Title: Accountancy bodies go for 'strategic consolidation'
Date: 14th September 2004
Keen not to lose momentum in their announced merger talks, the ICAEW, CIMA and CIPFA today announced plans for what they call "strategic consolidation". The brief announcement gives a slightly clearer idea of their objective.
With 200,000 members and a significant student base worldwide the new body would, they claim, "unify the business, practice and public sectors and quickly become the authoritative voice across the accountancy profession."
The respective governing councils hightlighted the opportunity to create a powerful body with increased influence across industry and government - and to "ensure the long term future of the profession for the next generation of chartered accountants." These few carefully chosen words will suggest to many that 'takeover' might be a better description than merger.
The joint announcement claimed that the size, scope and resources of the new body would increase the level of assistance available to members "throughout the lifecycle of their careers". In other words, in the professional world, size does matter - or is this just safety in numbers?
The proposals will ensure that existing members of all three bodies will be entitled to keep their current designatory letters and titles. Individual routes to qualification will be preserved during the post-consolidation transition.
This is perhaps the most controversial aspect of the proposals, and one which many, in particular Jeff Wooller's Ginger Group, will wish to examine in detail to ensure that entry standards to the combined professional body are not lowered.
Any future changes to these qualifications would have to maintain the same high standards of entry and would be subject to a three-quarter majority of the governing council of the new body.
The timetable for these plans is surprisingly short. Strategic consolidation has so far received an in principle yes from each of the governing councils of the three institutes. Formal proposals will be put to councils in December 2004 with resolutions expected to be put to the
members of all three bodies early to mid 2005. Subject to a positive mandate, permission will then be sought for a new Royal Charter.
Over the next few months the institutes will be rolling out an extensive nationwide campaign to present the findings of their strategic reviews, present the benefits of consolidation as a potential fast track towards common goals - and to persuade members to vote in favour of a
consolidation. Given the apathy shown towards CPE and Practice Assurance they will have to surpass themselves in communicating with members to meet the proposed deadline.