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Brexit And Accountants

The recent challenges for the UK economy.

Date : 24/01/2017

Author Information

Hamza

Uploaded by : Hamza
Uploaded on : 24/01/2017
Subject : Accounting

From my personal perspective, currently there are various factors that are contributing as key challenges for the UK economy. Recently, the EU referendum has had a significant impact to the economy, which was displayed on the market where the value of the Pound dropped dramatically compared to the Euro. This has created an economic tension throughout the UK, since a weaker pound would make imported goods more expensive, which contributes to the increase of inflation. To stabilise the economy Bank of England has reduced interest rates, to an all-time low of 0.25% as hypothetically this should increase consumer spending as it is inexpensive to borrow. Carnegie Investment Bank AB, managed over $17 billion for clients, sold all its UK holdings a month in advance of the June referendum, displaying the faith in the economy of the UK. Brexit has raised concerns for businesses as this movement could result in an unorthodox reaction in the market. However, it is uncertain to comment on how this has had an effect towards accountants, as it is unclear whether these repercussions are long term or short term and whether stability will be restored. This could result in mixed implications for the accounting industries.

Accountants are one of the most trusted business advisers therefore, it is more susceptible for clients to engage further with the firm to compete with the macro economic environment. Therefore, it is likely that it would provide a positive impact towards accountants as clients would require more time to ensure a smooth run in their businesses, due to the lack of confidence that has been created from this event. As accountants in practice will be able to provide insight to the potential repercussion for their clients business. Moore Stephens LLP, a top ten firm, advises investors to accept the volatility of the market and to mitigate some of the volatility by recommending highly diversified, structured portfolios.

This resource was uploaded by: Hamza