Can PwC partners sing?

Well, what can I say?

I admire them for being brave enough to do it but if I’m honest, by the look on some of their faces, I think a few of them aren’t sure that this will be the high point in their career.

Partners in accounting companies are renowned for being hard working and intelligent individuals.

One thing they are not renowned for is singing.

Now, whilst there are no doubt a number of partners who are good at singing, the PwC partners in Hungary have just released a video of them singing a cover of the famous John Lennon song “So this is Christmas” and it has confirmed that their finance and business skills are far superior to their singing skills (or at least I hope their finance and business skills are better than their singing…)

Congratulations though to them for getting into the festive spirit and their singing skills can be seen in the video below (if you’re viewing this in the office I’d advise headphones so as not to alarm any of your colleagues…)

It’s maturing nicely…

“Don’t worry, it’s secured with cheese” isn’t the most common phrase you hear when discussing the bond markets but a €6 million bond issue may well change that.

When a company issues a bond, the investor is lending money to that company in exchange for the bond. When the bond matures the company will repay the money that was lent (together with interest).

If you put yourself in the shoes of the investor, then what type of company would you invest in?

The chances are that you would be looking for large, well established and financially secure companies to invest in. That means that smaller companies generally find it challenging to raise funds via bonds.

An Italian cheese manufacturer has found a novel way around this problem.

4 Madonne Caseificio dell’Emilia is a relatively small Modena based cooperative firm which produces 75,000 wheels of Parmigiano cheese annually (nearly 2% of the world production of the famous cheese). It has issued a €6 million bond offering an annual yield of 5% with the capital being repaid in 5 annual amounts starting in 2018 and ending in 2022. The funds raised will be used to support their commercial expansion plans.

The interesting thing about the bond issue though is that it is secured by Parmigiano cheese worth 120% of the bond value. This means that if the company fails to repay the money the investors can get Parmigiano cheese from the company.

€7.2 million worth of cheese – that’s a lot of cheese! Let’s hope the bond matures nicely without any problems.

Does this suit you?

What do you wear to work?

If I had asked that question 10 years ago the chances are that a large proportion of answers would have been “a suit”.

Things are different now though. Tastes are changing and so are a number of office dress codes. As a result, fewer people are now wearing suits to the office.

A number of major companies revised their dress codes this year. JP Morgan for example decided to allow their employees to wear business-casual attire on most occasions. PwC also switched to a more casual dress code where employees were allowed to wear jeans as long as there were no client meetings.

Whilst this relaxing of business wear rules can have benefits for individuals who prefer to work in more casual clothing, there are some organisations who will suffer.

Fashion brands focussing on tailored men’s suits are an obvious example of a business which could suffer due to the decline in demand for men’s suits.

Brioni, the Italian menswear fashion house owned by French holding company Kering was founded in Rome in 1945 and is renowned for its high-quality suits. It has had numerous famous faces as its customers including James Bond in the Bond films from Goldeneye to Casino Royale and more recently it was reported that Donald Trump has been wearing Brioni suits during his US presidential campaign.

But things aren’t going well for Brioni.

Earlier this year Bloomberg reported 400 job losses due to a fall in demand and recently Justin O’Shea, the creative director of Brioni who was brought in to modernise the luxury Italian brand, left abruptly after just six months in the job.

Mr O’Shea is well respected in the fashion industry and has a reputation for being a very straight talking person. He told Vogue that “First of all, I would change the shitty logo. I would change the campaign. I would change the clothes. In fact, I would change pretty much everything.”

When it comes to change though, one thing seems certain and that is that the fall in demand for men’s suits is unlikely to change given the relaxing of more and more office dress codes.

Is it you or your competitor?

Sometimes it’s not what you do that counts but what your competitor does.

Apple are without doubt a great company and one of the most successful organisations that has ever existed.

They released their iPhone 7 the other week and whilst the die hard Apple fans will say that it is a big step forward for the iPhone, a number of commentators were not overly impressed with it.

But, and it’s a big but – their share price has been performing phenomenally well over recent weeks.

Just over 3 months ago at the end of June the price of an Apple Share was $92.04.

Since then the share price has increased by nearly 28%. This increase is partly due to the introduction of the new iPhone but the problems of their biggest competitor have also played a major part in their share price increase.

Samsung’s Note 7 has been a disaster for the South Korean company. Reports of the newly introduced Note 7 catching fire and the subsequent withdrawal of the phone from the market have caused big problems for Samsung.

Not so for Apple though as the 28% increase in their share price driven by the new iPhone and the problems at Samsung has resulted in the company increasing its value by $138 billion in the 109 days from 27 June to 14 October. Yes, the market value of Apple increased by $138,000,000,000 in just over 100 days.

$138 billion in 109 days is equal to

$1.27 billion per day, or

$52.75 million per hour, or

$879,205 per minute, or

$14,653 per second.

That’s not too bad an increase is it?

A good excuse to buy another handbag?

How much do the Louis Vuitton handbags cost?

A lot is the simple answer but some recent research by Deloitte’s has shown that the price of luxury items varies significantly around the world and foreign exchange movements play a big part in that valuation.

According to Deloitte, in US dollar terms London is now the “cheapest” city to buy designer and luxury goods.

Since the Brexit vote in June, at the time of writing the pound has fallen by more than 17% against the dollar (i.e. you need 17% more pounds now to buy the same amount of dollars you would have received back in June).

According to the research, on 7 October a Speedy 30 handbag from Louis Vuitton costs £645 ($802) in London, €760 ($850) in Paris and $970 in New York. China was the most expensive place to buy it with the handbag costing 7,450 Yuan ($1,115).

Nick Pope, fashion and luxury lead at Deloitte, told the BBC that “the trend in luxury pricing in the UK is being driven mainly by the depression on the sterling – thus making the same item more affordable in the UK than in any other luxury market”.

Of course, if your income is in British pounds then the cost to buy the handbag in London remains the same. If however your income is in another currency such as US dollars then it is $313 cheaper to buy in London than in China for example. If you are stocking up on your luxury handbags should you be planning a trip to the UK?

It’s not just the ladies from outside the UK who are buying luxury handbags who could be benefiting from the exchange rate movement.

Any male readers may be interested to know that a Brunello Cucinelli cashmere V-neck sweater now “only” costs £650 ($843) in the UK compared with $942 in France and $995 in the US.

$843 for a sweater?

Please form an orderly queue as you rush to the shops to buy one. Or maybe two…

Sam Allardyce and José Mourinho

As England’s football manager there are certain things that you should do and certain things that you shouldn’t do.

Winning a major tournament is a thing that you should do for example whilst looking to receive large amounts of money to advise people how to get around football transfer rules is something you shouldn’t do.

Alas for Sam Allardyce he did the latter and not the former and is now no longer the England football manager.

There are plenty of ways that football managers can make money in a legitimate and ethical way and maybe Mr Allardyce should have followed the example of the current Manchester United boss Jose Mourinho.

In addition to the £12 million wages Mr Mourinho receives from Manchester United he also does pretty well from various other activities.

Hublot watches, Adidas, Jaguar, BT Sport, Lipton Tea and EA Sports all pay a significant amount of money to Mr Mourinho to endorse their products. They see him as an internationally recognised figure with global appeal.

The latest big name to sign him up is Heineken. They reportedly will pay him £4 million for a 2-year deal to be Heineken’s global football ambassador.

That’s a pretty nice sum of money to receive and it got the accountant in me thinking about the financials from Heineken’s point of view. How many additional litres of beer would Heineken need to sell to cover the cost of appointing José Mourinho?

Heineken’s latest set of published accounts show revenue of €20.5 billion with an operating profit of €3.4 billion. In 2015 they sold 18.8 billion litres of beer. Ignoring various accounting items such as contribution and fixed costs it follows that each litre of beer generates approximately €1.09 of revenue and €0.18 of operating profit.

To cover the £4 million (approximately €4.6 million) cost of José the company would need to sell an additional 26 million litres of Heineken!

This clearly shows the challenges involved when an organisation is deciding whether or not to undertake any form of sponsorship or increasing brand awareness as it is virtually impossible to accurately place a financial value to the benefits achieved. The marketing guys would argue that the value is more than purely an increase in immediate sales revenue.

The fact is that it is extremely difficult to directly link an appointment of a brand ambassador to an increase in sales. There are numerous other items which can impact on the sales of a product. For example, a sudden heatwave would increase the amount of cold beer that is drunk and not even Jose Mourinho could claim to be able to impact the weather.

Back to Mr Allardyce though and whilst I doubt that many companies will be approaching him to sign him up as a brand ambassador, at least he can claim to be the only England manager who won all of the games where he was in charge (even if it was only for one game…)

It’s a dog’s life…

Greece has had a bad time of it over the last couple of years in terms of their finances but a recent announcement by their Finance Ministry may result in animals coming to the rescue.

When I say animals, I should be more specific and say that dogs will be helping out and not just any dogs but dogs who can sniff out money.

Let me explain a bit.

It’s been well documented that Greece has had a few financial problems. There were fears that they would crash out of the euro. Capital controls followed and there was a new international bailout for the country.

As a result, a lot of the Greek population perhaps understandably didn’t feel that confident in trusting the banks to look after their cash and a significant amount of money is being held outside of banks.

From November 2014 to July 2015 over 50 billion euros was withdrawn from the banks and It’s been estimated that between 15 to 20 billion euros is still being held by Greeks outside of the banking system.

That’s a lot of mattresses to be storing cash under and people are looking at avoiding capital controls and instead take the money out of the country without the authorities knowing.

Taking a suitcase of cash out of the country is seen as a safe option for a lot of people.

So, where do the dogs come in?

Well, a recent posting on a government website said that a team would be put together to assess tenders for the provision of dogs whose job is to detect cash. The dogs would be in place to sniff out significant amounts of cash being taken out of the country at border points.

Given all the money problems in Greece, one big advantage of this plan is that the dogs won’t be paid in cash. Instead, they will be more than happy to be rewarded with a biscuit or two…

French Connection not quite connecting…

Ted Baker, SuperGroup and French Connection are all well-known fashion brands. It appears though that some shareholders in French Connection aren’t too happy at the moment and feel the company has fallen behind the other leading fashion brands.

French connection was established in the early 1970s, owns the famous FCUK logo and is listed on the London Stock Exchange.

Gatemore Capital Management, an American fund holds an 8% stake in French Connection and last week they wrote to the board of French Connection and criticised the company’s “disappointing” performance over recent years. Their comments raise some interesting examples for anyone studying a professional qualification with a corporate governance element to it (e.g. ACCA P1 or CIMA E1).

In their letter to the board, the fund urged the founder of French Connection, Stephen Marks to split his roles as chairman and chief executive. Best practice in UK corporate governance encourages the chairman and chief executive roles to be held by different people so as to avoid too much power being in the hands of one person. Mr Marks though holds both roles.

The fund also wanted the replacement of 2 of the non-executive directors. They highlighted that Dean Murray and Claire Kent would both “soon be losing their status as independent” as they had been on the board for 8 years. A key feature of non-executive directors, or NEDs as they are often referred to, is that they should be independent so that they can for example challenge the strategy put forward by the executive directors. NEDs shouldn’t be on the board of the same company for more than 9 years.

The financial performance of French Connection since the 2008 financial crisis hasn’t been particularly impressive. The share price has fallen from 100p to 40p since then and Gatemore felt that the company could catch up on its rivals by reducing the size of their product ranges and speeding up the closure of loss-making stores.

One interesting observation they had was that they wanted the company to drop the FCUK logo as it was no longer felt to be “aspirational”. Are we about to see the end of the famous logo?

A football star who can’t kick…

When you were young did you dream of being an accountant when you grew up? My guess is that most of you probably didn’t fall asleep at night dreaming of spreadsheets and calculators. Perhaps a more common childhood dream was playing for your favourite football team or being a famous actor or actress.

There have been some interesting developments recently though when it comes to playing for your favourite football team and some of the top teams are now signing players who will never be kicking a ball for their team. Instead, they will be representing their teams in the world of gaming, or to be more specific, football gaming such as EA Sports Fifa

Manchester City have recently signed Keiran Brown, an 18 year old gamer who has more than 12,000 followers on his YouTube channel.

Keiran will represent Machester City at Fifa esports tournaments where gamers sit in front of computers representing their team and watched by crowds of thousands of spectators.

Manchester City didn’t disclose how much Keiran will be paid but other professional gamers are reported to be paid in the region of £3,000 per month and can also win prize money at tournaments which can run into the thousands of pounds.

It’s quite a smart move for the club though as football games on consoles such as Xbox and PlayStation are extremely popular with supporters of the actual game.

Diegao Gigliani, vice-president of media and innovation at Manchester City was quoted as saying “As esport continues to gain momentum, it makes sense for our clubs to be part of the action and get closer to our fans, who love playing EA Sports Fifa as Manchester City. We will be a bigger presence at gaming tournaments, we will have more content through our digital channels and we will activate even more with our fans at matches and club events.”

So, in summary, if you want to play for your favourite football team but can’t kick a ball then maybe get out your Xbox and start practicing…

Would you do this for a bit of chocolate?

What’s one way of increasing the chances of getting hold of someone’s password?

Does it involve the use of the very latest supercomputer? Does it involve some clever IT geeks hacking into a computer for you?

Or does it involve chocolate?

A recent bit of research published in the journal Computers in Human Behaviour attempted to find out how people are obligated by the kindness of others. Or in other words, if someone does something nice for a person, how likely is it that the person will be nice back to them?

The researchers in Luxembourg conducted a survey of random people in the street asking them about internet security including questions about passwords.

Some of the people interviewed were given chocolate and some weren’t.

30% of those that were not given chocolate revealed their passwords which to me is a surprisingly high percentage and just goes to show that quite often human stupidity is the weakest link in internet security.

For the people who were given chocolate at the beginning of the interview the figure rose to 44% and if the chocolate was given just before the question on passwords was asked an incredible 48% gave their passwords! Yes, nearly half of the people asked their passwords as part of a survey told a complete stranger their password if they had been given chocolate.

Andre Melzer, the author of the study said that “when someone does something nice for us we automatically feel obliged to return the favour”.

So, in conclusion, if someone walks up to you in the office and offers you a piece of chocolate be careful what you say…

Is this the best time to leave the office?

When do you think it is a good time to leave the office on a Friday night? After all, if the sun is shining and you’ve got a nice weekend planned it would be good to be able to finish at a reasonable time.

In some jobs though there can be pressure to finish projects which legitimately means that you’ll have to stay late to meet the deadline.

In other companies though there can be a culture of staying late as there’s “always something to do” and never enough time to do it all or there can be pressure to stay late to “prove” that you are busy and working hard.

As an aside, when I was younger I used to work with a colleague who would bring in a spare jacket to leave on the back of his chair when he left the office at the end of the day – his boss would see the jacket on the chair together with an open file on the desk and the screensaver active on his computer and think he was still working hard and in a meeting somewhere else in the office.

Back to 2016 though and Credit Suisse, the leading investment bank, has introduced a new policy called “protecting Friday nights”.

In an email leaked to Reuters, Credit Suisse said it would be ordering all employees to stop working at 7pm on Fridays.

Marisa Drew, co-head of banking and capital markets in London reportedly told workers that she “had given a great deal of thought into how we can provide some time off for our bankers”. Ms Drew went on to say that this would allow “employees to make firm plans with family and friends and ensure that this time will be respected”.

So, good news for Credit Suisse employees as (unless they are working on a deal) they have to leave the office by 7pm on Friday.

When do they have to be back in the office though? Well, they have been told that they cannot go back to the office until midday on Saturday.

Yes, a whole 17 hours to relax, see the family and get some sleep…

This is shocking…

A lot of our readers are accountants or are training to be accountants. It should arguably follow therefore that you are good with figures. You are good with numbers and can manage your finances.

Not everyone though may be as good at managing their own personal finances and for any of you who may have problems controlling your spending, a new product will shortly be hitting the market which could be of interest to you.

A British company by the name of Intelligent Environments has developed a wristband that will deliver an electric shock to the wearer when they exceed pre-set spending limits.

The Pavlok wristband links to an individual’s online bank account and when a pre-set limit is exceeded a 255-volt electric charge is delivered to the wearer. The wristband is named after the Russian scientist Ivan Pavlov whose research showed that the behaviour of dogs could be altered by the prospect of reward or punishment.

Submitting yourself to an electric shock to stop yourself spending money does seem a bit extreme and with a cost of £120 then the buyer may well end up having an electric shock earlier than anticipated…

You can’t read this book…

Everyone seems to be on their smartphone or tablet at the moment. After all, when was the last time you read a book? Or let me ask you a slightly different question, when was the last time you coloured in a colouring book?

“Coloured in a colouring book!? I’m not a child”, I hear you say but whilst most people will come to the conclusion that the last time they coloured in a colouring book was when they were a young child, things may be changing.

One of the latest crazes doing the rounds in the UK at the moment is adult colouring books where grown men and women are buying adult colouring books to colour in. A quick Google search of “adult colouring books” will reveal the vast variety of such type of books (as an aside make sure you include the word “colouring” when searching for adult colouring books otherwise you may get an unexpected search result).

It’s been reported that more than 3 million adult colouring books were sold in the UK last year which represented over £20 million worth of revenue for the publishing industry.

Now, whilst certain trendy people may well be rushing to buy colouring books, the tax authorities in the UK are also getting interested in the trend.

The reason behind the tax authorities interest is that colouring books are currently treated as children’s books and as such are zero rated for VAT purposes (in other words VAT is not charged on the books).

The tax authorities are currently in talks with publishers about plans to classify adult colouring books as uncompleted books which would then make them liable to VAT at 20% in the same way that diaries and notepads are.

The net result is that if the tax authorities do reclassify the adult colouring books then either the books will become 20% more expensive for the individual purchasers or if they remain at the same published price, the publishers will have to take the hit.

More expensive adult colouring books? It’s enough to make you throw your toys out of the cot.

High heels at PwC

Let me ask the men who are reading this a quick question – how would you feel if you had to wear uncomfortable high heels during a 9 hour working day?

My guess is that unless you have a pretty unusual job, as a man you wouldn’t feel too happy wearing high heel shoes. There would also probably be some fairly blunt discussions with your employer if they made it compulsory that you wore high heels.

If you’re a woman though, then it’s a different matter.

Nicola Thorp, a 27-year-old lady was temping at PwC’s office in central London as a receptionist. She turned up for her first day of work at PwC in flat shoes but she was told she had to wear shoes with a “2 inch to 4 inch heel” (5 cm to 10 cm).

According to the BBC, when she refused and complained that male colleagues were not asked to do the same, she was sent home without pay.

To be fair to PwC though, they had outsourced the reception duties at their London office to outsourcing firm Portico and the dress code was not a PwC policy. A PwC spokesman told the BBC that “PwC does not have specific dress guidelines for male or female employees.”

Portico said that Ms Thorp had signed the appearance guidelines but would now review them.

Ms Thorp however has taken the matter further. She has launched a petition on the UK Parliament website calling for it to be illegal for companies to demand that women wear high heels.

The UK Parliament website works in such a way that if a petition receives more than 100,000 signatures the matter will be considered for debate in parliament.

As at the time of writing, the petition has received over 140,000 signatures so it’s likely that the matter will be debated in Parliament.

My guess is that being debated in the UK parliament was the last thing on her mind as Ms Thorp put on her shoes to head into her first day of work at the offices of PwC in London…

Who audits the auditors?

The Financial Reporting Council (FRC) has just published its audit quality inspection reports for the 6 largest auditing companies in the UK. The job of the FRC’s Audit Quality Review (AQR) team is to monitor the quality of the audit work of those UK audit firms that audit public interest and large entities.

The AQR team have been busy over the last year and have now released lengthy reports for BDO, Deloitte, EY, Grant Thornton, KPMG and PwC.

Overall, the quality of the audits has improved during the last year with the number of audits that required “significant improvements” dropping from 10 to 2 for the Big 4. There were no audits that required significant improvements at BDO or Grant Thornton.

Unfortunately for KPMG though, they were the company that undertook the two audits that were highlighted by the FRC as needing significant improvements.

The FRC reviewed 22 KPMG audits and out of those there were 2 that required significant improvements.

The first one involved a change of systems and a 3rd party IT provider. The FRC identified that the KPMG audit team did not “design and perform procedures to obtain sufficient audit evidence in response to the migration risk”.

In the second audit where there were problems the FRC highlighted that insufficient audit work had been performed in relation to revenue and inventory.

Details of the scope of the reviews can be found here and are the full reports on the individual companies are on the following links:

BDO
Deloitte
EY
Grant Thornton
KPMG
PwC

Thank you 200,000 times from ExP…

WOW – thank you so much. We’re celebrating 200,000 fans on Facebook so a big, big, big thank you to all of you that follow us on Facebook – it’s much appreciated!

Whether you attend one of our classroom courses, our online courses or access our free courses on our website thank you so much for your trust in us and we hope we’ve helped you in your professional development.

Thanks again from all of us here at The ExP Group.

Maintaining eye contact…

It’s always nice to grab a social bite to eat with colleagues or clients but if I’m honest, I’m not sure I’d recommend the Bunyadi restaurant for such events.

The reason I wouldn’t recommend the restaurant for such events is not because of the food, location or service (which I’m sure are all very good).

No, the reason I think it would be an awkward location for colleague or client dinners is due to the fact that, how can I put it but using business terminology, they have taken an extremely differentiated approach to competing.

The Bunyadi restaurant has announced that it is opening in central London in June and the different thing about it is that it will be a naked restaurant.

Whilst an increasing number of people are choosing to eat their food in a more “natural” state without additives or preservatives, the company behind Bunyadi are taking things a step further by having a naked section in the restaurant.

Seb Lyall, the founder of the company behind the restaurant said “we believe people should get the chance to enjoy and experience a night out without any impurities: no chemicals, no artificial colours, no electricity, no gas, no phone and even no clothes if they wish to. The idea is to experience true liberation.”

When you arrive at the restaurant, you’ll enter the bar area (where everyone is fully clothed) and then head to the changing rooms where you will be given a gown. You then go to the naked area, take off your gown, fold it and put it on your seat and then sit down to enjoy your meal (and no doubt concentrate very carefully when eating your hot soup so that you avoid spilling any of it in your lap).

If you are interested in going to the restaurant you can sign up on their website but you’d better hurry. At the time of writing, there were over 15,000 people on the waiting list.

Superdry or Superdivorce?

Superdry is one of the world’s top fashion brands. The business was created in 2003 by Julian Dunkerton and James Holder.

Mr Dunkerton originally wanted to be a doctor but after performing badly in his A-level exams he got a loan of £2,000 from his father to start a business selling clothes from a local market stall in 1985.

Mr Holder created the Bench brand in 1992.

They got together in 2003 to create Superdry and since then things have been going well for them on the business front. Superdry products are now sold in over 100 countries with the company running around 500 stores around the world.

Shares in the retailer though recently fell by 6% and the reason for the fall was quite unusual as it involved selling a significant number of shares to fund a divorce.

Mr Dunkerton sold off 4 million of his shares in the company at £12 per share. The £48 million he got from the share sale will go towards funding his divorce as Mr Dunkerton had to sell the shares to pay for a divorce settlement with his ex-wife.

Now £48 million is a lot of money in anyone’s books and I’m sure Mr Dunkerton’s ex-wife is appreciative of that amount of money but there’s no need to feel sorry for Mr Dunkerton when it comes to his personal wealth as he still has a 27% stake in the business which is worth around £292 million.

Interestingly, the co-founder of the Superdry brand, Mr Holder, also had to sell shares because of a divorce. Back in 2013 he sold £20 million worth of shares to fund his divorce.

Some pretty significant figures for share sales to fund divorce settlements and given the amounts involved it’s not clear whether any of the husbands or wives of the other significant shareholders in Superdry are currently consulting divorce lawyers…

Grab your goat and let’s go…

Creativity and innovation in any organisation should always be welcome and whilst technology is often at the forefront of innovation it is sometimes the really simple ideas that can create benefits.

Unfortunately, in this particular situation it didn’t quite go according to plan.

The initial idea was good. Officials in charge of the 1,200 acre Minto-Brown Island Park in Oregon in America were concerned that several invasive plants were taking over the park and killing off a number of the native flora including maple and hazelnut trees.

The solution put forward was to create a crack team of 75 goats who would eat the invasive plants such as the Armenian blackberry and the English Ivy which would then mean that the native flora would thrive.

75 goats were duly obtained from a company called Yoder Goat Rentals (as an interesting aside I wonder how many of you were aware that you could rent a team of goats. I certainly wasn’t.)

The goats got down to work but 6 weeks later the project was cancelled.

There were a number of issues.

Firstly, the goats were fairly relaxed about what they ate. In terms of the invasive Armenian blackberry for example they decided to eat the tasty blackberry leaves but left the prickly bramble. This resulted in the plant carrying on growing.

Secondly, they didn’t show any distinction between the (tasty) maple and hazelnut trees which they were supposed to be helping and the invasive plants.

Thirdly, the total cost of the 6-week pilot programme was $20,719 which was nearly 5 times the $4,245 cost for a normal parks maintenance man supported by a prison inmate work crew.

Finally, according to a report to the city council the goats “had a barnyard aroma”.

In summary, a nice try but it didn’t quite work. Still, as any successful business person will surely agree, you don’t progress unless you try. Better luck next time and at least the goats had a nice 6-week holiday in a lovely park…

Nightclubs and lemons

What have nightclubs and lemons got in common? The answer may not be that obvious but the common link is the “inflation basket” of the 700 most used goods and services which the Office for National Statistics (ONS) uses to determine price movements for the inflation rate.

This inflation basket dates back nearly 70 years and the ONS currently uses around 180,000 separate price quotations for goods and services within the basket every month to come up with an inflation number for the whole UK economy.

Each year the items within the basket are updated to take account of changes in consumers spending patterns and a dozen or so items are added or dropped from the basket.

This year nightclubs have been removed from the basket as the younger generation are now preferring to do other things rather than go to nightclubs.

In the last 10 years the number of nightclubs in the UK has fallen from over 3,000 to less than 1,750.

In a great illustration of the impact that changes in the PESTEL environmental analysis model can have, there are several reasons for the decline in nightclubs including:

Economic – student grants have been replaced by student loans and as a result the students themselves now have less money to spend on expensive nightclub drinks.

Social – socialising with friends now more and more involves social media. Why meet up in a dark nightclub when you can Snapchat for example? Also, very dark nightclubs will limit the opportunities for photos for your Facebook feed…

Technology – whereas in the past people would often go to nightclubs to meet new people, websites such as the dating site Tinder now make it easier to meet new people without having to go to the trouble of trying to communicate with someone by shouting at the top of your voice in a nightclub which is so dark you can hardly see the person you’re shouting at…

Legal – the smoking ban imposed in recent years has impacted on the number of smokers who go to nightclubs (incidentally, electronic cigarette refills have been added to the basket this year following the increase in popularity of e-cigarettes)

What about lemons? Well Lemons have been added to the basket.

An increase in the popularity of home cooking driven by all of the cooking programmes currently on TV has led to a surge in demand for lemons.

So lemons are in and nightclubs are out.

Other changes include the removal of GPS satnavs for cars (more people are using their smartphones for directions) and the addition of mobile phone covers.

In case you’re interested here are the full details of the basket and how it is compiled.

What’s in a name?

The Indian car manufacturer Tata Motors, part of the Tata Group, one of India’s largest conglomerates recently skilfully averted what could have been a major international marketing mistake.

Tata motors, who also own the Land Rover and Jaguar brands, are about to launch a new small hatchback car. They debuted it at the recent 2016 Auto Expo as the Zica (short for Zippy Car) but following the rapidly spreading Zika virus which has infected over a million people in Latin America and which was declared an international health emergency, they decided to change the name to avoid any unwanted links between the two names.

The car will now be launched as the Tiago and the change was impressively dealt with by the company. They reacted quickly to the similarity and ran a competition via social media for the public to choose the new name. Over 30,000 names were put forward in the competition but Tiago was selected by the public as the winner.

However, if you look up the definition of Tiago in the Urban Dictionary the top two definitions are firstly, “Tiago is a great Portuguese king” and secondly “Tiago is a sex God who is…”.

I’m not sure the Tata marketing guys looked at the Urban Dictionary before agreeing to Tiago but in any case, if you see a man driving a Tiago then surely he’s either the Portuguese king or a sex God…

Are you better looking than your boss?

So who’s better looking – you or your boss?

Well, if you are male and your boss is also male there could be some disappointing career news for you if you think you are better looking than your boss.

A recent study has suggested that male bosses are less likely to promote good-looking men who work for them.

The study by University College London’s School of Management concluded that good-looking men were considered competent by their male bosses but as a result were also seen as a threat to them and their own personal career aspirations.

This raises an interesting point. Organisations no doubt want to employ the most competent people but if a male boss is reluctant to recruit or promote good-looking men because they take the view they are a threat to them personally then it means that good-looking men could be discriminated against whether or not they are competent.

Dr Sun Young Lee, the lead researcher on the study was quoted as saying “organisations want to hire competent candidates but individuals have their own agenda. When employing someone, they do not want the newcomer to do better than them and show them up”.

“What about good-looking females” I hear you say?

The study concluded that the same prejudice did not apply to women. Being a good looking lady was not associated with competence according to the study.

The study was published in the Organisational Behaviour and Human Decision Processes journal and Dr Lee felt her results suggested that organisations should consider appointing external recruitment consultants to avoid personal preferences impacting on recruitment decisions.

One additional point though is that if you yourself are male and have recently been overlooked for a promotion by your male boss then surely the only reason you didn’t get the promotion was because you are better looking than him…

My Little Pony or My Little Font?

My Little Pony is a very successful entertainment brand developed by the giant US toy multinational company Hasbro. The My Little Pony range of products first started back in the early 1980s when a line of plastic pony toys was introduced.

Since then the toy line has been joined by a number of animated TV series as well as an animated full length feature film.

All in all, a great success but there’s now a potentially very serious issue concerning the font they use on their products.

Typeface company Font Brothers design fonts and last month filed a law suit against Hasbro claiming that My Little Pony uses one of their fonts without permission.

According to Font Brothers, Hasbro used their “Generation B” font for their My Little Pony products and website without obtaining the correct licence. In other words, they are claiming that My Little Pony is using a pirated font.

Now whilst some people may say that using a font is a minor issue, if the courts find that they have been using it without the proper licence then it could be a very serious matter.

The complaint filed at the New York federal court stated that “Defendant Hasbro has used or instructed others to use unauthorised copies of the Generation B Font in the creation of, but not limited to, all products, goods, merchandise, television and film properties, and advertising material connected with the ‘My Little Pony’ product line…”.

It went on to say that “Defendant Hasbro has created unauthorised and infringing copies of the Generation B Font software and impermissibly distributed the same to third parties.”

Some fonts are so similar that it is difficult to prove which font is being used but the style sheet on Hasbro’s website specifically mentioned the Generation B Font so it will be difficult for them to claim that they weren’t using the font!

It looks like Font Brothers tried to settle matters before it got to court as they wrote in their complaint that they had contacted Hasbro about the unauthorised use but the toy company refused to license the font for their products.

The matter is now in the hands of the court but seeing as the infringements cover such a significant product there is a chance that damages could amount to a significant figure.

It may well be that it wasn’t My Little Font but it was in fact Your Little Font.

Would you buy a bottle of whisky or invest in a bottle of whisky?

Buying whisky or investing in whisky – that’s an interesting question and my guess is that most people who buy whisky are planning on gently pouring it into a glass and maybe adding some ice or a mixer before settling back to savour the flavour (before possibly waking up the next day with a headache…)

But should you be buying whisky as an investment rather than as a consumable item?

Most people are aware of the leading share indexes around the world such as the FTSE 100 and the S&P 500 (which show the index for the largest 100 and 500 companies quoted on the London and New York stock exchanges respectively) but there are also a number of other indexes out there.

These indexes measure movements and one of the more interesting ones is the Rare Whisky Apex 1000 which measures the price movement for rare scotch whisky.

It’s a significant market and last year there were rare whiskies sold at auction in the UK amounting to £9.6 million.

There was also a strong demand for rare whisky in Asia. In August last year a bottle of 1960 Japanese Karuizawa whisky was sold for over £80,000 which is a pretty significant figure for a bottle of whisky!

Back to the indexes though and the performance of the rare whisky index last year was impressive. It grew by 14%. Other indexes in comparison performed as follows in 2015:

FTSE 100 – down by 4.9%
S&P 500 – up by 0.7%
Gold index – fell by 10%.

So the increase in the Whisky index of 14% looks very good when compared to the major indexes but I guess there could be one problem.

Namely, if you’ve had a bit too much to drink and are looking for something to finish the evening off you’re more likely to drink some of your whisky investment than consume some of your share or gold investment.

Should this have been predicted?

Picture the scene. You set up a company with two of your university friends. Things are going well but as is often the case with start-ups the work is hard, the hours are long and there is no initial salary.

Chris Hill-Scott was one such entrepreneur who founded a tech start-up business back in 2008 together with fellow Cambridge University graduates Jon Reynolds and Ben Medlock.

After setting up the company and getting it off of the ground, Mr Hill-Scott decided that being an entrepreneur was not for him. He resigned as a director, left the business and transferred his shares in the company to Mr Reynolds and Mr Medlock in exchange for a bicycle.

We’ve all done things that we have regretted but in hindsight Mr Hill-Scott should have stayed in the company. He now works for the Government Digital Service creating websites and it has been reported that the average salary for that type of job is in the region of £55,000.

The two gentlemen he left behind in the company though have faced a different journey. The name of the company the guys set up is SwiftKey and although you may not have heard of the company, you have almost certainly used their technology.

SwiftKey developed the predictive text technology which suggests the next word a user is about to type on their smartphone or tablet. It has been incredibly successful and their software is used on more than 300 million smartphones and tablets around the world.

The company estimates that the software it developed has saved over 10 trillion keystrokes for its users. Let’s just think about that figure for a moment. 10 trillion keystrokes – that amounts to more than 100,000 years of typing time and represents an awful lot of thumb pain which has been avoided.

SwiftKey is an incredibly successful company and yesterday Microsoft purchased the business for £174 million (or in dollar terms, just over one quarter of a billion dollars).

Mr Reynolds and Mr Medlock will both make more than £25 million each whilst Mr Hill Scott will receive nothing from the sale as he transferred his shares in the business in exchange for a bicycle.

It’s not clear how much the bicycle is worth but I don’t think you have to be a technology expert to predict what words that Mr Hill-Scott was probably thinking when he heard the news the business he helped set up had been sold for £174 million and he had received nothing….

Would a good liar make a good accountant?

Do you have children? Have they ever told you a lie? Even a small teeny weeny lie?

Well, if they have then although you may not be particularly pleased with them, it may actually mean that they have good memories and excellent thinking skills.

Psychologists at the University of Sheffield tested 135 children and found that those children that lied performed much better than the honest children in the group.

The children in the study were aged between 6 and 7 years old and during the study they were given a trivia game. The answers to the trivia game were on the back of the card which they had been given. Initially, each child was in a room accompanied by one of the researchers but the researcher then left the child alone with the card with the answer on the back.

Before leaving the room the researcher told the children not to look at the answer but what the children didn’t know was that when they were alone in the room there were hidden cameras which were monitoring whether they would look at the answers on the back.

25% of the group subsequently cheated and looked at the answers on the back of their cards but claimed that they hadn’t cheated when the researcher returned to the room.

At a later stage, all of the children had to perform a separate memory test and the research found that the children who had lied performed significantly better than those children who didn’t lie.

Dr Tracy Alloway, project lead from the University of North Florida was also involved in the research and said that “this research shows that thought processes, specifically verbal working memory, are important to complex social interactions like lying because the children needed to juggle multiple pieces of information while keeping the researcher’s perspective in mind”.

This has got me thinking as a lot of the readers of this blog are accountants or studying to be accountants.

“Thought processes”, “verbal working memory”, “juggling multiple pieces of information” and “keeping other people’s perspective in mind” are all skills which many accountants need.

Does this mean that you would make a good accountant if you were a good liar when you were a child?

Whatever your answer is, I’m not sure I would believe you…

Let’s not run this up the flag pole…

Most of us have been there. Sat in a meeting when somebody decides to use “management speak” or “corporate jargon” to make something sound more impressive than it is.

You’ve probably heard of the phrase “think outside the box” but what about “let’s not boil the ocean”?

Michael Sugden, chief executive of the advertising agency VCCP, recently put together a list of the most irritating metaphors used in the corporate world.

He wrote in Marketing Magazine that the increased use of corporate jargon in recent years has resulted in meetings degenerating “into a quagmire of nonsensical verbal piffle”.

He put together his top 10 of the most annoying phrases and in reverse order the results are shown below.

Oh and in case you’re “not singing off the same hymn sheet” I’ve translated the “management speak” into English in the italics below the phrase.

10. Think outside the box
– come up with new ideas…

9. I may have a window for you
– I can see you on…

8. Content is king
–  first used by Bill Gates in 1996 to indicate that content would drive the success of the internet. It now appears to be used for random purposes in meetings…

7. Let’s not boil the ocean
– let’s not make this too complicated…

6. Level playing field
– keep things equal…

5. Let’s workshop this
– let’s spend far too long talking about this in a meeting…

4. Shift the dial
– to be honest I’m not 100% sure but possibly means talk about something else. Either way it sounds very dramatic in a meeting…

3. Let’s socialise this
– let’s talk about this…

2. Fail forward
– when something doesn’t work but we try to learn from it (if we still have a job after the error of course…)

1. Growth hacking
– again, I don’t think anyone is 100% sure what it means but it does sound very impressive…

So, there you go. A list of 10 phrases to [impress / annoy – delete according to how you feel about the phrases] your colleagues at meetings.

It’s a horses what?!

Business is becoming very international nowadays and more and more people are spending time working as an expat in other countries.

If you do end up working abroad it can be a great opportunity to experience another culture. One thing that is highly recommended though is not to offend the locals when it comes to their traditions.

Michael Mcfeat, a British employee of Kyrgyzstan’s largest gold mine, learnt a valuable lesson recently about the dangers of commenting on local traditions.

Whilst at a New Year’s Eve party he posted on Facebook saying that his Kyrgyz colleagues were queueing up for their “special delicacy, the horse’s penis“.

Mr McFeat was joking about the national dish “chuchuk”.

Vegetarians and horses should look away now but chuchuk is a sausage made from horsemeat and horse intestines.

Now whilst a lot of people would have seen the joke that Mr McFeat was trying to make, it appears that not everyone shared his sense of humour.

Some of his colleagues who work at the Kumtor mine briefly went on strike and there were calls for him to be prosecuted as a number of people claimed his action of comparing one of their national dishes to a horse’s penis constituted “inciting hatred”. If he was found guilty of such a crime he could have faced between three and five years in prison.

It was good and bad news for Mr McFeat though.

Whilst he was detained by the state security service for questioning (bad news), he was released by them with only a warning (good news) but they found out that he didn’t have the correct work permit (bad news) and as a result he was deported from the country (bad news).

So, the end result is that he is now back home and no longer eating horse penis working as an expat.

Surely this is genuine?

How do you feel when you return to the office after a holiday?

Do you feel refreshed and raring to go?

Or are you at the other extreme and cannot stand being back at work and are just a whisper away from handing in your notice…

My guess is that a lot of you are somewhere in between. It’s nice to be back at work but if we’re honest an extra week of holiday would be quite nice.

If you could do with an extra week’s holiday then you are not alone.

One reddit user recently posted an excellent attempt at securing an extra week’s holiday. Whilst the culprit wasn’t trying to get an extra week away from the office. I think we can all learn something from her determination.

The reddit user who posted the image above explained that her “daughter got the mail today (it’s Sunday), apparently they have another week off school”.

A quick audit review of the evidence suggests a few problems.

First of all, it was delivered on a Sunday when there wasn’t a postal delivery. Secondly, “break” was spelt incorrectly.

But that’s only two inaccuracies I hear you say. What about the details that appear to indicate it’s a genuine letter?

For example, the information was written with a black pen whilst the signature was signed with a blue pen. Surely this indicates it’s genuine?

For me, the thing which convinces me that it is a real letter from the little girl’s school is that it has an official stamp on the letter indicating that it’s a genuine official letter from the school and the girl should be entitled to an extra week’s holiday.

Ok, so the stamp is of a pink princess but surely that would pass the audit review test?