c h a r t e r l i n e

NEW MEMBERSWILLIAMS DENTON INLLANDUDNO AND BANGOR

With origins dating back ninetyyears, the present WilliamsDenton Cyf has grown to

become one of North Wales’ leadingaccountancy firms.

The original firm, Hugh E Edwards &Co, was formed in 1926 and was oneof the first accountancy practices inBangor. Since then it has grown, taking over a number of otheraccountancy practices and in 2002was incorporated to become WilliamsDenton Cyf.

Today the firm enjoys an enviablereputation for providing excellentadvice and first class service to business, charity and personal clientsalike.

With offices inLlandudno andBangor, the firm isled by directorsHugh Prys Jones,Keith Barker (right),Colin Bell, PeterDenton, JanetJones and Martin Barrett (below).

Williams Dentonlooks after entities, smalland large,across manysectors includingthe medical

professions, leisure, construction,charities, transport, retail, manufacturing and agriculture.

As well as general accountancy,audit and tax skills, their six directorsalso have individual specialist skillswhich enable them to provide clientswith an expert service includingadvice on an integrated businessstrategy or access to corporatefinance.

Staff are fully trained on all aspects ofXero bookkeeping and are now holding Xero workshops for clientsand prospective clients.

The directors can be contacted attheir offices in Bangor (01248670370) or Llandudno (01492877478) or visit:www.williamsdenton.co.uk

www.chartergroup.co.uk

BREXIT... WHAT NEXT?

With the widely unexpectedresult of the Referendum, achange of Prime Minister,

the fall in the pound, the increase inuncertainty and more electionsaround the world in the next year - itreally is a case of what next?

A slowdown in the economy may beon the cards although not everyone

sees a recession on the horizon asexports, on the back of the lowerpound, may increase. Professional services were already slowing andwhilst the City sees Brexit as a sourceof growth for the large firms, will yoube able to monetise help and adviceto your clients post Brexit?

The changes ahead are huge andmany have been well documented,like exporting to Europe, legislativeand tax changes but some issueshave had less comment:

u How will the specialist retailerthat imports from Europe fare in thenew world - like our local Europeanbeer shop or the antique warehousethat takes a lorry over to Europe forfurniture?

u Will businesses be able to find

that willing workforce to completeroutine tasks, or will capital investmentneed to grow?

u Given the increased exchangerate volatility over the short term, doclients know how to protect themselves, especially those whohaven’t experienced this sort ofvolatility in the past?

Clients will need to develop contingency plans as we face manychanges. A key service you can offeris to help them identify the risks fortheir businesses whilst ensuring thatyour firm stays up-to-date with developments to support your clients.I am sure many Brexit Consultants willemerge over the next year sellingtheir ‘expertise’!

Ian Brookman

What’s new from CharterGroup Autumn 2016

MEMBER’S NEWS......MEMBER’S NEWS......MEMBER’S NEWS......MEMBER’S NEWS......

75 CHARITABLE ACTS TO MARKRAWLINSONS’ SPECIAL ANNIVERSARY

Peterborough accountancy firm Rawlinsons celebrated its 75th anniversary by completing 75charitable acts in 75 days – which started on June 1.

Staff from across the business took part in a series ofevents and volunteering in projects to support local charities with either fund-raising or labour.

It was a wide and varied programme of activities – inJune the team completed a 17 mile family bike ride, a

dragon boat race, a 75 mile static cycle relay, a charityquiz and a human hound race at the city’s greyhoundstadium.

In July the team participated in a cathedral abseil,entered a team into the World Frog RacingChampionships and the main event – a 75km walk in aday!

The team also collected 75 bags of donations for SueRyder and secretary Sue Horsfall gave up sweet treats forthe whole duration of the challenge!

“We have been part of city life for 75 years and itseems fitting that in this special year, we shouldchoose to give something back to the local communities we have served.

As one of Peterborough’s leading independent accountancy firms, with a dedicated team of partnersworking with around 65 employees, we look after thefinancial needs of over 3,000 clients – from establishedmulti-nationals to business start-ups, providing a full rangeof accountancy services,” said Rawlinsons’ managingpartner Colin Crowley.

NEW ROLES FOR SENIOR STAFF

Two senior staff have been promoted as a direct resultof their commitment and dedication to Dyke Yaxleyin Shrewsbury.

Tony Elliott is named as Tax Director and Stacey Lea is thenew Associate Director.

Managing Director Laurie Riley said: “We’re always encouraging our staff to continuously develop their skills,and it’s important to us that we recognise talent across thecompany and reward our staff accordingly.

ROTHERHAM TAYLOR CHARTEREDACCOUNTANTS RT CHARITY CHALLENGE

At Rotherham Taylor we like to do our bit for charity. From our perspective we enjoy puttingsomething back into our community and the

whole process helps us internally with team buildingbesides making new friends and contacts in the businessworld.

This year Rebecca, Nicola, Chloe, Amy and Lucycompleted a 10,000 steps a day challenge for the wholemonth of March in aid of Care International’s “Walk In

Her Shoes”campaign. Theactual challengewas for a week butthey all agreed toextend for the whole month!

The campaign will directly fund the construction of 4wells, bringing clean and safe water to 12,500 people inthe Afar region of Ethiopia. This will ensure that womenand girls do not have to suffer the burden of walking forwater. Instead they can get an education, earn a living,and step out of poverty for good.

Tony Elliott and Stacey Lea who have both been promoted at Dyke Yaxley Chartered Accountants inShrewsbury.

ANNUAL PARTNERS’ CONFERENCE3rd and 4th November at the Carden Park Hotel,Cheshire.

This year’s conference is entitled: ‘ContinuousImprovement – How to inspire and maintain stellar productivity gains for your firm’. We will be

looking at how we manage and motivate staff and someof the ever expanding range of software tools that areavailable to automate the accounting process. BillBallard’s thoughts on page 6 are fundamental, we mustbe in the vanguard of change to support clients andsecure high growth and profitability.

Opening the conference will be the acclaimed businesswriter David Bolchover who has written three brilliantbooks together with numerous opinion articles for,amongst others: The Times, The Telegraph and TheFinancial Times. He has appeared on CNN, Sky News andBBC TV and now shares his insights on productivity in theoffice with us.

Mark Rhodes will address motivation and a small numberof Cloud based software providers will show us more productivity benefits from automation. Ian Brookman willbe your host and our after dinner speaker, GarryRichardson, will close the first day in his own inimitablestyle.

If you haven’t already done so, please send yourattendee numbers to Susan so that she can finalize numbers with the Hotel.

MANAGING PARTNERS’ SEMINAROn the 4th October Ian Brookman will host the secondManaging Partners’ Seminar for 2016. Ian will be askingsome searching questions and addressing the future ofour profession as well as burning issues from the present. Ifyou would like to add agenda items please let Susanknow.

SOCIAL MEDIA AND CYBER RISKLearning from others’ mistakes:Whilst social media provides excellent and immediatemarketing opportunities, it is not without risk. We have allread the horror stories relating to ill-conceived tweets bystaff and partners alike. You can help to reduce these risksby the following actions:

1. Ensure your business has a Social Media Policygoverning both corporate accounts operated by the business, and the use of social media by every employeeas a private individual (personal social media accounts).

2. Ensure your Social MediaPolicy gives your company theright to review and monitor staffaccounts and usage.

3. Provide training to all staff,so that they understand the issuesand consequences, and what todo if something goes wrong.

4. Ensure all of your company’s accounts are in linewith your company’s brand guidelines.

5. Ensure that staff responsible for your corporatesocial media accounts receive additional training.

6. Verify that your marketing team is aware of how toproperly secure the company’s social media accounts(e.g. strong passwords and two factor authentication).

7. Set up a service to monitor the internet for mentions of your company’s name. Google provide afree service called “Google Alerts” that can assist. This willhelp you catch negative reviews.

8. Ensure your marketing team has a regular processto search the internet for new mentions of your firm. Thesemay appear on forums or review websites that GoogleAlerts might not pick up. Again, this will help you nip issuesin the bud.

9. Ensure your HR manager has a regular process toreview staff social media accounts, and to ensure thatyour brand is not being brought into disrepute.

If your business needs assistance in understanding oraddressing cyber security, contact Berea.www.bereagroup.com

by Gary CorbettHead of CharterGroup

CHARTERGROUP NEWS

MARKETING PROFESSIONAL SERVICES – A RAPIDLY CHANGING LANDSCAPE

The short answer is no. The long answer is also no asG4S has found out in a lengthy judgement releasedby a Tax Tribunal in April 2016. G4S had incurred high

numbers of Penalty Charge Notices (PCNs) when providingcash transit services and parking their vehicles as close aspossible to their customers’ premises.

HMRC argued that the decision made in the Court ofAppeal in Alexander von Glehn Ltd gave rise to a principlethat:

u the purpose of a fine is to punish a taxpayer and

u the legislative policy behind the imposition of a fine would be diluted if tax relief were given.

In the von Glehn case the company was fined in the FirstWorld War for exporting goods to enemy territory. The fine

was £3,000 – a considerable sum thenand clearly meant topunish. G4S claimedits PCNs were of a

different characterfrom the public policy issues arisingfrom ‘trading with theenemy’.

The Tribunal did notagree with G4S. Thepurpose of the PCNsis to punish the taxpayer. The payment was at least in parta payment to meet its obligation to pay the fines as aconsequence of breaking the law rather than beingincurred for the purposes of its trade.

This case does not mean that all ‘fines’ are disallowable.For example, if a car has exceeded the paid for time in aprivate car park, this is simply an excess charge payableunder the terms of the contract made with the car parkprovider. This will be allowable if incurred ‘wholly andexclusively for the purposes of the trade’.

Phil Williams, Mercia

TAX RELIEF FOR PARKING FINES?

The rise of social media and the fact that more people than ever before are using the internet to findtheir professional advisers means that a sound

marketing strategy is increasingly important for anyaccountancy practice.

A survey conducted last year found that over 35 per centof those looking for professional services would now goonline, ahead of those who would still rely on a recommendation from a friend or family member.

In a crowded marketplace - there are over 10,000 practising firms in England and Wales - it is crucial thataccountants clearly identify their target market and dowhat they can to ensure they stand out from their competitors.

Developing your brand, demonstrating your expertise andengaging with clients have always been important to firmswho want to expand, and now both the internet andsocial media present so many more opportunities forpractices willing to invest in a more diverse marketing mixto get an edge.

Preparing the right mix of activities is vital. A combinationof brand, niche sectors and services, professional andclient referrals, on-line, events and networking all havetheir place in the ideal plan. Added to that, now firmshave to consider the benefits of building a strong presence on sites such as Twitter, Facebook, YouTube,

Google+ and LinkedIn – whichhave accumulated millions ofusers in the space of just a fewyears. Twitter alone now claims tohave 20 million people registeredin the UK and is difficult to ignoreas a marketing platform for professional firms.

Each of these channels has itsown particular strengths, whetherit is marketing niche services, promoting events or making it easier for potential clients to find your firm online. Overall, marketing is all about convincing your potential clientsthat you are a specialist in what you do, and they can relyon you as their trusted adviser.

It may be, depending on the services you offer, that oneelement of the marketing plan suits your need slightlymore than others, but generally the greater the mix, themore people are going to find out about you. While new technology is playing anincreasingly important role in howfirms put themselves across, thetraditional marketing methods alsostill apply, whether that involvesgetting a story into a local newspaper or sponsoring a localevent.

Jo Edwards

ForrestBrown recently met with CharterGroupmembers to explain

research and development(R&D) tax credits and provideinsight on the latest news on the incentive from HMRC. Aquestion many around the

table asked was how to review a claim to make sureyou’re delivering maximum value for your clients. Here we share a glimpse of our award-winning process:

HOW TO OPTIMISE YOUR CLAIM1. Know your client’s business:We usually begin each new client relationship with a visit to their place of work, so that we can fully understandtheir business, and how what they do differentiates from their competitors. Ultimately, we want to understandhow they innovate and why, so that we can prepare convincing examples of their R&D for HMRC.

2. Identify clientqualifyingactivities:Our next step isto examine -based on theguidelines set out by theDepartment for Business,Innovation and Skills - a client’s products, processes andservices to collate an inventory of all the different types ofR&D undertaken. We will ask the client which staff areinvolved in each type of R&D, and what records are available to verify time spent. With this information, wecontextualise R&D in the business for HMRC in our writtenreport.

3. Analyse client costs:Analysing what money has been spent on R&D andreviewing the available records is probably where weinvest most of our time. We ask ourselves a variety of different questions; for example, are the directors of thecompany taking salaries and/or dividends? Has the company received a grant? Has it spent money on materials? Have these materials been incorporated intoproducts which the company went on to sell?

4. Create your methodology:Finally, we create a bespoke methodology to apportionthese costs and calculate the client’s benefit. Thismethodology will vary from client to client depending

on what R&D they doand what records theyhave. It’s important atthis stage to make sureyou have the right people involved; so not only the financialdirector for example,but also those involvedin the R&D to make sure your assumptionsare robust.

5. Double-check yourclaim:We have a separate Quality Assurance team that reviewsour claims to ensure each meets the legislation and guidance set out by HMRC – for others, we recommendyou double-check your client’s claim before you submit it.

About ForrestBrownForrestBrown is a Bristol-based team of chartered taxadvisers who specialise in R&D tax incentives to help innovative businesses grow. Last month, we won “BestIndependent Consultancy Firm” at the prestigiousnational Taxation Awards 2016. We’ve submitted morethan 1,000 claims to date, recouping more than £50 million for our clients.

We partner with many accountancy firms, includingCharterGroup member Evans & Co., providing a specialist service to complement their general practice.

Working together, we can deliver the maximum possiblevalue for your clients. Would you like to find out more?

If you’re not sure if your clients’ activities qualify asR&D, or want to make sure your claim is fully optimised, call us today on 01179 269022 for a freeconsultation.

By Jenny Tragner, Director at ForrestBrown and member of HMRC’s R&D Consultative Committee.

HOW TO BOOST YOUR CLIENTS’ R&D TAX CREDITS

Jenny TragnerDirector at ForrestBrown

Looking back over manyyears of being in theaccountancy profession,

it always intrigues me to see how our working lives areaffected by different technological advances andalso how the rate of changeseems to increase without us noticing it.

I am old enough to remember the introduction of faxes,how they were around for a number of years before theysuddenly became the ‘must have’ piece of office equipment, and now all of us have faxes largely lookingforlorn and unused in the corner of the room.

Such a change I think is happening again with ‘Cloud’accounting, although the changes here are much morefundamental.

Accountants have traditionally been accused of acting inan historical vacuum producing financial informationmany months after a year end, and trying to deal withissues that often are no longer relevant to the client, apartfrom informing, when it is all too late, how much tax hehas to pay!

But with Cloud accounting I feel we have the opportunityto move from the past to the present.

In fact, the other day I was looking at some Cloud software which linked into Xero where it was projectingwhat future sales orders might be.

So suddenly accountants are moving from historical deaddata, to current live data through to anticipating futuredata.

This is quite a change in mind-set for most accountants,but we have to move with it if we are going to keep control of this developing new area of our business.

I understand that in the United States the accountant hasbeen left just dealing with the historical data whilst a newprofessional, a Business Adviser, has moved in to deal withthe current and future data.

We must not let that happen in the United Kingdom.Bill Ballard, Ballard Dale Syree Watson.

Bill’s thoughts are echoed throughout the profession,which is changing fast. CharterGroup has been proactive from day one in promoting Cloud accountingand in addition to Xero is now partnering withCrunchBoards and Receipt Bank.

THE ACCOUNTANTS CHANGING ROLE ………

Bill BallardBallard Dale Syree Watson.

Receipt Bankprovides award winning

bookkeeping automation software for accountants, bookkeepers and

small businesses. Over 5,000 accounting and bookkeeping firms around the world already use our tools to get the competitive edge.

Our mission is to help accountants and bookkeepers getmore out of their time, offer higher value services andmake a real difference to their clients. Our partner firmssave on average one hour per client per week.

Receipt Bank makes bookkeeping effortless by automating data extraction and data entry. Our easy to use app makes it painless for clients to submitreceipts and expenses to their accountant or bookkeeper.

No more boxes ofpaper left on yourdoorstep once a year.

No more chasing clients for missing paperwork.

The real powerof ReceiptBank, however,is unparalleledvisibility over firmand client data.Our partner

dashboards enable practices to prioritise workload, tracktheir staff’s productivity and identify ways to becomemore productive (and profitable).

Our partners are uniquely placed to take advantage ofthe cloud accounting revolution. Receipt Bank integratesseamlessly with leading accounting software such as Xeroand QuickBooks Online, allowing practices to grow efficient, scalable businesses – all in the cloud.

Founded in 2010 by Michael Wood and Alexis Prenn,Receipt Bank now has six offices worldwide. In January2016, Receipt Bank raised USD$10 million in growth capital from the Kennet Fund.

Growth and best practice are the foundations ofCharterGroup, which is why we’re delighted toannounce that this month we’re welcoming our

latest affinity partner, CrunchBoards, on board.

CrunchBoards,an all-in-oneforecasting andreportingengine, is drivenby two businessowners,HannahMcIntyre andAmy Harris.

The pair wanted advice and support from their accountant rather than just a review of past performance.They wanted to discuss cashflow, KPIs and their operational business drivers to help them plan and manage the future. As featured on the BBC, their solution,CrunchBoards, helps accountants and business ownersto collaborate on real-time financial intelligence andfocus on the future.

Create a 3-way cashflow forecast in seconds based onlast year's actuals or visualise what the next year looks like for a client with a wage increase across 30% ofemployees. You will be impressed with the flexibility, youcan view multiple scenarios like this side by side, quicklyand efficiently. The visualisation of the past, present andfuture makes your role in your client’s business even moredynamic and operational.

It's a stimulatingtime to be anaccountant, wenow have livedata at our fingertips thanks to theadvances incloud

computing and the power to visualise this information withpowerful tools like CrunchBoards. In the past, with onlyspreadsheets to hand, it was almost impossible for you toprovide such advisory services at an economic price thatclients saw immediate value in. CrunchBoards changesthat.

CRUNCHBOARDS

5 WAYS TO GO “BEYOND ACCOUNTING” IN 2016

Whatdoes it

mean to go“beyondaccounting”? It means takingfull advantageof the automation tools available. It means using them to streamline business practices. Stay ahead of thegame by using Xero and becomedigital savvy connected advisors:1. Understand the marketSmall businesses spend billions ofpounds for job creation which translates to huge opportunities. Smallbusinesses that use Xero are threetimes more likely to stay afloat thanthose that don’t. Xero can decreasethe average time it takes to get paidby vendors from 41 to 26 days.2. Implement fixed billingMake the move towards fixed billingbased on value and move awayfrom the “time as inventory” model.Clients are prepared to pay for your

expertise and the value you bring totheir business. This also helps smallbusinesses to properly budget for theiradvisory costs each month.3. Take controlThe move from being an accountantto an advisor gives you control. Startby moving systems and processes off desktop software (or filing cabinets), to cloud based options likeXero. People expect their businessesand services to be available on all devices. Making this digital transformation allows you to lead yourclients rather than being led by them.4. Set expectationsGiven some of the legacy systems in place, the modernization ofaccounting takes time. Different people will have their own expectations of value and time. Butto ensure these are reasonable, youcan help set the right expectations:Management: a business plan is keyto managing the right metrics andunderstanding that the process willtake time.

Staff: help them overcome the fearof change by showing them how thechanges will improve both their workand quality of life.Clients: explain how cloud basedaccounting solutions can help createa win win revenue model and addvalue to clients’ engagement withyour business in new ways.5. Be a partnerA connected practice strategy allowsyou to create a win win model withyour clients. Marketing yourself as alifestyle advisor and having yourbackend technology together creates the power of knowledge foryou.

To find out how to become a Xero partner, visit: www.xero.com/partners or email partnerteam@xero.com� �

Hannah McIntyre (left) and Amy Harris.

NEED SOME SUPPORT WITH THE NEW PSC REGISTER?

“BEEN THERE, DONE THAT” – PROBATE CLAIMS AGAINST SOLICITORS

At Travelers, we have been insuring solicitors inEngland & Wales since 2000. As accountants takeon probate work, traditionally reserved to solicitors,

we want to share some insights from our recent experience of solicitors’ probate claims and some questions to consider -

1. Probate claims rank third for frequency andexpense, after Residential and Commercial Propertywork.

2. Claims around distribution generate 30% of Probateclaims and the errors are often simple: – a third involve allegations of delay or simple

miscalculation of entitlements– failing to follow clear instructions causes a further

15% of claims, – drafting errors and missing time limits around 10%

each. Advice failure is less of an issue, focuses on giving the rightadvice but based on the wrong facts 10%, or using theincorrect law also 10%.

3. Taxation-based claims also amount to 30% ofProbate Claims. In contrast to distribution, which largely

involves failure ofprocess, around 40% oftax claims are due togiving incorrect legaladvice.

4. 5% of claims involvetheft of estate monies,committed by staff, clients or third parties attacking clientaccounts, but these account for almost 40% of themoney paid on Probate claims.

5. Questions -How do you currently view the risk posed by Probate work?

Would your systems prevent the sorts of process failureoutlined above?

How do you check the quality of advice provided?

How do you guard against fraud, by staff or clients or thirdparties?

Paul Smith, Travelers.

By now countless numbers ofguides and communicationshave been written about the

new Persons with Significant Control(PSC) registration legislation whichhas come to effect from 6 April thisyear.

The new legislation which is part ofThe Small Business, Enterprise andEmployment Act 2015 will require allUK companies (other than publiclytraded companies) to maintain aregister of those people who havesignificant control over the company.

The register will contain information on individuals who ultimately own or control more than 25% of a company’s shares or voting rights, orwho otherwise exercise control overthe company and its managementintending to provide transparencyaround who owns and controls UKcompanies.

The new regime requires unlisted UKcompanies (including LLPs) to takereasonable steps to identify those"people with significant control" overthem and record their details. As anaccountant, this will most definitelyaffect your clients due to the following reasons:

u Every live incorporated company in the UK will need to adjust their records and reflect it inthe forthcoming ConfirmationStatement that replaces the annualreturn

u The allotment and transfer ofshares has now become more complex as consideration has to begiven to who may now qualify as aPSC and how this is reported

u As from 30 of June, failure tocomply with the regime is a criminaloffence punishable by a fine and/orup to 2 years imprisonment

However, as company secretarialservices experts we are able to provide you and your clients with helpand advice.

Please contact FCLS via Susan ifyou require any additional support.

Given the amount of time, effort and rethinkingthat has gone into creating the current "third timelucky" manifestation of FRS 102, everyone from

experienced accountants to Lord Denning's man on theClapham Omnibus should be entitled to believe that thefinal result deals effectively and clearly with all frequentlyoccurring transactions. If they do, they are in for a disappointment. On some aspects, particularly those relating to small entities, FRS 102 is unhelpfully vague andnot always very practical. On other aspects it is irritatinglyand needlessly silent.

One such silent zone is the treatment of properties held by companies and rented out to other group members.Paragraph 8 of SSAP 19 expressly excludes such propertiesfrom the definition of investment properties. FRS 102chooses to ignore them. Does this absence of guidancemean that properties used for intra-group letting must berevalued in the lessor's own accounts only for that revaluation to be eliminated on consolidation? Any reasonable soul (whether on the Clapham omnibus ornot) should be entitled to conclude that such purposelessfiddling with figures is unnecessary. In this case, there isenough raw logic available to show that for once, thereasonable souls may have right on their side.

Under FRS 102, investment properties are defined as properties held "to earn rentals or for capital appreciationor both".

If properties are held by one group company either foradministrative convenience or to protect them from thecreditors of other group members, they do not fall withinthe definition of investment property because they areheld for neither of the purposes cited in the standard.

The fact that some ofthese properties earnrental income does notautomatically make

them investment propertiesbecause renting for gain isnot their main purpose. Theirmain purpose is either to provide accommodation for other group companies to pursue their activities or to place the properties inquestion beyond thereach of creditors where a group company entersinsolvency proceedings. Any such arrangements aremanifestly not designed to create a property investmentcompany established with the aim of earning externalincome for the properties' owners.

Agreements covering intra-group tenancies arise from the group's strategy for property management andadministration. They are not transactions to improve thegroup's profits or increase its balance sheet value. Anyattempt to impute a profit motive to the directors andshareholders of the individual company that holds theproperties can be nothing more than an insubstantialacademic theory. On the facts of the case, the rentalincome motive is a chimera. It would be absurdly insularto claim that the ultimate netting off of income on consolidation has no relevance to individual lessors'accounts in circumstances where the properties arewhere they are only because the income from them willbe net off to zero.

Using the same logic, it would be equally difficult to argue that such properties are being held for capitalappreciation. The fact that the properties are being usedto provide accommodation for the commercial activitiesof group members automatically negates the suggestionthat tenure has market speculation as its main or even itssubsidiary purpose. Any argument asserting that the property could be sold for a profit "if the right buyer wereto make the right offer" is conjectural at best because it is based wholly on an unproven and in many casesimprobable assumption.

To sum it all up: Properties that are the subject of intra-group letting arrangements should follow the costmodel.

Readers of this article should take heart from the fact thatat a discussion session on 14th June this year, a group ofsenior representatives from CharterGroup firms agreedthis interpretation unanimously. Surely we cannot all bewrong!

by Finlay ForbesCharterGroup Technical Director

INTRA-GROUP LETTING ARRANGEMENTS AND INVESTMENT PROPERTIES UNDER FRS 102