Institutes will now work together on the next steps to create the largest professional body on the island of Ireland.   Wednesday 21 February 2024:  Members of Chartered Accountants Ireland and CPA Ireland have voted in favour of a proposal to amalgamate the two Institutes.    The two Irish-based accountancy bodies will now work to implement the decision of their members, which will see the creation of a single Institute operating under the Chartered Accountants Ireland brand.   The proposal had been endorsed by the Councils of both Institutes who believe it will better position the profession for the future, driving new growth opportunities while being stronger to meet challenges.  In a joint statement, Sinead Donovan, President, Chartered Accountants Ireland and Mark Gargan, President of CPA Ireland said they were pleased that members had seen the benefits of the proposal.  Sinead Donovan, President of Chartered Accountants Ireland, said: “This is a vote of confidence in the future. Thanks to every member who engaged with us along the way and who turned out to vote in such numbers. Our work continues now to secure the legal and regulatory consents needed to deliver on this mandate for a stronger profession.”  Mark Gargan, President of CPA Ireland, said: “As one single Institute, we will be more strongly positioned to represent our members, to promote the profession and to be a positive voice representing the public interest.  The move towards consolidation of professional membership organisations is gaining momentum globally, and Ireland will be a model for other professional bodies in this regard.“

The UK Money Laundering and Terrorist Financing (Amendment) Regulations 2023 (Regulation 1371/2023) which took effect on 10 January 2024, provides that for the purpose of assessing risk, the starting point is that domestic (i.e.UK) PEPs present a lower level of risk than non-domestic PEPs .If no enhanced risk factors are present, the extent of enhanced customer due diligence measures to be applied in relation to that customer or potential customer is less than the extent to be applied in the case of a non-domestic PEP. A parliamentary statement on lower risk of domestic PEPs explains the change is to ensure that relevant persons take a proportionate and risk-based approach to the treatment of domestic PEPs, and to allay concerns that a number of holders of prominent public positions and their family have encountered problems accessing financial services due to their status as Politically Exposed Persons. This information is provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.    

Recent corporate failures throughout the world have underscored the benefits of clarifying and enhancing the role of auditors in responding to fraud and suspected fraud as a means of enhancing public trust in financial reporting.  The proposed revisions to the IAASB standard significantly strengthen the standard on auditors’ responsibilities related to fraud by defining the expectations in relation to fraud, delineating more robust procedures, and increasing transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report. During the consultation period, IAASB will release a videos series to help stakeholders understand the proposed revisions and their implications for strengthening the financial reporting ecosystem. Stakeholder are encouraged to submit their comments using the Response Template by June 5, 2024. 

The Economic Crime & Corporate Transparency Act (ECCTA) 2023 received Royal Assent on 26 October 2023, and the provisions of the Act are starting to be implemented. The primary aims of the ECCTA are to enhance corporate transparency and reduce economic crime, therefore providing increased benefit to the UK economy, for both businesses, and individuals. To facilitate these aims, the Act implements provisions about companies, limited partnerships and other corporate entities, including the registration of overseas entities and the individuals associated with them. As part of implementation of the Act, Companies House will have new and enhanced powers to improve the quality of the information held on the Companies Register. Companies and individuals will also be required to comply with their obligations to deliver documentation on time and in the correct format. A number of the changes are being implemented from March 2024; these are outlined below. The changes will apply to incorporated entities, limited partnerships and limited liability partnerships. It will also apply to their members and directors. Companies House has set out the following important changes:  • Appropriate registered postal and email addresses – Companies will need to ensure their registered office address is “appropriate”, meaning that any document delivered to that address would be reasonably expected to come to the attention of a person acting on behalf of the company, and acknowledgement of delivery can be provided. For these reasons, PO Boxes will no longer be permitted as registered office addresses. Companies will also need to supply an appropriate email address with their next confirmation statement. As part of the transition, we understand Companies House will communicate to companies both by post and by email, with an eventual move to email-only communication. • Lawful purpose – On incorporation, the subscribers (the members of the entity at point of incorporation) will need to make a statement that the entity is being formed for a lawful purpose. A similar statement will be required for all entities on their next confirmation statement, confirming that all intended future activities are lawful. • Greater powers for Companies House – The Registrar will have enhanced powers to scrutinise, query and reject information it believes to be incorrect or inconsistent with information already held on the Register. In some cases, the Registrar will have the power to remove previously filed information. Annotations will also be made public on the Register to make stakeholders aware of potential issues with information supplied. • Enforcement and sanctions – Companies House will be given greater power to take action where a company, and its directors, do not respond to formal requests for information, or where their registered office is not an appropriate address. Sanctions could include financial penalties, annotations on the company’s public record, or even in the most severe cases prosecution. In addition to the above, Companies House will be closing their Belfast office to the public from 4 March 2024. Therefore, filing paper documents, including financial statements and confirmation statements in person will not be possible at the Belfast office from that date. Individuals wishing to file information in paper format will need to post the documents to the Registrar’s office in Cardiff. Electronic filing options are available for almost all documents, and Companies House are encouraging companies to avail of these filing options, as they phase out paper filings. Further information on the remaining significant changes, such as the identity verification requirements and changes in filing options, will be available in the coming months from Companies House. Article written by Maeve Hunt, Principal – Head of Accounting Services Grant Thornton (NI) LLP and Chair of the Members in Practice Committee. Originally published in Practice News February 2024. The opinions expressed are solely those of the writer and not to be construed as those of the Institute. The purpose of technical articles is solely to draw the attention of the reader to issues, and these should never be construed as guidance or relied on. To the fullest extent permitted by law, no liability is accepted by the Institute or the author for persons acting or failing to act as a result of anything contained in this article.  This information is provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.

On 5 February last, the report stage and third reading of the latest Finance Bill took place in the House of Commons. The Government’s proposed amendments to the Bill were passed, as was a new clause which had been tabled to introduce a new investment exemption for the electricity generator levy.  The Bill has now moved to the House of Lords where second reading was scheduled to take place on 21 February 2024. As the Bill is a ‘Money Bill’, it should be noted that this is a formality only as no changes can be made to the Bill by the House of Lords. This therefore means that, for UK GAAP/IFRS purposes, the Bill is now classed as ‘substantively enacted’. 

HMRC has published a new section in its Employment Income manual which sets out that from 1 July 2024, certain double cab pick-ups will no longer be treated as vans for income tax purposes leading to significantly higher benefits in kind as a result of being treated as cars. The UK Government has agreed to update the terms for transitioning from the Digital Services Taxes to Pillar One and HMRC has published the latest performance data for the quarter ended 31 December 2023. And finally, this week, the National Audit Office has published its report on tax measures to encourage economic growth.   Change in treatment of double cab pick-ups  HMRC has confirmed in its Employment Income Manual that from 1 July 2024, certain double cab pick-ups will no longer be treated as vans and will be classed as cars for income tax purposes.   According to the guidance in the Employment Income Manual, from 1 July 2024, HMRC will no longer interpret the legislation that defines car and van for tax purposes in line with the definitions used for VAT purposes. This VAT approach for double cab pickups differentiated the treatment based on payload, with anything under one tonne classified as a car, and anything a tonne or more as a van. This rule was replicated as a pragmatic way of resolving the primary suitability and classification of double cab pickups. Going forward, classification of double cab pickups will therefore need to be determined by assessing the vehicle as a whole at the point that it is made available to determine whether the vehicle construction has a primary suitability as per the two-part test outlined at EIM23115 onwards.   As a result, from 1 July 2024, most if not all double cab pickups will be classified as cars when calculating the benefit in kind. This is because typically these vehicles are equally suited to convey passengers and goods and have no predominant suitability.   Transitional arrangements will apply for employers who have purchased, leased, or ordered a double cab pickup before 1 July 2024, meaning that they will be able to rely upon the previous treatment until the earlier of disposal, lease expiry, or 5 April 2028. The position prior to 1 July 2024 remains unchanged as outlined at EIM23150.   Digital Services Taxes and transition to Pillar One  The UK, together with Austria, France, Italy, and Spain, has agreed to update the terms for transitioning from their Digital Services Taxes to Pillar One and have also published a joint statement on the transitional approach.  In 2021, 130 countries of the G20/OECD Inclusive Framework agreed on a two Pillar package of reforms to the international tax framework. In support of that, in a joint statement in the same month, the US, Austria, France, Italy, Spain, and the UK announced the terms of a political compromise on the transition from existing Digital Services Taxes to the new multilateral solution and to continuing discussions through constructive dialogue.  In light of the continuing multilateral negotiations at the G20/OECD Inclusive Framework, those same countries recently announced an extension of the political compromise set forth in the October 2021 joint statement through to 30 June 2024 which is consistent with the revised timeline.   Latest HMRC performance data  The latest HMRC quarterly performance data has been published and specifically data in relation to the quarter ended 31 December 2023. Monthly performance data is also available for the month ended 31 December 2023.   The Institute continually discusses HMRC service levels with HMRC and welcomes your feedback at any time by email. We recently requested feedback in relation to the most recent self-assessment filing deadline and are still accepting feedback on this until the end of this month. Members are encouraged to get in touch and share their experiences to enable the Institute to engage more effectively on their behalf with HMRC. 

Last week, the Government published two documents as part of the Tax Administration Framework Review (“TAFR”) which represent the next steps in delivering the Government’s commitments to reform areas of tax administration. As outlined in the Government’s Tax Administration Strategy, the ambition is to create a tax system fit for the challenges and opportunities of the 21st century.  The two documents published last week are as follows: A Summary of Responses to the Simplifying and Modernising HMRC’s Income Tax Services through the Tax Administration Framework Discussion Document. Chartered Accountants Ireland response to this Discussion Document is available in the Tax Representations section of our website as document 2023/12.   This outlines the next steps in relation to the three sections in the Discussion Document:-   developing and promoting the use of HMRC’s digital services by implementing a digital by default approach whilst making alternative provisions for digitally excluded taxpayers;   improving Pay as You Earn processes which cause frustration for taxpayers; and   moving to digital registration for Income Tax Self-Assessment and reviewing the criteria used to determine which taxpayers are required to file a tax return.  A new Call for Evidence on Enquiry and Assessment Powers, Penalties and Safeguards has been launched.   This will run for 12 weeks and closes on 9 May 2024. According to the Call for Evidence, reform in these areas has the potential to simplify and modernise the tax administration framework relating to HMRC’s role to promote and enable compliance and respond appropriately to non-compliance whilst ensuring taxpayers’ rights are protected.   The Government welcomes engagement from any individual, business, or organisation with views on how these powers, penalties and safeguards can be made more efficient, effective, and simpler to understand.  HMRC is holding an online introductory session via Microsoft teams to discuss this Call for Evidence on Friday 1 March from 11-12. Please email HMRC if you would like to attend.   Further workshops will be held during the second half of the consultation period to focus in detail on the different parts of the Call for Evidence. HMRC will communicate separately about these workshops.

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. The most recent Trader Support Service Bulletin is also available. Now that the first phase of the UK’s new import controls has commenced, we take this opportunity to remind you of the various phases in both the UK’s Border Target Operating Model and implementation of the Windsor Framework which are set out in a flyer prepared by the Institute’s Public Policy and Tax team. More guidance is set out below on the first phase of the UK’s new import controls in the context of certain meat products which confirms an extension to certain transitional arrangements until 30 April 2024, and we also take a look at the outcome from the recent Call for Evidence on Expanding export support.  Guidance on the UK’s new import controls – certain meat products  The Foreign and Commonwealth Directorate Office has asked us to share recently published guidance on minced meats, meat preparations and mechanically separated meat in the context of the UK’s new import controls which commenced from 31 January 2024 which effectively extends the transition period until 30 April 2024.   The default position is that imports of meat preparations and minced meat into Great Britain must be deep frozen. Imports of minced poultry meat and pig or poultry mechanically separated meat are not permitted.  In 2022, Ministers announced a delay in applying these prohibitions and restrictions to imports from the EU. Consequently, the government extended the statutory transition for meat preparations until 31 January 2024.   The guidance note now published confirms that the statutory transition for meat preparations did not end on 31 January 2024 and has been further extended until the end of April 2024 in line with the timetable for checks under the Border Target Operating Model (“BTOM”).  Call for evidence outcome: Expanding DBT export support in Northern Ireland, Scotland, and Wales  In this Call for Evidence, the Department for Business and Trade (“DBT”) proposed increasing its export support in Wales, Scotland, and Northern Ireland by introducing one-to-one support to complement existing services.  The DBT proposes increasing its export support in the Nations by introducing one-to-one support that complements existing services in the form of DBT International Trade Advisors (“ITAs”). ITAs are currently available in the English regions, and introducing this support to Northern Ireland, Scotland, and Wales, will ensure that DBT offers consistent export support across the UK. This rationale is set out in the corresponding document Exporting for Growth, DBT Services in the Nations.   Miscellaneous updated guidance etc.   Recently updated guidance, and publications relevant to EU exit are set out below:-  CDS Declaration Completion Instructions for Imports;  Customs declarants and declaration volumes for international trade in 2023;  External temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service;  Reference Document for The Customs (Northern Ireland) (EU Exit) Regulations 2020;  Data Element 2/3 Documents and Other Reference Codes (National) of the Customs Declaration Service (CDS);  Notices made under the Customs (Export) (EU Exit) Regulations 2019;  Data Element 2/3: Documents and Other Reference Codes (Union) of the Customs Declaration Service;  Simplified procedures exclusion list of procedure and additional procedure codes for CDS;  Data Element 2/3: Documents and Other Reference Codes (Union) of the Customs Declaration Service; and  Authorised Consignee Temporary Storage (ACTS) location codes for Data Element 5/23 of the Customs Declaration Service. 

The OECD is hosting the latest session in its Tax and Development Days series. This event provides an update on some of the OECD's initiatives to strengthen tax capacity and improve tax policy and compliance in developing countries and explore future challenges. Members of the public can register for this event, which is taking place virtually, and attendance is free of charge.

Costantino Lanza and Simone Brogi, two key members of the Commission’s Directorate-General for Taxation and Customs Union (DG TAXUD), recently gave a short interview discussing the new VAT Central Electronic System of Payment Information (CESOP). They discussed that the purpose of CESOP, which is an EU centralised database to which tax administrations send relevant data, is to reduce the VAT gap by enabling tax authorities to better identify online sellers of goods and services.

As European lawmakers reach provisional agreement on the final text of the EU Artificial Intelligence Act, Jackie Hennessy and Dani Michaux delve into the potential risks businesses may face In December 2023, European lawmakers announced a provisional agreement on the final text of a new Artificial Intelligence Act (AI Act), giving developers and users of AI systems the first chance to consider in detail what the proposed new framework could mean for them. Businesses are now in a position to consider the role AI plays in their organisation and how to mitigate potential risks that may arise as a result of this new legislative advancement. What is an AI system? According to the Act, an AI system is a “machine-based system designed to operate with varying levels of autonomy and that may exhibit adaptiveness after deployment and that, for explicit or implicit objectives, infers, from the input it receives, how to generate outputs such as content, predictions, recommendations, or decisions that can influence physical or virtual environments”. Why do we need this Act? The AI Act classifies AI systems into three risk categories: Unacceptable risk AI systems are considered to pose an unacceptable risk and are prohibited by the Act. These practices include systems that target vulnerable people or groups of persons, systems that materially distort a person’s behaviour, the use of biometric categorisation and identification systems and systems that classify natural persons that lead to unjustifiable detrimental treatment. High-risk AI systems are those that, based on their intended purpose, pose a high risk of harm to the health and safety or the fundamental rights of persons, taking into account both the severity of the possible harm and its probability of occurrence.    A General Purpose AI (GPAI) system displays significant generality and competently performs a wide range of distinct tasks regardless of the way the model is placed on the market. It can be integrated into a variety of downstream systems or applications. The Act is intended to ensure better conditions for the development and use of AI and is a pillar of the EU’s digital strategy. Furthermore, the Act takes aim at the emerging issue of ‘deepfake’ technology. Deepfakes are defined as “AI-generated or manipulated image, audio or video content that resembles existing persons, objects, places or other entities or events and would falsely appear to a person to be authentic or truthful”.  The Act places a requirement on deployers of this technology to disclose that the content has been artificially generated or manipulated. Who will the Act affect? The Act will impact both developers and deployers of AI systems and will legislate the following: Human oversight measures for high-risk AI systems; Effective employer obligations for organisations planning to deploy AI in the workplace; Testing of AI systems in real-world conditions; and Implementation of codes of practice for proper compliance with the obligations of the regulation for providers of General Purpose AI systems. The Act represents a major overhaul for businesses developing or deploying AI systems. Businesses doing either in the course of their work should consider how AI can be made compliant with the EU AI Act and what impact this might have on the business and its operational performance. Jackie Hennessy is the Risk Consulting Partner at KPMG Dani Michaux is EMA Cyber Leader at KPMG International

Paul Guess explains what work-related burnout means and outlines the pivotal role managers can play in prevention and recovery Many people think of ‘burnout’ as solely related to how much they work. They believe just taking some time off will relieve feelings of overwhelm and pressure and that they can quickly return to work feeling refreshed and renewed. Several factors can cause burnout, however, and it is unlikely to be resolved by taking a break. One of the most important contributors to a person’s well-being at work is their relationship with their manager. As burnout has been classified as an “occupational phenomenon” by the World Health Organization, support at work is essential to curb the rising tide of overwhelm at work.  The manager's role is critical in assessing and addressing employee burnout. Here are some tips to support leaders in preventing and managing burnout in their teams. 1. Be knowledgeable about the factors that contribute to burnout  Research has indicated the six areas that, when left unchecked, can lead to burnout. Recognising how these areas impact a team can give leaders a better idea of how to improve.  Workload Do staff have a clearly defined job description, and are their responsibilities reasonable? Additionally, do they have the resources they need to fulfil the duties assigned to them? Perceived lack of control When people feel they have a say in the decisions being made that are related to their job, it can positively affect well-being and reduce feelings of disengagement and cynicism.  Appreciation and reward When people feel the extrinsic and intrinsic rewards of their job don’t match their effort and time, they can become disengaged and unmotivated – a key indicator of burnout. Fairness Ensure that people receive fair and equitable treatment. Transparency and trust are the foundations of psychological safety within the workplace, and innovation and creativity flow from this. It is essential to effectively communicate the thinking behind decisions that impact them. Community It is vital that people feel a sense of belonging within the organisation. Develop opportunities to bring teams together and keep connections strong to build positive relationships, as loneliness and isolation are often drivers of poor mental health and well-being. Values Do the leadership’s behaviours create an environment in which people feel that it’s okay to look after their well-being? Role modelling and recognising their own management style and how it contributes to an employee’s experience is an important piece of reflective work that will lead to improved relationships. 2. Pay attention to the warning signs of poor mental health There are common indicators of burnout that managers should be aware of: poor decision making; reduced concentration levels;  feelings of overwhelm;  withdrawal; procrastination;  inability to prioritise tasks effectively;  poor timekeeping;  relationship difficulties;  expressions of anger and frustration; and  increasing cynicism and disengagement. If a manager notices these behaviours in a team member,  they must be aware of how to manage burnout in an employee. There are several steps they should take:  Start supportive conversations  Managers should use one-on-one opportunities to start exploring what might be driving any difficulty. Some people will need a little encouragement to open up, so actively listening to what they say, creating space and responding sensitively will help to reassure them that their manager is there to support them. If they feel stressed or overwhelmed by their workload, guide them on how to handle pressure. Set clear goals and spotlight progress When people don’t have clear goals, they either become stuck because they are unsure where to invest their energy or frantically churn out work in the hope it will be valuable. Good leadership involves setting clear goals that contribute to the team’s success. It’s also important to recognise progress and highlight any accomplishments or achievements by individuals or the team. Protect the team’s time A manager must protect their team’s time, especially regarding their well-being. Ensure that people take time off in light of illness, bereavement or other notable situations. Encourage people to take their annual holiday allowance and have some protected time to rest and decompress during periods away from work. Managers should always be practising the behaviours they encourage, so they must be sure to take their own time off as well. Paul Guess is a mental wellbeing expert at caba, the occupational charity supporting ICAEW

PwC’s Irish CEO Survey 2024 reveals rising concerns about company survival in a shifting business landscape. CEOs must drive innovation, agility and digital transformation for lasting prosperity, writes Amy Ball The PwC Irish CEO Survey 2024 shows that 28 percent of Irish CEOs are still not confident that their company would survive more than a decade on its current path – up from 21 percent last year. In an age where CEOs increasingly foresee the possible demise of their company within 10 years if they continue in their current direction, the imperative for business transformation has never been more critical. Innovation is at the forefront of this transformation. CEOs must champion a culture that not only welcomes but seeks out innovation. This means moving beyond traditional models to embrace disruptive technologies and processes in areas such as finance, front office, HR and operations transformation, in particular. Agility The digital era demands a shift towards more agile, technology-driven business strategies that resonate with contemporary market dynamics. Equally crucial is understanding and adapting to rapidly changing consumer behaviours. Today’s consumer landscape is a mosaic of evolving preferences and expectations heavily influenced by digital technologies. Businesses closely monitoring these shifts and aligning their strategies will likely create a valuable competitive advantage. Survival strategy Digital transformation isn’t just a buzzword; it’s a survival strategy. Integrating digital technologies into every business area, from operations to customer engagement, is essential. This digital pivot involves a fundamental change in how businesses operate and deliver value as part of the transformation journey. Clear and flexible leadership Leadership in such times of change requires a nuanced approach, too. CEOs need to navigate uncertainty with a clear vision and a flexible strategy. This involves making tough decisions, fostering a culture of resilience and preparing the organisation for continuous change. Data Data is the compass in this journey. Leveraging data-driven insights for strategic decision-making can uncover new opportunities, optimise operations and enhance customer experiences. CEOs who harness the power of data can steer their company towards more informed and effective pathways. Adaptability Lastly, business model adaptability is crucial. The ability to pivot quickly in response to market changes can be the difference between thriving and merely surviving. This adaptability should be ingrained in the company’s DNA, encouraging continuous evolution and responsiveness to emerging trends and challenges. A prosperous future The CEO’s role in steering their company towards a prosperous future is more dynamic than ever. It requires a blend of innovative thinking, digital savvy, strategic adaptability and data-driven decision-making. By embracing these principles, CEOs can ensure their company is resilient enough to create sustained outcomes. Amy Ball is Business Transformation Leader at PwC

Welcome to the latest edition of Technical Roundup. In developments this week, the Financial Reporting Council has announced its support for a four-week consultation launched this week aimed at tackling the backstop in local audit and reporting.  The consultation will gather views on legislative changes to the Accounts and Audit Regulations 2015. The UK Companies House is hosting a webinar on 22 February on getting ready for changes to UK company law. They will discuss the first set of changes including new rules for registered office addresses and new lawful purpose statements. Read more on these and other developments that may be of interest to members below. Auditing The International Auditing and Assurance Standards Board (IAASB) has published proposed revisions to ISA 240 The Auditors Responsibilities Relating To Fraud In An Audit Of Financial Statements. The proposals aim to strengthen the standard on auditors’ responsibilities related to fraud by defining the expectations in relation to fraud, delineating more robust procedures, and increasing transparency about the auditors’ responsibilities and fraud-related procedures in the auditor’s report. During the consultation period IAASB will release a videos series to help stakeholders understand the proposed revisions and respondents are encouraged to share their insights by June 5, 2024. IAASA undertakes statutory enquiries and investigations under the companies act 2014 and its own regulations. From time to time, IAASA may need to establish committees to carry out full enquiries/investigations. IAASA is seeking potential members and advisors to enquiry/investigation committees. Expressions of interest are sought by 4 March 2024. The Financial Reporting Council (FRC) has announced its support for a four-week consultation launched this week aimed at tackling the backstop in local audit and reporting.  The consultation will gather views on legislative changes to the Accounts and Audit Regulations 2015. Financial Reporting The International Accounting Standards Board (IASB) has released a webinar which introduces IFRS 18, which is expected to be issued in April 2024.  This new Accounting Standard, which will replace IAS 1, will respond to investors’ demand for better information about companies’ financial performance. This will introduce new subtotals, disclosures about performance measures as well as enhanced guidance on aggregation and disaggregation for IFRS reporters. The new standard is expected to be effective from 1 January 2027. The IASB has also released a short webinar addressing the proposals in their Exposure Draft Financial Instruments with Characteristics of Equity. The IFRS Foundation has published its January 2024 monthly news summary. ESMA, the European Securities and Markets Authority, has published the latest edition of its Spotlight on the Market Newsletter. The UK Endorsement Board (UKEB) has published a Draft Endorsement Criteria Assessment (DECA) on Lack of Exchangeability (Changes to IAS 21). In August 2023, the International Accounting Standards Board published Lack of Exchangeability, which amended IAS 21 The Effect of Changes in Foreign Exchange Rates. UKEB are inviting comments on the DECA by 6 May 2024. The UKEB has issued a draft comment letter on the IASB Exposure Draft Financial Instruments with Characteristics of Equity. This is open for public comments until 8th March 2024. UKEB has also published its final comment letter in response to the IFRS Interpretations Committee’s (IFRIC) Tentative Agenda Decision: Climate-related Commitments (IAS 37). While agreeing with the overall conclusion of IFRIC, the UKEB have suggested some amendments to enhance the clarity of the technical analysis to avoid unintended consequences. EFRAG, the European Financial Reporting Advisory Group, have released their January 2024 update which summarises public technical discussions held and decisions taken during the month. EFRAG has launched a survey to seek input from various stakeholders in preparation for the IASB’s upcoming request for information on the post implementation review of IFRS 16 Leases. The FRC has published a revised version of Actuarial Standard Technical Memorandum 1 (AS TM1) which is effective from 6 April 2024.  Anti–money laundering Issue 24 of SARs in Action is out now, a special issue on UKFIU support for SAR reporters. From virtual workshops to 1-2-1 feedback sessions, the UKFIU’s Reporter Engagement Team have a variety of support options available to SAR reporters, all of which are listed inside this magazine. Also, within issue 24, find updates on the SAR Portal, changes to Companies House and read about the National Investigation Service (NATIS) investigations into the misuse of COVID business support grants. Sustainability EFRAG, the European Financial Reporting Advisory Group has released the first set of technical explanations to assist stakeholders in the implementation of the ESRS. Last year, EFRAG launched its ESRS Q&A platform to collect and answer technical questions. The platform is a useful resource for CSRD reporters and will be updated with further responses in future. EFRAG is hosting an outreach event on 20th February which will provide an overview of the two exposure drafts on sustainability reporting standards for SMEs which were released recently. Other news In a recent blog Company Bureau Formations, a company formation and corporate service practice, provided information which readers may find useful on “Understanding CRO submission rejections 10 key factors”. It provides a list of 10 key pitfalls to avoid which could otherwise lead to a CRO submission being returned including incorrect PPSN and director’s name mismatch with PPSN details. Click here to read more details on the pitfalls. UK Companies House is hosting a webinar on Thursday 22 February at 10:30am to 11am on getting ready for changes to UK company law. They will discuss the first set of changes, including new rules for registered office addresses, a requirement for all companies to supply a registered email address and new lawful purpose statements. They will also share information about future changes and an expert panel will be available to answer questions. Click here to register for the webinar. Accountancy Europe, along with a group of European Businesses, have issued a joint statement calling for the deepening of the EU single market and renewing the dynamic of European integration. The joint statement also includes some recommendations to overcome some of the obstacles identified. The Dept. Of Finance has recently (February 2024) published its Economic Insights – Spring 2024. The report provides analysis and insights on topical economic issues and developments in a collection of short notes. The Minister for Justice has recently appointed 2 new Data Protection Commissioners to replace the outgoing commissioner. The appointments will take effect from 20 February 2024, for a five-year term. The press release states that the Data Protection Commission has grown significantly in size, scope and responsibility over the last decade and following a review by the Department of Justice into how best to support this growth, the Government decided to appoint two additional Commissioners who were selected following an open competition. Read the full press release here. For further technical information and updates please visit the Technical Hub on the Institute website.                    This information is provided as resources and information only and nothing in the information purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the information. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of the information we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained herein.  

Chartered Accountants Ireland has today outlined a series of concrete steps aimed at making the provision of childcare across the island of Ireland work for both providers and parents, which could leave working parents up to €4,500 a year better off and free up vital working capacity in the economy. Last month, the Institute published data underscoring the challenge that the costs and availability of childcare is presenting to businesses and working parents.  Today, its paper ‘Supporting Working Parents – The case for better childcare policy’ sets out the core economic arguments for improved childcare provision as well as shining a light on the experiences of working parents seeking childcare.  Currently places for children with unregistered childminders do not attract the same National Childcare Scheme (NCS) funding for parents as creche places, which are highly limited and often difficult to secure. This means a mother-of-two on an average annual wage of €45,000, and paying €24,000 per year for childcare, is left with just €235 per week after paying taxes and childcare fees – an amount which makes returning to the workforce a difficult economic proposition. Expediting the Government’s plans to enable parents who use childminders that are not registered with Tusla to access the NCS would give parents of up to 80,000 children easier access to subsidised childcare. Commenting, Tax & Public Policy Lead, Chartered Accountants Ireland, Cróna Clohisey said  “We know what the challenges are for providers and parents and we welcome the upcoming increases to NCS subsidies. But as a mother of two young children, I’ve seen first-hand the difficulties in securing creche places, the scramble to find a childminder, and the quest to make full-time employment viable for parents. The policy tools to address these are already largely in place, so it is time to move to solutions mode. “Implementation and awareness are the two major hurdles that need to be overcome, and bolder interventions are now required if effective change is to be achieved in the childcare space. That is where we are now focusing our attention in our proposals to the Government.”  Chartered Accountants Ireland is calling on the Government to: Expedite plans to enable parents who use childminders that are not registered with Tusla, to access the National Childcare Scheme, giving parents of up to 80,000 children easier access to subsidised childcare. Streamline Core Funding. The introduction of Core Funding represented a new and different way of providing funding to the sector, but it could be greatly streamlined by: Increase funding, capital investment and grant support to the sector to more adequately reflect the true cost of providing childcare services. Importantly, these funding levels should not be static but regularly reviewed and updated in line with economic and inflationary changes. Increase awareness: engagement across the Institute’s membership has pointed to a lack of awareness of supports already in place. The Institute is calling on the government to launch an improved campaign of awareness to working parents that is integrated into and promoted by the public health system. Commenting, President of Chartered Accountants Ireland, Sinead Donovan said  “Allowing childcare challenges to persist constricts labour market capacity, narrows the tax base through lower labour market participation, and maintains the gender pay gap by making it more difficult for parents, proven to be predominantly women, to return to the workforce full time. This is a generational issue, it’s hitting men and women in different but equally real ways. “Currently, Chartered Accountants Ireland members are being asked to vote on a proposal to amalgamate with CPA Ireland which, if passed, would create the largest single accountancy body on the island of Ireland. Issues such as childcare can only truly be solved through a whole-of-government strategy, which is why a single, strong voice for the profession will be crucial in the years to come.” ENDS  Notes to editors Chartered Accountants Ireland’s paper, Supporting Working Parents – The case for better childcare policy, will be published on the Chartered Accountants website on Tuesday 13 February. Chartered Accountants Ireland members are currently being asked to vote on a proposal to amalgamate with CPA Ireland which, if passed, would create the largest single accountancy body on the island of Ireland. An online vote closes at 1pm on Wednesday 14 February with a final, in-person opportunity to vote at the Chartered Accountants Ireland SGM on Wednesday 21 February. More information on the proposal and how to vote is available on the Chartered Accountants Ireland website.

In October 2023, HMRC announced that the 31 October 2023 deadline for the end of the VAT margin scheme for second hand vehicles moved from Great Britain (“GB”) to Northern Ireland (“NI”) prior to 1 May 2023 was being extended to 30 April 2024. This six-month extension followed extensive lobbying from Chartered Accountants Ireland in September and October 2023. We are now issuing a reminder that the extended deadline of 30 April 2024 is in just over two and half months.   This means that any vehicles moved from GB to NI prior to 1 May 2023 but sold after 30 April 2024 will require output VAT to be charged on the full selling price, and not on the margin. Businesses affected should check how such stock is selling – please contact us to discuss if this vehicle stock continues to be slow-moving. 

This week we remind agents to copy client VAT authorisations across to the Agent Services Account before 16 February 2024 and earlier this month, the Labour Party published details of their business tax plan should the party succeed in winning the next General Election. HMRC has also announced that research is taking place into the recent changes to VAT penalties that took effect from 1 January 2023.  Labour’s Business Partnership for Growth  The plans published by the Labour party earlier this month in this publication confirmed the following in the event that the party were to win the upcoming General Election:  Corporation tax would not be increased from the current main rate of 25 percent;   Full expensing, Research and Development tax relief, the Patent Box regime and the annual Investment Allowance would all remain unchanged;   In its first six months, a new Labour Government would publish a roadmap for business taxation; and  Greater use of rulings and clearances to provide certainty to businesses looking to invest in the UK would be trialled.  VAT penalty reform research  HMRC has announced that it is working with an independent research agency to research the views of VAT-registered businesses on the changes in the VAT penalty regime that apply to VAT return periods commencing on or after 1 January 2023.  Selected VAT-registered businesses are being contacted up to 25 March 2024 to invite them to take part in an interview. Note that a business may still be contacted even if it has not received a VAT penalty.

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. The most recent Trader Support Service Bulletin is also available and the UK Government has provided a range of resources which aim to provide support as a result of the UK implementing the first stage of its new import controls which commenced from 31 January 2024 (see below for details). On the Northern Ireland front, the return of the Northern Ireland Assembly has resulted in a new committee being formed, the Windsor Framework Democratic Scrutiny Committee.   Resources to assist with new UK import controls  The UK Government has provided a range of resources which aim to provide support, help, and guidance as a result of the UK implementing the first stage of its new import controls which commenced from 31 January 2024 as part of the first phase of its Border Target Operating Model (“BTOM”). These are as follows:  Details of key contacts which can be used for urgent border issues relating to health certification and pre-notification;  Information on the UK Government’s approach to compliance and enforcement in respect of the BTOM;  An email from HMRC providing guidance on the customs requirements to move goods from Northern Ireland to Great Britain through Ireland; and  The latest Cabinet Office Borders Bulletin which contains important Border Target BTOM guidance for businesses.  Miscellaneous updated guidance etc.   Recently updated guidance, and publications relevant to EU exit are set out below:-  Software developers providing customs declaration software;  Known error workarounds for the Customs Declaration Service (CDS);  Importing SPS controlled goods that interact with ALVS;  How to apply for a repayment of import duty and VAT if you've overpaid (C285);  Designated export place (DEP) codes for Data Element 5/23 of the Customs Declaration Service;  External temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service;  Bringing commercial goods into Great Britain in your baggage;  Taking commercial goods out of Great Britain in your baggage;  Notices made under the Customs (Import Duty) (EU Exit) Regulations 2018; and  Notices made under the Customs (Export) (EU Exit) Regulations 2019. 

HMRC’s latest schedule of live and recorded webinars for tax agents is available for booking. Spaces are limited, so take a look now and save your place. Are you interested in how HMRC uses the Litigation Settlement Strategy to try and resolve tax disputes through civil law? HMRC is holding a webinar next week on Friday 23 February which will look at the key principles of this strategy. Bookings for this particular webinar can be made now. A webinar is also being held tomorrow, Tuesday 13 February, on the National Minimum Wage; bookings can be made here. 

Do you use HMRC online services? Don’t be caught out by the planned downtime to some services. HMRC are warning about the non-availability of specific services on the HMRC website, a range of services are impacted. Check the relevant page for information on planned downtime.