Business News Round Up (23/01/2023)
Under a fifth of SMEs plan for growth in 2023 according to ACCA
Government measures to reduce the impact of inflation, impending recession and rising energy costs to support the UK economy have fallen short according to the latest edition of the ACCA UK (the Association of Chartered Certified Accountants) and The Corporate Finance Network (The CFN) SME Tracker which polls accountancy professionals on the financial outlook of their SME clients. The number of SMEs who have plans for growth has plummeted from 38% in the summer of last year to just 17% with the Chancellor’s Autumn Statement failing to deliver. The research brings to the forefront the underlying pessimism among UK SMEs as a third (33%) of businesses felt less confident in their ability to grow following the statement in November. The survey also found that 78% believe the government should prioritise small and medium businesses when identifying business sectors to direct future support. With a further 12% noting that micro businesses mustn’t be overlooked. SMEs are pinning their hopes on the Spring Budget in March for realistic, deliverable plans which will address the severe issues smaller businesses are facing. This theme was summed up by an accountant in the East Midlands who commented that ‘SMEs are in need of a detailed plan post April 2023’, with the ‘government appearing to focus on issues that only really affect larger businesses’ in the Autumn Statement.
Maximising the impact of universities to rebalance the UK economy
The Northern Powerhouse, Midlands Engine, Levelling Up – straplines have changed over the years, but the challenges of rebalancing the UK economy and releasing untapped potential across our regions remain all too familiar.Evidence of this regional imbalance is stark, not least in terms of lower productivity. But what’s also stark is its impact. Fewer jobs, wages below the national average, young people with fewer opportunities, and often wider health impacts. It leads many to feel like they get a raw deal. This is a familiar picture in many of our towns and cities, and the increasing political consensus on the need to tackle this challenge is welcome. But translation of these good intentions into real, practical action and investment at a national and local level can feel elusive. The Levelling Up White Paper identified the key drivers to create a better sense of place – tackling skills gaps, fostering innovation, and attracting new investment. Universities are uniquely placed to help deliver – and they are more committed than ever to working with partners on their local key economic and societal challenges.
32% yearly rise in insolvency-related activity in Scotland, R3 research shows
The number of Scottish businesses experiencing insolvency-related activity jumped over 32% in December 2022 compared to the same period in 2021, according to new research from R3, the insolvency and restructuring trade body. R3’s analysis of data provided by Creditsafe shows there were 142 cases of insolvency-related activity, which includes liquidator appointments, administrator appointments and creditors’ meetings, in Scotland last month – an increase of 35 activities from December 2021’s total of 107. Scotland saw the largest year-on-year increase in insolvency-related activity compared to the rest of the regions and nations in the UK, followed by the East Midlands (22.8% increase), the West Midlands (9.8% increase) and the South West (9.2% increase). Insolvency-related activity peaked in December to the second-highest figure of the year, falling only behind March when 201 activities were recorded. Richard Bathgate, Chair of insolvency and restructuring trade body R3 in Scotland, said: “More and more directors are turning to insolvency processes to resolve their financial issues in the face of rising costs, low consumer confidence, and ongoing economic turbulence.
UK businesses overconfident in digital supply chain security
Organisations are too trusting of Managed Service Providers, according to new research. Just four-in-ten believe they need to make sure Managed Service Providers are certified in providing cyber security essentials, while one-third agreed personnel of providers should undergo security checks before taking on such work. Managed services is the practice of outsourcing the responsibility for maintaining, and anticipating need for, a range of processes and functions, ostensibly for the purpose of improved operations and reduced budgetary expenditures through the reduction of directly-employed staff. To that end, Managed Service Providers (MSPs) can help business stay flexible when it comes to resources, and can accommodate swift changes which an in-house team might not be able to respond to efficiently. But as with any outsourcing practice, MSPs also come with a host of risks, which have been exacerbated by the pandemic. As the Covid-19 outbreak opened even more avenues for fraudsters to commit financial crimes, 64% of UK companies admitted they had experienced fraud or economic crime since 2020 – and when pointing to external sources of such incidents, 20% said they had been hit by outsourced suppliers, such as MSPs. Even so, a new study from cyber security advisory firm Kocho has found that most companies implicitly trust their MSPs. As a result, they often fail to ask them basic cyber security-related questions, even as they admit to suffering ‘unscheduled downtime’ due to the actions of their suppliers.
https://www.consultancy.uk/news/33316/uk-businesses-overconfident-in-digital-supply-chain-security