Our star letter writer wins a fantastic PQ memory stick!
Thanks, PQ
I must admit I’m not sure I should
be on your subscriber list as I am
not actively studying, but instead
focusing on my bookkeeping
business. Complaints by PQ
readers about exams being hard
are a bit tiresome and I am
shocked by the numbers cheating
in their exams.
However, every issue of your
journal contains some useful gems
of information or interesting
comments, which I value
tremendously. Please carry on the
good work.
Hoping to remain a subscriber!
Elaine Humphreys, by email
Nothing will change
So Labour Party shadow chancellor
John McDonnell wants to take on
the Big 4 accountancy firms? (PQ,
March 2018). Well good luck with
that, John! These firms are just too
big and powerful, they have friends
in very high places, including
Parliament. And guess what? Once
they tire of Westminster many of
these ‘trusted public servants’ waltz
into top jobs with... the Big 4 firms.
Despite all the good publicity
these firms get for being ‘the top
places to work’ the Big 4 do more
harm than good with their tax
avoidance advice that costs the
PQ Magazine Unit 3a, Kingfisher Heights, 2 Bramwell Way, Royal Docks, London E16 2GQ | Phone: 020 7216 6444 | Email: graham@pqaccountant.com
Website: www.pqmagazine.co.uk | Editor/publisher: Graham Hambly graham@pqaccountant.com | Advertising manager: Polly Thrasivoulou polly@pqaccountant.com
Associate editor: Adam Riches | Art editor: Tim Parker | Subscriptions: dom@pqaccountant.com | Contributors: Robert Bruce, Prem Sikka, Zoe Robinson,
Tony Kelly, Phil Gammon | Origination and print services by Classified Central Media
If you have any problems with delivery, or if you want to change your delivery address, please email dom@pqaccountant.com
people I meet already seem to
believe accountants lack any
ethical or moral integrity, and will
do anything to keep being paid
I need
pqjobs.co.uk
government millions in lost revenue
every year – and all the while the
average person is seeing their living
standards fall.
The only way to stop the Big 4
from designing these schemes is to
jail those responsible for creating
them when they are found to be
Published by PQ Publishing © PQ Publishing 2018
email graham@pqaccountant.com
their high salaries!
If these cheating
students are happy to
share vital information at
such an early stage in their
careers, how can CIMA
guarantee they will be safe
with important company
details, which has even
more value?
Name and address supplied
The editor says: The
accountancy bodies do
indeed have a duty of care
to the public; it is in their
charters. But the
punishment also needs to be
proportionate. It is natural for
students to need to talk about the
exam they have just sat, and a
illegal (and thus tax evading). They
would then have to think very hard
indeed before promoting some of
their (more dubious) schemes to
clients. And the same should hold
true for the directors of massive
firms like Carillion, who it seems
certainly did not have their
WhatsApp group would seem a
good place to do it. Not being able
to talk about a shared experience
online will seem alien to many.
When you leave the exam hall you
just want a chance to moan and
groan. Even going to the pub or
café to let off steam with fellow
sitters might be breaking the rules
– you don’t know who could be
listening! As I said in my
commentary last month, I believe a
lot of those reprimanded students,
and there were more than 30 of
them, honestly didn’t realise they
were doing anything wrong by
‘letting off steam’ about their exam.
I also think CIMA now has to make
it much clearer and be more
upfront about the rules.
collective ‘eyes on the ball’ when
they ran that company into the
ground. Perhaps these directors
would have been more cautious
and diligent if they potentially faced
a stretch in one of Her Majesty’s
facilities? But despite Mr
McDonnell’s talk of a ‘Hippocratic
Oath’ for accountants I can’t
honestly see anything changing any
time soon.
Name and address supplied
Mini magic
I received my Bumper Quiz prize of
a Google Home Mini speaker in the
post at the weekend. What a lovely
surprise! The speaker is so much
fun and has lots of great features.
It is a pleasure to read your
magazine on a monthly basis and it
provides so much insightful news
and tips. As someone who works
on a screen all day, it is always so
uplifting to come home and find
PQ magazine in the mail – to read
it as an actual paper magazine and
spend time away from screens.
This is a rarity in 2018.
I will continue reading PQ and
am especially looking forward to
the 2018 Bumper Quiz, which I will
have to enter after this year’s luck.
Now back to my studying for
next week’s F7 ACCA exam.
Ryan Anderson MAAT, by email
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PQ news

ROBERT Want to sit your exams F7 students told us they were

BRUCE
Sound and
fury that
signifies
nothing
Years ago I was asked by one of the
Big 4 firms if I would be videoed for
an interview that would be shown at a
subsequent partners’ conference.
They wanted the film to provoke
discussion of issues that senior
partners in large audit firms would
normally avoid. So I suggested that
audit firms were in big reputational
trouble. The public had no proper
clue about what they did and didn’t do
and thought they were a cosy cartel. I
suggested that, sooner or later,
to some drum and bass?
How do you fancy sitting your
ACCA with drum and bass music
banging in your ears? Well, that’s
what happened to one group of F5
sitters in London this March!
There also seemed to be an
increase of PQs having problems
with their computer exams –
remember, this sittings sees a real
upscaling of the CBE exams.
One set of F5 sitters had to wait
40 minutes in front of their
computer screens before they
could begin, and another group of
PQs went to three rooms before
they were finally allowed to sit their
test. Oh, and there was the little
matter of a busker outside the
Newcastle exam centre. Ear plugs
may be the order of the day for
future exams! The F5 exam itself
was deemed a hard one. One
student claimed the CBE was 10
times harder than the paper exam,
and although many sitters agreed it
was harder, some were grateful that
CBEs have finally ‘arrived’.
taken aback by the disposal of a
subsidiary with group accounts
question. They were sure
‘approved’ texts said a 20-marker
question like this would not appear!
Reading technical articles also
proved particularly useful for P1
sitters. A student explained six of
the articles ‘came up’. “Thank God
I read them just before the exam,”
they stressed.
The big complaint about P2 was
how ‘dry’ this paper is. Section B
was also described as ‘weird’! But
many students admitted they loved
the Brexit question and LaLand.
One student did say the examiner
should have just gone for it and
called it ‘LaLaland’.
Finally, a P5 sitter summed up
manys’ March experience: “It’s the
bloody time pressure.”

Association unveils
politicians would force regulators to
come after them. I said that the best
strategy for them would be to

new jobs shake-up

recognise that this would happen and
take pre-emptive action ahead of
time. I suggested that each of the Big
4 firms should split themselves in
two. This would create eight audit
entities, independent of each other.
Public worries would appear to be
answered. Future reputational damage
would be mitigated.
Needless to say, my arguments did
not carry the day. The big firms just
got bigger and now, as happens
periodically, are under fire from
public opinion and politicians alike.
And their attitude, as ever, is to
hunker down, take the brickbats and
live to fight another day. The recent
select committee hearings on the
collapse of Carillion were a classic
example. Grandstanding politicians
fire off furious vituperation. The
witnesses apologise for everything,
even for having been born. In the end,
no one is much the wiser, certainly
about the facts of the affair.
Robert Bruce is an
award-winning writer on
accountancy for The Times
Proud ‘PQ’ winners: the team from The Training
Place of Excellence pose for our photographer
Phil Gammon, while NQ of the Year Michael
Scott shows what winning really means to him.
Our full awards round-up is on pages 16-17
PQ has discovered that The Association of International
Certified Professional Accountants (The Association),
the body formed by CIMA and its US partner the AICPA,
has begun an extensive business transformation
programme. Almost a year to the day that it created the
Association and transferred CIMA and AICPA employee
positions to the new body, it has confirmed that 120
jobs, about 8% of the global workforce, will be
‘changing’ roles.
Association CEO – Managing Accounting, Andrew
Harding, in an exclusive interview with PQ magazine,
explained that bringing the two bodies together meant
there is some duplication of roles. He admitted there
are also some key areas, particularly digital, where it
needs to up its game. He stressed that the organisation
wants to ensure it has staff with the right skill-set to
support their students and members going forward, and
reiterated that the idea is not to cut staff numbers.
In fact, he said that at this very moment the
Association has a significant number of vacancies.
When pushed, Harding emphasised that he didn’t
expect a lot of redundancies, and although it is still
early days in the process he honestly believes at the
end of the ‘transformation’ the Association will be
employing more people than it does today.

In brief
CIPFA to help in Nepal
CIPFA has signed a
memorandum of understanding
with the Institute of Chartered
Accountants of Nepal (ICAN) to
help boost the country’s public
financial management. Under the
MoU, the two institutes will share
expertise to help promote and
improve ‘responsible’ public sector
accounting in the country. It will
also explore routes to CIPFA
membership for ICAN members.
Created in 1997, ICAN has over
8,400 members across Nepal.
Available for hire
ACA students who have had
their training agreements
terminated still have a chance of
becoming an ACA through the
‘available student register’ (ASR),
Alison Stiles reminded delegates at
the recent ICAEW Partner Learning
conference. She explained that
PQs who have had their
agreements terminated, along with
those studying for the ICAEW
CFAB, and those who have
completed the Level 3 Diploma in
Accounting (AAT), can all register
on the site. Their details are then
circulated to authorised training
employers on a monthly basis.
Students need to contact
tvsupport@icaew.com to register.
Woman in finance
The Financial Reporting
Council is the latest signatory of the
Women in Finance Charter. CEO
Stephen Haddrill said the FRC is
proud of its record on diversity and
has a majority of women in senior
executive positions. He went on: “A
diverse workforce contributes to
more integrity in business and the
long-term success of organisations,
which in turn leads to sustainable
growth in the UK economy.”
Platinum Status retained
Manchester Metropolitan
Business School has retained its
ACCA Platinum Approved Learning
Partner status. The professional
stage course at Manchester Met is
designed to allow those who have
completed F1 to F9 to sit and pass
the professional papers in just nine
months.

6 PQ Magazine April 2018

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PQ news

PREM
ICAS enters into
ICAS has signed an historic mutual
recognition agreement with both
SIKKA the US CPA and US Certified

We must
heed the
Carillion
warning
In recent days parliamentary
committees have questioned KPMG
about the audit of Carillion, which
collapsed in January 2018.
The KPMG responses were
defensive and some old favourites
were wheeled out. These included
claims that the company’s accounting
was in accordance with accounting
standards, we audited in accordance
with auditing standards, and that there
is an expectations gap and people
expect too much from the auditor.
The replies are unlikely to have
historic alliances
Public Accountants.
The Scottish Institute says the
new deal will provide a streamlined
process for their respective
members to practise in the other’s only pass one exam
jurisdiction. – the International
International Trade Secretary Dr Qualification Exam
Liam Fox said: “This is a really (IQEX) – and satisfy
welcome initiative, which my the relevant state
department supports, and shows board requirements.
the huge benefits which greater Eligible US CPAs
UK-US co-operation can bring to now need to only
our business.” Fox felt that the complete the
mutual recognition of qualifications international
could help boost trade in services, Done deal: signatories Ken L Bishop, President qualification
making it easier for world-leading and CEO of NASBA; Anton Colella, CEO of ICAS; pathway, a two-year
professionals to operate in other Barry C Melancon President and CEO AICPA training contract
countries. chartered accountancy body and and have requisite UK audit
ICAS CEO Anton Colella said: US accountancy bodies and comes experience.
“This is an historic agreement. It’s at a pivotal point for the UK.” The FRC has also approved the
a first of its kind between a UK Under the MRA, ICAS CAs need agreement.

Beware last-minute ACCA exam updates

impressed legislators. Compliance
with accounting standards is not
mandatory and the Companies Act
2006 permits a ‘true and fair view’
override. Auditing standards may
specify the minimal benchmarks, but
there is nothing to prevent auditors
from aiming for higher standards. The
professional bodies make claims about
professional judgment, but auditors
say that they audit by the book and are
reluctant to go beyond. This can’t be
reconciled with their claims of
professionalism.
Is it too much to expect auditors to
raise red flags for a company that was
in dire financial trouble? What can the
people expect from auditors? The
Despite assurances that it wouldn’t
happen again, the ACCA released a
new P1 technical article just a week
before the March exam.
Concerned tutors contacted PQ
magazine, worried that many
students in their final phase of
revision would miss the article on
transaction cost theory, which was
posted on 26 February.
It was LSBF’s Paul Mersion
(pictured) who first spotted the
article, 10 minutes after he had
finished his final P1 revision
course! He explained that there
has been nothing on
‘organising transactions’ in any
exam for the past 10 years and
wondered with just two sittings
left of P1 why is had suddenly
appeared. Remember, the P1
paper disappears once the new
SBL exam takes over in September.
Fortunately for Merison’s
students he had covered this
subject in his classes. He said:
“Most tutors would not have
covered it as it’s not a
mainstream topic. This is
going to cause some panic.”
One student contacted PQ
to say: “Very unethical of the
exam team to publish such an
article this close to an exam.”
Another countered: “No it isn’t, if it
covers something already in the
syllabus. It is already in the syllabus
and students should have covered
it; be glad of the revision material!”

IAS 19: IASB amends pension accounting

profession spends more time telling
people what audit can’t deliver but still
expects fees. Imagine a producer of
televisions telling people that the set
will not do what they expect, but they
must still buy it because the law
requires it.
A public backlash is inevitable
unless the profession re-examines its
relationship with society.
Prem Sikka is Emeritus
Professor of Accounting at
the University of Essex
The International Accounting
Standards Board has issued
narrow-scope amendments to IAS
19 Employee Benefits. These
specify how companies determine
pension expenses when changes to
a defined benefit pension plan
occur.
IAS 19 sets out how a company
accounts for a defined benefit plan.
When a change to a plan – an
amendment, curtailment or
settlement – takes place, the
standard requires a company to
remeasure its net defined benefit
liability or asset. The amendments
require a company to use the
updated assumption from this
re-measurement to determine
current service cost and net
interest for the remainder of the
reporting period after the change to
the plan. Until now, IAS 19 did not
specify how to determine these
expenses for the period after the
change to the plan. By requiring
the use of updated assumptions,
the amendments are expected to
provide useful information to users
of financial statements.

Sexual harrassment
‘issues’ down under
A partner at KPMG South
Australia has left the Big 4
firm following a sexual
harassment investigation
against him. KPMG CEO Gary Wingrove has
now issued a warning to all staff and partners,
telling them the firm has a zero-tolerance to
predatory behaviour. He said: “KPMG fully
investigated and promptly addressed the
matter. The individual responsible no longer
works for the firm.” Wingrove also urged staff
to report any inappropriate behaviour. The
news broke at the same time as accusations of
sexual harassment against a senior partner of
EY Adelaide came from a junior female staffer.
‘Beware the third wave’
PwC says a third of British jobs could be
impacted over the next 15 years by
automation. Economists at the Big 4 firm have
identified three waves of automation between
now and the mid-2030s: the algorithm wave,
the augmentation wave and, finally, the
autonomy wave. It believes relatively few jobs
will be automated in the first wave (from now
until early the 2020s). However, financial
services could prove the exception to the rule
here. When the third wave hits in the mid-
2030s the prediction is up to 30% of existing
jobs could be impacted, with transport,
manufacturing and the retail sectors
particularly affected. The study suggested that
more women will initially be effected by the rise
of automation, whereas men are more likely to
feel the impact in the third wave.
EY boost for apprenticeships
EY has opened a further 60 digital degree
apprenticeship places in 2018, to help meet
future skills and business needs. The new
apprentices will study towards a BSc degree in
Digital and Technology Solutions, funded by the
firm. They will spend 80% of their course
working in the business, gaining valuable work
experience, and earning a salary of up to
£21,500. In addition to the 60 new EY degree
apprenticeship in digital technology, some 300
of the firm’s graduate intake this year will be
eligible to study towards a Level 7 higher
apprenticeship.

8 PQ Magazine April 2018

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PQ news
ZOE
ROBINSON
Learning
at the point
of need
The NHS always promotes its mantra,
‘free at the point of need’. If we can
put the ‘free’ part to one side so as to
avoid the politics, the very idea that
something is there just when you need
it is an interesting one. Traditionally,
learning has been linear; you get on
the train at the start of your journey,
along with the other passengers, and
get off together when you reach your
destination. But what if you were to
plan your own journey, only calling on
help when you needed it?
This journey would be far more
personalised and may encourage
more independent and curious
travellers, or should I say students.
And there is no reason you can’t do
both – follow a standard pathway but
allow individuals to access
knowledge where they simply want to
know more or get an alternative view
to help with understanding.
YouTube is a free-at-the-point-of-
need learning resource and evidence
suggests people love it. Some 3.25
billion hours of video is watched each
month, with 300 hours uploaded to
YouTube every minute! YouTube EDU
now offers up more than 500,000
educational videos.
Of course, providing learners with
answers to questions when they want
them is what good teachers have
always done. What technology
facilitates is a greater range of
opportunities for students to be
curious – if you like there are now
more trains going to more
destinations, so go explore!
Zoe Robinson is Learning and
Programmes Director at
Kaplan Financial
Carillion
Corner
EX-FD IN THE SPOTLIGHT
Ex-finance chief Richard Adam is
coming under increasing scrutiny
because he apparently sold his
Carillion shares ‘at the earliest
possible moment’. In early 2017,
10
Practice makes perfect
ICAEW student’s really do need to
put in the practice before sitting
their first CBE exam, stressed the
ICAEW’s head of development and
special projects, Adam Birt.
He told a packed ACA Partner in
Learning tutor conference they
must encourage students to play
with the software in advance of the
exam. Being unfamiliar with the
functionality and formatting is
costing some students dear.
That said, he revealed that the
CBEs have had no effect on pass
rates. It is only at the margins that
the problems seem to be occurring.
He reminded tutors that’s all
exams follow the standard rounding
rules to the nearest whole number
by default, with the exception of
Financial Management which will
The Big 4 accountancy firms are a
great place to work, but they wreak
havoc with your work-life balance,
according to the key findings of a
new ACCA Generation Next study.
Despite the downsides, young
finance professionals still very much
see the experience gained in the
largest accountancy firms as
invaluable to securing their long-
term career success.
ACCA director of professional
insight Maggie McGhee said that
across the profession some 48% of
all Gen Next respondents said they
Middle-class problems
Middle-class professionals are
operating a closed shop, deterring
new entrants to the market, claims
chief secretary to the Treasury Liz
Truss (pictured).
She said professionals such as
lawyers and accountants effective
hid behind professional regulations,
and that this was damaging growth.
Adam’s sold shares worth hundreds
of thousands of pounds, as soon as
he qualified for them. He left
Carillion in December 2016. The
information was released by the
joint committee of MPs looking into
Carillion’s collapse. Adam’s
successor Zafar Khan’s contract
was terminated last
September after just eight
months in the role. The
chairman of the works
and pensions select
committee, Frank Field
(right), said: “The other
directors appear keen to set up the
round to two decimal places.
PQs also need to understand
how to expand their cells and show
their workings. One tutor asked why
Big 4 are good for you
were happy in their role [Editor: that
seems a bit low to me!]. At the
larger firms, job satisfaction scored
higher, particularly for those in the
Big 4, where almost 60% of
respondents said they were satisfied
or very satisfied with their job.
However, the research also
uncovered a number of talent
management issues. Some 43% of
respondents said they had a poor
work-life balance, with 48% saying
hapless Zafar Khan as the fall guy
for the collapse. It is not lost on us,
however, that he inherited
Carillion’s mountain of debt.”
WHISTLEBLOWER NAMED
The newly appointed finance
director of Carillion’s construction
division, Emma Mercer, has been
named as the whistleblower who
brought down Carillion by MP
Frank Field. The works and
pensions committee chair said
that it was Mercer who as early
as last May warned board directors
at the construction company of an
students can only see 18
lines of an answer at a
time. “They don’t like it,”
she suggested.
Another wondered
why students can’t have
a paper copy of the
questions on the desk.
Birt felt that security
issues outweighed any
backward step here.
He said the ICAEW
was still looking at how
the case study will be
presented. “We may split
the question into
different tabs,” he said.
But he reiterated that what students
were being asked to do will be
exactly the same as the paper
exam.
their workload was too great.
One area that does not frighten
Gen Next is the rise of digital. The
younger generation expects
automation and technology to
transform large accountancy
services, but they see such
innovations as a key opportunity for
adding more value to their roles.
For more see ‘Generation Next:
managing talent in large
accountancy firms’.
Truss pointed out that there are
“people with a vested interest in
more government”, and she is
promising to wage war on their
restrictive practices.
She told a recent conference:
“They can be the lobbyists. They
can be the unions. They can be the
bureaucrats. They can be the
nimbys. I call them The Blob.
Gloopy. Treacly. Hard to define.
Harder to resist.”
impending scandal over the books.
She expressed serious reservations
about the company’s accounting.
Field explained that it took Mercer
just six weeks in the job to “spot
and pull the thread that began the
entire company unravelling”. In the
minutes from that board meeting
the directors were warned by a
senior lawyer that if they did not
disclose the accounting issues on
the construction of Royal Liverpool
Hospital and the redevelopment of
Battersea Power Station they risked
being accused of misleading the
Stock Market.
PQ Magazine April 2018
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PQ news
Register now
for the new
ACCA exams
ACCA PQs can now register to sit
the new Strategic Professional
exams – the Strategic Business
Leader case study and Strategic
Business Reporting paper.
Both will be ‘available’ for the
first time this September, and
ACCA says these new exams will
continue to ensure students have
the skills needed for the modern
working world. As part of the
qualification redesign the ACCA
also introduced its new Ethics &
Professional Skills module.
ACCA’s director of professional
qualifications, Judith Bennett, is
advising students to complete the
ethics module before taking these
two new exams.
The Strategic Business Leader
case study focuses on leadership,
integrating technical and ethical
behaviour. It replaces both P1 and
P3. The Strategic Business
Reporting paper is an enhanced
corporate reporting exam that
replaces P2.
12
AAT enjoys its freedom
It’s been nearly a year, but the
AAT has gone from strength to
strength after dropping its
chartered sponsoring bodies.
At the 2017 AGM, AAT
members decided it was time
sideline its sponsoring bodies
– CIMA, CIPFA, the ICAEW
and ICAS. These bodies were
key in the foundation of the
AAT over 36 years ago. They also
‘supplied’ many presidents and
council members.
AAT Council told members that
going it alone would reflect its
position as a full member of IFAC,
and take account of the changing
landscape among the professional
Time to give a f***
When you are a professional
accountant you have to behave
professionally 24/7. That is what
ICAEW member Paul Singleton
found out to his cost recently. He
was fined £1,500 plus costs of
£8,000 after the red mist
descended when he met some
clients who hadn’t paid him.
bodies in the sector. Members
agreed and voted for ‘freedom’!
AAT’s Andrew Williamson
explains: “The relationship with the
chartered accountancy bodies has
evolved over the years.” He also
stressed AAT recognised that
increasing competitive conflicts and
He was actually in a pub having
a birthday drink in Sheffield when
the chance encounter happened
and he used the f-word on three
occasions!
A complaint was made to the
ICAEW about his behaviour and
he was brought before the
disciplinary committee. Singleton
Plan ahead and
book your exams
Standard entry for June exams
closes on 30 April 2018.
Find out more:
accaglobal.com/bookexams
the AAT’s own strong status
no longer warranted the
sponsoring bodies’ mandatory
representation among AAT’s
trustees.
Williamson pointed out that
the AAT continues to have a
strong relationship with each
of the bodies.
An ICAEW spokeswoman
told PQ: “Due to the growth and
success of AAT, we understand that
AAT no longer felt that it needed
the support of the funding
members. Both ICAEW and AAT
continue to work together and to
develop the strong relationship that
exists between the two bodies.”
accepted that, having seen ‘Mr B’,
he went to speak to him and
admitted swearing at him. He also
accepted he swore at ‘Mrs A’. He
was found to have broken the
code of ethics and to have
breached the fundamental
principle of professional
behaviour.
Added together the fines and
costs meant he paid more than
£3,000 for every f***!
PQ Magazine April 2018

ABC, it’s easy as 123
Katie Collins takes you on a step-by-step journey through the
world of activity based costing – a topic you really must know
M
anagement accounting is
discretionary for the UK’s
organisations, yet most feel
the need to employ techniques in order
to survive. The costing area of
management accounting is one that
appears to be an old-school technique,
one that is hard to conceptualise. This
article focuses on this area and with
particular reference to activity based
costing, better known as ABC.
Traditional management accounting
scenarios have used widgets as
examples, but who really knows what a
widget is? Costing isn’t only employed by
manufacturing organisations and, in the
21st century, many service-based
organisations also use activity-based
costing to work out how much to charge
for their services.
The NHS, for example, would work out
the cost of an inpatient stay for someone
with a broken leg or the cost of an initial
consultation with a doctor, particularly
vital within today’s cash-strapped NHS.
If we think about the terminology that
is seen within costing studies and think
about applying it to the NHS, we get the
example here.
For the latest issue see issuu.com
NQ magazine is an e-mag for newly
qualifieds who want to get ahead
All the back issues are available too – type NQ magazine into www.issuu.com
Sign up today via the PQ magazine website – www.pqmagazine.com
PQ Magazine April 2018
1) Identify the major activities: This first
step would look at what the organisation
does. In the case of the NHS, we could
have a look at the major costs – ward
costs, drugs, central office costs, staff
costs, theatre time. The list is endless.
The costing accountant would need to
decide which of the activities will be the
major ones.
2) Group the activities into cost pools:
Cost pools are a holding pot for the costs.
Think of this where the accounts payable
team will be coding all of the costs into
these major activities. For example, Ward
One in the hospital will have costs such
as nurses, porters, laundry, etc. All of
these will be grouped together and coded
for that particular ward. For example, the
cost of Ward One is £200,000 a week.
3) Identify the cost drivers: Cost drivers
are the activities that cause the cost to
happen. For staff time it could be the
number of beds within their ward or
average patient appointment time. For
example, Ward One has 20 beds.
4) Work out the cost driver rate: This
would involve working out the amount
per driver to charge back to an individual
patient.This could be done for Ward One
CIMA P1 PQ
as the amount per day that a patient
spends. This would involve taking the
total cost pool and dividing it by the total
drivers to give you an amount. Taking
Ward One this would mean £200,000/20,
giving a cost of £10,000 per bed per
week, or by dividing it by seven this
would give £1,428.57 a day.
5) Charge the cost drivers back to a
patient: This could be based on their
length of stay in each area or the amount
of resource they consume. Patient XYZ
spends three days in Ward One, meaning
that they would incur costs of (£1,428.57
x 3) £4,285.71.
This would give the cost of a patient that
could be used for budgeting and pricing
purposes. Within the NHS, tariffs are set
for payment from Clinical Commissioning
Groups, who allocate funding on behalf of
the government. Costing and budgeting is
vital in today’s environment as the NHS
needs to become increasingly more
competitive. Getting these tariffs and
pricing principles correct will be a
fundamental job of the costing and
management accountants.
I’m hoping this has helped to give
some context to ABC. ABC is not an old-
school costing technique – it is a useful
one to help with accurate costing and
pricing.
Although it will take time and effort, the
advantages will far outweigh the
disadvantages and will help with accurate
decision making. Once a few examples
have been worked through, the principles
will become easier. If you don’t believe
me, take a note from the Jackson 5.
“ABC, it’s as easy as 1,2,3....” PQ
• Katie Collins is a tutor with Kaplan
Financial
Not a lot of people know that…
For reference, the word widget is a placeholder name for
an object or, more specifically, a mechanical or other
manufactured device. It is an abstract unit of production.
The Oxford English Dictionary defines it as “an indefinite
name for a gadget or mechanical contrivance, esp. a small
manufactured item”, and dates this use back to 1931.
13
PQ profile

The write stuff

dated for 17 years, so was a bit out of
practice. When he got back into the
game he was a little shocked by what he
found, and began keeping a journal.
His ‘experiences’ can now be read in ‘7
Deadly Dates’, and he’s got some great
Meet Jean-Paul Noel-Cephise, former accountant and author of 7 Deadly Dates
reviews, including one in this issue (see

A
s regular readers will know, PQ page 29). Jean-Paul must love the fact
magazine always loves a story that he has been described as Sex and
that is a little left-field. So we the City’s Carrie Bradshaw – “well, if she
were more than happy to listen to ACCA was a bloke and lived in south London”.
lecturer and accountant’s Jean-Paul And we think his experiences would
Noel-Cephise’s story when he called one make a great TV show too (seriously). We
day. We discovered that following a just haven’t worked out who would play
degree in finance he studied for the Jean-Paul yet, though.
ACCA qualification. His current job as a
freelance lecturer takes him all over the Dating guru
world. He has also worked as a legal The dates took him to the heart of
executive in Africa, the Middle East and Istanbul’s criminal underbelly and even to
Asia. Bromley South station car park. His book
But he didn’t want to talk about is also packed with sound dating advice
accountancy! No, he wanted to talk • 7 Deady Dates is and in his circle he has become the
about love, and a book he had just reviewed on page dating guru, or maybe even the ‘UK
written. We told him the February issue, 29 of this issue Hitch’. So, what are the no-nos? Well,
which came out just after Valentine’s perhaps you shouldn’t add a foot to your
Day, had come and gone, but he height, as you will be found out! Oh, and
insisted. use a picture that actually is you, or at
His book, ‘7 Deadly Dates’, charts his least looks like you now.
experience of internet dating, warts and But if you want to know more you need
all. It took three years of dating and six to read his book.
months to write his tome. You might want to check out the
He explained that after getting website too and its great little video. You
divorced in 2012 he wasn’t immediately can also order the book or ebook. See
comfortable with being single. He hadn’t www.7deadlydates.com PQ

A leading qualification
for a changing world
The role of the professional accountant is becoming more
important than ever.

That’s why we’re evolving the ACCA Qualification to keep it current

and maximise your employability to give you the professional edge
in a changing world.

Key changes include:

Session CBEs Ethics and Professional Strategic

Available now Skills module Professional
Available now Changes coming
in 2018
Find out what this means for you:
accaglobal.com/examchanges

14 PQ Magazine April 2018


Helping you to
help yourself
ICAEW gives PQ a round-up
of what students need to
know this Spring
Finance Act for 2018 exams
Last year, two Finance Acts were
published, but only one is examinable in
the 2018 exams: Finance Act 2017
(enacted on 27 April 2017). The second
Finance Act received Royal Assent on 16
November 2017 and is not examinable.
Learning materials updated for 2018
ICAEW published learning materials for
the ACA have undergone their annual
review and have been updated for 2018.
You should use the up-to-date editions of
the learning materials to study for the
respective exams in that year, as these
will reflect any changes made within the
syllabus, learning outcomes and the way
in which you are assessed. The syllabus,
study manuals, question banks and
PQ Magazine April 2018
technical knowledge grids for the 2018
exams are available now from
icaew.com/examresources and
www.gillards.com/icaew
No late bookings after the deadline
ICAEW is no longer able to accept late
exam applications or changes to an exam
application once the deadline has
passed. It is your responsibility to apply
for your exams by the exam closing
deadline, so ensure you have all the key
dates you need during your ACA studies.
Advanced Level moves to computer
This summer will see the Advanced Level
exams also begin the transition to the
new computer-based format. The
transition will see Corporate Reporting
and Strategic Business Management
become computer-based from this July,
with the process culminating in the move
of the Case Study to computer in July
2019, after this date all ACA exams will
ICAEW spotlight PQ
be taken on computer.
Support and guidance to help you
prepare for the Advanced Level
computer-based exams is in
development, but look out for new
resources within each ICAEW student
update email, and at icaew.com/cbe
Technology and the ACA
As all ACA exams will become computer-
based by July 2019, becoming more
allied to the everyday working life of ACA
students, ICAEW continues to recognise
the increasing importance of technology
in the profession.
Integrating the relevant aspects of
technology across the ACA syllabus,
learning materials and professional
development, with content including data
analytics, cyber risk and security, and
cloud computing, has resulted in two
Professional Level modules changing
name from January 2018. Business and
Finance has become Business,
Technology and Finance, and Business
Strategy has changed to Business
Strategy and Technology.
Key dates for your diary
Keep your studies on track in 2018 by
using the ACA planner, you can use it to
note down when to arrange your six-
monthly reviews and update your online
training file. Download your copy at
icaew.com/acaplanner
Key spring and summer dates
20 April – March Professional Level exam
results
30 April – Exam booking deadline for
June Professional Level exams
14 May-18 June – Exam booking open
for July Advanced Level exams
4-6 June – Professional Level exams
12 June – Advance information available
for July Advanced Level exams
26 June – Advance information will be
posted for July Advanced Level exams
2 July-6 August – Exam booking open for
September Professional Level exams
13 July – June Professional Level exam
results
For regular updates visit the student
community at icaew.com/student
community or join Students@ICAEW on
Facebook. PQ
• Thanks to the ICAEW for this article
15
PQ Awards 2018

OH WHAT A NIGHT!
FORGET THE OSCARS
AND THE BAFTAS – A
PQ IS THE ONE TO WIN
The Café de Paris was once again the wonderful backdrop to
the only accountancy awards worth winning! Yes, all the PQ
magazine 2018 award winners now have one of our coveted
PQs in their grasp.
Before editor Graham Hambly took to the stage to
announce the winners the packed-out venue was first
entertained by Britain’s Got Talent star Daliso Chaponda.
The top prize of the night, PQ of the Year, went to FairFX’s
ACCA trainee Tyson Nsimbe. Although it hasn’t all been plain
sailing for Nsimbe, he never gave up on his dream of Form an orderly queue... crowds gather in anticipation
becoming a qualified accountant.
Distance Learning Student of the Year was CIMA PQ Toby
Austin. It was fellow online studier Lucy Wheatley who
nominated him, despite the fact that he beat her in every
single exam.
The NQ of the Year trophy went to ICAS-qualified Michael
Scott. He was shortlisted last year for PQ of the Year but
came back for more, and was delighted to pick up his prize.
The one blot on his evening was the fact that his wife Roanna
had to stay at home. She couldn’t leave the farm as the cows
were calving! That was a new excuse for us at PQ.
The ACCA picked up two awards on the night. It won
Accountancy Body of the Year and also the award for
innovation for its Ethics and Professional Skills module.
Meanwhile, AAT College, The Training Place of Excellence,
beat off the big boys to win the Private Sector College of the
Year, and London South Bank University won the Public
Sector prize for a second year in a row.
CIPFA’s CEO Rob Whiteman also picked up an Editor’s
award, as did Fiona Williams from Sutton Coldfield College.

THE INDEPENDENT JUDGING PANEL

Rachel Kellett Head of Product Development, AAT
Shaun Robertson ICAEW Director of Qualifications
Cheers! It’s time to get this party started
Julie Corkish Head of ACCA qualification – content and
development
Peter Stewart VP Progression at Association of International
Certified Professional Accountants

TOP MAN: PQ of the Year Tyson Nsimbe, FairFX plc Looking good: the wonderful Café de Paris

16 PQ Magazine April 2018

 Awards 2018 PQ

ACCOUNTANCY COLLEGE OF THE YEAR

STUDENT BODY OF THE YEAR ACCOUNTANCY BODY OF THE YEAR PUBLIC SECTOR London South Bank
BCASS ACCA University

ACCOUNTANCY COLLEGE OF THE YEAR

ONLINE COLLEGE OF THE YEAR LECTURER OF THE YEAR PUBLIC SECTOR
PRIVATE SECTOR The Training Place of
Kaplan OnDemand Alan Parkinson, UCL
Excellence

NQ OF THE YEAR STUDY RESOURCE OF THE YEAR INNOVATION IN ACCOUNTANCY

Michael Scott, EQ Accountants LLP (ICAS) Premier Training (Premflix) ACCA’s Ethics & Professional Skills module

TRAINING MANAGER/WORKPLACE ACCOUNTANCY TEAM OF THE YEAR

BEST USE OF SOCIAL MEDIA MENTOR OF THE YEAR Mel Wright, Training Greater Manchester Mental Health NHS
Avado’s Caron Betts – ACCA exam countdown manager, Lovewell Blake Foundation Trust Finance Team

ACCOUNTANCY PERSONALITY EDITOR’S AWARD #1 EDITOR’S AWARD #2

Vicky Taylor, HTFT Partnership Rob Whiteman, CIPFA Fiona Williams, Sutton Coldfield College

APPRENTICE OF THE YEAR LECTURER OF THE YEAR PRIVATE SECTOR DISTANCE LEARNING STUDENT OF THE
Rahil Mahmood, Rolls-Royce Andrew Mower, Kaplan YEAR Toby Austin, Explore Learning

PQ Magazine April 2018 17

PQ CIPFA Student Network
Your body wants you!
T
he CIPFA Student Network
(CSN) continues to represent
students at the highest levels of
the organsiation. It provides a
consultative body for the institute to
discuss proposed changes, feeding into
the development of new initiatives such
as CIPFA Learning (CIPFA's online
learning package which offers e-learning,
blended study options, and access to
materials and discussion forums); the
new apprenticeship programme; and the
changes to the Practical Experience
Portfolio (which must be completed as
the final step to qualification). In
addition, the CSN provides a strategic
lead to local groups, coordinating events
nationally and sharing best practice, as
well as organising the national student
conference in the summer.
However, we need your help in three
particular ways!
Getting involved
While we receive a great deal of support
from CIPFA, the CSN both nationally and
in the regions is student led and student
run. We have lots of space for new
volunteers, and there really is something
for everyone, regardless of how much
time you have to spare – from attending
meetings of your local CSN or dialling
into our short monthly calls on the
national CSN, to helping out at a single
event, to being the compere at a CIPFA
pub quiz!
There are loads of benefits to being
involved. You get to network with your
peers, more senior colleagues, and
sometimes even examiners! I’ve found it
invaluable professionally, when I’ve
always had someone to call – whether it
was about an ethical issue, because I
needed some career advice, or was
looking to compare notes on a particular
topic. And, personally, I have made some
great friends and had some really good
times – one colleague always notes when
promoting conference that she found a
husband there!
There are also opportunities to attend
events representing the CSN, such as
18
CSN President Chris Roberts explains why you
should get involved in the student network
national conferences and even the PQ
Awards – there may even be international
events offering the opportunity for travel.
Alongside these, as a volunteer there are
also opportunities to gain really useful
experiences that are great for your CV:
I’ve spoken at the national conference,
acted in a governance role on one of
CIPFA's boards, managed a budget,
developed a strategy, and had the
opportunity to lead a large and
geographically diverse team.
If you’d like to get involved, let us
know by emailing csn@cipfa.org with a
bit of information about yourself and
what you’d like to do.
Coming to an event
We’ve been working hard to organise a
series of events, including the popular
strategic revision events, which have
previously been offered around the
country. There will be refreshments
provided at face-to-face events. These
will be held in the following locations and
dates:
• Webinar – 9 May or 16 May
• London – 10 May
• Birmingham – 22 May
• Manchester – 26 May
• Edinburgh – TBC in May
In addition, I’m delighted to
announce a further national
series of networking, careers
focused events. There will be
drinks and nibbles provided at
these face-to-face events.
These will be held in the
following locations and dates:
• Bristol – TBC early April
• Webinar – 3 April
• Glasgow – 10 April
• Cardiff – 11 April
• London – 12 April
• Newcastle – 20 April
• Leeds – 17 May
• Belfast – 21 May
• Manchester – 23
May
• Birmingham – 25
May
There will also be an
exams Q&A session,
where you will be able
to put your questions
to the Chair of CIPFA’s
Exam Panel, which
makes final decisions
on marking and special
considerations, a real-
life examiner, and
someone from CIPFA
who deals with exams support and
administration. This will be held on 21
May in London in the early evening. This
session will also be offered via webinar,
and if there is interest we may be able to
arrange screens at local venues to watch
in a group.
Main conferences
Looking ahead to the summer, CSN also
organises the national student
conference, which is held alongside the
main conference. As ever, this will be free
to attend for students, with a discounted
package available for those of you who
want to experience the full conference.
This year’s conference will be in
Bournemouth, on 11 July (and 12 July if
you pay to attend the second day).
All of the above events, with the
exception of the second day of CIPFA’s
National Conference, are free of charge.
Please email csn@cipfa.org for more
details or to register.
In addition, Scotland CSN have
negotiated a significant discount for
students who would like to attend the
annual CIPFA Scotland Conference in
Glasgow on 22-23 March. The price is
£165 but there is a discount code to
bring it down to £35 – the discount code
to use is Student18. There is a limited
number of spaces for this offer. The
student package will provide for
attendance at both days of the
conference plus the dinner, but does not
include accommodation. This can be
booked using the CIPFA website.
Getting in touch
Even if you don’t have time to volunteer,
and can’t get to an event, we’d still love
to hear from you! How are you finding
CIPFA Learning? What do you think could
be improved? What’s already working
really well?
CSN aims to represent students, so we
need to know what you think. Email
csn@cipfa.org and let us know. PQ
• Chris Roberts, pictured left, is
President of the CIPFA Student
Network
PQ Magazine April 2018
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PQ leadership
Make your mark
L
eadership means different things
to different people. For some, it’s
about being good at your job and
being well liked. For others, it’s all about
being in charge.
Being a great leader should be an
aspiration of any finance professional.
Whether you are the managing director
or a shift leader, the way you lead has a
huge impact on everyone you work with.
Leaders have the power to change the
organisations around them. They make a
difference to the business, rather than
just making the business work.
Leadership is about what you do and
attaining skills that can be applied to the
tasks that occur in every business.
As professionals increase their
knowledge of the profession, so do the
opportunities for leadership roles in the
workplace. ACCA support its students in
this area. As part of the ACCA
qualification re-design there’s a new
Strategic Business Leader exam, which is
designed to mirror the workplace and
presents students with real-world
challenges.
Practical tasks
The exam will require candidates to take
on various roles within the main
organisation, or in connected
organisations such as consultancy
practices, audit or regulatory authorities,
or other connected stakeholders. Tasks
set will be practical, requiring students to
apply any models, theories or techniques
they deem appropriate to complete the
task. The assessment is marked on how
the task is completed and whether the
objectives of the task have been
achieved, allowing students to apply the
right technical, ethical and professional
skills to tasks that would be expected in
the workplace.
The syllabus brings together core
areas from governance, risk and strategy,
links to other leadership areas such as
organisational control, innovation and
change management – and uses new
technologies and data analytics.
Ethics remain crucial. ACCA pioneered
ethics when it introduced the
Professional Ethics Module back in 2007,
and it remains a core element of the
ACCA qualification today, with an
updated module re-launched in October
2017.
Every exceptional leader has
developed and honed their leadership
skills, continuously learning and
developing over time to shape their
leadership success.
By 2020, all professional accountants
20
Alan Hatfield tells you exactly what you need
to know to improve your leadership skills
will need to develop and balance the
necessary professional quotients to fit
their role and stage of career. The seven
qualities that have been identified in
ACCA’s professional accountant – the
future research are the key drivers
shaping the profession over the next
decade and beyond:
• Technical and ethical competencies
(TEQ): the skills and abilities to perform
activities consistently to a defined
standard while maintaining the highest
standards of integrity, independence and
scepticism.
• Intelligence (IQ): the ability to acquire
and use knowledge: thinking, reasoning
and solving problems.
• Creativity (CQ): the ability to use
existing knowledge in a new situation, to
make connections, explore potential
outcomes, and generate new ideas.
• Digital quotient (DQ): the awareness
and application of existing and emerging
digital technologies, capabilities,
practices, strategies and culture.
• Emotional intelligence (EQ): the ability
to identify your own emotions and those
of others, harness and apply them to
tasks, and regulate and manage them.
• Vision (VQ): the ability to anticipate
future trends accurately by extrapolating
existing trends and facts, and filling the
gaps by thinking innovatively.
• Experience (XQ): the ability and skills to
understand customer expectations meet
desired outcomes and create value.
Individually they are not new to the
profession, but together these skills
represent how finance professionals can
proactively manage the future, enhance
their preparedness for the unknown and
help them to succeed.
The seven skills aren’t meant as a
checklist but a guide. They can help
professionals recognise where they may
excel and where they need to improve
through continuous professional
development, all of which professional
accountants already know to do so well.
Tomorrow’s leaders need to be aware
of increased regulation and stronger
governance, which is expected to have
the greatest impact on the profession
over the longer term. All members of the
profession will be affected directly or
indirectly and to varying degrees, and
regional variations will also influence
regulation and governance.
Digital technologies are also a major
driver for change as they will transform
the role and the competencies that
accountants require. Smart software
systems will eventually replace manual
work (like bookkeeping) as well as
automating more complex and
multifaceted processes such as the
financial close.
“
Success is Variety of skills
not final, All professional accountants will be
failure is not fatal: expected to look beyond the numbers,
it is the courage to and to possess a variety of skills. They
continue that will need to meet more frequent requests
counts. for holistic and forward-looking
Sir Winston Churchill information, and may also face demand
for more frequent ad-hoc reporting from
stakeholders as the barriers are eroded
between financial and non-financial
performance.
And, finally, continuing globalisation is
leading to an increased rate of change
and economic volatility. Professional
accountants will need the interpersonal
skills to work as part of a diverse team.
Finance professionals will be working with
team members around the world and
from younger generations who have
different aspirations and expectations
from previous generations.
Finance leaders will always be needed
in future to maximize productivity, shape a
positive culture and ensure organisations
succeed. After all, finance is the language
of business. Some people are natural born
leaders, and most can develop leadership
skills with a combination of practice,
mentorship, self-belief and a world-class
professional accountancy qualification
behind them. PQ
• Alan Hatfield, ACCA executive
director – strategy and development
PQ Magazine April 2018
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PQ CIMA exams

Wrestle with your future!

A
re you wondering what a Sumo
wrestler on a unicycle has to do
with being a PQ? Well, let me tell
you this: this image and the concept
behind it might just change your life!
SUMO is an acronym, originally ‘Shut
Up and Move On’; modified for a younger
audience to ‘Stop, Understand, Move
On’. I came across SUMO and its creator
Paul McGee many years ago when the
idea was not particularly well known.
These days it’s big news – SUMO is used
in schools and businesses across the
globe.
The key principles that underpin the
SUMO approach offer a simple but a very
powerful tool. They’re about taking
responsibility for our lives and careers,
reflecting on the situations we find
ourselves in and not getting bogged
down by things that don’t matter. It’s • Shut Up acting on autopilot and Move CIMA’s Jackie 7. Can I find any positives in this
about prioritising the stuff that affects the On to self-awareness. situation?
long term and letting go of things that • Shut Up blaming someone else and Durham has If we think about these examples in
seem important at the time but, when set Move On to personal responsibility. some simple terms of our accounting exams, there’s
in context, are not worth the stress. • Shut Up about missed opportunities, some pretty good advice here. If you fail
regret and stagnation. Move On to advice – shut an exam it’s not the end of the world.
Key principles fulfilling potential, using talents and up and move Undoubtedly, it might be a real blow in
These are principles we can use in our growing as a person. the short term, especially of it’s your last
everyday lives, our studies and our • Shut Up being the passenger; Move On
on! OT in a level, your final case study before
careers to help us make the right to being the driver. ‘exams complete’ or the exam that would
decisions. Once you are familiar with it, • Shut Up speaking ‘victim’ language; have gained you a pay rise.
the SUMO approach to decision making Move On to speaking SUMO language. However, if you use principle one and
may offer a framework around which you • Shut Up wishing life would get better; reflect on what went wrong rather than
can assess issues in your CIMA case Move On to making it so. assuming you’ve been unlucky, you’ll be
study exams. There are also seven questions that able to identify the steps to take to
Let’s look at a couple of examples of should guide our decision making and ensure a better result next time around.
SUMO in action. There are six key help us to cope with life’s challenges. And if you look at the seven questions, it
principles – the first is ‘Change your T These are: may feel like a disaster today but in six
Shirt’. This one is about taking 1. Where is this issue on a scale of 1-10? months’ time, this exam may be history,
responsibility – it’s your life, take control 2. How important will this be in six particularly if you work through the full
of it. We have to stop thinking that things months’ time? set of SUMO questions.
just happen to us and instead reflect on 3. Is my response appropriate and There’s much more SUMO. Visit
our role in what’s happening and effective? http://www.thesumoguy.com to learn how
determine how we can own and change 4. How can I influence or improve the the concept can change positively impact
our behaviours to achieve our goals. situation? your thinking and your life. PQ
The SUMO explanation of principle 5. What can I learn from this? • Jackie Durham, education and
one is as follows: 6. What will I do differently next time? training consultant, CIMA

22 PQ Magazine April 2018

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PQ blockchain

Blockchain and the fu

With bitcoin seemingly always in the news there’s much interest around the
blockchain concept. David Lyford-Smith explains what it is and how it works

I
t’s hard to avoid hearing about
blockchain these days – mostly in
the context of the rampant interest
in crypto-currencies such as bitcoin.
Blockchain is the recording system that
underpins bitcoin and effectively all
crypto-currencies – a distributed system
that keeps everyone’s records in
agreement, all without using a central
database or organiser.
Blockchain is a whole new method of
record-keeping that has some fascinating
possibilities for both the wider business
community, and specifically for
accountants. It’s also a difficult subject to
get in to, as it’s very complicated and
quite unlike anything else. But although
the details behind how blockchain works
are complex, it can be understood in
terms of what impact it makes.
That’s the goal of a new white paper
from ICAEW’s IT Faculty, entitled
Blockchain and the future of
accountancy. I’ll be taking you through a
few of the key lessons of the paper here;
you can read the full paper at
www.icaew.com/blockchain.
Key qualities of blockchain
The three key features of blockchain
according the paper are the three ‘Ps’:
1. Propagation of new information from
origin to a group of collaborators, without
a central control or ‘master copy’.
2. Permanence of transactions is
assured, as everyone has their own copy
and can identify and reject attempts to
change the record.
3. Programmability can be added to
blockchains, allowing self-executing
contracts to be contained alongside
transactions.
The most important quality of a
blockchain is that they can be
decentralised – that is, there is no need
for owner, controller, gatekeeper, master
copy, or authenticator. While some
blockchains might choose to have more
centralisation, none is necessary and a
blockchain can work as a network
without a leader.
In accounting terms, what we have is a
ledger of transactions that is shared
among many people. Anyone can add to
it, and we know that additions are
permanent and uneditable. What’s more,
we don’t have to expend effort
reconciling different ledgers, as the
blockchain process automatically creates
consensus between all the parties.
So we could theoretically cut down on
the work currently expended in
performing consolidations and
reconciliations. We could also use a
blockchain-like system to add certainty
and efficiency to unsure or slow markets,

PQ wellbeing

CABA partners with Kaplan to improve students’ resilience

C
ABA, the charity that supports the
wellbeing of chartered accountants, has
partnered with Kaplan to offer free
‘Boost your Resilience’ workshops to ACA
students throughout April.
The 90-minute sessions are
specifically designed for
students and will give them the
opportunity to learn evidence-
based, practical techniques to
help develop a resilient attitude
and learn how to cope more
effectively with setbacks. They
will also provide advice on how
to improve pressure and stress
management skills, to enable
students to overcome
challenges in both their
personal and professional lives.
The sessions will run in
Kaplan’s centres in
Birmingham, Leeds, London
and Manchester, with limited spaces at each
venue. Priority will be given to ACA students,
although these workshops are open to all Kaplan
students and Kaplan tutors, too.
Laura Little, learning and development
manager at CABA, said: “Resilience is the ability
to adapt and bounce back from
difficult times and setbacks in life.
Through our partnership with
Kaplan we are offering students
advice on how they can develop a
resilient attitude. Being flexible in
our approach to stress is vital,
and we believe that these
workshops will help students
differentiate between pressure
and stress, so they can eventually
find the right way of coping.”
Last year, CABA’s student
wellbeing research revealed that
almost two in five students (38%)
are unhappy about their work-life
balance, with those working in
small and large firms struggling
the most. Some 28% said they are expected to
work extended hours.
This course will help address these feelings of
worry and provide easy-to-implement tactics to
enable attendees to feel more in control.
Little added: “‘Throughout our careers we all
encounter multiple challenges. From learning
the ropes through to senior management, there’ll
be times when we’re under significant pressure
and not sure how to proceed. This is also true of
our personal lives, be it the pressures of family
life, or financial planning for retirement, learning
coping mechanisms now at the beginning of a
career can help us be more resilient and reap
the benefits for years to come. If you implement
the right activities, on a consistent basis, you will
become more resilient with each passing day,
and able to cope better with life’s setbacks while
increasing confidence and self-belief.”
To book your space visit www.caba.org.uk/
Kaplan-resilience
Students can access CABA’s practical online
wellbeing tools and training 24 hours a day for
advice and tips to help navigate their way
through day-to-day challenges.
• Thanks to CABA for this article

24 PQ Magazine April 2018


uture of accountancy
such as land registry.
Blockchains are particularly useful
where we have a large number of
different parties involved in one business
process. Maersk, for example, are
investigating the use of blockchain in
shipping, where a single crate might pass
through over 100 transactions involving
40 or more parties. There are substantial
technical, legal, regulatory, and
governance issues to resolve before a
solution like this can truly be put into
place – but it could be a powerful
application for this new method of
recordkeeping.
The paper outlines how blockchain
PQ Magazine April 2018
could affect the accountancy profession.
In a blockchain environment, there is
little need to check that one participant’s
records agree with another’s; this makes
some transactional-level assurance
obsolete, such as existence and
accuracy. However, more complicated
and judgmental areas, such as valuation
and completeness, are if anything more
important. There is also a greater need to
test the controls of how new entries get
onto the blockchain, and to what extent
physical assets correlate with its content.
All this likely means that accountants
as a whole will shift to more high-value
and judgment-driven work in a
blockchain PQ
Blockchain FAQs
• Is it something to do with bitcoin?
Yes – blockchain was originally
created alongside bitcoin, and it’s the
system that bitcoin uses to track
ownership of the digital currency. But
blockchain can be used for other
things, and could be an asset registry
or ledger instead of a currency.
• How does it work?
The full answer is very complicated
but, in essence, new transactions are
bundled into blocks before being
posted. Blocks are then verified by
anyone that has the computing power
free, which is a complex process.
Blocks are then broadcast and added
to each participant’s ledger. Blocks
also refer back to the preceding block
to avoid deletion or ambiguity.
• Does this mean anyone can see my
data?
It depends. The bitcoin blockchain is
totally open, but many other variants
allow encrypted data or limit access to
known and trusted parties.
blockchain-driven environment.
Technological understanding of
blockchain might be a useful
differentiator, but for the most part
knowledge of its key strengths and
weaknesses will be sufficient. But there
may well be some contraction of services
around bookkeeping, reconciliation, and
other transactional work that may affect
specific accountants if they aren’t
prepared.
Blockchain isn’t the right solution for
everything – it currently is very costly and
complex to run, and isn’t an
improvement over a central database in
all cases. But it is a potent new option to
explore where there’s a need to keep a
group of actors on the same page but
where a central trusted party is
unavailable or unaffordable. PQ
• David Lyford-Smith, ICAEW Technical
Manager, IT and the Profession
25
PQ ACCA F1
Micro-economics 101
Demand Curves
A change in the price
The basic concept is simple enough: if
the price of goods increases consumers
don’t want to (or can’t afford to) buy as
much as before. Therefore the total
demand for those goods decreases. The
opposite is true if the price decreases,
because consumers can now afford to
buy a greater quantity (although there
are limits to this!).
For example, if we plotted the price
and demand of bicycles on a graph, we
would get a downward sloping curve,
something like this:
We can see that at a price of $80 per
bicycle, the total demand is 2,000 units.
But if the price were to decrease to $40
each, demand would double to 4,000
units.
The blue line hasn’t moved at all, we
are just hitting it in a different place as
the price falls.
A change in other things
Now let’s consider other things which
might change the demand for bicycles.
Perhaps the Government launches a
campaign encouraging people to start
riding bicycles as an alternative to driving
their cars to work. This campaign hasn’t
changed the price of bicycles at all, but
the demand is likely to increase, in which
case, the whole demand curve will move.
Now, at the original price of $80 per
bicycle, the demand has risen to 3,000
units, without having to change the price
at all. The whole demand curve has
shifted up/right.
The same might happen if cycling
becomes more fashionable after the
Olympic games, as happened in 2012.
Alternatively, the demand curve would
shift down/left if the overall demand fell.
Perhaps there is a period of very bad
26
In the latest of our occasional Back to Basics series, Cat Hill looks at demand
and supply curves, and gives advice on tackling conceptual questions
weather, or cycling accidents are often
reported in the press, which discourages
the activity.
So the golden rule to remember is: a
change in the price doesn’t move the
curve. A change in anything other than
the price, does move the curve.
Now let’s try to apply this rule to an
example question, to see how it might be
tested in an exam.
Example 1
Which of the following would cause the
demand curve of train tickets to move
up/right?
A. A fall in the price of train tickets.
B. Motorway tolls being scrapped.
C. Sales tax on train tickets increasing
from 0% to 20%.
D. The price of petrol increasing by 10%.
Firstly, we know we are looking for
something which moves the curve itself.
Therefore, we can eliminate anything
which changes the price of the train
tickets themselves.
That rules out A, which is clearly the
price changing, but also rules out C as
the increase in sales tax charged on the
tickets would increase their price.
So we are left with B and D as our two
possible options. We are looking for
something which makes the demand
curve move up/right so, it must be
something which increases demand.
Motorway tolls would make the cost of
motoring lower, so the public are likely to
drive instead of take the train. That would
decrease demand for train tickets and
shift the demand curve down/left.
We are now left with D as the only
option. If the price of petrol increased,
fewer people would want to drive,
therefore they are more likely to take the
train. Demand for train tickets increases
and the demand curve shifts up/right.
Therefore the correct answer is D.
Supply Curves
These are similar to demand curves, but
from the supplier’s point of view.
This time, if the price rises, the
supplier wants to supply a lot of units
because they can make a lot of money. If
the price falls, they
will reduce their
supply and probably
sell something else
instead. This gives
an upward sloping
curve.
However, the
supply can still be
affected by things other than price e.g.
material shortages, costs which can’t be
passed on to the customer and new
technology which improves efficiency, so
the same golden rule still holds true:
A change in the price doesn’t move the
curve. A change in anything other than
the price, does move the curve.
Example 2
Which of the following would NOT move
the supply curve of supermarket own
brand bread?
A. Consumers are willing to pay more for
bread because it is fashionable.
B. A new piece of more efficient bread
making machinery.
C. Poor harvests making flour expensive.
The extra costs can’t be passed on to the
consumers.
D. The supermarket can make bread or
bagels but not both. The bagel profit
margin is increasing.
This time we are looking for something
that doesn’t move the curve. That could
be either because the price of bread has
changed, or it’s something which won’t
affect the supply of bread at all.
Option A doesn’t directly mention
bread prices, but if the consumers are
willing to pay more for bread, then the
price can be increased and the
supermarket will want to supply more.
However, the supply curve itself hasn’t
moved.
A new piece of machinery should
increase productivity and the extra
efficiency improves margins, therefore
increasing the amount the supermarket
wants to supply. However, this doesn’t
change the price which can be charged,
so the supply curve will shift down/right
and we can eliminate B.
If the price of flour increases but the
supermarket can’t pass on this cost, the
profit margin will be squeezed. The
supermarket would want to supply less
bread, so the supply moves up/left and
we can eliminate C.
If the supermarket could make a larger
profit margin on bagels, they would prefer
to make these rather than bread. This
moves the supply curve of bread up/left
but doesn’t change the price, so we can
eliminate D. Therefore, the correct
answer is A, as it’s the only option which
wouldn’t shift the supply curve.
Top tip: if you have scrap paper in the
exam room, you might find it easier to
visualise what happens to the curve if you
draw it. PQ
• Cat Hill is a tutor for AVADO
PQ Magazine April 2018
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PQ financial statements
Keeping it real
T
o meet their basic objective
financial statements must be
useful and the information
relevant and reliable and a faithful
representation.
Information will have relevance if it
influences the decisions of the users.
Irrelevant information has no use.
Relevance and reliability or faithful
representation are primary characteristics
relating to content, together with the
threshold quality and materiality. The
primary characteristics relating to
presentation include comparability, clarity
and understandability. Such financial
statements are based on accounting
standards issued by the Financial
Reporting Council (FRC), UK GAAP and
their Financial Reporting Standards
(FRSs) or those issued by the IASB, the
International Accounting Standards
Board, the International Financial
Reporting Standards (IAS/IFRSs)
The IASB’s (International Accounting
Standards Board) The Conceptual
Framework for Financial Reporting
(issued 2015) and the UK GAAP
Statement of Principles identify the major
user groups of financial reports:
• Potential investors/shareholders.
• Employees.
• Lenders.
• Suppliers.
• Other trade creditors.
• Customers.
• Government.
• The public.
Of these, the IASB’s Conceptual
Framework identifies potential and
existing investors, lenders and other
creditors as the primary users. The
others being interested parties to whom
general purpose financial reports are
directed and may also find such financial
reports useful.
So, what are the needs of these groups
and how would they use the published
statements?
Potential investors/shareholders
This group would comprise of both
existing and potential shareholders, who
would be considering whether to invest or
disinvest in the business. Equity investors
consider two elements to their
investment – income and gain (income in
the form of dividends and gain in terms of
the share price rising). The investor group
would also be interested in profitability
and its trend over a period of time.
If the investor takes a short-term view,
then current dividends are of interest; a
long-term view would concern future
earnings. A guide to the future can to
some extent be seen in company reports
with the Chairman’s statement; although
28
these are based on current performance,
company forward strategy is often
included.
Employees
It is encouraging to note that some
companies produce a separate
employees’ report. Employees and their
representatives require information on
business performance for two principal
reasons:
• Wage and salary negotiation.
• Assessment of current and forward
employment opportunities.
They would be interested in both the
current financial stability and the long-
term financial viability of the business
and would need information in a clear,
simple and understandable form. I have
seen some employee reports that include
a value-added approach rather than a
profit and loss account review of
performance.
Lenders
This is often referred to as the loan
creditor group. It would include the long-
medium and short-term lenders of
money. The concern of the existing
and/or potential loan creditor is whether
they will get their money back.
A short-term loan creditor will
immediately consider cash flow. The
Statement of Cash Flow, a section within
Financial Reporting Standard, FRS 102
(UK GAAP); and for those companies
using International Financial Reporting
Standards the Statement of Cash Flows,
IAS7, will be of particular interest here.
The banks make up much of this
grouping and would also have an interest
in the net realisable value (NRV) of the
assets.
Medium- and long-term creditor
groups will review the future cash flow
potential of the business. They would
have an interest in current and future
profitability and growth prospects of the
entity. A further consideration would be
on the priority of claims on the business’
resources.
Suppliers
This group comprises the trade
creditors – an important element in the
supply of a business’ working capital.
They would be interested in the financial
stability of the business in terms of cash
flow and its ability to meet its short-term
liabilities. Suppliers would consider
current and future cash flow, together
with current and future profitability.
An interest in the company’s future
strategy is also likely, as they would need
to consider how they, as suppliers fit with
the strategy; other trade creditors would
have similar needs.
Customers
This group will be interested in the
business’ short- and long-term financial
stability and its potential to supply high-
Carillion report: quality goods and services with, where
who read that? appropriate sound after sales service.
They may also have interest in the
environmental policy of the business.
Philip Dunn
Government
explains the Government departments require
importance published financial information for the
purposes of company taxation and VAT.
of financial The government is a decision-maker and
statements its forward economic plans are influenced
by the performance of all businesses
and who they within various sectors of the economy.
Current financial reports will be used as a
are of most
base in its economic models for
use to assessing future performance.
The public
Businesses do not exist in isolation; they
are part of society at large and as such
generate much public interest, so the
public are often referred to as
‘stakeholders’.
At local and national level, factors such
as employment and the environment are
often key interests. Some of these issues
may be included in a business’ financial
and long-term strategy.
Above we have referred to business in
• Dr Philip E the form of companies. However, we
Dunn is a should be aware that public sector bodies
freelance author – such as local authorities and NHS
and technical trusts, together with non-profit-
editor for Kaplan organisations and charities – publish
and Osborne financial statements that are also relevant
Books to a wide range of user groups. PQ
PQ Magazine April 2018

social media
ROUND-UP
PQ was all over social media like a
rash following the PQ magazine
Awards – you may have noticed. You
can even get a flavour of what you
missed with our one-minute highlights
video at https://www.facebook.com/
pqmags/videos/1743042679089971/
It was another great night and lots of
fun was had by all. They are definitely
the coolest accountancy awards
around (that’s what we told everyone
on LinkedIn)!
Meanwhile, over at the ACCA the
P1 examiner was putting up last-
minute articles. We put the story on
our website and tweeted out where to
find the article on organising
transactions (full story on page 8).
HTFT thanked us for “a good spot”.
On the great Facebook group, the
UK (Only) ACCA Distance Learning
Students, one PQ put the cat among
the pigeons by asking: “I’ve heard
conflicting info regarding taking food
in to the exam… has anyone sat here
[Stevenage] before and taken food
in?” It was quickly pointed out that the
rules state that only water/soft drinks
are allowed in the exam hall. Even
bananas are not allowed! “I took a
banana in with me in the early days of
sitting and it was taken off me, I have
additional time so I’m so hungry when
it’s over,” said one student. The big
advice was to eat just before going
into the exam, and the hungry
Stevenage PQ was reminded “it’s an
exam not a picnic”. Several PQs also
complained about the noise people
make with food when they do get it
past the invigilators. “My last exam I
was sat next to someone with a stack
of Belvita biscuits and the noise of
them rustling and crunching was so
annoying!!”
We also noticed that the online
trend of cat pictures seems to have
been replaced with people ‘showing
off’ their study areas. Top marks here
at PQ went to Sharon Rodgers for her
very tidy and ordered area. Can you
do better? Send your pictures to
graham@pqaccountant.com.
PQ Magazine April 2018
Life at Explore Learning
Toby Austin, 28, is a Financial Planning & Analysis Manager based in Guildford, Surrey.
He has worked for the firm for three years. A CIMA studier with a maths degree from
Southampton, Toby was recently named PQ’s Distance Learning Student of the Year
What time does your alarm
clock go off on a working
day? 6:30am – although I’m a
serial snoozer…
What’s the first thing you do
when you get to your desk?
Coffee!
What’s on your desk? A mini
whiteboard (littered with workings
and the occasional doodle), some
congratulations cards and a toy
dinosaur.
What’s the best thing about
where you work? The people –
makes all the difference.
Where’s your favourite place
to go for lunch? Pret a Manger
– great veggie options.
What (or who) can you see
when you sit at your desk? A
big TV on the wall, which will be
showing every World Cup game.
What more could you ask for?
Which websites are your
favourites and why?
Letterboxd, which is cool for
In brief
Salaries on the rise again
Advertised salaries for
accounting roles increased by
2.6% month-on-month,
according to new stats released
by CV-Library. MD Lee Biggins
said that given that pay declined
in January it was great to see that
salaries are on the rise again for
accountancy professionals. This
jump in salaries for accountants
compares very favourably to the
1.2% increase in the legal sector.
It is also double the rises being
seen by staff in the IT sector.
The PQ Book Club: books you should read
7 Deadly Dates by Jean-Paul
Noel-Cephise (Compass, £7.99)
On the back cover of this
entertaining, if slim, book the
author is described as “the UK’s
answer to Carrie Bradshaw – if
Carrie Bradshaw was a bloke
and lived in Croydon”. The
premise is a simple one: a
divorcée the wrong side a 40
wants a partner and so sets off
on a series of dates arranged via
the internet. Trouble is, each of
his dates are, in turn, guilty of
one of the seven deadly sins –
gluttony, lust, greed, sloth,
wrath, pride and envy.
So we meet beautiful Anna
reviewing and sharing favourite
films. And BBC Sport (I think I
open it up each morning before
my eyes are even open).
Which websites do you use
for work? One of the main ones
is Infogram.com – an infographic
creator where you can make
dynamic charts and data
visualisations. Highly
recommended!
How many hours a week do
you spend in meetings?
Probably between eight and 10. I
try to keep them short and sweet.
What time do you leave the
office? 6pm most days.
How do you relax? I play bass
in an indie band called Indigo
Club (we’re on Spotify and
everything). It’s great fun!
What’s your favourite tipple?
Pale ale or red wine… but never
both (learnt that the hard way).
How often do you take work
home? Almost never – I’m guilty
It’s never enough
When is enough enough? It
appears that even those on six-
figure salaries believe they are
still struggling to make ends
meet. A study by Caxton FX of
those earning over £100,000
discovered a third of respondents
did not consider themselves
wealthy. Many in the study
also followed mindful
spending habits, regularly
seeking the cheapest
deals on food, flights,
insurance and utilities.
from Poland, who can’t be
bothered with personal hygiene;
child-free Phoebe, who is
envious of the mothers she sees
around her, and asks the writer
on their first date if he’d be
willing to father a child with
her; and, most disturbingly of
all, Sophie, a beautiful Russian
who lures the (rather gullible)
author to Istanbul, and
eventually into the nightclub
she works in, where he is
fleeced for £2,000 for drinks!
These seven cautionary tales
are well told, are often highly
amusing and frequently toe-
curlingly embarrassing. There’s
careers PQ
of staying too late sometimes, but
try to keep life at home separate.
What is your favourite TV
show? Black Mirror – it’s scary
how close it is to society today.
Summer or winter? Winter (I
feel like I should apologise for
this).
Pub or club? Pub.
Who is your hero? Flea – best
bassist of all time.
If you had a time machine,
where would you go? I think I
would go back to England in the
late 1950s. It would be interesting
to see how much (and how little)
has changed. I’d get to meet my
grandad, who my mum says was
just the kindest man. And see
Villa win their most recent FA Cup!
If you hadn’t chosen
accountancy, where might
you be right now? Trying to play
music in a house band or a
wedding band. You never know,
there’s still time!
Protection works
Ending sexual harassment
also helps #TheEconomyToo,
says the International Monetary
Fund’s Christine Lagard (below
left). She explained that women
in countries with strong protection
against harassment are more
likely to be economically and
financially active. According to a
recent study, financial access
for women in emerging and
developing countries is 16%
higher when harassment
protections are in place.
more than a tinge of
sadness in these
pages, too. One has to
admire Noel-Cephise’s
candid writing and no-
puches-pulled honesty
(he is a freelance lecturer, but
started out his working life as
an accountant).
This book – a very easy read
at under 100 pages – would
make a very useful self-help
guide for those about to play
the dating game after a long
absence from the scene.
PQ rating 4/5 Entertaining, but
for this male reviewer a bit
scary, too!
29
PQ got a story, funny or serious, you want to share? Email graham@pqaccountant.com

LOOKS LIKE CASH IS ON THE WAY OUT

Card transactions, driven by our love of contactless, are now outpacing cash ones
for the first time. The Bank of England has said we passed ‘cash peak’ sometime
last year. Apart from being a seminal moment in the history of finance, there is real
concern that the decline in cash transactions could lead to higher costs for smaller
retailers as cash remains the cheapest means of payment. It is estimated that cash
transactions cost retailers less than one and a half pence per transaction (0.155 of
the value), compared to over five pence per transaction for debit cards, 0.24% by
value, explained Sir Jon. Even with cheques and bank transfers in the 1970s cash

ELECTRIC
accounted for 95% of all transactions. Countries such as Sweden have already
passed peak cash in terms of volume.

DRIVE OF A WOULD YOU VOTE

LIFETIME
Forget how much SENSIBLE?
the car cost, what Accountant Peter Saxon runs his
about the number practice out of Church Road in
plate? One of the leafy Wimbledon, south-west
UK’s most sought- London. It is also the address of a
after licence plates newish political party – the
has just been sold Sensible Party, where Peter is
at auction for a leader, nominating officer and
whopping £92,000. treasurer (obviously). So you
The plate TAX 1, know, the campaigns officer is
which has been in Urszula Saxton. Formed in March
private hands for 2015, we discovered from their
over 40 years, was website that the Sensible Party
sold to an was formed by sensible people to
unnamed bidder. promote sensible policies!
However, when you click on the
‘policies’ button you will discover
that “we are presently in the
process of forming a
comprehensive number of
polices”. Check out more at
thesensibleparty.org.uk
A DUCHY
ORIGINAL MEMORY
A memory-enhancing device that
Who would have thought
provides the brain with small burst of
that some old set of
electricity boosted recall in the
accounts could be worth
participants by 15%. This
so much! The 1483
‘neurostimulation’ was given to patients
accounts from Richard
via electrodes when they struggled to
III’s estates in Cornwall
learn a word. No one, however, is
look set to fetch £6,000
suggesting accountancy students need to
when they are sold at
plug themselves into the grid to improve
auctioneer’s Bonhams
pass rates.
this month.
FORGET ECONOMISTS –CHECK THE PREGNANCY RATE!
New research suggests if you want to know when the next recession is
going to hit you don’t need a room full of economists – just look at the
pregnancy rates! A study by the National Bureau of Economic Research
has discovered that when the fertility rate dropped the economy was
about to slow down. The study looked at over 100 million births over
almost 20 years and found six months before each of the past three
recessions in the US the number of pregnancies fell. As Professor Kasey
Buckles says: “One way to think about this is that the decision to have a
child often reflects one’s level of optimism about the future.”

APOLOGY FOR AVOIDANCE ERROR

The new FCA chairman Charles Randell has come
clean about his ‘error of judgement’ after it
emerged he had invested in a tax avoidance
scheme. He admitted recently that he put money
into the Ingenious Film Partners 2 scheme
between 2006 and 2011. He repaid £114,000
plus interest in 2015 after a letter from HMRC.
The treasury select committee said it was satisfied
that Randell (pictured right) has the professional competence and
personal independence for his new role.
GLOBAL GOALS
The ICAEW has integrated the UN Global
Goals for Sustainable Development into
its syllabus. The goals aim to transform
our world by 2030. Among the goals are
‘no poverty’, ‘zero hunger’ and ‘gender
equality’. And, you can now test your
knowledge of the world’s most
sustainable issues and learn about the
goals all at the same time, thanks to the ICAEW’s new online game. Check out if
you live up to the UN standards – go to www.icaew.com/globalgoals

’
WEV E GOT THE L OT
Your home reference set
What is your study area missing? How about a Collins
Home Reference collection! With a dictionary, thesaurus
and guides to spelling, grammar and punctuation, this
set is worth just under £50. The collection also includes
a guide to scrabble, a book on quotations and a
crossword solver’s dictionary. What more would you want?
Send us your name and postal address to be entered for this great
giveaway. Head up your email ‘Collins’ and send it to
graham@pqaccountant.com. It’s as easy as that!
Pick and mix – give it a go!
We have seven great books to give away to seven lucky
readers. Those whose names are pulled out of the hat will be
sent one of the following titles: ‘What Everyone Needs To
Know About Tax’; ‘Digby Jones Fixing Business’; ‘Ambition:
Why It’s Good To Want More and How to Get It’; ‘Confidence
Pocketbook’, ‘The Highly Profitable Accountant’; ‘The Little Book of Holistic
Accounting’; and ‘What We Mean When We Talk About Leadership’.
Send us your name and address to be entered for our lucky dip. Head up
your email ‘Pick and mix’ and send to graham@pqaccountant.com.

Terms and conditions: One entry per giveaway please. You must send your name and address to be entered for the draw. All giveaway entries must be
received by Friday 13 April. The main draw will take place on Monday 16 April 2018.

TO ENTER THESE GIVEAWAYS EMAIL GRAHAM@PQACCOUNTANT.COM

30 PQ Magazine April 2018
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