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  1. Get in touch:
  2. FTSE falls 1%
  3. GDP growth revised down to 0.4%
  4. KPMG grilled over Carillion
  5. Centrica profits slump 17%
  6. Barclays in £127m Carillion loss
  7. Serco profits down 29% in "difficult market"

Live Reporting

By Tom Espiner

All times stated are UK

Hold - Good night

That's all from the Business Live page for tonight. See you bright and early tomorrow at 06:00.

Dow and S&P rise

The Dow Jones and S&P 500 indexes advanced on Thursday to halt a two-session losing skid, buoyed by gains in industrial and energy shares.

The Dow Jones rose 164.7 points, or 0.66%, to 24,962.4, the S&P 500 gained 2.63 points, or 0.10%, to 2,703.9, and the Nasdaq dropped 8.14 points, or 0.11, to 7,210.09.

Industrial shares climbed 0.59%, led by a 3% gain in Quanta Services after its quarterly results, and a 3.34% rise in United Technologies after the aero parts maker said it is exploring a breakup of its business portfolio.

Energy stocks, up 1.08%, also helped support gains, as oil prices advanced.

Blow for Dyson in EU vacuum cleaner case

James Dyson
Getty Images

A top European court advisor has rejected a complaint by British vacuum cleaner firm Dyson that EU energy labels underplay the efficiency of its bagless devices.

Dyson says the EU's energy efficiency labels fail to recognise that ordinary cleaners become less energy efficient as their bags become clogged with dust, unlike the company's bagless cleaner.

In a separate case, Dyson has challenged the labelling system itself. Advocate general Henrik Saugmandsgaard Oe was giving an initial opinion as part of that process.

He said EU law made the energy label compulsory and also set out its format and the information to be included in it. The methodology of the test was not part of that information. He concluded that EU law precluded the use of supplementary labels on energy efficiency as these would undermine the aim of the law -- to standardise information for consumers.

Bud and breakfast

Marijuana leaves
Getty Images

A marijuana entrepreneur is pulling in more than $1m per year with his "Bud and Breakfast" hotel in Colorado, says Business Insider.

The drug is legal to possess in the US state for people over 21 years old.

Joel Schneider's innovation is providing a space to smoke/ingest it - most hotels ban the drug.

Rooms cost between $300 and $400 per night, and include breakfasts of bacon, eggs, waffles, and weed, the article says.

Volkswagen 'a disgrace' says MP

Volkswagen cars

An environment minister has said Volkswagen should "hang their heads in shame" for the company's role in tests where humans and monkeys inhaled diesel fumes for hours.

Therese Coffey told MPs the tests were "disgusting", adding that Volkswagen's role in cheating emissions tests was "a disgrace".

Volkswagen launched an inquiry last month when it was reported that it was one of three car manufacturers funding scientific tests in which monkeys and humans were exposed to diesel fumes.

Booze cruise? Think again...

Victoria Fritz

BBC transport correspondent

Cross channel ferry
Getty Images

UK drivers licences may not be recognised by the EU after Brexit, the Daily Telegraph reports.

British vehicle registration documents and certificates of professional competence may also become invalid in the EU.

The result could be that travellers would be unable to hire cars or take out insurance.

The warning was issued in presentation slides released by the European Commission today, the Daily Telegraph article says.

The Department for Transport says ministers are “confident” a deal will be agreed and that the government has already begun taking steps to mitigate the impact if discussions fail.

Plan B is signing up to the United Nations convention on road traffic. It allows drivers to apply for an International Driving Permit.

That document would enable UK drivers to drive in the EU. But its more paperwork and more cost, and it's a paper-based system. The RAC and AA charge £5.50 for it.

Mexico turns to Brazilian grain

Mexican buyers imported ten times more corn from Brazil last year amid concern that Nafta renegotiations could disrupt their US supplies, a Reuters analysis of government data and grain merchants finds.

Mexico is on track to buy more Brazilian corn in 2018, which could have an impact on a US agricultural sector already struggling with low grain prices and the rising competitive threat from South America.

Phoenix 'in talks to buy Standard Life Aberdeen unit for £3bn'

Phoenix Group Holdings is in talks to buy Standard Life Aberdeen's insurance business for about £3bn, Reuters reports.

The deal for the unit could be announced as soon as Friday, when Standard Life Aberdeen (SLA) publishes its first set of annual results.

Insurer Phoenix would fund the transaction with a rights issue of about £1bn, Reuters says.

Elon Musk quits AI ethics research group

Elon Musk

Technology billionaire Elon Musk has quit the board of the research group he co-founded to look into the ethics of artificial intelligence.

In a blog post, OpenAI said the decision had been taken to avoid any conflict of interest as Mr Musk's electric car company, Tesla, became "more focused on AI".

He has been one of AI's most vocal critics, stressing the potential harms.

Mr Musk will continue to donate to and advise the group.

Universities 'making money from strikes'

Striking staff
Edward Anderson

A fascinating post from the Financial Times Alphaville blog.

Due to the economics of tuition fees and the employment of lecturers, universities could actually be making money from widespread staff strikes over pensions, the article says.

Pay is docked from striking lecturers, but students are not reimbursed fees.

Neat, eh? Everyone's a winner, apart from the staff and the students.

KFC shortage: How much do we spend on fried chicken?

Reality Check

KFC logo
Getty Images

KFC outlets across the UK have closed temporarily this week as delivery problems led to a shortage of chicken.

The fried chicken chain switched its delivery contract last week to DHL, which blamed "operational issues" for the disruption.

Nearly half of the restaurant's 900 outlets were closed on Tuesday night - down from 575 on Monday.

The fast food giant expects disruption to its restaurants to continue for the rest of the week.

Read more here.

Snap shares sink after redesign and Jenner tweet

Kylie Jenner
Getty Images

Snap shares have sunk about 7% in the third session of losses in a row after a poorly received redesign for Snapchat.

The redesign, which separated "friends" from content feeds, did not impress some users, including Snap "influencer" Kylie Jenner, the half-sister of celebrity Kim Kardashian.

On Wednesday, Ms Jenner - who has almost 25 million Twitter followers - tweeted: "sooo does anyone else not open Snapchat anymore? Or is it just me... ugh this is so sad."

Summit Insights Group analyst Jonathan Kees says: "She's one of the Snapchat divas... it's not good if one of the main symbols for your app says 'I'm not going to use the app'" -

Airbnb looks to luxury holidays and hotels for growth

Airbnb app
Getty Images

Airbnb is rolling out new services aimed at attracting travelers looking for luxury accommodations and traditional hotels, the latest move to contend with sputtering growth in its original home-renting business.

Regulators in key cities such as Berlin, London, New York and San Francisco, its home town, have cracked down on short-term rentals, blaming Airbnb for exacerbating already tight housing markets.

The company has been forced to slash its listings in certain popular cities as part of its concessions to regulators.

Barclays' gender pay gap 'shocking' says Morgan

Nicky Morgan
Getty Images

The gender pay gap at Barclays is "shocking", says Treasury chair Nicky Morgan.

"On average, women at Barclays International are paid half as much as men. For this to be the case in 2018 is shocking," she says.

"Barclays has signed up to the Women in Finance Charter, which commits signatories to supporting the progression of women into senior roles in the financial services sector.

"One way of reducing the gender pay gap is to increase the proportion of women in more senior roles, so it appears that Barclays is on the right track."

EU shadow-boxing towards Brexit

French President Emmanuel Macron (L), German Chancellor Angela Merkel and British Prime Minister Theresa May in Brussels, 22 Jun 17

There is much political posturing but still a lack of detail in the Brexit talks, Katya Adler reports.

Tech giants face new UK tax clampdown

Facebook logo

Some of the world's largest technology firms are facing hefty new bills as the UK government moves to fundamentally change the way they are taxed.

Google and Facebook are braced for significant changes in the tax system after the Treasury told the BBC that a new tax on revenues was the "potentially preferred option".

It would open up the firms' huge UK sales numbers to the tax authorities.

At the moment, tax is levied on profits, a much smaller figure.

Read more here.

May holds crunch Brexit talks at Chequers

Government cars arriving at Chequers

Theresa May and her senior ministers are meeting at the PM's country retreat in the latest attempt to settle the government's approach to Brexit.

The group of 11 are at Chequers to decide how closely the EU and UK should align after exit day in March 2019.

Snap chief gets $638m pay for float year

Evan Spiegel and Miranda Kerr
Getty Images

Snap chief executive officer Evan Spiegel received $637.8m total compensation during 2017, the year the company went public, according to an SEC filing.

The figure is based on stock-based awards worth $636.6m and salary and other compensation worth about $1.2m.

Ford names Kumar Galhotra as North America chief

Kumar Galhotra
Getty Images

Giant US car maker Ford has appointed company insider Kumar Galhotra as president for its North America business, filling the gap left by the abrupt departure of Raj Nair on Wednesday after an internal investigation.

Mr Galhotra has worked for Ford for 29 years and previously led its luxury Lincoln Motor Company arm.

He will report to Jim Farley, Ford executive vice president and president of Global Markets.

The appointment will be be effective from 1 March.

Ford said on Wednesday that Mr Nair was leaving the company immediately after an investigation found his behaviour was "inconsistent with the company's code of conduct."

It did not give any details on what that behaviour was.

A company spokesman said the review was launched in the past few weeks after Ford received a report of inappropriate behaviour.

Mr Galhotra, who has also been Ford's chief marketing officer since last year, will take charge of a business that generates about 90% of Ford's global profits.

Flybe shares take off as Stobart weighs up takeover bid

Flybe plane
Getty Images

Shares in Flybe have soared by more than a quarter after the owner of London Southend Airport said it was weighing up a potential swoop for the regional airline.

Flybe was up about 26% in afternoon trading on the London Stock Exchange.

Stobart Group is looking at "alternative structures" for its airline and leasing business.

The company, which spans infrastructure, energy and aviation, said one option was to take a "non-controlling interest in a vehicle to acquire 100% of Flybe".

Something in the Air?

Bloomberg reporter Mark Gurman says Apple has some improvements to its AirPods in the works:

View more on twitter

Women at Barclays earn 43.5% less than men

Barclays Bank
Getty Images

Women at Barclays earn 43.5% less than men, according to gender pay gap figures it has submitted to the government.

Only 28 of the 1,154 companies that have reported the figures have a higher median hourly pay gap than Barclays.

Of all financial and insurance companies that have submitted their figures, the median pay gap is 14.8%.

Barclays chief executive Jes Staley said it had "more work to do" so women could progress in financial services.

Read more here.

Southern RMT strike on 12 March

Southern trains
Getty Images

Workers on Southern Railway are to stage a fresh strike on 12 March in the long-running dispute over the role of guards, RMT says.

Wall Street higher in early trading

Wall Street traders
Getty Images

Major US stock indexes are higher in early trading after St Louis Fed President James Bullard said policymakers would need to be careful not to raise interest rates too quickly.

Hi comments came after Fed minutes on Wednesday showed policymakers were getting more keen on raising rates. Stocks finished lower on Wednesday after concerns about rising inflation resurfaced.

The Dow Jones Industrial Average was up 0.46% at 24,911 points, the S&P 500 was up 0.65% at 2,71 points, and the Nasdaq was up 0.28% at 7,245.

UPS and Workhorse to build electric delivery vans

UPS logo
Getty Images

United Parcel Service (UPS) is getting truck maker Workhorse to build electric delivery vans that could replace tens of thousands of vehicles in the package delivery company's fleet.

he two companies said the first 50 vans will have a range of 100 miles (160 km) and will be delivered in 2018.

UPS recently rolled out "smart charging" software at a central London facility that allowed the company to nearly triple its local electric fleet to 170 delivery vans.

The smart charging technology determines when and how fast to charge vehicles. If vehicles are not scheduled for a full route the next day, the system can opt not to fully charge them and charge other vehicles more.

Living Wage workers 'will be worse off in retirement'

A cleaner
Getty Images

Workers earning the National Living Wage could be left "significantly worse off" in their retirement as a result of the Government's pensions auto-enrolment scheme.

That's according to accountancy body ICAS. It claims it could take 48 years after retirement on a workplace pension for a Living Wage worker to be better off than if they had received other benefits and a state pension.

ICAS president Sir Brian Souter - founder of Stagecoach - called on the government to review workplace pensions to ensure a better deal for lower paid workers.

"It can't be right that a policy which aims to help people in retirement could actually result in the poorest getting poorer," he said.

Don't look down...

Gas meter firm blames Brexit for job cuts

Landis+Gyr in Stockport
288 jobs are at risk at Landis+Gyr in Stockport

A company that makes smart meters for British Gas is planning to shed 288 of 601 jobs at its factory in Greater Manchester because of Brexit.

Landis+Gyr told the GMB union it could move production from Stockport to Romania and Asia because costs have risen 20% since the referendum in 2016.

The union said it was "an example of the pressures companies are facing due to Brexit uncertainty".

A consultation on redundancies is expected to finish by the end of April.

Full story here

Where’s the missing money?

Peter Meehan

One interesting point that came up at the select committee grilling of Carillion's auditors earlier is that there appears to be £126.1m missing.

KPMG’s Peter Meehan was asked by MPs about a disputed £200m bill. Carillion maintained it was owed the cash by the Qataris – but the Qataris claim that, in fact, it’s the other way around and they are owed the money.

When asked who owed who £200m, Mr Meehan attemtped to clear things up. He told MPs, “in March [20]17 I don’t know…” He explained that his audit responsibilities only went to the end of the previous year. “I know that my client was owed £73.9m as of December 2016.”

It remains unclear what’s happened to the outstanding £126.1m.

Diesel ban still up in the air

Theo Leggett

BBC Business News Reporter

Diesel pump

A Federal court in Germany is due to decide whether banning diesel cars from entering cities is an acceptable way to cut urban air pollution.

If it concludes that such bans would be legitimate, analysts say, then authorities across Germany will come under pressure to introduce them. Carmakers could also face demands to make expensive modifications to millions of older cars, so that they meet the latest EU emissions standards.

The case was originally brought by an environmental group, which claimed not enough was being done to address poor air quality in the cities of Duessledorf and Stuttgart.

A lower court ruled last year that the most effective way to reduce pollution and protect public health in cities was to restrict the use of older diesels.

More KFC stores re-open

Chris Johnston

Business reporter, BBC News

In other news KFC says 690 of its 900 UK stores are now open, though it is not clear how many of those are serving a full menu.

This store on Camden High Street in North London was still closed this morning, however.

And if you want the "inside story" on what went wrong for KFC's delivery, read this story from Wired.

View more on twitter

The session has finished

That's it for today's select committee sessions on Carillion.

Should accountants be broken up?

Frank Field

Frank Field asks a blunt question of the auditors. "There's a real question about your integrity. There's a little gang of you that competes for these contracts. Should we recommend in our report that the government should seriously think about breaking you all up?"

KPMG's Michelle Hincliffe replies: "To deliver the quality audit that we have to, we need scale. We need to have specialist resources."

Deloitte's Michael Jones adds: "I've worked for Deloitte's and other firms for 30 years and been a partner for 20 and it does not feel like a cosy club when we are pitching against each other for work."

It's a tough job...

"I've learned lots of lessons in the three evidence sessions we've had already," says Rachel Reeves. "What have you learned, she asks Peter Meehan.

There's another long pause from the KPMG man. Eventually he says: "I suppose I learned what a tough job it is."

Carillion: lessons to be learned

Rachel Reeve: "If you were in a company in the future and you saw some of the warning signs that you saw at Carillion would you do anything differently?"

KPMG's Peter Meehan says: "Um." He pauses and collects his thoughts. "I can't think I would," he eventually responds. The he adds: "You're always learning in life and there's an investigation going on into the audit which we we will learn lessons from and I will take on board."

KPMG: no 'aggressive accounting at Carillion'

Michelle Hincliffe

Carillion has been criticised for 'aggressive accounting', points out Ruth George. "Is that a term you recongise in the way Carillion approached its accounts?" she asks the auditors.

Michelle Hincliffe of KPMG says: "I certainly don't recognise it."

She then quickly tries to distance herself from the mess. "In my role I wasn't directly involved in the audit," she says.

Carillion auditors: 'Did you challenge goodwill calculation claims?'

"Did you ever challenge them about the value of goodwill they put in their accounts?" Rachel Reeves challenged KPMG's Peter Meehan.

He points to KPMG's report and says: "The paper outlines that we did. They still had headroom and we concurred that they still had headroom based on the forecasts for the business."

'You didn't think this was a risk?'

MP Ruth George
Parliament TV

"Nobody makes 38,000 design changes on a project unless there is a difficult client relationship," said MP Antoinette Sandbach.

She mentioned previous evidence given by Carillion's management that they had repeatedly visited Qatar trying to get the government to pay up for the 2020 Fifa World Cup project work.

"And you didn't think that this was a risk that had to twist people's arms?" she asked KPMG's Peter Meehan.

Mr Meehan argued that Carillion did receive £40m, so KPMG did not see it as a risk.

However, Ms George pointed out that the Financial Reporting Council (FRC) had repeatedly criticised KPMG for the way it calculates goodwill.

'Contract costing': Does anyone know how it works?

Accounting article
Edinburgh Napier University

Accounting academic Grahame Steven writes in response to the MPs grilling of Carillion auditors this morning and the practice of including expected profits/losses on a contract.

He points out it's called "contract costing" and helpfully includes a link to a paper he has written that highlights the subjective nature of this practice.

But he has a question for MPs: "When a contract is expected to make a loss, IAS11 (item 36) requires that loss – the whole loss - to 'be recognised as an expense immediately'. Is the Committee aware of IAS11?"

Good question! Is anyone involved in the sorry business aware of IAS11?

'How did you get your figures?'

MP Ruth George
Parliament TV

MP Antoinette Sandbach is getting serious about numbers Carrillion released about the Qatar contract, which KPMG's Peter Meehan claims he hasn't seen.

A common accounting-trick businesses use is to project how much money they are likely to make in the year ahead, and include that in the current year's figures.

Mr Meehan said KPMG's report had different, lower figures than the ones Carillion released.

"Only £11m were incurred costs, the rest were expected earnings, so they weren't in the balance sheet yet," he explained.

"Yet, less than six months after this report, there was a write-off of over £200m. What changed on the contract in that time?" asked Ms George.

Mr Meehan said that relations went really sour and a blockade prevented Carillion from getting materials and people to the building sites in Qatar.