We hope you’re enjoying the transition into proper Autumn when the temperature drops to “crisp” and is just this side of enjoyable. 

You’re no doubt as busy as usual with clients and your business but that is exactly why we created our accountants hub so you’ll have access to the most important and accurate insolvency information whenever you need it. 

But you can’t be everywhere and read everything all at once, so we collect the most interesting and important business and insolvency news stories every week along with regular new blogs on a range of relevant topics for you each and every week. 

We’re always keen to hear what you think so email us at ask@businessrescueexpert.co.uk because we really want to write what you really want to read!

Account for yourself!

According to new research from ICAS, eight in ten people recognise accountants as experts in their field but half of them have no idea what that field is. 

Descriptions ranged from “catering to the wealthy” to “shrouded” and “mystical” underlining a lack of understanding about the job which shaped the public’s perception of the role. 

This perceived complexity may explain why two thirds of respondents said that technology has made it easier for people to do their own accounting and is why most accountants (57%) believe the main challenge facing the industry is staying relevant as more people use online tools.

The research included eight focus groups with members of the public and a survey of more than 1,000 people as well as ICAS members. 

Many people outside the accountancy industry still mainly associate it with tax and bookkeeping activities. This is why ICAS stresses the need for accountants to demonstrate their value to wider society and make the role more accessible. 41% of respondents said they saw the job as “too complex or hard to understand.”

There is some divergence when it comes to how the industry should respond. 58% of accountants believed the profession should focus on its core roles while the wider public believed there are more opportunities to evolve in order to meet the future needs of society. 

Among the barriers that stand in the way of people understanding what accountants do are a lack of accessibility, an erosion of trust, old fashioned stereotypes, a narrow focus and a desire for the industry to be inward looking were all highlighted.

James Baird, chair of the ICAS steering group said: “Public perception of the profession is generally positive, particularly around trust, but there is limited understanding about what accountants do and outdated stereotypes persist.

“What’s clear and exciting is that there is significant opportunity for the profession to take on a broader role in areas such as strategic advice and the adoption of AI. The profession can also do more to demonstrate to stakeholders and the public the full range of capabilities that it offers beyond the numbers and how it positively contributes to society.”

UK Accounting Standards are changing in 2026 – are you and your team ready?

There are less than six months to go before the UK accounting standards are changing and will impact a host of major sectors. 

Back in 2024, the FRC published amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland and other FRSs (the periodic review). The periodic review introduced changes to FRS’s notably significant changes to FRS 102, including key changes to Section 1A Small entities and in some cases, similar changes were made to FRS 105. 

The amendments significantly change how entities recognise revenue and account for operating leases which are brought on balance sheets from January 1st 2026. 

Among the wide-reaching business and operational impacts include:-

  • Financial metrics – EBITDA, profit, net assets and net debt
  • Impacting debt covenants where ties to EBITDA, net debt, interest cover and liquidity ratios
  • Requiring amendments to performance-based remuneration such as bonus calculations, profit shares or earn out clauses payable to former owners, where the calculation is based on KPIs impacted by the changes. 
  • Impacting distributable profits and dividend payments – where profits are reduced as a consequence, there will be less realised profits to distribute

The FRC estimates that over three million businesses will be affected and while some sectors and industries will see more of an impact, all entities are required to comply with the new rules.

There will be a lot of internal and external communications and planning required including information stakeholders of the changes before they see them in the accounts. 

Owners, boards, investors and lenders need to be educated on why revenue and lease figures will shift and early engagement will help. 

As with any change to new standards, additional data and new calculations will have to be plugged into existing tools and software to make sure they can handle the changes.

Covid Repayment Amnesty Scheme Soft- Launched

The Treasury has launched a limited Covid repayment window until the end of the year, giving directors an amnesty to fully settle any unpaid pandemic related debts. 

The new voluntary repayment scheme promises a “no questions asked” approach on debts that are repaid by directors even if “they were not entitled to or did not need” the money the Treasury said. 

The scheme gives individuals and businesses until December 31st 2025 to pay back any outstanding arrears before a visible clamp-down coming in the new year. 

The government stresses that this is a last chance to escape any action following the appointment of the Covid counter-fraud commissioner Tom Hayhoe and new investigatory powers being assigned and used. 

All Covid-era schemes including bounce back loans, Coronavirus job retention scheme (furlough), local government grants and benefits such as universal credit are covered under the voluntary scheme with a “how to” page being launched on gov.uk – while bounce back loan borrowers should contact their lender directly. 

Commissioner Tom Hayhoe said: “Our message to those who still owe Covid era money is simple – pay now, clear your conscience or face the consequences. This money belongs in communities, the NHS, police and armed forces. 

“Those who don’t take up this straightforward offer and have knowingly or wrongly claimed tax-payer funded help could face prosecution, disqualification or prison.”

A Covid fraud whistleblower reporting website is also being launched to allow people to anonymously report people or organisations suspected of committing Covid fraud. 

The estimated amount of fraud from the bounce back loan scheme and CBILS alone is £1.93 billion. Fraudulent furlough claims are said to amount to £3.5 billion.

SME’s to feel impact of new Economic Crime legislation

Accountants and their clients will need to pay attention to the reformed corporate liability rule within the Economic Crime and Corporate Transparency Act 2023 which now makes businesses of all sizes strictly liable for a wide range of economic crimes committed by their senior managers. 

This is through the introduction of the “failure to prevent fraud offence” which became active on September 1st. 

A key but less high-profile aspect of the Act is reform of the corporate liability rule also known as the “attribution principle” or the “identification doctrine”. While the “prevent fraud” offence is reserved for larger firms, the corporate liability rule applies to companies of any size – including SMEs. 

Offences covered include money laundering, fraudulent evasion of VAT and customs duty, bribery offences and breach of sanctions.

If senior managers commit an offence then the business can be prosecuted on a strict liability basis for their actions. Previously the company might have faced a “failure to prevent bribery” charge but under the new rules they are deprived of an adequate procedures defence. 

Wider compliance training across the company’s management team is important so managers are fully aware of the implications of breaching the new laws with the prospect of dismissal, fines, imprisonment and director disqualifications as potential sanctions.

Chartered Accountants amongst most trusted professions in Scotland

According to a new survey, 87% of senior business and finance decision-makers trusted chartered accountants “to do the right thing”, placing them ahead of scientists  & engineers (84%), doctors (83%), academics (70%) and lawyers (65%). 

This is a 12 point increase in trust since 2023 and higher than the 84% that English chartered accountants received and 77% in Wales. 

Additionally 88% of respondents believed that chartered accountants are crucial in helping businesses navigate new challenges while 72% said they relied on them for strategic guidance. 

Ainslie van Onselen, chair of Chartered Accountants Worldwide (CAW) said: “Trust is becoming more fragile across institutions but this data confirms that chartered accountants continue to buck the trend. 

“In a climate dominated by AI, disinformation and societal pressure for accountability, our profession is increasingly seen not just as technically skilled but as essential guardians of trustworthy data and ethical leadership.”

Key factors contributing to these high scores include compliance with laws and regulations (58% of respondents indicated this) and their role in informing key business decisions (51%). Additionally 75% of respondents considered chartered accountants essential for guiding Scottish businesses through automation with 68% viewing them as key drivers of AI investment.

Most accountants struggling to recruit

Research from accountancy firms shows that 94% said they are struggling with recruitment, forcing some to turn away new clients while a high number of accountants approach retirement. 

The latest Accounting Talent Index by Advancetrack found that nearly half of these 94% of firms were facing “significant” problems and were unable to meet their clients’ needs. 

30% of respondents said that replacing ageing staff was a critical issue as there were more people nearing retirement than there were joining up, and half of respondents said that the talent shortage was causing a more significant problem than it was three years ago.

Vipul Sheth, managing director of Advancetrack, said: “This year’s Accounting Talent Index confirms what many in the profession have feared – that the accounting talent crisis is not only continuing but intensifying. 

“Growth is no longer being held back by ambition or opportunity, but by a lack of skilled people. It’s why we’re seeing record numbers of firms turning to outsourcing and tech investment.”

New chair of HMRC Board

After the recent government reshuffle, there is a new chair of the board at HMRC. 

HMRC Minister James Murray MP was promoted to chief secretary at the Treasury and was replaced by Dan Tomlinson MP for Chipping Barnet as Exchequer secretary to the Treasury.

Accountants V AI

The recent rush to embrace AI is going to put further pressure on accountants to maintain their standards for accuracy and honesty as more and more clients are going to take as gospel whatever their AI of choice tells them – no matter how inaccurate. 

One director recently spent hours correcting a potential client who wanted to set up a limited liability partnership (LLP) for a property project. They had rightly flagged the possibility of potential stamp duty land tax and capital gains tax (CGT) implications which the client had ignored because “AI is telling me it’s OK”. 

It transpired that they were getting their information from Google’s AI Overview which in turn was pulling the information from an outdated HMRC Spotlight document about a tax avoidance scheme that’s already been proven not to work!

Another accountant said: “At first glance the information from clients looks very professional and appears credible but because they’re written queries, I have to respond to each point professionally and correctly and it’s costing me hours.”

This is a problem that is only going to get worse. The most recent example is in the tax tribunal case between Marc Gunnarsson and HMRC. The judge criticised Mr Gunnarsson for using AI to assist him with his skeleton argument after HMRC searched public and internal databases to check the decisions Gunnarsson referenced only to find they didn’t exist. 

The judge warned that “the accuracy of artificial intelligence should not be relied upon without checking” and how in this case HMRC was “put to the trouble of having to investigate the existence of the purported decisions.” 

The tribunal accepted that the taxpayer was under time pressures but also flagged that in the appropriate case the upper tribunal “may take matters very seriously”, including sanctions for the misuse of AI.

Additionally the cost of AI-generated queries will impact firms operating fixed-fee models. 

If a client is on a package that covers trade tax queries up to half an hour, they could waste more than that finding out why ChatGPT is giving them a specific answer. Working out how to price this service and continue to remain commercially competitive could be an issue. 

Wild goose chases can unintentionally push clients into higher pricing brackets with one accountant saying that the time spent on queries they’re receiving just to see if the clients are in the right tier could see them moved to a higher one just because they’re using AI. 

Cutting through noise and jargon can be difficult but having proactive conversations with clients including using video, social media, newsletters and blogs to educate clients will reduce the need to rely on AI to summarise, exaggerate or invent.