That does not, however, prevent me feeling distinctly unhappy about this whole arrangement. Firstly, nothing in the German accounts gives an indication of the scale of Lidl’s UK activities.
Secondly, those accounts are not, in any event, easily available in Germany.
Thirdly, we are left with the situation as a result of this loophole in our company law where a company with a significant UK presence is simply not accountable under UK law for its trade in this country to its UK stakeholders.
Who are those stakeholders? You are. It staff are. Its suppliers are. Its customers are. Many government authorities are. Its competitors are.
That is why accounts are required on public record. When a company trades with limited liability the obligation to file accounts was created to ensure the trust placed in the company was not abused with all of us having to pick up the pieces if things go wrong. And in this case we have no clue what that risk is. That’s why this matters.
A year ago David Cameron told the G8 that trade, tax and transparency were at the core of his agenda. If he was serious then he would change the law so that Lidl and any company with a trading presence in the UK would have to file accounts for its UK operation as well as its operations as a whole with Companies House. Without that requirement companies like Lidl will continue to make a mockery of the disclosure requirements in UK company law.
And as result all other UK supermarkets will trade at a competitive disadvantage to Lidl because they simply do not know what it’s up to, which is another very good reason for this change in the law. A level playing field is an essential pre-requisite of fair markets. It’s time for ministers to commit to supplying it.
This isn’t something that UK law can do anything about. It’s part of the Single Market structure.
A company from anywhere in the EU can trade anywhere else in the EU as a branch if that’s what it wants to do. Accounts are then the responsibility of that place where the non-branch part of the company exists. And that’s just that.
Back 12 months I had the option of doing business in Germany as a UK Ltd or as a GMbH. Same rights on offer to me as Lidl have in the UK.
He’s just not got a clue, does he?
Why does he presume that suppliers will do no due diligence before agreeing to supply goods on credit to Lidl?
While audited accounts may be of some use, they’re only of limited use in credit decisions. Because they’re prepared several months after the end of a financial year, by the time you get them the company’s financial position may be considerably different to what is showing in the accounts.
He’s trying to solve a problem that doesn’t exist with a remedy that doesn’t work.
Ah yes, but he wants County by Country reporting, so that would, to an extent, deal with this? Or does he want CBC and also a requirement for full branch accounts in every country to be filed as well?
Who can possibly know what wonderful ideas fill that cavernous and astute brain, apart from “Venn” (TM Murphy) diagrams?
What Christie said – annual accounts mean virtually nothing to non-shareholder stakeholders; they go to someone like Experian if they want to know about the company. At a recent event discussing big data one of their senior analytics guys confirmed that filed annual accounts are pretty much irrelevant in the modern business world. Ritchie may have a point about transparency and accountability, but seeking to impose yesterday’s solution is not the way forward.
‘Who are those stakeholders? You are. It staff are. Its suppliers are. Its customers are. Many government authorities are. Its competitors are.’
Given that he is funded by tax-payer charity, and spouts his bullshit to the world, I guess there are people out there who could claim to be Richard Murphy’s customers and competitors. Can we see the fine print of his bank accounts/activities, pls?
“And as result all other UK supermarkets will trade at a competitive disadvantage to Lidl because they simply do not know what it’s up to”
They could walk into any Lidl and figure out pretty quickly what it’s up to.
As Glendorran says, the information on pricing and costs is as avaialble to Lidl’s competitors as theirs’ is to it.:
“And as result all other UK supermarkets will trade at a competitive disadvantage to Lidl because they simply do not know what it’s up to”
I have asked him a number of times now, what disadvantage? How does it manifest itself? He continually hints at tax avoidance bringing competitive advantage yet will not say how or why. The reason: because that would be an acknowledgement that there is tax incidence for customers and staff; not just shareholders. So, instead of explaining, he shouts “absurd”, “time waster” and “neoliberal”. Richard, you are a fraud.
The man sees tax avoidance under every stone.
He can’t be a fan of imports then, if he wants company accounts up front and available.
By his definition we are also stakeholders in his blog so should have the right to post comments there unfettered.
“And as result all other UK supermarkets will trade at a competitive disadvantage to Lidl because they simply do not know what it’s up to”
These being supermarkets capable of tracking rivals prices on a day by day basis and issuing money off coupons along with your receipt?
Murphy really is a cretin.
I didn’t know that supermarkets’ competitive advantage was based on their geographical corporate structure and tax liabilities.
You learn something everyday.
Does anyone on here donate to the Joseph Rowntree Foundation?
Wouldn’t that make you a stakeholder in Richard Murphy?
Obviously there will be a reason why you aren’t, but it would be interesting to hear it from Murphy himself.
But why Lidl & not Aldi, we ask ourselves…
Wiki: “Lidl has been criticised in the United Kingdom and Ireland for not allowing workers to join unions.”
Who helps pay Murph’s rent?
Tim
In order to control totally you need total control. The arrangement he is advocating here (wherein any EU domiciled business has to publish its full accounts within another EU jurisdiction it does business) is, as you point out, part of the Single Market legislation and the UK cannot, unilaterally do anything about it.
Odd that when he talks about Portugal all he can mention is ‘all rights of free movement we have come from the EU’ yet he is remarkably reticent when the same EU has legislation preventing him from mounting one of his hobby horses.
As it hasn’t been pointed out yet, I will say that your post title could easily substitute history, geography, politics, human nature, finance, taxation etc for the ‘Accounting’ and be fully accurate – a truly deranged individual…..
I can accept that a company can refuse to recognise a staff union (as far as pay negotiations go – I think it is on a stickier legal wicket wrt disciplinary representation). How the hell does it stop an employee from merely joining?
You are allowed to bring someone with you at disciplinary meetings. They aren’t allowed to argue for you as I recall.
Unless recognised.
Martin,
I appreciate that the ACAS code is, once again, non-statutory but it is still held as having significant moral force and precedent significance at Tribunal. It makes no allowance for non-recognised unions (and, in fact, the companion can be a mere fellow worker rather than a formal representative of a recognised union):
“This isn’t something that UK law can do anything about. It’s part of the Single Market structure.”
Not really, no. There’s nothing stopping us having a requirement that any corporate entity trading in the UK file accounts.
Despite that, though, it’s typical Ritchie, because his basic premise is wrong.
Ironman>
“Richard, you are a fraud.”
What, you’ve only just noticed? To paraphrase his fellow-traveller Nick Griffin, they’re not going to get what they want by shouting ‘kill the Jews’, but if they use codewords they might manage to sneak into power – and then they can kill the Jews.
“The companion does not, however, have the right to answer questions on the worker’s behalf, address the hearing if the worker does not wish it or prevent the employer from explaining their case.”
If you’ve ever seen a union rep dominating some cowed employee & fighting a battle on the employee’s behalf the employee was rather not fought, you’d understand how important those words are.
These Rowntree grants, are they based on how many sweeties you ate as a kid?
Can I still make up the lost ground? I promise I’ll forget all the accountancy, economics, tax and company law I had to learn as well.
He seems very hung up on the idea that a company can’t compete unless it can get a full view of its rivals accounts.
As there are other people hoping to become the UK’s Leading Tax Expert ™, presumably in the interests of fair competition he is going to publish his own accounts in full?
Tim, your title is wrong – it is the *law* that Murphy does not understand. I might go further and say that he does not accept the concept of laws passed by democratically-elected governments that fail to meet the “Murphy-knows-best” criterion.
Oh, f*ck me.
Murphy has out-done himself with his ‘Venn diagram’ today.
It includes an ethereal ‘impact of financial crisis’ that’s apparently floating around and having no effect on anyone.
“Time and again I have said these diagrams are metaphors and do not follow the strict rules of Venn diagrams
You either aren’t following, don’t understand or wilfully ignore what I say”
Hopefully that clears things up….
A metaphor is a figure of speech that describes a subject by asserting that it is, on some point of comparison, the same as another otherwise unrelated object.
How is what he has drawn a metaphor?
If he called it “a meaningless pretentious scribble which aspires and fails to be satirical” I could understand it.
Re these fvcking “Venn diagrams”.
One of his habitual latrine lickers suggested it would a great idea for Murphy to collect these up and publish them in a book. Murphy said he would consider it.
Expect therefore to see it on a tax-avoiding internet retailer’s site in the not too distant future. However, I don’t know which section you would be most likely to find it in.
Did I read his comment today that the Lidl thing is actually “not about tax”. Since when?
Imoronam
When it’s about reporting.
I agree, however, that books made from off the cuff one-liners are rubbish. See 101 uses of a dead cat, or Worstall’s blog.
Nothing about gays today?
For pointing out that the suggestion that people seeking employment at Lidl would be impacted by Lidl’s lack of UK accounts and Lidl gains advantage from this, is complete bollox, I am apparently deluded, have no business knowledge etc.
He is a complete twat. Why does the BBC ask him to comment?
Max
For the BBC it’s called balance. 999 accountants might be saying the same thing about tax but one pompous twat is saying something else, so instead of concluding that the lone voice is wrong, the BBC concludes that it has to invite one from each side for ‘balance’. Although if the topic is about tax avoidance they often don’t bother with the majority opinion as that doesn’t make good TV.
Murphy likes to play the “they first laugh at a lone genius then later realise the genius was right” card. His line of reasoning being “they laugh at unorthodox genius, they laugh at me, therefore I must be an unorthodox genius”
What Murphy forgets is that, yes they laughed at Columbus but they also laughed at Bozo the Clown and let’s be honest, Murphy is not the Columbus of tax.
Can I suggest you all head over to enjoy the interchange between Ironman and the Murphster on the objective economics post? Ironman queried Our Murph’s figure depicting two entirely separated circles, suggesting Piketty as an example of someone who was in both. His Murphship had the gall to claim that his diagram, of let me remind you entirely separated circles, was “clear” that one could inhabit both!
And then the Murphmeister proceeded to argue that Piketty was, in fact, an inhabitant of only one. I think he’d just about made up his mind which circle he wanted Piketty in, but it seemed a close-run thing at points. I’m not entirely sure he has yet realised that practically every response he made to Ironman was in contradiction to his previous.
Philip Walker
I always feel affirmed when Ritchie screams “time waster” at me. When he deletes my comments..oh the bliss. I recommend it.
@BraveFart
“One of his habitual latrine lickers suggested it would a great idea for Murphy to collect these up and publish them in a book. Murphy said he would consider it.”
You mean this one?
http://www.taxresearch.org.uk/Blog/2014/07/09/venn-diagrams-for-our-times-tax-compliance/comment-page-1/#comment-693520
I think someone is taking the piss as:
– it refers to reading the book in the lav
– “Andrew Hoboarside” = “Howard Reed is a nob”
Let me guess.. when Richie says “Venn diagram”, he doesn’t actually mean Venn diagram but something that looks like one but is in fact completely different. This was always clear, and you are a troll and time waster.