finance policy - amazon s3s3-eu-west-1.amazonaws.com/.../fpqu_autumn_winter_2013.pdfyear ends) for...

Finance policyQuarterly update

Autumn / Winter 2013

Page | 2 Autumn / Winter 2013

Finance Policy Quarterly Update

Contents1. Introduction 3 2. Economic overview 4 3. Accounting – FRS 102 and housing SORP 2014 6 Developments with the housing SORP 2014 Accounting for impairment and pensionsTransition and loan covenant compliance 4. Treasury 10PRA rule changes and housing association borrowing costs Derivatives reporting requirement changes 5. The Federation’s thought leadership 14 HotHouse: Towards a Vision 6. Taxation 15Help to BuyTaxation of green initiativesTax on board member fees Expression of interest to tender for the tax advice contract 7. Pensions 19The Federation’s Pensions Strategy Local Government Pension Scheme – 31 March 2013 valuation 8. Investment 21The new rent settlement The new investment programme 9. HCA new regulatory framework 23 10. Publications 24Expressions of interest – board guide on social housing finance Risk management guide for board members 11. Finance conference and the HANAAs 2014 26

12. Welfare reform update 29Universal Credit and the bedroom tax 13. Managing information risk 31

14. Quarterly round-up 33Latest developments in consumer credit regulationChanges to the UK anti-money laundering regime

15. Seminars and conferences 2013/14 35



1. IntroductionWelcome to the Autumn/Winter edition of the finance policy quarterly update. Since the previous edition, the Government has announced that rents will be set at Consumer Price Index (CPI) plus 1% after 2015, that rent convergence will end from the same date and a new housing minister, albeit that the position has been relegated to that of under-secretary of state. Labour has announced that it would abolish the bedroom tax, that its new shadow housing minister would be part of the shadow cabinet, and that they would build 200,000 homes by 2020, if elected in 2015. On the economic front, the UK goes from strength to strength with the IMF raising its forecasts for the UK by more than for any other country.

In this issue of the update we:

• take stock of UK economic growth by assessing the strength of the green shoots of the recovery and the upturn in the housing market

• chart the progress of the rewrite of the housing SORP 2014, highlighting recent developments in accounting for impairment and describing urgent work you should have already started in preparation for the move to international-style accounting

• encourage participation in our thought leadership work. Our new HotHouse brand seeks to invigorate thinking on the state of social housing in 2033 - it is up and running and we are keen to hear your views

• highlight developments from the 2013 Spending Review, including the very latest on rent convergence and the new investment framework

• provide an update on the Homes and Communities Agency’s (HCA’s) proposed new regulatory framework

• launch the Federation’s new pensions strategy and provide an article on the 2013 LGPS valuation

• provide the latest news on the banking regulator’s rule change which threatens a wholesale re-pricing of housing association debt

• seek expressions of interest to tender for the Federation’s tax advisory contract and a new guide for boards on housing association finance.

Upcoming events

Ensure your audit committee is up to date by attending our Audit Committees Conference at the Hyatt in Birmingham on 3 December 2013. Keynote speakers include Bob Davies, Chair of Home Group and Andy Watson, Chair of Network Housing Group.

Consider new horizons at our Risk Conference 2014 at the Novotel in Birmingham on 21 January 2014. Hear from Will Hutton, economist, political commentator, previous editor of the Observer and chair of the Big Innovation Centre and David Orr, Chief Executive of the Federation.



2. Economic overviewMike Roche, Director, Savills Financial Consultants provides an economic outlook for the UK economy and housing market

Encouraging economic data released in the UK over the recent months has added increasing weight to the view that a sustained recovery is underway at last. News from other parts of the globe has also added to the increasing economic confidence, with the Eurozone coming out of recession and growth continuing to accelerate in the US. However, Syria, China and the political situation in the US continue to give cause for concern.

The UKGDP growth has increased significantly, reaching 0.7% in the second quarter with business surveys pointing to a continued increase through the third and fourth quarters. The steady flow of improved economic news has led to improved consumer confidence, as evidenced by the GfK/NOP consumer confidence barometer reaching its highest level since October 2009. Faster consumer spending in the second half of the year will, of course, result in reduced personal savings.

The Bank of England made no change to the base rate or the asset purchase programme at its November meeting, maintaining these at 0.5% and £375bn respectively. This came as no surprise as Governor Carney had already indicated that there would be no review of interest rates until unemployment fell to 7.0% (currently 7.6%).

The Government’s favoured inflation measure, CPI, was 2.2%, down from 2.7% in September. RPI was 2.6% in October, down from the all-important September RPI figure of 3.2%, which is used to set housing associations’ rent increase for 2014/15.

The UK housing marketUK housing market activity has picked up significantly this year with every month bringing a fresh batch of bullish data. Mortgage lending, house prices and transactions are all beginning to show signs of life, even outside the bright lights of London. This raises the question of whether this is the start of a meaningful recovery or a short-lived bounce similar to that seen in 2010?

Most indicators are now at or above the levels seen in 2010 during the early bounceback from the downturn. Average house prices are up 4.1% over the year according to the Nationwide index, while transaction levels are at their highest since October 2008. At 625,000 a year, annual mortgage approvals for house purchases are at their highest since July 2010.



Yet despite all the apparent record breaking, all three of these indicators are substantially below their longer-term pre-crunch averages. Behind the average statistics, the market remains fragmented, with parts of the country still experiencing price falls.

The plight of first-time buyers has prompted the Government to launch a number of schemes over the years aimed at improving activity in the housing market. The latest scheme, Help to Buy, goes further than any of its predecessors and is aimed at all buyers, not just first timers.

Since it was first announced in April this year, there has been a lot of debate over whether the measure may cause the market to overheat. So far it appears to have helped drive consumer confidence in expectation of stronger demand.

Overall, the improvement in market activity is a welcome sign, as increased turnover will contribute to economic growth, and hopefully rising incomes will allow housing market affordability to rebalance over the medium to long term.

However, looking ahead, although we are unlikely to see any increase before 2015, interest rates could dampen the housing market recovery. After four years of official rates at the current unprecedented low of 0.5%, higher borrowing costs will place a heavy burden on homeowners who stretched themselves when rates were low. The affordability squeeze may act as a brake on future house price growth.

The Federation contact for treasury matters is Joseph Carr, Policy Leader, 020 7067 1094 or [email protected]



3. Accounting – FRS 102 and housing SORP 2014 This time next year, consistent with advice offered in previous editions of this update and reiterated again in the article below, many of you will be engaged in work required to restate your financial statements for the current year in the new Financial Reporting Standard 102 (FRS 102) format. To complete the process, you'll need to be fully conversant with both the radically new FRS 102 framework and the housing SORP 2014 which is still work in progress.

In this article, we provide a progress check on the SORP rewrite process. We invited James Forrest, principal consultant and actuary at KPMG and Jonathan Pryor, partner, Smith and Williamson respectively, to highlight recent key developments in accounting for pensions deficit and impairment and we describe urgent work you should have already started in preparation for restating accounts for the financial year 2013/14.

Developments with the housing SORP 2014 The SORP Working Party is making good progress in producing a revised draft of the housing SORP 2014. The draft will reflect the requirements of FRS 102 which will become mandatory (for March year ends) for March 2016 year-end financial statements. The exposure draft has been issued for a three-month consultation exercise ending on 14 February 2014. An email should have been sent to you with a unique link to the consultation. If you have not received this, please email [email protected] with your name and organisation.

FRS 102 is based on a completely new accounting framework and housing association accounting will change significantly. As described in the paragraphs below, changes will include accounting for multi-employer pension fund deficits, impairment of social housing property and financial instruments. This change in accounting will create greater volatility in housing association financial reporting and is likely to result in a mismatch between information extracted from new FRS 102 accounts and existing loan covenants.



Accounting for multi-employer pension fund deficits Currently, under UK GAAP, an employer participating in a multi-employer defined benefit pension scheme can account for its pension scheme on the defined contribution basis (the multi-employer exemption). This is only possible if the employer is “unable to identify its share of the underlying assets and liabilities in the scheme on a consistent and reasonable basis”. Under this accounting convention, contributions are booked to the income and expenditure account as they are paid, with no liability recognised on the balance sheet. This approach is adopted by employers participating in the Social Housing Pension Scheme (SHPS), where assets and liabilities are not segregated by employer.

Under FRS 102 (effective for annual periods beginning on or after 1 January 2015), whilst accounting for multi-employer schemes on a defined contribution basis can continue, employers will also be required to recognise the capitalised cost of any contracted deficit contributions payable as a liability on the balance sheet. This liability will unwind as contributions are paid and an interest charge will be recorded in the income and expenditure account reflecting the unwinding of the discount rate.

The impact of any change in deficit contributions payable, for example when an updated recovery plan is agreed, will be recognised through the income and expenditure on a capitalised cost basis. It is worth noting that the next SHPS valuation is 30 September 2014 and that any contribution increase would take effect from 31 March 2016. There will therefore be an impact on income and expenditure in the first year of adoption (2015/16).

On first application of these changes, so at a transition date of 1 January 2014 for calendar year 2015 reporters, the capitalised cost of deficit contributions agreed at that date will be treated as an adjustment to opening retained earnings. Any subsequent change in the present value of the Recovery Plan, either due to changes in the discount rate used or in the Recovery Plan itself, will go to the income and expenditure account.

This change to pension accounting under FRS 102 could have a significant impact on the balance sheet of SHPS employers currently using the multi-employer exemption. For example, of the £1.1bn deficit reported in 2011, it is estimated that £700m to £900m of this would have been disclosed globally as a deficit by housing associations had the pensions deficit rules been applied at the time of the previous valuation. Each employer should assess the expected impact of the change on its financial statements. This change to the balance sheet and the reporting of the present value of future deficit contributions will impact your gearing ratio and your banking covenants. This should be considered now, as part of your proposed business funding strategy and the impact on borrowing.



Accounting for impairmentA significant issue has emerged in relation to the accounting treatment for the impairment of property, plant and equipment (including housing properties in old money). This issue has the potential to have a very profound impact on housing association financial statements and as a result is requiring considerable attention.

Under current accounting rules as set out in the current SORP, a “planned internal subsidy”, (i.e. an investment the housing association consciously chooses to make in a scheme over and above its expected revenue potential) is not impaired. The relevant requirements of FRS 102 are phrased differently - initially there were concerns that the Financial Reporting Council (FRC) would reject this concept altogether and insist on full impairments if any indicator of impairment was present. Fortunately a sub-group of the SORP Working Party, working very closely with FRC on this point, has been able to make progress and persuade the FRC that there are technical arguments in favour of the principle of allowing an asset generating social benefit not to be impaired even if its financial return is less than its cost. Unfortunately, though, we have had to agree that the planned internal subsidy method is not robust, as it relies on a self-assessment of the value of the social benefit. In other words, we have agreement on the principle but not the measurement process.

Following further discussions with some of the leading valuers operating in the sector, we have been able to reach a consensus that EUV-SH (the existing valuation method for housing associations’ social housing assets) should already reflect this additional value from social benefit. This is because EUV-SH is derived from an assessment of what other housing associations would be willing to pay for the relevant property and therefore includes the social benefit element that they would factor within their pricing. It might be argued that some EUV-SH calculations in the past may have understated this element. Importantly, we also clarified with the same valuers that the valuation for accounts purposes should reflect the optimal structuring of a disposal process for the properties and not reflect only the price that might be achieved if all of the properties were sold in one lot at the same time. Experience tells us that the price achievable from dividing the properties into appropriate parcels can increase the value considerably.

In addition, and this point is crucial, we have been able to establish consensus that impairment is measured against the carrying value of the properties less the carrying value of the grant rather than against just the former.

So where does this leave us? Vanity schemes which were previously carried forward without impairment because of the planned internal subsidy process may well end up now with significant impairment charges. Furthermore if the normal outturn of schemes is that they are built with a cost less grant higher than EUV-SH then they will be impaired also. Inevitably, this will attract much greater attention to individual EUV-SH valuations, quite probably on a scheme-by-scheme basis. It will also require housing associations to understand better likely EUV-SH valuations on particular schemes as they are being considered.

Further discussions are on-going with both the FRC and valuers to fine tune the proposed new accounting treatment. With the exposure draft now issued, this particular point will require careful consideration by the sector not only in relation to the theory but, crucially, its impact. Inevitably, there are going to be major repercussions for how impairments are calculated which could destroy some housing association’s current business plans.



Transition to FRS102 and loan covenant complianceHousing associations should already be preparing for the changes from FRS 102. There is a lot of change and it will take time for everyone to become familiar with the new accounting processes. Furthermore there may be some actions that need to be performed, for example in relation to financial instruments, before the transition date (for March year ends, this is March 2014). Early preparation tasks that should be considered include training for finance teams, audit committee members and boards preparing transition plans and assessing the impact of the changes on the housing association and its subsidiaries.

One particular area to focus on will be the impact on loan covenants, particularly those derived from the financial statements. We can say with certainty that reported operating surpluses will change for all housing associations unless they are virtually dormant. However, many other reported balances will also change (e.g. debt, net assets, interest payable). Housing associations should check what their loan agreements specify should happen in the event of major accounting policy changes and they should also consider obtaining external advice from their auditors.

Next stepsThe Federation will continue to issue updates on development with the housing SORP 2014 to assist housing associations as they transition toward FRS 102 accounting. During December 2013 and January 2014, the Federation has arranged for representatives from the firms that serve on the SORP Working Party to attend regional finance forums taking place around the country (see page 36 for details of meetings of regional finance forums) to discuss the draft housing SORP 2014 and, in particular, recent developments surrounding accounting for impairment of social housing properties. FRS 102 and the housing SORP 2014 will also be covered extensively at the Federation’s Annual Finance Conference at the University of Warwick (for an overview of the conference, see page 26 of this update). Finally, listen out for announcements from the Federation on a series of SORP roadshows it will also be hosting once the housing SORP 2014 has been published.

The Federation contact for accounting is Joseph Carr, Policy Leader, 020 7067 1094 or [email protected]



4. Treasury Update on Prudential Regulatory Authority rule changes Background In the last edition of this update, we reported that the Prudential Regulation Authority (PRA), the new banking regulator that replaced the FSA in April 2013, proposed increasing the amount of capital certain banks would be required to hold against existing and new housing association loan portfolios. The concern was that these higher loan capital adequacy requirements would increase banks’ cost of funds which would, in turn, impact adversely on housing association borrowing costs.

Specifically, three banks – Barclays, RBS and Santander – apply the Advanced Internal Ratings Based (AIRB) approach to assess the capital adequacy for low default, sovereign-linked loan portfolios such as housing associations. Because housing associations have a thirty year or so no-default record, banks have no loss default data available for housing association loans and consequently hold relatively little capital against housing association portfolios. However, in the post-credit crunch era, the direction of travel for both national and international banking regulators is to require banks to increase capital holding.

The PRA proposes replacing the Loss Given Default (LGD) of 10% used by the three banks in their AIRB approach with a floor of 35% weighting for secured loans and 45% for unsecured loans. The 10% weighting was a concession provided by the FSA.

The additional level of capital the three banks will need to set aside as an opportunity cost. These banks have lent circa £30b to the sector and the concern is that the type of cost increase clause, uniquely standard in housing association loan agreements, would enable the banks to transfer their costs to housing associations automatically.

A mere 1% increase in lending costs on housing association loan portfolios would result in additional borrowing costs of some £300m per annum. This would reduce quite dramatically the capacity of housing associations to build new social homes, at a time when demand is at its greatest. It would also undermine the commitment of housing associations to build the 165,000 new affordable homes targeted by the Government for 2017 and with that, the continued boost to the economic recovery.

The story so far In the intervening period:

• we have liaised with members, the HCA, the banks and treasury specialists within the sector on the issue

• we have submitted a written response to the PRA’s consultation • we accompanied finance directors from G15 housing associations to a meeting with the PRA, and• the HCA has also met with the PRA.



We emphasised to the PRA:

• the no-loss default record of the sector• that housing associations operated in a regulated environment with implicit government

support and• that housing associations enjoyed an index-linked, secured income stream

On this basis, we questioned the logic of the capital adequacy requirement for housing associations being similar to unregulated, for-profit organisations with riskier business models.

The PRA had not appreciated that uniquely, housing association loan agreements included the standard cost clause. It was also interested to understand the seminal role housing associations played in building new social homes and assisting the Government to build the country back to economic recovery.

The PRA conceded that a 35% LGD might be excessive for housing association loans and confirmed it would undertake a detailed review of the whole process, including the procedures adopted by banks and the impact of moving to a new system. As part of the review, it agreed to consider the specific position of housing associations.

In discussions with the banks and treasury specialists:

• they stressed that determination of loan margins was a complex process and included many components, some of which were commercially sensitive and LGD weightings was only a small part of the process. Consequently there was not a linear relationship between banks’ increased regulatory costs and increases in loan margins. The lawyers emphasised that banks would need to justify to the PRA how any regulatory cost increases they incurred translated justifiably to the re-pricing of existing loans.

• the banks have suggested that they are less likely to respond to higher LGD weightings by re-pricing housing association loan back books. However, they have suggested that it was more likely to impact on margins charged on new loans. They have also suggested that the changes to capital adequacy rules will reduce the latitude available to banks in negotiations with housing associations, and might inhibit the more positive attitude they have adopted recently, when re-negotiating loan covenants and considering group restructures and mergers.

In September 2013, the PRA published Supervisory Statement 1/13 which consolidates existing banking regulation issued by the FSA up to 31 December 2013: http://www.bankofengland.co.uk/pra/Pages/publications/irbapproaches.aspx

Pleasingly, in Paras 1.11 of the Statement, the PRA echoed the comments made in our response by acknowledging the role of housing associations in delivering new social housing and its contribution to the UK’s economic recovery. As expected the Statement stopped short of suggesting revised LGDs applicable for housing association loan portfolios, but confirmed that this will follow in 2014.

Again in September 2013, a new EU banking regulation and directives were published to take effect from 1 January 2014. The PRA has issued the consultation paper CR IV CP5/13 on the domestic implementation of the regulations. The results of the consultation will inform a Supervisory Statement for 2014.



Next steps

• The PRA is undertaking a cost and benefit analysis to assess its prudential concerns about LGDs, including the impact on social housing portfolios.

• The results of this analysis are not expected until the second half of next year.• The PRA indicated that it was minded to include housing associations in the new LGD

framework but stated that a weighting of 20% might be more appropriate.

Reporting requirements for derivativesHousing associations have to comply with new rules on their derivatives trading, some of which have been in place since March 2013, with others coming into force in 2014. Verinder Sharma of the OTC Derivatives Policy and Post Trade Team at the Financial Conduct Authority (FCA) explains the requirements and what you need to do.

What is European Markets Infrastructure Regulation?

In 2009, the G20 agreed to increase transparency and reduce systemic risk in the ‘over the counter’ (OTC) derivatives market, and European Markets Infrastructure Regulation (EMIR) is a key part of the EU response. EMIR applies to all users of derivatives contracts, including ‘non-financial counterparties’ (NFCs) such as housing associations.

What you need to do

Housing associations have been required to measure their derivative activity on a group-wide basis since March 2013. If all the derivatives activity in your group is done to hedge risks directly related to commercial activity or treasury financing activity, you will be exempt from some parts of EMIR.

If any transactions fall outside this definition, you will need to check whether the group-wide total exceeds the thresholds set out in EMIR. You will also need to notify the FCA and comply with more stringent rules.

Although NFCs below the EMIR thresholds are exempt from some requirements, you will still need to comply with the new rules on timely confirmation of trades, dispute resolution, portfolio reconciliation, and compression.

Housing associations will be required to report their derivatives trades, including intra-group transactions, to trade repositories. Both parties must report no later than the business day after the transaction takes place. You can report to a repository yourself, or outsource reporting to a third party. This is expected to be required from February 2014.



Complying with the requirements

The FCA is responsible for overseeing compliance with EMIR and we expect all affected firms to be ready to meet the requirements.

The FCA will be checking compliance with EMIR across different sectors. If full compliance cannot be achieved in time, you should have a detailed and realistic plan to meet the requirements within the shortest timeframe possible.

To help you prepare, you can find more information about the requirements and subscribe for email updates on our website www.fca.org.uk, you can also contact us on [email protected]. Barry King of the FCA will be speaking on the issue at our Finance Conference 2014.

The Federation contact for treasury issues is Joseph Carr, Policy Leader, 020 7067 1094 or [email protected]



5. The Federation’s thought leadershipWhat will the world look like in 2033? What role can housing associations play? And what steps must we take to get there? With these questions as the starting point, we are bringing the sector together to think about its long-term future, to answer these questions and more, and work towards a vision.

Demographic changes, technological advances and changes in relation to the state – these are all factors impacting the future of housing associations. Looking forward to 2033, the housing sector will face challenging questions in addressing this less predictable future. It is vital that we take up the challenge, invest now in identifying the answers and create a vision of our own.

At our annual conference in September both our Chair and Chief Executive talked about a project we have launched to create a new vision for housing associations in 2033.

This project will ask questions such as ‘what will the world look like in 2033?’ and ‘how do we shape our future?’ We want to explore the possibilities openly, confront the uncertainties head on, and make positive choices together. From there we want to create a clear, compelling vision for the future and map the journey we need to make.

We have hosted a series of events across the country to begin the debate and explore with members where we think the sector is heading and where we want to be by 2033. These events were designed to stimulate ideas and challenge assumptions. Further information on these events can be found on the HotHouse website.

We have also commissioned some research on the politics of housing and issues around supply and have been sharing views and ideas from across the sector and beyond.

The ideas and opinions gathered during the events and from the online discussions will form the basis of the vision for housing associations. This will be launched at the Leaders Forum in February 2014. This will set the direction for conversations with politicians and inform our plans for the now, as well as the next 10 and 20 years.

You can join in the debate on www.hothouse.org.uk, where you can participate in discussions, answer questions and comment on blogs, or keep up to date with discussions on Twitter by following @hothouse2033 and using the hashtag #hothouse2033.

The Federation’s contact for HotHouse is Catherine Ryder, Policy Leader, 020 7067 1096 or [email protected].



6. TaxationHelp to BuyThe Help to Buy equity loan scheme has been operating since 1 April 2013. It is designed to facilitate purchases of new build properties on the open market via equity loans to the purchaser from government, and is administered by the HCA. There are no maximum income criteria for purchasers and the scheme applies to purchases of new build properties worth up to £600,000. As of 8 October 2013 Help to Buy was extended to include existing properties.

From a corporation tax perspective, sales of properties acquired with the assistance of the Help to Buy scheme are likely to be treated as a trading activity. A charitable housing association will therefore have to decide whether these sales are for charitable or non-charitable purchasers. As above, this is essentially a legal question and would need to be considered on a case-by-case basis with reference to the financial and other circumstances of the purchasers. However, it would need to be remembered that this information may not be readily available as it is not required under the terms of the Help to Buy scheme.

Are your energy efficiency works tax-efficient? The last 18 months have seen a significant increase in the volume of energy efficiency works performed on social housing properties by energy companies rushing to meet their obligations under the expiring Community Energy Saving Programme (CESP) and Carbon Emission Reduction Target (CERT) programmes and now under the Energy Companies Obligation (ECO). It is essential that housing associations understand the tax consequences of these works so that opportunities to reduce the cost of the works aren’t missed and the activity does not trigger an unexpected tax cost.

CESP, CERT and ECO are programmes introduced by the Government that require energy companies to facilitate energy efficient improvements to houses. Where an energy efficient improvement was or is made to a property then it triggers a ‘credit’ for the works.

Energy companies were each set targets for the amount of ‘credits’ they had to obtain. As the energy companies do not own houses to perform works to, they have approached housing associations in two ways:

1. the energy company approaches a housing association offering to perform energy efficiency works at a discounted price and the energy company claims credit for the works, or

2. the energy company approaches a housing association offering to pay for the credits produced by energy efficiency works arranged by the housing association.



The Federation’s tax adviser, KPMG, has corresponded with HMRC on these programmes. With regards to the first arrangement, HMRC has only highlighted that there is usually a supply to the housing association of the works, which is normally subject to the 5% VAT rate.

For the second arrangement, where the housing association is now likely to incur the full cost of the works, it becomes more important that the 5% VAT rate for the installation of energy saving materials is maximised. It is essential that the housing association establishes the VAT liability of the income that is received from the energy company in return for the credits and impact on VAT recovery.

HMRC has confirmed to KPMG that in the majority of instances the sale of the credits represents a standard rated supply. Importantly, this taxable supply can have implications from a VAT recovery perspective. KPMG has agreed with HMRC that where any VAT incurred is not already recoverable under a VAT shelter, housing associations are likely to be entitled to recover a significant proportion of the VAT incurred on the energy efficiency works as a result of the taxable supply to the energy company.

From a corporation tax perspective, the treatment of these programmes will depend on the specific terms of the contract. It is KPMG’s view that many of these arrangements should be exempt for corporation tax purposes where undertaken in a charitable housing association. However, there is a risk that HMRC could take a different view in some circumstances. Non-charitable housing associations should expect the activity to be taxable subject to the availability of any allowable expenses.

Board member fees and IR35 – updateAs set out in the previous update, HMRC have recently sought to confirm the application of the IR35 legislation in respect of fees paid to board members.

You will recall that HMRC guidance suggests that IR35 will apply to payments to board members (as office holders) engaged through intermediaries e.g. a personal service company. This means that the housing association engaging the board member will not be responsible for deducting PAYE and NIC on payments to the intermediary.

The above is contrary to the view of HMRC policy writers who confirmed that IR35 will apply only if the intermediary is a corporate board member and is reported as such in statutory returns.

The position therefore remains unclear and so, if you are about to engage a board member through their personal service company or HMRC are challenging that PAYE and NIC is due by the housing association on payments to the board member’s personal service company, please call the Federation’s tax helpline for further advice (see page 18).



The Federation’s tax advice contract – expression of interestWe will be re-tendering our tax advice contract to support our work representing housing associations on tax issues for the period commencing 1 April 2014 and are seeking initial expressions of interest. We would like to take this opportunity to thank our current tax partners KPMG for their outstanding contribution in allaying the sector’s tax concerns over the last seven years.

Key objectives

• To provide housing associations that are Federation members with access to high quality advice on tax issues via a readily available advice line service

• To provide the Federation with timely advice and assistance on direct and indirect tax matters to ensure that we are able to represent our members interests on tax issues and influence the future tax environment

• To ensure that the relationship is a genuine partnership that results in sufficient benefits for both parties over an agreed period of time and

• To ensure that the partnership maximises the potential for adding value (e.g. via events and publications) and opportunities for income generation for either or both partners.

Current service

To give an indication of the service we are seeking, a brief explanation of the current engagement is provided below.

• A tax advice helpline for Federation members, whereby members receive a free initial 30 minutes’ advice

• Attendance at regular (quarterly) meetings with the Federation• Tax advice for the Federation’s lobbying work, including attendance at ad-hoc meetings with

the Federation at HMRC, HM Treasury or other Government offices• Provision of articles for the Federation’s quarterly finance newsletter and other ad-hoc

articles for the website and• Speaking engagements at Federation events.

Selection process

A tax advice partner will be selected by process of competitive tender with submissions assessed against a series of set criteria that apply to our key objectives:

• tax advice helpline for use by Federation members• tax advice and assistance to the Federation• your expectations of the Federation as a partner and • potential for realising added value and opportunities for income generation.



Timetable:

Expression of interest sought 16 December 2013

Start of tender period 13 January 2014

Deadline for return of tender questionnaires 3 February 2014

Period for interviews (at the Federation’s central London offices) 3/4 March 2014

Confirmation of appointment w/c 10 March 2014

Launch of taxation advice service 1 April 2014

Tax helpline for Federation membersFederation members are reminded that included as part of our contractual arrangement with KPMG is the provision of FREE tax advice for members. Members using the tax helpline are entitled to the first half hour of tax advice free. This service covers corporation tax, VAT, people’s taxes and stamp duty land tax issues. Details of how members can access this resource are available from the members section of our website. You will need to register and log in to use this service.

The Federation’s contact for all taxes is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



7. PensionsThe Federation’s pensions strategyPensions are becoming an increasingly important issue for housing associations. The introduction of auto-enrolment and the increasing costs and unknown risks of defined benefit schemes have led to housing associations spending ever-increasing amounts of time reviewing their pensions offering and considering their options. In recognition of this, we have appointed KPMG as our preferred pension policy advisers and we are looking to build upon the service that we already provide to meet the growing needs of our members.

The Federation’s key objectives in this area are to:

• provide access to quality pensions advice and information for all housing associations, regardless of their size, background and pension provision

• bring consistency of delivery and strategy across the sector. There are issues that face all associations – for example the need to establish a clear pensions governance strategy – and we will provide access to information that all housing associations can use to understand their risks and improve their governance procedures

• respond to individual queries as and when they arise

• push for changes that will benefit the sector – for example we have recently responded to DCLG’s call for evidence on the structural reform of the Local Government Pension Scheme (LGPS). Our response pushes for a greater recognition of the strength of the sector and improvements in flexibility, communication, accountability and transparency in the pensions section of our website and

• provide help for the increasing number of housing associations with defined contribution (DC) schemes as well as defined benefit (DB) schemes. Good governance and scheme designs which meet industry standards are important in our sector and this will be our focus.

If there is any area in which you would like us to initially concentrate our efforts please contact [email protected]



Local Government Pension Scheme – 31 March 2013 valuationThe initial results of the LGPS actuarial valuations are starting to be revealed and as expected do not make for good reading. The valuations are confirming that the deficits have increased – largely due to the fall in government bond yields that has increased the value of the liabilities, despite reasonable asset returns since the previous valuation.

The results will vary by scheme and the funding approach varies by advisor – the Federation believes that this is unhelpful and are pushing for more consistency. Each participating housing association should be ensuring that they ask for an early sight of the results and build contingency into pension budgets. Any change in contribution will take effect from 1 April 2014.

The Federation would encourage opening a dialogue with your LGPS and joining forces with other housing associations in the same LGPS to argue the case for recognition of the strong covenant provided by housing associations – for information on housing association membership of LGPSs email [email protected]. LGPSs are starting to listen to reasoned arguments and this can only be a good sign for future flexibility and transparency.

We would also suggest that you review the terms of your admission agreement and ensure that you are clear on any guarantees you have from a local authority and identify how these impact your funding and bond requirements.

It should be noted that the impact of the LGPS 2014 benefit and structural changes will vary significantly between different participating employers depending upon the membership profile. For example, if your employees receive a significant amount of non-contractual overtime then the changes may lead to a significant increase in your costs. In many cases, the impact will not offset the increase in liabilities and costs caused by the market movements since 2010.

As mentioned earlier, we have responded to the call for evidence on the future structure of the LGPS. We are pushing for fundamental reforms that would bring significant benefit to the sector and enable housing associations to be treated more appropriately. In order to keep you up to date with the latest issues surrounding this important area, we will be hosting a free webinar for all our members. Invitations will be sent out in the next few weeks.

The Federation’s contact for pensions is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



8. InvestmentThe new rent settlement Following the announcement of the new rent settlement in the July Spending Review, we have been working with members and the Government to understand the detail behind these announcements and the impact they may have on housing associations.

As members will be aware, the new ten-year rent settlement means social rents can increase annually by the Consumer Price Index (CPI) plus 1% from 2015/16 to 2024/25. However, the new rent settlement does not include the provision of increasing rents by £2 per week to allow convergence towards the target rent.

The Federation is aware that for some housing associations the loss of the ability to increase rents by £2 per week could mean they will be unable to continue as viable businesses or will, at the least, lose significant capacity to develop additional housing or invest in neighbourhood or community services.

In order to better understand the impact on housing associations of ending rent convergence, we sent a survey to all members in August. The results show that for many housing associations the impact will be manageable within the context of their current business plan. However, there are a number of housing associations where the consequences for viability and/or capacity could be significant.

In September, the Federation’s Chief Executive David Orr wrote to the then Housing Minister, Mark Prisk MP, and Danny Alexander MP, Chief Secretary to the Treasury, voicing our concerns about the loss of income resulting from the end of rent convergence and suggesting ways these impacts could be mitigated.

The Department of Communities and Local Government (DCLG) has recently published a consultation document on ‘Rents for Social Housing from 2015-16’, inviting views on the proposed rent policy for social housing from April 2015 onwards. We will be responding to the consultation, which closes on 24 December. The full consultation can be found on the DCLG website. We have also taken legal opinion about the decision to end rent convergence. Once the consultation has taken place and the final policy has been announced we will explore further whether there are any legal implications associated with the decision.

Our latest briefing on the new rent settlement, including more detail about the survey and our letter to ministers, can be found on our website:http://www.housing.org.uk/publications/browse/rent-convergence



The new investment programmeIn the July Spending Review, the Government announced it will invest £3.3b over three years from 2015/16 to support the delivery of 165,000 new affordable homes. Ministers expect these homes to come not only from a grant funded programme, but also a non-grant funded programme, most notably Right to Buy replacement homes. The £3.3b funding includes £957m of grant each year from 2015/16 to deliver homes for affordable rent and shared ownership, in an extension of the Affordable Homes Programme (AHP).

We are committed to working with the HCA to help support the delivery of 165,000 new affordable homes in this programme. We believe getting the design right will persuade more housing associations to join the programme.

We have been gathering views from members on the current programme and the improvements they would like to see for the next programme and have received a range of comments covering the following broad areas:

• importance of healthy grant levels• allocating grant • access to land • delivering a flexible programme• making a more accessible and competitive

programme• getting the planning framework right.

This feedback has helped inform our conversation with the Government, the HCA and the GLA to influence the prospectus and bidding round for the new investment programme.

The Federation’s contact for investment is Catherine Ryder, Policy Leader, 020 7067 1096 or [email protected]



9. HCA new regulatory framework Protecting social housing assets – where next for regulation? If the HCA discussion paper on Protecting Social Housing Assets was intended to stimulate debate in the sector, there is no doubt that it succeeded. The HCA, it will be recalled, suggested that landlords should set up ring-fencing arrangements to insulate their social housing from any financial shocks arising elsewhere in the organisation.

It is fair to say that the sector was not wildly enthusiastic in its response to this idea. But this initial reaction was modified, as discussions progressed, by a recognition that even if the HCA’s suggested remedy was not the right one, the fundamental objective of protecting social housing was a legitimate issue for the regulator to address.

After an extensive programme of member consultation with members, the Federation submitted a response that recognised that social housing assets need to be protected but argued that this would best be achieved by robust risk management on the part of providers.

The HCA has since indicated that it sees merit in this approach and Julian Ashby, chair of the Regulation Committee, has indicated a shift of position to put risk management at the heart of the HCA’s approach.

At the same time, the HCA has indicated that it is likely to continue with its proposal to require registered providers to adopt recovery and resolution plans in the event of serious problems (although it no longer terms them as “living wills”). It is also working on a suitable regime for the for-profit providers that are beginning to appear in the social housing sector.

A further round of formal consultation will be required before any changes are made to the Governance and Financial Viability Standard, and any changes are likely to take effect at some point during the financial year 2014/15.

The Federation’s contact for regulation is John Bryant, Policy Leader, on 020 7067 1082 or [email protected]



10. PublicationsBoard guide on social housing finance – expressions of interestThe Federation is seeking expressions of interest from potential writers for a publication with the working title Demystifying housing association finances for board members.

The publication aims to provide a straightforward explanation of fundamental accounting issues and principles, such as audited financial statements, budgets, management accounts, and financial performance ratios. The publication is aimed at housing association board members, non-finance directors, and finance staff new to the social housing sector.

The publication will replace the existing 2011 guide, Understanding financial statements: an overview of accounts for social housing providers, to reflect the Financial Reporting Standard 102 and the housing SORP 2014, which will shift all UK businesses - including housing associations – to a new financial reporting framework from 1 January 2015.

The writer will:

• have expertise in housing association finance and accounting• be up to date with the new financial reporting framework, and• be able to explain key accounting issues in a writing style appropriate for non-finance

specialists.

The content of this publication needs to take into account and be consistent with the new international financial reporting framework. Therefore the proposed dates in the timetable below may be subject to change according to the drafting and on-going consultation of the housing SORP 2014. The proposed project timetable is as follows:

Activity DeadlineDeadline for receiving expressions of interest 26 November 2013Deadline for returning tenders 6 December 2013Interviews at the Federation’s offices in central London (if required) 10 December 2013Confirmation of appointment of writer by no later than 12 December 2013Meeting to finalise spec by no later than 19 December 2013First draft submitted by writer 28 March 2014First draft sent to readers panel for comments 7 April 2014

Writer reviews changes from the readers panel 16 April 2014Final draft submitted for finalisation and publication 9 May 2014Publish and launch event September 2014

An invitation to tender will be sent as soon as an expression of interest has been received.

The Federation’s contact for the board guide on social housing finance is Arnon Leung, Policy Assistant, 020 7067 1070 or [email protected].

Risk management – a guide for housing association board membersIn the last edition of this update we alerted you to our forthcoming publication “Risk management – a guide for housing association board members”, which is due to be launched at the Board Members conference in London on 7 February 2013.

The guide will seek to inform board members of their responsibilities in risk management at a crucial time. The sector is more complex, challenging and changeable than ever, with the nature and magnitude of potential risks increasing.

The guide emphasises that risk management is not a top-down tool used to restrict opportunities and limit advancements - risk management should help identify all housing association perils and inform all decisions.

The guide will not be a tome that can be used to micro-manage housing association’s risk management systems but will enable board members to review and challenge policies, practices and processes put in place. It will offer clear, straightforward guidance, explaining, amongst others, the following key areas:

• the art of risk management• the board and others role in risk management• the risk management approach – a practical guide• setting the risk appetite and• managing reputational risk.

The Federation’s contact for risk is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



11. Finance Conference and the HANAAs

Housing Finance Conference and Exhibition 2014Seizing opportunities and safeguarding against risks19-20 March 2014, University of Warwick, Coventry

The Housing Finance Conference 2014 is set to again have a line up of inspirational and expert speakers to give you the latest updates on the sector. Bookings are open to ensure you can take advantage of the early bird offer. Use priority code FIN0314PQR when booking.

2014 signals a rosy outlook for housing associations with the recent upturn in the UK economy, the Government’s offer of ten-years’ rent certainty and the HCA’s Global Accounts revealing a sector in good financial health. However major challenges such as welfare reform and new regulatory and accounting frameworks present spiraling risks for the sector. Consequently, housing associations have been and continue to re-invent their business models to seize new opportunities and safeguard against pitfalls.

The event will address each of these issues and more to ensure your association is ready for the new challenges. Highlights include:

• Douglas McWilliams, executive chairman at the Centre for Economics and Business Research on the UK economic outlook and its impact on the future of housing

• Magnus Lindkvist, acclaimed futurologist with his alternative view of the future including new, better ideas about how to work, live and thrive in housing and beyond

• Mike Roche, economist at Savills on the lending market with Paul Rickard, Circle, and Clive Barnett, RBS, on what the future might hold for housing association borrowing costs and the impact on your business plans

• Jonathan Walters, deputy director of strategy and performance at the HCA, with a preview of the new regulatory settlement for your association

• Tracey Hartley from the PRS Taskforce, on maximising the benefits and understanding the risks in the growing private rented sector market and Jack Stephens, Thames Valley Housing Association, on his experiences of joining the market

• THFC’s Fenella Edge and JCRA’s Michael Leslie on the funding available for mid-sized and smaller housing associations

Plus so much more … preparing for housing SORP 2014, lessons learned from Universal Credit trials, 2033 vision for housing, future borrowing costs and the potential of social enterprises.

You are also invited to an evening of networking, including the new conference dinner with Steve Punt, satirical comedian and writer on BBC’s Mock the Week and The Now Show and followed by the lively drinks reception at the largest housing finance exhibition in the sector.

Full details are available at www.housing.org.uk/events or call 020 7067 1066 for further information.



The HANAAs are back – will you be a winner? Last year we launched the Housing Association National Accountancy Awards. Over 300 people celebrated the success of finance teams across the sector at the glittering awards ceremony. Now we’re back and we’re bigger and better. The 2014 awards will take place at the National Motorcycle Museum, Birmingham on Tuesday 18 March as the curtain-raiser to the Housing Finance Conference.

Now open for entries, the categories are:

• Finance Team of the Year • Most Effective Financial Risk Management Approach • Outstanding Financial Communications • Financial Innovation • Best Newcomer • Measurement of Social Return on Investment • Achieving Best Value for Money • Best External Professional Advisor • Best Board Report - new for 2014• Finance Director of the Year - new for 2014• Outstanding Lifetime Contribution

The entry deadline is 5pm on Friday 22 November. Don’t miss out on this chance to make an entry and you could be walking away with a coveted trophy.

Judges confirmed so far include:

• Deborah Shackleton, former Chief Executive, Riverside Group• Mark Davie, Head of Social Housing, M&G• Maria Hallows, Audit Partner, Beever and Struthers• Kate Allen, Property Correspondent, Financial Times• Keith Ward, Director - Social Impact Services, Baker Tilly



What is winning a HANAA like?

‘It has been a wonderful validation of the great work that the team has been doing in communicating to our internal and external audiences and ensuring they understand our financial position. The award has motivated the team to maintain best-in-sector financial communications and continue to build on this to make it even better, competing not just with sector leaders but leaders across the corporate world.’

Paul Rickard, Director of Corporate Finance, Circle, winner of Outstanding Financial Communications 2013

‘It was extremely motivating for the team to get the recognition and know that we compare so favourably with other finance teams in other organisations. It was great to share our success with colleagues within Riverside too, gaining recognition for a back office function and giving the team a chance to shine. It was a great night out too!’

Pam Welford, FSC Director, The Riverside Group, winner of Finance Team of the Year 2013.

Give your team the chance to shine

You can find all category information and entry details on our website www.housing.org.uk/hanaas and the winners will be announced at the awards ceremony on Tuesday 18 March at the National Motorcycle Museum. Don’t miss out on your chance to be part of this celebration.

Full details are available at www.housing.org.uk/events or call 020 7067 1066 for further information.

The Federation’s contact for the HANAAs is Natasha Papa, Conference Organiser, 020 7067 1053 or [email protected].



12. Welfare reformUniversal Credit

Arrears trigger announced

The Department for Work and Pensions (DWP) has announced a two-month arrears trigger for Universal Credit (UC). The majority of tenants claiming UC will receive their housing costs as part of their monthly UC payment, with the arrears trigger allowing for the housing element to be paid to the landlord where arrears have built up.

The key points of the trigger are as follows:

• if arrears reach the equivalent of two months’ rent, housing payments will be switched to the landlord

• if arrears build up to the equivalent of one month’s rent the decision to make direct payments to the tenant will be reviewed and

• the decisions about whether tenants should receive direct payments will be made in collaboration with social landlords.

We still believe the best way to protect residents is for the Government to allow them to choose to have their rent paid directly to their landlords. However, we are pleased that the DWP is committed to collaborating with housing associations and we look forward to working with them on further details surrounding the trigger.

Introduction to new areas

Over the summer DWP announced further information about the roll out of UC. Currently, new UC claims are limited to the four Pathfinder areas in the North West (Tameside, Warrington, Wigan and Oldham). UC is now rolling out next to six more areas; Hammersmith, Rugby, Inverness, Harrogate, Bath and Shotton. This stage of the rollout will be staggered from October 2013 until April 2014 and commenced with Hammersmith at the end of October. As in the Pathfinder areas, these Jobcentres will initially be taking new claims to benefits from unemployed, single people without children.

At present, there are no further details of the rollout after April 2014, although the recent report from the National Audit Office suggests that UC will not be ready to take all new claims and provide the full planned service until at least December 2014. The report also cautioned that to keep to the current end date of 2017 a large volume of existing claims will need to be migrated in a short time frame.

We have been working closely with housing associations with stock in the North West Pathfinder areas and will be extending this support to associations in the new roll out areas. We will shortly be publishing our early learning from the pathfinder areas to help members prepare for UC.



Bedroom taxThe bedroom tax has now been in force for six months.

Our survey of 51 housing associations around England found that 51% of residents affected by the bedroom tax were unable to pay their rent between April and June. Meanwhile, a quarter (25%) of those affected by the tax entered rent arrears for the first time, according to a smaller sample of 38 housing associations.

According to polling we commissioned by ComRes almost three in five people (59%) say that the Government should abandon the bedroom tax entirely.

We will be building a fuller, more comprehensive picture of the impacts of the bedroom tax over the coming months. We have engaged with all political parties on the impacts of the bedroom tax and we are delighted that the Labour Party has committed to repeal the tax if elected in 2015. We will continue to call on the Government to look at the evidence and repeal the bedroom tax.

The Federation’s contact for welfare reform is Pippa Bell, Policy Officer, on 020 7067 1174 or [email protected]



13. Managing information riskProtecting your most vulnerable asset

Background

We live in a world of increasing regulation and penalties for the inappropriate use of data, while the threat to data held is growing through new ways of working, increased use, changing technologies, and emerging external threats. A recent survey concluded that the annual cost of cyber-crime in the UK alone was an estimated 18-27bn (UK National Audit Office 2012).

Housing associations, like all organisations, are facing an increasing number of challenges surrounding the management of information. More information is available than ever before, in an array of different formats, and flexible ways of working result in a greater reliance on access to information and systems.

Some of the obvious issues are how to:

• manage and control confidential information securely• avoid theft or malicious hackers• manage the expectations of residents and stakeholders and • work within the growing number of laws and regulations on information security.

It is vital therefore that information is managed and controlled in an appropriate way, in order to protect a housing association’s reputation and support good service delivery.

What do we mean by information governance?

Information governance is an emerging term used to encompass the set of multi-disciplinary structures, policies, procedures, processes and controls implemented to manage written, printed, electronic, and stored information at a strategic level within an organisation.

Information governance can be summarised as:

“…an organisation’s ability to secure its people, information systems and reputation in cyberspace”, Julia Graham, CRO at DLA Piper.

It is currently high on the agenda at senior management team levels, although there is a significant amount of misconception as to what exactly constitutes the main risks.



What are the risks?

There are a number of risk factors to be considered: malware and viruses, human error and theft or loss of information or devices. There are also well-documented examples of the risks associated with an increasing reliance on social media as a key communication method. Some of the potential costs incurred are tangible, such as fines or penalties, legal or PR fees, replication or recovery costs and business interruption. However, there are also a vast number of intangible (or uninsurable) costs associated with information risk: damage to reputation, loss of customer or stakeholder confidence and devaluation of intellectual property, for example.

In conclusion, it is vitally important that housing associations remember that while new technology has many positives it also brings its own spectrum of risks which must be understood and managed.

For more information on the emerging risks affecting your organisation visit www.newworldofrisk.com.

For more information on the emerging risks affecting your organisation contact Chris Greaves, Strategic Risk Consultant, on 0121 733 1326 or visit newworldofrisk.com.

The Federation’s contact for risk is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



14. Quarterly round-upLatest developments in consumer credit regulationIn the last update we reported on the joint responses we submitted with Trowers & Hamlins to both HM Treasury and the FCA to their consultations on the planned transfer of consumer credit regulation from the Office of Fair Trading (OFT) to the FCA in April next year. Suzanne Benson from Trowers & Hamlin provides an update on where we are with the new regulations.

The Treasury has now issued updated legislation and we are delighted to note that the main points of our responses have been reflected in the changes.

The good news is that housing associations will, from April 2014, have a blanket exemption from FCA regulations in relation to the provision of loans which are secured on land. This will make life much easier in the future when setting up either new shared equity schemes or other forms of secured lending.

The change in approach should enable most housing associations to be subject to the ‘lighter touch’ regulatory regime proposed by the FCA for the other consumer credit regulated activities they participate in. Although the full details of the requirements for the lighter touch regulatory regime are subject to further consultation this year, the indications are that the FCA will require less financial and policy information in order to assess an application.

The fees to be levied are also anticipated to be considerably lower. The FCA has confirmed that organisations wishing to apply for interim permission will need to pay £350 (reduced to £245 to the end of November) and apply online. Further details of the changes can be found at www.trosers.com in the publications section.

The FCA’s next round of consultations are due out soon. We are proposing to respond to both consultations where necessary and would welcome views from any interested parties.

The Federation’s contact for consumer credit licences is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



Changes to the UK anti-money laundering regimeThere are a number of changes to the UK anti-money laundering requirements as a result of the EU 4th Money Laundering Directive and some of these will affect housing associations. The changes are likely to take effect in the UK in early 2015. To explain the requirements and potential impact anti-money laundering expert Steve Mackle from Quo Vadis Forensics, who wrote our anti-money laundering guidance 2010, takes you through the details.

The proposed changes to the anti-money laundering regime which are most likely to impact on housing associations are:

• All regulated sector businesses will be required to produce an assessment of their anti-money laundering risks and have written policies and procedures in place. These policies and procedures will need to include employee screening in addition to the current requirements.

• Beneficial owners of businesses will have to be identified which means that information will need to be held about the structure of a business so that it can be disclosed to the appropriate authorities. Complicated business structures are a recognised money laundering risk.

• The current limit on cash transactions beyond which a business is classed as a high value dealer will be halved to 7,500 Euros.

Many in the sector conduct regulated business as estate agents and HMRC is to take over responsibility for the supervision of estate agents from the OFT. HMRC are currently working through a list of issues to clarify the position for all estate agents and will be publishing guidance once all of the transitional issues have been resolved. Each business should only have one supervisor, irrespective of what activities place it in the regulated sector.

Enforcement is likely to be more rigorous and the sector should take steps to review current policies and procedures in order to smooth the path to compliance with the new regime.

The Federation’s contact for anti-money laundering is John Butler, Finance Policy Officer, 020 7067 1177 or [email protected]



15. Seminars & ConferencesNational eventsService charges: An introductory workshop Monday 2 December 2013, Renaissance Hotel, Manchester

Leaseholder and Tenant Service Charges Conference Tuesday 3 December 2013, Renaissance Hotel, Manchester

Audit Committee ConferenceTuesday 3 December 2013, Novotel Birmingham Centre

Risk Management ConferenceTuesday 21 January 2014, Novotel Birmingham Centre

Housing Association National Accountancy Awards (HANAAs) Ceremony Tuesday 18 March 2014, National Motorcycle Museum, Birmingham

Housing Finance Conference and ExhibitionWednesday 19 and Thursday 20 March 2014, University of Warwick, Coventry

Local finance conferencesSouth WestThursday 5 December 2013, Sandy Park Conference Centre, Exeter

Local finance forumsEast Midlands Finance ForumTuesday 3 December 2013 - contact Rob Griffiths at [email protected]

North West Finance ForumThursday 5 December 2013 - contact Wendy Taylor at [email protected]

North East Finance Forum Thursday 5 December 2013 - contact Andrew Malcolm at [email protected]

South East Finance ForumFriday 6 December 2013 - contact Joanne Bell at [email protected]

Yorkshire and Humber Finance ForumThursday 12 December 2013 - contact Sean Flynn at [email protected]

South Finance ForumWednesday 22 January 2014 - Reena Chander at [email protected]

East of England Finance ForumFriday 7 February 2014 - contact Chris Wyer at [email protected]

www.housing.org.uk/events

Finance policy quarterly update

This issue include:• A significant accounting impairment issue and progress with the housing SORP • An update on the Prudential Regulatory Authority’s changes to the amount of

capital banks hold when lending to housing associations• Economic improvement and the effect on the UK housing sector• The launch of the Federation’s new pensions strategy

Join the conversation

@natfedJoseph

National Housing Federation - Social Housing Finance

If you would like to be added or removed from the mailing list for this publication and other policy updates on our database please contact [email protected].

The National Housing Federation is the voice of affordable housing in England. We believe that everyone should have the home they need at a price they can afford. That’s why we represent the work of housing associations and campaign for better housing.

Our members provide two and a half million homes for more than five million people. And each year they invest in a diverse range of neighbourhood projects that help create strong, vibrant communities.

National Housing Federation25 Procter Street, London WC1V 6NYTel: 0207 067 1010 Email: [email protected]: Joseph CarrEmail: [email protected] Tel: 020 7067 1094

finance policy - amazon s3s3-eu-west-1.amazonaws.com/.../fpqu_autumn_winter_2013.pdfyear ends) for...

Documents