Morning business news - December 20

Friday 20 December 2013 10.37
Morning business news with Conor Brophy
Morning business news with Conor Brophy

Facebook founder Mark Zuckerberg picked a good time to announce he will sell some of his stake in the company. Shares in the social network closed at an all-time high yesterday after it introduced video ads. Gráinne Barron is the founder and chief executive of Viddyad which, as the name suggests, helps companies make their own ads the web.

Gráinne Barron says the move to video ads is a very big deal for Facebook as the company has one million active advertisers. While You-Tube is still number one for video ads, Facebook is quickly catching up, she points out. The new video ads on Facebook will play on people's timelines but won't be too distracting and can be skipped over. Ms Barron says that Facebook was meant to launch the ads in July, and then September and finally launched them yesterday. The big brands are just there at the moment, but the ads will become more prevalent to local markets over the coming months, she adds.

The costs of launching video ads is enormous and Ms Barron says that is where Viddyad comes in. She says that companies should concentrate on being creative, on having a good scipt and - perhaps most importantly - keeping it short when coming up with a video ad campaign for their company.

***
MORNING BRIEFS - Although the president of the European Commission, Jose Manual Barroso, was blaming Ireland for destabilising the euro, the IMF took the opposite track yesterday. Mr Barroso has given the distinct impression that Ireland will not see EU funds used to defray some of the cost to the country of bailing out the banks.
But summing up the lessons he has learned since coming to Ireland as the IMF mission chief on the occasion of the bailout, Ajai Chopra said it was "unfair to impose the burden of supporting banks primarily on domestic taxpayers while senior unguaranteed bank bondholders get paid out". European Parliament president Martin Schulz also said that Ireland should be helped rather than punished. "We have to help Ireland to bring about the re-stabilisation of its economy and its State budget," he said.

*** Accounting firm EY, previously Ernst and Young, has been hit with a £1.2m fine due to poor quality audit work on a Christmas savings club which collapsed in 2006. Both EY and the former partner who oversaw the audit were criticised by the UK's Financial Reporting Council. It said that in auditing Farepak's accounts the firm had failed to consider properly its ability to continue as a going concern. EY acknowledged that the work fell short of its standards.
Farepak collapsed in the run up to Christmas seven years ago owing £37m to over 100,000 customers.

*** Rating agency Standard & Poor's has reaffirmed Ireland credit rating and said the outlook for the country remains positive. In a statement, S&P's said it believes Ireland will continue to reduce its general government debt burden through budgetary consolidation and asset sales, as the domestic economy improves. It said that the outlook remains positive and that there is a more than one-in-three probability that the agency could raise its long-term ratings on Ireland in the next 18 months. But S&P downgraded the EU's long term credit rating. S&P said cohesion among member states has lessened and that the EU's financial profile has deteriorated.