Less is more (influential)
/Last week I wrote that perfection comes from including only the essential. Let me explain one way to apply that thinking to an audit report or similar (as taught to me when I worked at a Big Four firm).
Read MoreWhy does the UK’s tax year begin on 6 April?
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Historically, in Britain taxes were due on the first day of the year, which was 25 March (Lady Day). When Britain (and its empire) moved from the Julian calendar to the Gregorian calendar in 1752 it was necessary to ‘lose’ 11 days so that 2 September 1752 was followed by 14 September 1752. Taxpayers did not want to have to pay their taxes 11 days early…
Read MoreInternational public financial management — my new book
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My new book, _International Public Financial Management: Essentials of Public Sector Accounting_ to give it its full title, was published at the very end of December. If you want a copy of the book this is the official page on the publisher’s website. You can also buy if from Amazon, of course.
Read MoreOnline accounting training for one
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I wrote previously about the work I do for Ibba Girls Boarding School in South Sudan and the trip I made to the school in February 2015 to recruit a new finance manager. The school is (almost entirely) funded by a UK charity, the Friends of Ibba Girls School (FIGS), and it is important to FIGS that the school has high standards of probity and governance to go with the high quality education. That’s why the school is willing to employ a finance manager whose primary job is to manage the school’s cash on a day to day basis.
Read MoreOnline certificate in IPSAS launched
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I’m a CIPFA accountant but over the last few months I’ve been working with a different accounting institute, the Association of Chartered Certified Accountants (ACCA) on the development of an online course. The course is their Certificate in International Public Sector Accounting Standards (IPSAS). The course opened today for registrations.
Those who don’t know much about the accounting profession might not be entirely surprised to learn that accountants have lots of rules and regulations to follow. Unfortunately (or perhaps fortunately, depending on your point of view) the rules and regulations are not the same for every organisation in the world. There are some differences between countries in the accounting standards used by private sector companies although many countries have adopted the International Financial Reporting Standards (IFRS).
IFRS nearly fit, but don’t quite fit, public sector bodies. Public bodies have some significant differences in their finances, such as having tax-raising powers, and investing in assets like roads and parks and schools and public hospitals that have no promise of earning them income in the future but will cost them money to operate and maintain. Hence, over the last 15 years or so, the accounting profession, in the guise of the International Public Sector Accounting Standards Board (IPSASB) has been developing and publishing IPSASs. There are now 32 of them (plus a special one for public bodies that use cash accounting rather than the more sophisticated accruals basis of accounting). The full set is available for free in PDF format from the IPSASB (use this link) but be warned, there are 2,000 pages over two volumes, and a total download of over 8MB.
There are some countries (including Austria, Cambodia, Kenya, Spain,South Africa, and Vietnam) and organisations (including the European Commission, NATO and the United Nations family of organisations) that have adopted IPSASs as they are. In some other countries, like the UK, public bodies follow the IFRS as far as they are able, and look to IPSAS for guidance on how to deal with transactions that IFRS doesn’t deal with. And there are other countries who have developed their own standards for their public bodies, often using the IFRS and IPSAS as a basis.
Anyway, my point is that IPSASs are important to public sector accountants, either because they are used directly, or because they underpin the accounting standards that they follow, and the course by the ACCA is intended to address the need for accountants around the world to know what IPSASs are, and at least understand the important principles. If you are interested in the course you can read more about its contents and find out how to register for it at the ACCA’s website.
Why the UK tax year ends on 5 April
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Today is 5 April, the final day of the UK tax year. It is unusual for an annual period to end on the 5th day of a month. I can’t think of any others. Generally, we like to use the first or last day of the month for defining periods—and this is especially the case with financial periods. Companies and governments are likely to use 31 December, 31 March, 30 June, etc as dates for the end of their financial years. In fact, as far as UK public sector bodies are concerned their budgets and statements of accounts use 1 April to 31 March as their financial years. So why does the UK government collect taxes on the basis of a year that runs from 6 April to 5 April?
Historically, in Britain taxes were due on the first day of the year, which was Lady Day, the 25 March. When Britain (and its empire) moved from the Julian calendar to the Gregorian calendar in 1752 it was necessary to ‘lose’ 11 days so that 2 September 1752 was followed by 14 September 1752. The change made the year 1752 11 days shorter and taxpayers did not want pay their taxes on 25 March 1753 because that was, in their view, 11 days too early. To settle this the first day of the tax year was moved from 25 March to 5 April. Then, in 1800 another day was lost because in the Gregorian calendar 1800 was not a leap year but it was in the Julian calendar. The result was the change of the first day of the tax year to 6 April, where it still remains. (There was another day was ‘lost’ in 1900 but by that time the British government had clearly had enough of moving the dates.)
