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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.

Don’t upset your web developer.

Cash flow can be a real challenge for businesses. Smaller ones especially can find it very tough to get paid on time and bigger organisations can sometimes dominate the relationship.

After all, if for example you’re an individual freelancer and are negotiating with a large company for work you will find it tough to get short settlement terms. Also, if the big company is late in paying it’s very difficult for the smaller party to “force payment”. Going to court for payment of a relatively small amount of money isn’t cost effective as the legal fees would far outweigh the money owed.

Reddit user absando is a freelance web designer and recently posted a great illustration of how he dealt with things when a big company “forgot” to pay him.

He posted that ‘I used to do freelance translating work a few years ago and I finished a 1,200 word technical manual for an Indian client that had good reviews on their industry profile. Normally payment for freelance transitions can range between 30 to 60 days, and under my contract they had 60 days to pay the amount.’

Straight away we can see that absando has a tough time as 60 days isn’t a particularly short payment term.

Things got worse for him though.

He continued explaining ‘Fast forward to the 65th day since I delivered the project and I didn’t hear anything from them. After multiple phone calls, e-mails and Skype messages, I received no word from the client so I decided to give up, write a negative review and move on.’

Whilst a lot of people in that situation would have had to write off the debt, absando was lucky.

Six months later the same company got in touch with him and obviously forgot that they hadn’t paid him last time. This time the project was for some web design work and he played it really well as rather than ask for the money he was owed, he kept quiet about it and got on with the project.

In a stroke of genius though he completed the project on time but didn’t send it all in. Instead, he changed the lock screen to the fine piece of artwork shown above.

He continued: “Surely enough a couple of hours from the deadline the translation company was frantically trying to reach me, sending emails and even trying to call my American number. They were freaking out because the project was due for their client on the very same day, and if they didn’t get it they’d lose their business with them.

I gladly responded, saying: ‘Hey remember that freelancer you stood up 6 months ago, yeah that’s me. I have your project ready to go, but you need to pay me for my previous work PLUS interest.”

Needless to say the cash was deposited into his account within 30 minutes.

Nice work!

Would you do this with your job?

If a company outsources jobs, in some situations it can be seen as good business practice but if an individual outsources his own job then what is that seen as?

Outsourcing is where a company gets another organisation to undertake a job or business function that would have previously been completed in-house. This is often done for cost saving reasons and an illustration of outsourcing would for example be getting another organisation to maintain your payroll.

I’ve never heard of an individual outsourcing his own job though but that has just changed.

Verison is one of the leading telecoms companies in the US and their security team provided details of a case study where an employee by the name of “Bob” who was a top developer had actually outsourced his own job to China without his employers knowing about it.

In other words, he had received his salary from his employers but had personally paid for somebody else to do his job at a cheaper rate without his employer knowing about it!

He was paid in excess of USD 100,000 for his job and yet he was paying a Chinese consulting firm less than 20% of that to do the job for him.

According to Verison a typical day for Bob was:

9:00 a.m. – Arrive and surf Reddit for a couple of hours. Watch cat videos (!!)
11:30 a.m. – Take lunch
1:00 p.m. – Ebay time.
2:00 – ish p.m Facebook updates – LinkedIn
4:30 p.m. – End of day update e-mail to management.
5:00 p.m. – Go home

Despite not actually doing any of the work himself his performance reviews were excellent and he had been regarded as the best developer in the building.

So, in summary – he was paid a pretty good salary and all he did was play around on the internet.

All his real work was outsourced by him to a Chinese company. He paid them whilst his employer paid him 5 times the amount that he had paid the Chinese company.

Bob has now lost his job but it does raise an interesting debate as when a company outsources it’s seen as a clever move but when an individual outsources their own job they end up losing that job.

Anyway, whilst you’re thinking of that particular point I’d like to mention that the next blog article will be written by a Chinese company but please don’t tell my employer.

Meanwhile I’m off to watch some cat videos…

The Vatican Bank releases their results.

The Institute for Religious Works, or as it’s more commonly known “the Vatican Bank”, has just released its latest set of accounts and they show a sharp increase in profits.

blog-vatican-262x275The bank has just reported net profits of €69.3 million for 2014 which compares very favourably with the corresponding figure of €2.9 million in 2013.

So what has caused the turnaround?

The bank has reported that the improved figures were as a result of a fall in operating expenses together with higher income from trading in securities.

Last year, the management of the bank was replaced as part of a clean up ordered by the Pope to remove corruption in the bank. The reforms also involved the bank bringing in anti-money laundering experts to screen all the accounts to ensure they comply with international laws governing the banking sector and the bank’s new standards for clients. Over 4,000 accounts have now been closed since 2013 and whilst the majority were dormant accounts, 554 accounts were closed because they did not meeting the bank’s new standards.

President of the Board of Superintendence, Jean-Baptiste de Franssu said that “The long-term, strategic plan of the Institute revolves around two key objectives: putting the interests of the clients first by offering appropriate and improved services and by de-risking the activities of the Institute”.

In summary, the bank seems to be doing much better now. If you are interested in opening an account with the bank though it’s worth noting that the use of the bank is limited to clergy, Vatican employees and staff at its embassies. There are now reportedly over 15,000 clients on the banks books.

More details on the Vatican bank’s accounts can be found here.

Should you be able to get this benefit at work?

How much do you get paid? My guess is it’s not as much as the chief executive of WPP.

Sir Martin Sorrell (pictured) is chief executive of the advertising business WPP and his annual pay has just been revealed in the company’s annual report.

blog-sirmartinsorrell4-275x275His total pay was £42.98 million. In case you think that’s a typo – it’s not. He received nearly £43 million in pay.

As well as being the chief executive, Martin Sorrell is the founder of the company.

The company has grown significantly since it was founded in 1985 and it is now quoted and part of the FTSE 100 (the largest 100 companies on the London stock market).

As a result of being quoted there are numerous corporate governance requirements which need to take place. One of these is the disclosure of the directors’ remuneration policy in the published accounts. 

Following the publishing of his remuneration package in the accounts it became apparent that one element of his package was very unusual.

Included within his remuneration package of $43 million is a payment to him in respect of his wife’s travel expenses. Now his wife’s travel expenses which were paid by his employer were pretty significant and definitely amounted to more than the occasional taxi journey. In fact, they amounted to £274,000!

That’s not a bad amount for travel expenses is it?

So, should you suggest to your boss at your next salary review that you should receive a travel allowance for your husband or wife?

My guess is that if you do, the response to your request would be fairly brief and probably include a rude word or two…

This is one way to lose your job…

Let’s be honest now. Have you ever played around on the Internet whilst at work?

Most of us will probably have had a quick look at websites such as Facebook or news sites but it’s worth bearing in mind that most organisations have a policy which restricts looking at non-work related websites.

dog with computer2Some people will mistakenly think that if they delete the browser history it will remove all traces of what sites have been visited but the IT savvy people amongst you will realise that the history is stored on servers.

Three judges in the UK obviously didn’t realise their browsing history would be tracked and following an investigation they were fired as they had been viewing pornographic websites on court computers.

The court cases they were presiding over obviously weren’t exciting enough and they took matters into their own hands to liven up their days by viewing adult websites on the court computers.

One of the judges who was fired was called Timothy Bowles. In a bizarre coincidence there is in fact another judge in the UK with the same name.

You have to feel sorry for the innocent one of the two.

Imagine the scene, the innocent Timothy Bowles is sat at work when word goes around amongst his colleagues that Timothy Bowles has lost his job because he was looking at porn during working hours.

A frantic clarification was issued by the Judicial Conduct Investigations Office stating “that District Judge Timothy (Paul) Bowles who sat at Romford County Court and has been removed from office should not be mistaken for the High Court Chancery Master Timothy (John) Bowles. There is no connection between the two.”

So, in conclusion three judges have lost their job due to watching pornography on court computers.

There is an important lesson to be learnt from all of this and that is, if you’re going to look at pornographic websites in the office it’s best to do so using a colleague’s computer rather than your own…

A pretty unusual team meeting for all to see.

Professionalism and confidentiality are two important features which should be present in today’s business environment.

Unfortunately for two individuals working at Marsh Insurance in New Zealand they undertook some activity in the office which was neither professional nor confidential.

cheeringA married manager in his 40s was working late with a junior colleague in her 20s when one thing led to another and before you could say “how do we record this on the timesheets” they were getting down to let’s just say some “activities which would be difficult to record on a timesheet”.

Whilst people having relationships with colleagues in the office maybe isn’t that unusual, what was unusual about this situation was what they got up to and also that they left the lights on and the blinds in the office were open.

This, together with the fact that the Marsh offices were directly opposite the Carlton Bar and Eatery which at the time of the “short term intimate team building exercise” was hosting a live band playing a concert with over 50 people in attendance.

This meant that the “teambuilding exercise” was viewed by all of the people in the pub with a number of them filming the action and subsequently posting it on facebook and YouTube.

Despite the cheers and encouragement from the pub the two office workers didn’t notice that their indiscretions were on view for all to see. When they finished the “teambuilding” the band in the pub across the road even struck up a rendition of King’s of Leon hit “Sex on Fire” but the couple were still unaware that their indiscretions had been recorded and proceeded to get dressed and head out of the office back home to their respective partners / homes.

With the viral power of the internet, word soon got around and my guess is that there was a fair amount of explaining needed both at home and in the office regarding their professionalism at the office.

It’s not been reported what the colleague whose desk was used for the “teambuilding” thought of the matter.

Would you have refused to accept this?

Let’s be honest here. Would you have done what Rick Holley did?

Who is Rick Holley I hear you say?

ethics in businessMr Holley is head of Seattle based Plum Creek Timber, a company that manages forest land as well as energy and mineral extraction, and he did something which is extremely unusual.

He was awarded a bonus worth $1.85 million but he refused to accept it as he didn’t feel comfortable accepting the bonus.

According to the terms of his contract he was entitled to receive the bonus but he wasn’t comfortable accepting the bonus as he felt it wasn’t the right thing to do given that the shareholders returns in the company were down 10%. He stated that the results of the company he was running didn’t show the strong performance he believed was deserving of a bonus.

I can’t imagine many other people refusing to accept a bonus worth $1.85 million.

Cynics may point to the fact that he still received over $8 million in remuneration during the year but even so it’s an honourable thing for him to do and I’m sure the vast majority of the stakeholders were impressed by his actions.

Now, hands up who else would refuse a bonus of $1.85 million?

This idea by Levis is certainly a good fit.

The first pair of blue jeans to be made in the world were made by Levi Strauss in 1873.

levi jeansSince then, the company Levi Strauss has gone on to sell millions of pairs of jeans and their turnover last year was $4.6 billion.

Interestingly the shares of the company are not publicly traded as the company is a private company owned by the descendants of the family of Levi Strauss.

As well as being a company with an 141 year history it is also leading the way in terms of the ethical treatment of its suppliers.

It has recently announced that it will start offering low-cost working capital to its suppliers who meet certain environmental, labour and safety standards.

It was announced that the company will provide loans with progressively lower interest rates to those of its 550 suppliers who perform well in terms of their environmental and safety standards.

This is an admirable move by the company.

Their suppliers are often from developing markets such as Bangladesh and to encourage their suppliers to adhere to better ethical conditions they will provide loans to them at interest rates that get lower the better the suppliers perform in terms of their environmental and safety standards.

A great idea and will we see other companies introducing similar schemes to encourage ethical approaches to their supply chain?