Accountants Want UK To Start From Scratch In Late Payments Fight

As U.K. policymakers march forward in their debates and regulations aimed to combat late payments to smaller suppliers, one group is calling on officials to entirely scrap what has been done so far in the matter and start from scratch.

The Association of Chartered Certified Accountants has reportedly criticized the government’s late payment fight as one that treats the symptoms, but not the root cause, of such behavior by corporate buyers. The remarks came as the ACCA released the last installment of its three-part report, “Ending Late Payment,” on Friday (June 5).

“The fact is, with the right intervention, late payment doesn’t have to be a fact of life for businesses,” said ACCA spokesperson Andrew Leck, adding, “With a new government in place, we now have the perfect opportunity to stamp out our culture of late payment by taking a fresh look at the causes.”

“What the UK Government needs to recognize is that late payment is essentially a demand for credit and start tackling the problem as such,” Leck declared.

The report provides a list of ways to combat late payments, including ensuring that buyers and suppliers make their terms of credit as transparent as possible. The ACCA also calls on businesses to actively monitor invoices throughout their lifetime, and firms should be honest about and understand the reasons for late payments.

But in addition to these recommendations, the accountants’ group wants federal officials to rethink their strategy to support small businesses hit hardest by the late payments trend. In a statement, the ACCA added that the new Business Ministers should place their efforts into rebuilding the U.K.’s financial infrastructure that supports alternative financing and greater transparency of credit data.

“This approach has the potential to be far more effective than the measures currently proposed around improving the legal framework for late payment disputes,” the ACCA concluded, “and ensures that government policy makes a positive difference far earlier.”