No-deal Brexit is ‘likely’, say finance chiefs

Icas chief executive Bruce Cartwright said the lack of clarity with just weeks left until the Brexit deadline was a 'major concern'. Picture: Contributed

A study released today by the Institute of Chartered Accountants of Scotland (Icas), in association with law firm Brodies, found that 73 per cent of some 300 members polled think that a no-deal Brexit is a “very” or “quite” likely outcome.

Just over half (56 per cent) of respondents felt that their organisation was prepared for a no-deal scenario, while 8 per cent felt “very unprepared”. However, only one in three believed that the UK will formally leave the EU on the appointed 29 March deadline.

Around four in ten believe that Brexit will happen later this year, while 11 per cent believe the decision to leave the union will be reversed.

This comes as a report from a separate accountancy body said that Scotland’s business confidence remained in negative territory for the second successive quarter.

The latest ICAEW Business Confidence Monitor dropped to -9.5 in Scotland, higher than the UK average of -16.4 but considerably lower than the +18.4 Scotland recorded on the index one year earlier.

The study stated that the continued uncertainty surrounding Brexit is “likely to be hampering business sentiment in Scotland”.

Prime Minister Theresa May last month said that MPs will be given the chance to vote on whether to extend Article 50 in the case that her proposed Brexit deal is not approved in Parliament and if there is then a vote against leaving the union without securing a deal.

Icas chief executive Bruce Cartwright said: “Icas members are working hard to ensure that their organisations are ready for whatever transpires, and we will be doing everything we can to help them in this.

“Our major concern, however, is that the clock is ticking down to 29 March and although the UK government is publishing more guidance there is very little time left to implement it.”

ICAEW Scotland director David Bond said: “Confidence levels in Scotland have, historically, been reasonably robust – in fact, Scotland has often reported positive results at times when the rest of the UK has not.

“The fact that the Scottish results are increasingly in line with those seen elsewhere, suggests that factors such as Brexit and regularity requirements are now impacting on businesses everywhere.”

Meanwhile, despite the political uncertainty relating to the Brexit process, 78 per cent of small and medium-sized firms across the UK appear to be showing resilience.

A study from business advisers and accountants Scott-Moncrieff has found that 78 per cent of small businesses either met or exceeded expectations last year.

It also found that almost half are determined to grow their businesses and 36 per cent plan to launch new products in 2019, despite Brexit woes.