The Government has withdrawn draft regulations after consultation with companies raised concerns about imposing additional reporting requirements.

Instead, the Government will pursue options to reduce the burden of red tape to ensure the UK is one of the best places in the world to do business.

Draft regulations published in July would have added certain additional corporate and company reporting requirements to large UK listed and private companies, including an annual resilience statement, distributable profits figure, material fraud statement and triennial audit and assurance policy statement.

This would have incurred additional costs for companies by requiring them to include additional layers of corporate information in their annual reports.

Since July, the Government has completed a call for evidence on existing non-financial reporting requirements, which has identified a strong appetite from businesses and investors for reform, including to simplify and streamline existing reporting.

The Business Secretary has now decided to withdraw these regulations and will be setting out options to reform the wider framework shortly to reduce the burden of red tape on businesses.

The Government remains committed to wider audit and corporate governance reform, including establishing a new Audit, Reporting and Governance Authority to replace the existing Financial Reporting Council. The Government will bring forward legislation to deliver these reforms when Parliamentary time allows.

If your business grants a customer time to pay – say 30 days – after the services or goods supplied have been delivered, effectively, your money stays in their bank account for 30 days.

Further, if you have incurred costs regarding a sale, that have to be paid for before your customer settles their bill, you are out of pocket until your account is settled.

Many business owners are driven by sales targets and to meet these targets many are tempted to offer extended payment terms.

There is a well-worn cliché in business that cash is king. Your business only has choices – regarding the sales it makes – once your customers’ money is in your bank account.

Once you have secured the attention of a customer that has purchased their initial goods or services from you, you have completed the hard part – converted a prospect into a buying customer – so don’t be afraid to follow up with cross-sales offers.

For example, when you deliver goods to a customer, do you promote other products that you supply or offer a discount for a repeat order?

Many firms adopt this strategy by:

• Inserting a current publicity leaflet or brochure with the goods physically delivered, or by
• Following up orders by email, a “Hope you found our recent delivery useful…”, with a link to your website and other offers.

In this way you build your relationship and increase footfall.

Three factors influence turnover:

• The number of customers.
• The price of your goods or services, and
• Footfall, the number of times a customer buys from you in a trading period.

In most cases, increasing footfall will have the most impact on turnover. Footfall is the number of times you can encourage customers back to buy more from your business.

So, be on the lookout for ways to encourage your customers back. Once you start thinking in this way, you will be surprised by the number of strategies you could apply.

Most business owners will appreciate the difference between one-off sales, and services that are generally described as recurring.

For example, you may sell a laptop (a one-off sale) and then bolt on a support contract (a recurring sale).

The advantage of recurring income streams is that they not only impact your current sales numbers, but they also help you build a platform of future sales for your business.

Also, the cost of “selling” or acquiring recurring sales is generally lower than securing a one-off sale as you are creating sales revenue into future years rather than just improving your sales figures in the current month. 

Most smaller businesses will have spent time chasing customers for payment beyond their agreed payment terms.

These demands take entrepreneurs away from their core tasks of business building and place unnecessary pressures on cashflow.

To assist, government is stepping in with new regulatory powers. The new measures will include:

• Extending the Reporting on Payment Practices and Performance Regulations 2017. Following consultation, Government will take forward legislation to extend payment performance reporting obligations. They will include new metrics for reporting, including a value metric, so businesses and commentators can see the value of invoices, including invoices paid late, and a disputed invoices metric. They will also introduce reporting on retention payments for businesses in the construction sector.
• Providing greater advice to small businesses on negotiating payment terms that better suit them, and on how going digital can help them get paid quicker and manage their cash flow.
• Broadening the powers of the Small Business Commissioner: Introducing broader responsibilities, enabling the Commissioner to undertake investigations and publish reports where necessary on the basis of anonymous information and intelligence. This will require primary legislation, so will be subject to the legislative timetable.

The stronger measures will benefit UK businesses by fostering a stronger payment culture and providing businesses with more predictable and reliable cash flow, allowing businesses to spend and invest with greater certainty.

It will reduce the time spent by businesses chasing payments, freeing up more time for other activities that will help them to grow. Tackling late and long payments provides an opportunity to increase investment and productivity across the economy.

This will improve payment culture in the UK to support smaller businesses, many of whom do not have the resources to accommodate long or late payments from their business customers.

The Charity Commission has launched the next phase of its trustee campaign which aims to increase charity trustees’ knowledge and drive a positive change in charities’ governance.

The campaign encourages trustees to check what they know about their duties and aims to increase their awareness of the Commission’s 5-minute guides.

As part of the latest phase of the campaign, the regulator has released a new Trustee Quiz to enable trustees to test their knowledge of their duties and responsibilities.

The quiz is designed to engage trustees with a variety of questions based on everyday scenarios that they may encounter at their charity. It has been designed to help identify knowledge gaps and is an ideal refresher for trustees at all levels of experience. Research shows that the majority of trustees feel confident in their ability to manage their charities, however there may be areas of knowledge they can improve. The quiz is intended to encourage trustees to think again about what they know, to inspire upskilling.

The quiz takes around three minutes to complete and gives busy trustees an interactive means to quickly check what they know and help them uncover potential knowledge gaps they may not have been aware of. It prompts participants to test their knowledge on a range of topics, such as conflicts of interest and safeguarding. Feedback is provided for each question, and users are pointed to further guidance from the regulator to strengthen their knowledge.

Each participant also receives a score out of 10, allowing them to benchmark their knowledge.

The quiz can be accessed at https://beingacharitytrustee.campaign.gov.uk/take-the-trustee-quiz/

Organisations across the country will be able to demonstrate that their new artificial intelligence and digital innovations meet regulatory requirements so they can quickly bring them to market.

In their press release published 19 September 2023, the Department for Science, Innovation and Technology said:

A new pilot scheme set to launch next year will see a number of regulators develop a multi-agency advice service providing tailored support to businesses so they can meet requirements across various sectors while safely innovating – including through innovative technologies such as AI.

Backed by over £2 million in UK government funding, the streamlined service is intended to make it easier for businesses to get the help they need, by bringing together the different regulators involved in the oversight of cross-cutting AI and digital technologies.

In turn, businesses will be able to take their new innovations to market responsibly and more quickly, helping to grow the UK’s economy.

With digital technologies such as artificial intelligence needing increasingly to demonstrate compliance with a range of regulatory regimes, there is a growing need for joined-up advice across the regulatory landscape. This pilot scheme will meet business demands for coordinated support and help innovators navigate regulations, so they can spend more time developing cutting edge new products.

The service will be run by members of the Digital Regulation Cooperation Forum (DRCF), made up of the Information Commissioner’s Office, Ofcom, the Competition and Markets Authority and the Financial Conduct Authority, and known as DRCF AI and Digital Hub.

The DRCF came together as a voluntary collaboration in 2019, launching formally in 2020, and works to explore emerging regulatory issues which cut across the remits of the four regulators with the goal of making it easier for industry to comply with multiple regulatory regimes.

The trial is expected to last around a year, and will assess industry take up, service feasibility and how innovators are interacting with it. Innovators and businesses requiring advice will be invited to apply in due course with the DRCF expected to run a competition for innovators to outline where they need support from regulators to ensure innovative new technologies comply with cross-cutting regulatory regimes. Successful applications will be selected against criteria agreed jointly by regulators and the department.

Due to new legislation working its way through Parliament, Companies House will be making a number of significant changes. In a recent blog post, they made the following announcement:

We’re approaching a pivotal moment in the history of Companies House. This legislation, The Economic Crime and Transparency Bill, will fundamentally change our role and our purpose and will give us the powers we need to play a more significant role in tackling economic crime. Over time, we’ll become an active gatekeeper of the data on our registers rather than a passive recipient, and we’ll have the tools to go further to prevent the misuse of corporate entities.

It's widely known that the UK has one of the largest and most open economies in the world. However, it’s become increasingly apparent that this openness exposes the UK to criminals who want to use our corporate structures for illicit purposes. This is one of the things the new Bill will address.

The measures in the Bill will make sure the UK continues to be a great place to do business, while enabling us to take a tougher stance against economic crime.

The measures include:

• introducing identity verification for all new and existing registered company directors, people with significant control, and those who file on behalf of companies;
• broadening the registrar’s powers so that Companies House can become a more active gatekeeper over company creation and a custodian of more reliable data;
• improving the financial information on the register so that the register is more reliable and accurate, reflects the latest advancements in digital technology, and enables better business decisions;
• providing Companies House with more effective investigation and enforcement powers, and introducing better cross-checking of data with other public and private sector bodies; and
• enhancing the protection of personal information provided to Companies House to protect individuals from fraud and other harms.

As more details are published more information will be posted on our newsfeeds.

Companies House have published information that suggests their fees may be increasing in the near future. And it’s all to do with the ECCT Bill currently passing through parliament.

To give it its full name, The Economic Crime and Corporate Transparency (ECCT) Bill will change the role and purpose of Companies House and will provide the powers needed to improve the accuracy of the information on their registers and to play a significant role in tackling economic crime.

Companies House are quoted as saying:

“We want to be ready to take action, and we’re working hard on a number of different workstreams to make sure we’ll be ready to implement many of the measures as soon as possible after the Bill achieves royal assent.”

As a reminder, the measures in the ECCT Bill include:

• introducing identity verification for all new and existing registered company directors, people with significant control, and those who file on behalf of companies;
• broadening the registrar’s powers to become a more active gatekeeper over company creation and a custodian of more reliable data;
• improving the accuracy of financial information on the register so that the register is more reliable and accurate, reflects the latest advancements in digital technology, and enables better business decisions;
• providing Companies House with more effective investigation and enforcement powers, and introducing better cross-checking of data with other public and private sector bodies; and
• enhancing the protection of personal information provided to Companies House to protect individuals from fraud and other harms.

If implemented in full, Companies House costs will increase to meet the additional functions dictated by the Bill.

Companies House fees are set on a cost recovery basis. This means their fees must cover the cost of the services delivered. They do not make a profit on fees charged.

In a recently published blog post Companies House said:

“We review our fees every year to make sure they’re set at the right level. This year, we’ve taken new future expenditure into account as well as making sure we recover costs from our existing expenditure.

Companies House fees are much lower than the global average and have not changed since 2016. Many believe our fees are too low. During the debates while the ECCT Bill has moved through Parliament, there’s been a focus on the low levels of our fees and on making sure we’re adequately funded in the future.”

There is more to being appointed a company director than accepting the title.

According to Companies House directors formal, statutory duties and responsibilities include:

• filing an annual confirmation statement;
• filing your company annual accounts – even if the company is dormant;
• notifying Companies House of any change in your company’s officers or their personal details;
• notifying any change to your company’s registered office address
• filing details of any allotment of shares;
• dealing with the registration of any charges (mortgage); and
• notifying Companies House of any change in your company’s people with significant control (PSCs) or their personal details.

Additionally, directors need to record minutes of company meetings that impact returns to Companies House and HMRC. For example, when dividends are voted and paid.

Directors should be aware that if you use a sensitive address like your home address as your company’s registered office or single alternative inspection location (SAIL), it will be available to the public. You cannot remove a registered office or SAIL address from the public register, even if it’s your home address.

If you are a director of a registered company, some of your details will be made public. This includes your:

• name
• nationality
• occupation
• month and year of your date of birth

A director must provide two addresses:

• a correspondence address for the public register – known as a ‘service address’; and
• their home address – known as the ‘usual residential address’.

A correspondence address is one you can use to receive communications about the company. This can be the same as the registered office address of the company, or it can be somewhere different.

A residential address is a director’s usual home address. You must tell us your home address, but it will not be available on the public register for everyone to see. It’s kept on a private register.

We will only provide home address information to credit reference agencies and specified public authorities, such as the police. In certain circumstances, you may be able to restrict the disclosure of your home address to credit reference agencies.