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Deloitte programme aims to open up public sector contracts to SMEs
A programme aiming to open up valuable public sector contracts to SMEs has just been launched by Deloitte Digital and small business support platform Enterprise Nation.
Deloitte is leading the way on a new spirit of SME collaboration by supporting more UK tech start-ups and early-stage businesses to make their debut in delivering valuable public sector contracts.
The SME Supplier Eco-system Programme will help firms become supplier-ready and overcome the hurdles smaller businesses face in accessing large government procurement bids – such as providing evidence of previous contract work or three years of audited accounts.
The programme will help talented digital firms access life-changing opportunities to grow their business sustainably.
Deloitte plans to hold events to open up opportunities more widely and to develop a new culture of collaboration and a sustainable pipeline of innovative ‘supplier-ready’ digital SMEs it can plug in.
Businesses signing up to the SME Supplier Eco-system will also receive monthly newsletters with notifications on new contract opportunities and join a community of peers looking to scale.
The programme comes as the Procurement Bill goes through Parliament with the intent to give innovative small firms ‘an even bigger slice of the procurement pie’ by mandating large contractors like Deloitte to work with SME quotas on bids.
Deloitte Digital partner, Andrew McKibbin, said: “We are committed to building a thriving SME community that will bring unrivalled access to exciting opportunities across Government, working on complex, large scale programmes that will make a difference to society. SMEs bring a wealth of innovation, agility and geographic access that compliment how we work at Deloitte Digital.
“We have a rich heritage of working closely with SMEs and I am looking forward to turbocharging that through a diverse and collaborative SME community that will help businesses grow.”
Enterprise Nation founder, Emma Jones, added: “Accessing public sector work in this way can act like an accelerator for SMEs. Government contracts are solid, they pay within 30 days and small firms get to work with incredible machines like Deloitte.
“It’s a very powerful way to evolve the UK’s digital business community and apply the work from some of the UK’s most agile and innovative businesses to solve public sector problems. This benefits not just SMEs themselves but the wider community, by saving taxpayers’ money along the way.”
Fraud-related audit procedures to be priority for PCAOB
The US’ Public Company Accounting Oversight Board (PCAOB) plans to increase focus on fraud-related audit procedures, continue prioritising risks related to material digital assets, and continue selecting audits in the financial services sector for inspection.
The priorities established in the most recent PCAOB staff report follow an increased deficiency in 2021 inspections and increased comment forms in 2022 inspections, according to PCAOB chair Erica Williams.
Williams said: By staying ahead of new and emerging risks, our inspections plan will hold firms accountable and drive improvements in audit quality for investors.”
Last year, the PCAOB found a year-over-year increase in the number of audits with deficiencies at audit firms that the PCAOB inspected in 2021. Williams said higher deficiency rates in 2021, coupled with increased comment forms for 2022, were a warning signal. She challenged the audit profession to sharpen its focus on improving audit quality and protecting investors.
The complete list of 2023 inspection priorities outlined in the report includes:
- Risk of fraud
- Auditing and accounting risks
- Risk assessment and internal controls
- Financial services specific considerations
- Broker-dealer specific considerations
- M&A, including de-SPAC transactions
- Digital assets
- Use of the work of other auditors
- Quality control (particularly talent retention and its impact on audit quality, and independence)
- Other areas of inspection (critical audit matters, cybersecurity, and use of data and technology in the audit)
The report notes the target team of inspectors, who execute in-depth reviews across audit firms each year, will focus its work in 2023 on audits that include risks related to digital assets, first year audits, multi-location audits, and significant or unusual events or transactions. As part of ongoing efforts to enhance inspections, today’s report also says inspectors will expand the number of audits they review for certain annual firms.
The Spotlight can be found at the PCAOB’s Staff Publications page, along with other resources aimed at fostering understanding of the PCAOB’s and its staff’s activities and observations.
At the end of last month, PCAOB issued for public comment a proposed new standard, AS 1000, ‘General Responsibilities of the Auditor in Conducting an Audit’. The Board requests public comment on the proposal by 30 May, 2023.
FRC sanctions KPMG and former employee
The Executive Counsel of the Financial Reporting Council (FRC) has issued a Final Settlement Decision Notice under the Audit Enforcement Procedure (AEP) and imposed sanctions against KPMG LLP and Stuart Peter James Smith, a former employee of KPMG, in relation to the statutory audit of the financial statements of Luceco Plc for the financial year ended 31 December 2016 (the “FY2016 Audit”).
Smith performed the role of audit engagement partner in respect of the audit on behalf of KPMG.
The following sanctions have been imposed against KPMG:
- A financial sanction of £1,250,000, discounted for admissions and early disposal to £875,000;
- A published statement in the form of a severe reprimand;
- A declaration that the FY2016 Audit report signed on behalf of KPMG did not satisfy the Relevant Requirements; and
- A requirement for KPMG to analyse the underlying causes of the breaches of Relevant Requirements and whether the firm’s current processes would lead to a different outcome, to identify and implement any further remedial measures necessary to prevent a recurrence, and to report to the FRC at each stage of the process.
The following sanctions have been imposed against Mr Smith:
- A financial sanction of £50,000, discounted for admissions and early disposal to £35,000;
- A published statement in the form of a severe reprimand; and
- A declaration that the FY2016 Audit report signed on behalf of KPMG did not satisfy the Relevant Requirements.
KPMG will also pay Executive Counsel’s costs of the investigation.
During FY2016, the Company was the ultimate parent of a group of companies which produced and distributed lighting products and wiring accessories. The Company’s subsidiaries included a production and manufacturing company in China, subsidiaries in a number of other countries, and two distribution companies in the UK.
KPMG and Smith admitted eight breaches of Relevant Requirements in relation to two areas of the Audit: intercompany transactions and year end intercompany balances; and accuracy of the cost of inventory and year end inventory balances. The Company’s FY2016 financial statements included multiple material misstatements in relation to these two areas, which had to be restated in FY2017.
The breaches included failures in the design and performance of audit procedures, failures to adequately review and critically assess the audit evidence obtained, failure to document the audit work and failures by the Respondents to apply professional scepticism.
The breaches were made more serious by the fact that KPMG and Smith were aware of prior year errors in respect of the accuracy of the cost of inventory and therefore this was one of the areas that needed particular focus in the FY2016 Audit.
KPMG and Smith co-operated with the FRC’s investigation and admitted the breaches. The extent and timing of their admissions is reflected in the 30% discount which has been applied to the financial sanctions.
ICAEW announces cyber risk management partner
Mitigo and ICAEW have announced their exclusive affinity partnership, with Mitigo becoming the appointed member rewards partner for cyber risk management to ICAEW in the UK.
With a rise in ransomware attacks and email account takeover amongst the profession, it is essential to recognise that cyber risk management is not the same as IT support. It is a different, independent discipline. Following an extensive due diligence process, Mitigo have been selected for their expertise and experience with professional service firms, perfectly suiting ICAEW member requirements.
ICAEW director of corporate partnerships & operations, Andrew Stott, said: “Cybercrime is sophisticated, and defending against it is now a specialist job. Mitigo can give ICAEW members real visibility of their cybersecurity risks, which means they can close any gaps, meet legal and regulatory responsibilities, and sleep at night.”
Mitigo chief executive, Lindsay Hill, concluded: “Cybersecurity should be at the top of your risk register and requires board level attention. Yet we still see some firms merely hoping that they have the right protections in place, not having undertaken and documented proper cybersecurity risk assessments, and without any independent assurance to prove they are safe. We look forward to working with ICAEW, to give their members visibility of their cyber risks, and the means to control
Clive Owen LLP celebrates 40th anniversary
‘Clive Owen LLP is celebrating 40 years since its first office, in Darlington, opened to offer accountancy and taxation services to local owner manager businesses and private individuals.
The Darlington office was opened with a team of 40 in 1997 and the firm now operates from Darlington, York, Durham and Middlesbrough with 13 partners and 128 staff. To mark the landmark anniversary, the firm has launched a series of celebratory events for partners, alumni, clients and intermediaries which are planned across the year. It has also introduced a team ’40 challenge’ where colleagues are encouraged to pick something with a 40 theme as a challenge to themselves – such as reading 40 books, visiting 40 beaches or swimming 40km.
Clive Owen LLP managing partner, Gary Ellis said: “Although much has happened over the last 40 years and the client base and range of services provided has widened, the firm’s core offering of working with growing, entrepreneurial businesses and private individuals delivering exceptional service remains unchanged.” Ellis added: “The way we work has been revolutionised through technology, the internet and cloud-based accounting, leaving us more time to focus on advisory work that helps us to help our clients achieve their business and financial goals.
“We are building on these advancements with new services that cater for the needs of businesses and individuals. The firm has ambitious plans for the future, including further expansion.
“As a commercially focussed organisation, we are very proud of what our team has achieved within the regional business community. As trusted advisers, we have developed robust, long-term relationships with our clients which has been the key to our success.
‘We’d like to thank everyone that has been involved with our business and who have helped shape our success over the past 40 years”.
FCA and ASA team up with Sharon Gaffka
The FCA and ASA have teamed up with Sharon Gaffka to help educate fin-fluencers about the risks involved in promoting financial products.
In addition, the FCA and ASA will be engaging with influencers and their agents, providing them with clear information about what could be an illegal financial promotion. This includes an infographic, designed for influencers, which will set out what they should check before accepting brand deals for financial products and services.
Influencer agents and the Influencer Marketing Trade Body will be invited by the FCA to an open roundtable discussion on illegal financial promotions.
Both the FCA and ASA have grown increasingly concerned about the misuse of social media by influencers and the harm this can cause their followers.
FCA executive director, Sarah Pritchard, commented:
‘We’ve seen more cases of influencers touting products that they shouldn’t be. They are often doing this without knowledge of the rules and without understanding of the harm they could cause their followers.
‘We want to work with influencers so they keep on the right side of the law, as this will also help protect people from being shown scams or investments that are too risky.’
ASA director of complaints and investigations, Miles Lockwood, said:
‘We’ve worked hard to ensure that influencers are equipped with the training and advice they need to help them advertise responsibly. From setting up a dedicated webpage to highlight those who are publishing misleading content, to using cutting edge data science to process more ads than ever, we’re seeing influencers increasingly understanding and following the rules.
‘But we recognise that there are still problems, particularly around financial products. That’s why we’re pleased to be partnering with the FCA and Sharon Gaffka to help educate influencers about the risks and responsibilities around marketing these products.’
Social media influencer Sharon Gaffka added:
‘When you leave a show like Love Island, you are bombarded with opportunities to promote products and work with brands. If like me, you’re new to this kind of work, it can be a little bit overwhelming.
‘This campaign with the FCA and ASA will hopefully make sure other influencers stay on the right side of the law and prevent them from unknowingly introducing their followers to scams or high-risk investments.’
The campaign follows the recent publication of the FCA’s annual financial promotions report, which revealed that intervention by the regulator led to 8,582 promotions being amended or withdrawn during 2022 – 14 times more than 2021. In 2022 the FCA also published 1882 consumer warnings on its website relating to unauthorised activities.
The FCA will continue to look for opportunities to join up its work with other regulatory partners, recognising that collaboration can lead to better results.
Navigating the gender pay gap crisis
Despite a continued drive for equality, there remains a 9.4% wage difference between the sexes. As testament to this, the Financial Times reported that around 80% of UK employers pay men more than women, a figure which has worsened in the last six years. In light of this, Rethinkly – unveils a nationally representative study addressing the struggles women face communicating difficult conversations in the workplace.
28% of women say that inability to communicate within the workplace has had the largest impact on their productivity, while 27% of women say they encounter challenges with their speech when attempting to confront difficult issues at work. Rethinkly’s software removes all real-world references to create a safe space that is designed to inspire autonomy of expression.
Rethinkly’s research highlights that miscommunication might be at the heart of this pattern and in turn, is not allowing women to navigate conversations about what they deserve, as an alarming 30% of workers admit they harbour all workplace tension and find confrontation too difficult. To combat this, Rethinkly creates a virtual world, which staff can anonymously enter using anonymous avatars, helping women feel safe and supported during these challenging conversations.
The use of visualisation can help women depict their contribution to managers and peers and give them the autonomy to address what they deserve, all while being anonymous. Co-founders – Andrew Jackson and David Tinker – discuss why miscommunication exists in so many offices and further outline how virtual reality tools can be used to promote better communication in difficult conversations.
How does Rethinkly work:
‘By design, the software removes all real-world references creating a neutral, virtual space that is solely designed to inspire autonomy of expression. In this context, users are able to create avatars that can express emotion and gestures, enabling detachment for reflection and transparent communication. By utilising a virtual world, the platform reframes problem-solving and communication in the workplace and beyond, in scenarios where people may feel uncomfortable expressing their feelings or opinions out loud. As such, the power of imagery and visualisation prevails where words fail, with Rethinkly combining the most effective principles of storytelling, psychodrama and coaching to address the issue at hand.
Understanding the power of images, the NHS has been relying on the software for years as a tool to help patients express themselves when they otherwise couldn’t, alongside corporate firms such as IBM which have integrated the software into employee development and coaching initiatives.‘
Pass rates announced for March 2023 ACCA exam sitting
Pass rates have been announced by the Association of Chartered Certified Accountants (ACCA) for students who sat their exams in March 2023.
According to the body, 87,305 entered for the March sitting, which saw 102,770 exams completed. A total of 3,278 students completed their final exams to become ACCA Affiliates. Remotely invigilated exams continue to be popular with the number of students choosing this option being 12,347.
ACCA executive director, Alan Hatfield, said: “This was the first exam session of the year and it’s great to see so many students making progress towards their goal of ACCA membership. We are extremely pleased with the March session results and congratulate all successful students, it is delightful to see an increase in pass rates across the majority of exams especially the Strategic Professional Options exams, AFM, APM and ATax.
“For students preparing for their next Applied Skills exams, we launched our new student feedback product, My Exam Performance in September 2022. This provides students with tailored feedback on their performance with personalised links to support them as they continue their ACCA journey and prepare for their next exam. It also helps them if they need to understand their strengths and weaknesses if they prepare for a resit exam. A recent survey confirmed that 87% of students rated it as highly useful and 81% said it motivates them to study. All Applied Skills students should make use of this invaluable support.
“For students preparing for their next Strategic Professional exams, it’s important to remember that Advanced Tax exams are changing from June 2023 onwards when our Advanced Tax exams will include professional skills marks. (ATX Malaysia variant will however change in December 2024).
“Additionally, we’re excited to launch a new development for the Strategic Business Leader exam. Starting from September 2023 we will introduce pre-seen information to SBL, further supporting students’ learning and helping to develop strategic thinking skills.”