RSS feedsAs we walk around the Paddington Basin office development in search of an appropriate photo-shoot location, Fiona Hotston Moore talks about her first few months in the hot seat at Moores Rowland.
She is now six months into her tour of duty as managing partner at the London-based firm, having taken over from Matthew Wickers at the beginning of April to become one of a very select band of female managing partners. But she had already been working closely with Wickers to manage the partnership, which had been going through a tough time in recent years.
‘The partnership had not been performing as it should have been for a few years by that stage,’ says Hotston Moore. ‘So the decision was taken that we needed to go back to basics and start going through the detail. We had made a number of investment decisions over recent years that hadn’t worked out – not necessarily a reflection on the people, but were they the right decisions for the practice?’
Hotston Moore says that tough decisions had to be made to stop one particular service line that had only just been started. ‘It was a tough 12 months,’ she recalls.
Hotston Moore had already been asked to prepare her own thoughts on what had been going right for the firm and where it was going wrong. ‘There were some service areas that were not core and we needed to concentrate on those areas. We had too many senior people for the level of work that we had and we didn’t have sufficient quality of staff. And we had taken our eye off the costs,’ she says.
Candid stuff, and not what you usually expect to hear from a newly installed managing partner, but it is clear that Moores Rowland is now beginning to reap the benefits from her no-nonsense style of management.
According to Hotston Moore, the firm had a strong client base, but it was necessary to look at every partner’s client portfolio to see where recoveries could be improved. And this inevitably led to the loss of some partners, as well as directors, managers and staff. But the firm also invested time with its remaining people, looking at individual roles and new opportunities.
So how did this tough leader get to where she is? Rather curiously, Hotston Moore began working life as a nutritionist. As part of her degree course she worked at Addenbrooke’s Hospital in Cambridge and on a health farm as a dietician. But she found that opportunities for such work in the National Health Service were limited, so was persuaded by her husband to study for a general business qualification. ‘I decided to train as a chartered accountant, but took the decision to train outside the Big Four. I joined a Cambridge practice with an agricultural focus that was then immediately taken over by KPMG – a company I had just turned down.’
Although she feels she benefited from experiencing the best of both worlds – a smaller office within a larger organisation – she admits she didn’t particularly enjoy the process of being in a big firm. More often than not she would find herself working on only a small part of a much larger project, without being able to see the bigger picture. ‘But I did focus on the end, which was getting the qualification.’
As soon as she had qualified, Hotston Moore moved to a much smaller practice in Hertfordshire – Bradshaw Johnson – where she studied for the ATII direct and indirect tax qualifications. She then moved on to a small partnership at Waltham Cross called Thickbroom Coventry, where she became a partner at the age of 30.
Then came the move to Moores Rowland. At the time, eight years ago, the average fee per client was £5,000. Now Hotston Moore puts the average fee per client in the region of £20,000, with the client profile moving towards AIM-listed and other similarly sized businesses.
Hotston Moore herself has sought to specialise in the media industry. Her interest was originally sparked while she was at KPMG. She had been able to secure a secondment to Granta Publications, publishers of new writing and photography. ‘I was running everything behind the scenes and that provided a valuable insight into the media industry, its strengths and weaknesses,’ she says. But this interest has only really developed over the past four years.
One of her first clients was Future Film Group, a company that helps secure financing for the film industry (see client’s view). ‘Getting the first couple of clients in an area is always very difficult, but once you have actually convinced those clients by giving them a really good service and showing them that you do know what you are talking about, everything else snowballs very quickly,’ she explains. She has big ambitions for her media practice. In time, she would like to see it become the largest media practice outside the Big Four.
As we were speaking, the Moores Rowland media team was waiting for details of the new tax credit scheme, details of which emerged in August (see box). Hotston Moore fears the scheme will not encourage individuals to invest in films as they have done in the past. ‘The old system was devised to encourage individuals to invest in film and it did to an extent, although there was perceived abuse,’ she says. ‘Individuals had the incentive to invest in film, become interested in film and enjoy the glamour of being associated with film.’
But Hotston Moore explains that under this system, HM Revenue & Customs had no idea how much tax people were going to be claiming back until the tax returns were filed. ‘This was seen as a case of shutting the door after the horse had bolted,’ she says.
Now, the system will focus on production companies getting the tax relief themselves and this will be built into the pre-certification system so the HMRC will have a better idea what is going to be paid out.
The big problem is that it is a tax credit that will only be given after a film has been made and it is not beyond the realms of possibility that production can grind to a halt midway through. This serves to add more risk to what is already a risky business and the banks have not been rushing in to lend against a credit that might not materialise for some time.
But, as Hotston Moore says, there is an opportunity here for accountancy firms. ‘We can be involved in looking at the budgets and giving the banks some comfort that we think the film really will qualify and that the tax credits are going to come back,’ she says.
Hotston Moore also observes that, partly as a result of changes to the tax system, film production has been moving away from the UK to Eastern Europe, Canada and even the Isle of Man.
Other areas of interest for Hotston Moore include individuals in the entertainment business, music publishers and inward investment. She also has an interest in AIM listing and believes it could be a potentially lucrative area.
Work on AIM is proving lucrative for the firm: it is one of the top 10 reporting accountants on AIM listings. Recent floats include mining companies Condor Resources and Kalahari Minerals, plus engineering company Turbotec and energy business St James Energy. Indeed, the firm has helped bring to market more than 10 companies in the past year.
As well as corporate finance work and the media world, the firm focuses on the property and financial services sectors.
Such activity is helping to ensure that the firm maintains its current sound financial footing. Hotston Moore claims the business is now very profitable, has an exceptional partner group and, by not relying on one-off projects, it is sustainable.
Morale has greatly improved over the past 12 months as staff can see clear career paths. Working capital management has improved with increased recovery rates and client retention. Currently, there are 10 partners on board, seven of whom are executives, based in the firm’s Paddington office and the firm plays an active role in MRI, its international network.
But the managing partner still has clear ambitions for the firm. This year, fee income came in at £12.2m, ranking it as the 36th largest firm in the UK. Although Hotston Moore maintains she will focus on consolidating the progress made to date, she would like to see the firm double in size.
There are currently 80 members of staff and Hotston Moore wants to see that figure grow to up to 200. Perhaps this is where her earlier career as a nutritionist has come in handy: by making the firm leaner, she has made it fitter and ready to grow again.
Measured success
Fiona Hotston Moore is one of few female managing partners in the accountancy world, and is currently the only one in the top 50.
She acknowledges there are still glass ceilings in the profession, which is why it is vital to choose the right organisation to work for – one where you are measured on your contribution to the organisation.
Hotston Moore, a mother with two young children, says: ‘You need to decide what’s right for you and organise your life accordingly. It can be easy to beat yourself up about it, but at the same time you need to be flexible.’
Philip Smith is contributing editor of Best Practice
