Archive for the ‘Economy’ Category

Eurozone to agree Greek €110Bn bail-out

Monday, May 3rd, 2010

Eurozone members and the IMF have agreed a 110bn-euro (£95bn; $146.2bn) three-year bail-out package to rescue Greece’s embattled economy.

In return for the loans, Greece will make major austerity cuts which Prime Minister George Papandreou said involved “great sacrifices”.

The EU will provide 80bn euros in funding and the rest will come from the International Monetary Fund (IMF).

The deal is designed to prevent Greece from defaulting on its massive debt.

Last orders rise as Pubs feel credit crunch.

Wednesday, July 22nd, 2009

The BBC reports that UK pubs closed at a rate of 52 per week in the first half of the year - a third more than the same period in 2008.  The number of pubs has dropped by 2,377 in the past year, to a total of 53,466.

In research by the British Beer and Pub Association, local pubs were the most vulnerable as communities were hit by the fallout of the economic downturn.  The report suggested businesses that provide food were far more resilient to the recession.

And branded pubs and cafe-style bars were opening at a rate of two a week, according to the BBPA. “Pubs are already diversifying, but unfortunately if you are a community pub, you can’t transform yourself into a trendy town-centre bar,” said an association spokesman.

“The biggest impact is the recession. There are fewer people out and fewer people spending money in pubs and bars, regardless of where they are,” he said.  The rate of closures was the fastest since the number of UK pubs began being tracked, in 1990.

KPMG report highlights rise in UK fraud.

Wednesday, July 22nd, 2009

UK fraud levels hit a record high in the first half of 2009, figures show, on a CIMA website article

It reads:

KPMG’s Fraud Barometer has revealed that more than 160 cases involving sums in excess of £100,000 passed through UK courts during this period - the highest number in the barometer’s 21-year history.

The total value of cases was £636 million and if this figure is replicated in the second half of 2009, this would lead to the highest value of fraud ever recorded by the index.

However, Hitesh Patel, partner at KPMG Forensic, warned that there is worse to come.

He said: “It will be a number of years before the impact of the recession fully feeds through into the fraud statistics.

“Hard times mean more people driven to fraud by personal pressures, and more investors willing to believe in cooked up investment schemes.”

Internal fraud also remains a major risk, Mr Patel added.

UK farmers’ need more financial awareness

Wednesday, April 8th, 2009

Farmers run the risk of failing to maximise their incomes because of a lack of understanding of their own costs. This issue is further compounded by the food retailers’ lack of understanding of the farmers’ perspective, and the short-termism forced on farmers as a direct result of the poor co-ordination throughout the agri-food supply chain. In a report launched through CIMA, the Chartered Institute of Management Accountants, addresses the issues surrounding cost management faced by the agri-food sector and suggests that a system based upon Target Cost Management (TCM) could be a solution.

‘Gate To Plate’ (see draws upon international research and a series of CIMA focus groups. The report addresses the inherent and sector specific barriers farmers face when it comes to implementing a collaborative costing system and also considers food security and wastage.

The report concludes that strategic management accountancy, and approaches such as Target Cost Management, have the potential to address a number of these issues, to encourage visibility of costs throughout the supply chain and better understanding between participants.

Naomi Smith, Research and Product Development Specialist at CIMA, comments:
“Farmers simply haven’t focused on cost management before. This is partly because of a reliance on subsidies which has meant they frequently don’t understand their costs. This is putting them at a severe disadvantage – especially when dealing with food retailers which have a professional and sophisticated understanding of their own costing systems.

Marks and Spencer sales fall 4.2%

Tuesday, March 31st, 2009

Marks and Spencer has reported a fall in sales for the fourth consecutive quarter and admitted that the outlook remains “uncertain”.

M&S said like-for-like sales in the UK - i.e. those which strip out the impact of store openings and closures - were down 4.2% for the 13 weeks to 28 March.

Executive chairman Sir Stuart Rose said he was confident M&S was doing “the right things for our customers”.

In January, M&S announced 1,200 job cuts and plans to close 27 stores.

It intends to close 25 of its Simply Food stores and two of its regular stores.

CIMA: economic downturn increases fraud risk.

Thursday, February 19th, 2009

Businesses across the world must step up vigilance on fraud risk in times of economic stress, according to CIMA’s ‘Fraud Risk Management: a guide to good practice’ information released today (16 February).

This is particularly important for small businesses. As recent high profile cases have centred on multinationals, SMEs may not realise that they are often more susceptible to fraudulent practices, and that they can be hit by proportionately higher losses which could prove crippling in the current economic climate.

Surveys are regularly carried out to try to estimate the true scale and cost of fraud to business and society. These surveys all indicate that fraud is prevalent within organisations and remains a serious and costly problem. Indeed, when CIMA surveyed 200 of its member FDs in the UK earlier on this year, it found that 55% felt that employee fraud posed a significant risk to their organisation.

‘Fraud Risk Management : a guide to good practice’ – see - will arm management accountants with guidance and case studies on how to prevent, detect and combat internal fraud.

Helenne Doody, innovation and development sSpecialist at CIMA, comments:

“Despite the serious risk that fraud presents to business, many organisations still do not have formal systems and procedures in place to prevent, detect and respond to fraud. While no system is completely foolproof, there are steps that can be taken to deter fraud. It is in assisting organisations in taking such steps that CIMA’s guide should prove valuable.”

CIMA’s approach is being endorsed by the Chartered Management Institute (CMI) following the publication of data which reveals low levels of trust within UK organisations coupled with fears over financial management capabilities.

Zavvi retail chain to disappear from High Street.

Thursday, February 19th, 2009

The music, games and DVD retail chain Zavvi is to disappear from the High Streetsoon, with its remaining stores to be either sold or shut down.

Zavvi’s administrators said 446 jobs would be lost after the closure of a further 18 stores by 20 February.

However, 10 other Zavvi stores have been sold, and a further three are also expected to find a new owner.

Before its demise, Zavvi had 114 stores in the UK and 11 in the Irish Republic, and employed 2,300 full-time staff.

Bank of England: UK faces deep recession

Wednesday, February 18th, 2009

The BBC has reported the governor of the Bank of England, Mervyn King, has warned that the UK is “in a deep recession” in 2009 and said rate cuts may no longer work.

In its latest forecast for economic growth and inflation, the Bank says that the UK economy will decline sharply in the first half of the year.

And it says that there is a significant risk that the recession will be even longer and deeper than expected.

The Bank forecasts the economy will shrink by 4% from mid-2008 to mid-2009.

Lloyds TSB: £10bn loss expected for 2008

Friday, February 13th, 2009

Lloyds announced that it expected HBOS to report a pre-tax loss for the whole of 2008 of £10bn, which is £1.6bn more than it predicted in November.

Shares in Lloyds - 43% owned by the government - fell by as much as 40% on investor shock at the latest forecast.

The Lloyds side of the business is expected to make a profit of £1.3bn.

Lloyds Banking Group shares closed down 32.5% at 61.4 pence, having earlier fallen as low as 54.9 pence.

Who wants to be a Trillionaire?

Wednesday, January 21st, 2009

Zimbabwe is set to introduce a 100 trillion dollar note, in its latest attempt to keep pace with hyperinflation.

The new 100,000,000,000,000 Zim Dollar bill was worth about 300 US dollars (225 euros) at its exchange rate on the informal market, where most currency trading now takes place, but the value of the local currency erodes dramatically, every single day.

The central bank had introduced billion-dollar bills in denominations of 10, 20 and 50 with the same goal, but those notes are no longer large enough to keep up with hyperinflation.   The last official estimate put inflation at 231 million percent in July, but outside experts now believe it is many times higher.