You'll have spotted at the weekend that Alison Reed, former FD at Standard Life, has won her legal battle with the erstwhile employer - walking away better off to the tune of more than £1.3m.

This follows her resignation from the company in 2006, though she said at the time, the decision to part company was not hers.

I had the good fortune of spending a whole morning in the company of Reed just before her departure and she was concise, though very frank about what she'd found at Standard Life. She was happy to admit that some things, especially in the finance department, needed sorting out.

She was professional, incisive and perfectly amiable during the entire time we both worked on judging the Accountancy Age awards.

It's a piy others could not have seen the qualities that were so evident that day. They might have saved themselves a coniderable sum of money.

April 7, 2008 | Permalink | Comments (0) | TrackBack (0)

The political pressure to do something about fair value/mark to market accounting is mounting.

This week, as reported in the Financial Times, Charlie McCreevy, European markets commissioner, has said he believes there are 'real accounting issues' to examine in relation to fair value accounting for illiquid markets.

The EU has a history of putting pressure on the IASB, the guardian of fair value accounting, and it looks as if McCreevy could placing himself at the lead of this particular bout of argument.

There have been very vocal calls in the US for fair value to be suspended, but as yet no one has moved on the issue.

The alternatives are still to be decided though EFRAG, the body that advises the Commission on accounting issues, has begun arguing strenuously and publicly for the use of average market price over a fixed period.

Is it too early now to say it's only a matter of time before we bid adieu to fair value?

April 4, 2008 | Permalink | Comments (0) | TrackBack (0)

Philip Neal is worth talking about. He’s the NHS FD recently jailed for fraud at Chelmsford Crown Court after he confessed to false accounting to inflate a property valuation.

The false valuation put the Mid Essex Hospital Services NHS Trust into surplus by £1m, instead of being £10m in deficit.

He’s worth talking about because he claimed that pressure to meet strict targets forced him into making the false claims. That was his defense in court and if true that’s a serious problem for public services. Because there was no gain for Neal himself, in the deception. Perhaps being adverts for NHS FDs should come with a public health warning.

He has garnered some sympathy. Former NHS FDs have pointed to the expectation that they were expected to ‘pull a rabbit out of hat’ to meet targets, and that a ‘healthier environment’ is required where people don’t fear for their jobs if the targets are missed.

Neal didn’t profit himself from his wrong doing – though he does seem have received £2,500 bonus on his £100,000 for meeting the target. However, it’s difficult to see that a motivation. £2,500 is relatively small beer.

While dishonesty among public servants can never be condoned, likewise if the pressures of the job are pushing people in that direction, a problem clearly exists. I cannot imagine that there are no other FDs out there who haven’t thought of massaging the figures for the sake of an easier life.

However, if anything Neal’s experience proves that it is always much better to be honest even if, at the risk of sounding soft, 12 months seems a little excessive.

April 2, 2008 | Permalink | Comments (5) | TrackBack (0)