April 2013

Naked accountants…

Published on: 29 Apr 2013

Is this you? At a young age you decided that a career in finance was what you wanted. Whilst the other kids were running around dreaming of being football players or famous actresses you were busy dreaming about spreadsheets and calculators.

You then went to University and worked hard. After that you studied for a professional qualification such as ACCA or CIMA.

After all that hard work the end result is that you’ve now got a job as an accountant and you perform your job naked.

Woh, slow down. How did that last sentence end? Naked?

Yes, you read it correctly.

The Natural Cleaning Company which markets itself as “The Worlds only all-naked service co” is currently advertising professional services provided by various professionals including Accountants and Lawyers.

So, you can hire accountants that perform their service in the nude.

Now, if I’m honest, I’m not sure about this.

For example there could be some awkward scenes in the office reception when they turn up for a meeting wearing only a smile on their face.

In addition, and I’m not being rude to our profession here, but on balance there are probably more accountants I would prefer to see with their clothes on rather than with their clothes off.

Only time will tell whether the business model of The Natural Cleaning Company will stand up or not. It certainly is an unusual approach but we wish them well.

Oh, and before anyone asks I can’t remember what I was searching for when I came across their website.

Is it me or is this just nuts?

Published on: 27 Apr 2013

Anyone that suffers from an allergy knows full well that it can be a very unpleasant experience. One of the more common allergies is when people are allergic to nuts.

food-labelling-lawsAccording to Allergy UK, peanut and tree nut allergy is the most common food allergy in adults and children. The symptoms can range from mild reactions to more serious problems including difficulties in breathing.

It’s a vital safeguard therefore that food products are clearly labelled with their ingredients in case they contain items which an individual is allergic to.

The Food Standards Agency is an independent government department responsible for food safety and hygiene across the UK. They monitor food products and when for example the allergy labelling is incorrect they can force the food product to be withdrawn from sale or recalled to protect the consumer.

They have just issued an alert about some food that was being sold by the supermarket chain EH Booths.

If I’m honest I’m not sure what to say about the warning as by way of background the food that was being sold by the supermarket was bags of monkey nuts. Monkey nuts are peanuts with the shell on.

To quote from the alert:

EH Booths is withdrawing some batches of its Whole Hearted Roasted Monkey Nuts, because the presence of peanuts is not declared on the label. This makes the product a possible health risk to those who are allergic to peanuts.

Or in other words, the supermarket had failed to highlight that a bag of peanuts with their shells on would contain peanuts.

Now, I’m not an expert here but I can’t help thinking that the presence of peanuts in the bag could have been a bit of a clue that the product contained peanuts.

If by any chance you’re not allergic to peanuts but are allergic to milk then you should be ok as long as that carton of milk doesn’t contain any milk.

Would you have ridden this wave differently?

Published on: 25 Apr 2013

I’ve got a couple of friends who are keen surfers. If you speak to them they will tell you that successful surfing is all down to getting the timing right and catching the wave at the right moment.

billabongIt looks like timing is also an important issue if you happen to hold shares in one of the world’s largest surfing brands.

Billabong is Australia’s largest surfwear company and is currently the target of a takeover bid.

Billabong was set up by Gordon Merchant in 1973 when he started making surf shorts on his kitchen table and selling them to local shops.

The company rode the waves of success over the following 35 years and developed a strong following amongst fashionable surfers (as well as a strong following amongst people who had never been near the sea!)

Back in 2007 the company was valued at A$3.8 billion (approximately £2.5 billion at today’s exchange rate) but unfortunately for the shareholders the global recession bit and faced with increased competition from other fashion brands the sales of Billabong products fell dramatically.

Last February the shareholders turned down an offer of A$842 million (£560 million) to buy the company.

Earlier this year the company reported their largest ever loss after writing off most of the value of its main brand.

It’s not exactly smooth water for the company and they are currently in sale discussions with a consortium made up of a former director and a private equity company. The value of the offer on the table at the moment is A$287 million (£190 million).

£2,500 million to £560 million to £190 million.

As they say in the surfing community, it’s all in the timing.

An ex-partner of KPMG has been a bit naughty…

Published on: 23 Apr 2013

An ex-partner at KPMG has been a bit naughty. In fact, he’s been more than a bit naughty as he’s been accused of insider trading.

Insider trading is the illegal activity of using information which isn’t in the public domain to make a personal gain or avoid a personal loss.

insider-trading-examplesScott London was a partner at KPMG in the US and led their LA audit practice. Two of their major clients were the nutrition supplement giant Herbalife and the leading footwear company Skechers.

It’s been alleged that Mr London passed on price sensitive information to a golfing friend of his who then subsequently made more than $1.2 million in illicit trading of shares ahead of merger or earnings announcements (in other words, the golfing friend bought shares at a low price knowing that the share price would increase as soon as the information he was secretly given was released into the public domain).

The US Securities and Exchange Commission charged Mr London and his golfing buddy with insider trading on non-public information.

As soon as KPMG found out about this Mr London was fired and quickly became an ex-partner in the firm.

A statement from Mr London was published in the Wall Street Journal where he apologised “for any harm that results to KPMG”. He went on to say that “I regret my actions in leaking non-public data to a third party regarding the clients I served for KPMG”.

It’s not looking very good for Mr London as the authorities will no doubt come down heavily on him.

It’s unfortunate for KPMG as well as due to Mr London’s illegal activities their independence on the audits of Herbalife and Skechers had been compromised. As a result they have resigned as auditors of both Herbalife and Skechers.

Can a bottle of Coke save a child’s life?

Published on: 21 Apr 2013

Coca-Cola is one of the worlds’s largest companies and is certainly one of the best known global brands.

The company is good at lots of things and one thing they are extremely good at is working with their bottlers and managing the Coke distribution channel.

Coke-CSR-exampleAfter all, the distinctive Coke bottles and cans can be seen in shops in all corners of the world. They certainly can get their products to the distribution outlets.

I came across a report the other day involving an inspirational person called Simon Berry.

Simon spent some time working in Zambia as an aid worker and quickly spotted that one of the major causes of death amongst children in that area was from diarrhoea. It’s a shocking statistic but in some countries, 1 in 9 children die before their 5th birthday from simple preventable causes such as dehydration from diarrhoea.

The sad thing is that there is a relatively cheap and easy cure for this life taking disease. A simple mix of oral rehydration salts and zinc supplements can provide the appropriate immediate nutritional and hydrating fluid that is necessary to save a child’s life.

The big problem though is that this cheap and easy cure isn’t in the remote villages that need them.

Simon and his team started looking into ways of getting the life saving medicine to the remote villages that needed them.

A fantastic solution has been identified. Namely, to produce the medicine in packets that would fit into the spaces between the bottles in the Coke crates. As a result, the medicine can be delivered alongside the Coke bottles without taking up any additional space (and hence without increasing the cost of transporting the Coke).

The photo above shows a father and his lovely daughter together with one of the specially designed anti-diarrhoea kits that fit into a Coke crate.

In my opinion this is an absolutely brilliant idea – life saving medicine being delivered via Coke’s world class distribution channel without taking any additional space up on the delivery trucks. A great partnership between the commercial sector and the Not-for-Profit sector where all parties win.

The idea is currently being piloted in Zambia and more details can be found at colalife.org.

Congratulations to all concerned for such a great project.

Would you have done this with a new car launch?

Published on: 16 Apr 2013

If you were in charge of a car company and you were going to launch a new car model, how would you do it?

all-new_range_rover_sport_daniel_craig_nyc_260313_LowResLand Rover has just released the new version of their Range Rover Sport model and they appear to have launched it pretty well and have “ticked all the boxes” as they say in management speak.

First of all let’s think about the Range Rover Sport – what type of car is it and what image is the company trying to portray about the brand?

Some would argue that it’s a rough, tough, 4×4 off-road car that is also sporty and “sexy” so that it can be driven to sophisticated events.

Who better therefore to launch such a car than James Bond??

Sorry to disappoint a lot of you but James Bond doesn’t really exist. The actor Daniel Craig who plays James Bond in the famous 007 films however does exist so why not use him?

Now that the lead person in the launch has been identified where shall we hold the launch?

In a nice bit of segmentation, Land Rover identified which urban area has the highest concentration of Range Rover Sport sales and lo and behold it’s New York (now, whilst some of you may well be thinking that New York has lots of roads so just how important is it to buy such a powerful off road vehicle if you live there but let’s just ignore that discussion at the moment and move on).

So, launching a new product that is sexy with a rough and tough yet luxurious image – what could be better than James Bond and New York City?

The official launch event involved Daniel Craig driving the car through closed off New York streets whilst live video footage of journey was shown on the internet around the world and can be seen below.

In fact now that I’ve seen the video it looks like “James Bond” was so impressed with the new car that he forgot to stop off and pick up one of his famous Bond Girls to join him for the ride as he arrived at the event all by himself.

He could beat vampires but he couldn’t beat the tax man…

Published on: 12 Apr 2013

It doesn’t matter if you’re a famous film star or not. If you don’t pay your taxes you could get into a lot of trouble.

445px-Wesley_Snipes_mug_shot

Wesley Snipes, the famous star of films such as the Blade Trilogy and White Men Can’t Jump hasn’t starred in any films during the last 3 years.

And the reason why?

Well, the reason is that he’s been in jail since 2010 after not paying tax on $37 million of earnings.

Despite being able to defeat terrorists and vampires in his films he was unable to beat the US tax authorities and was convicted of federal tax evasion. The photo of Mr Snipes above is his mug shot courtesy of the United States Marshals Service.

For the last 3 years he has had to swap film premieres and glamorous parties for the confinement of a US prison cell.

It’s an interesting point but people often get the terms “tax evasion” and “tax avoidance” confused and think they are the same thing.

In fact the two phrases mean different things and in the UK for example tax evasion is where a person evades paying tax by illegal ways such as non declaration of income. Tax avoidance on the other hand is where a person minimises his or her tax liability in a legal way (whether or not it is in an ethical way though is a different matter altogether!).

Mr Snipes was convicted of tax evasion back in 2010 and has just been released from prison although he remains under house arrest until July when he will be free to start his film career again.

One thing he should probably do first though before he starts his film career again is to find a good tax accountant to make sure that he settles all his tax liabilities correctly on any of his future earnings and doesn’t evade any tax.

Surely you’re not watching that on your phone?

Published on: 04 Apr 2013

A few years ago Blackberry used to be the phone of choice amongst business people but the emergence of Apple’s iPhone and various Android smartphones has resulted in sales of Blackberry phones plummeting.

phones-for-accountantsEarlier this year Blackberry launched their new phone, the Z10 and this was seen to be a make or break situation for the company behind Blackberry. Before the launch of the Z10 their latest set of sales results showed a fall of 47% from a year earlier and the Z10 was hoped to stop the fall in sales.

By all accounts it’s a pretty good phone and some commentators are saying that it could even be a rival for the ubiquitous iPhone.

It seems to be doing well but yesterday news emerged of a potential flaw in the design that could lead to some embarrassing situations.

It’s a sophisticated phone and one option it has is to share details of what music you’re listening to with your contacts on your phone. This alone makes you realise how far Blackberry has moved from a pure business phone where its main use was phone calls and emails.

Now, music sharing isn’t the embarrassing bit. Not even if your music listening habits include Justin Bieber.

No, the embarrassing bit is that when the music sharing option on the new Blackberry is turned on it not only shares what music you’ve been listening to but also shares what videos you’ve been watching on your phone.

There have been reports of people being surprised at what videos their contacts have been watching on their phones with some of those videos being how can I say it but, um, adult only videos with content of an adult nature.

A lot of you reading this are qualified accountants or are studying finance so I’m sure that most videos you watch on your phone are about the latest International Financial Reporting Standards so you’ve got nothing to worry about.

Then again there are some people who would maybe argue that it’s more embarrassing to be caught watching Financial Reporting videos than watching videos of people getting friendly with each other.

The ExP Group