Is it time for a REPRESENTATIVE body for accountants in practice?
In the consultation document chapter "The Case for Change" HMRC do not put forward any overwhelmingly convincing arguments that the changes they are proposing are essential; they are at best good ideas (from HMRC's point of view) but they are not essential requirements for the proper operation of HMRC.
Surely it must be a fundamental principle that a regulation should only be introduced when there are overwhelming reasons for it. We live in a country where we should value our freedom, and our freedoms should not be taken away lightly. Freedom has been achieved over centuries and ANY erosion of freedom should be considered a serious matter of public concern and be fully tested before it is accepted.
No overwhelmingly good reasons for change have been fully established in the consultation document, yet the accountancy bodies (who were consulted prior to the publication of the consultation document) did not oppose the regulations in principle. Otherwise the consultation would not have been about how to implement the changes, but whether the changes should be there at all. The attitude shown by the accountancy bodies (and probably many others) seems to be that we should be grateful to HMRC for giving us the opportunity to be consulted on details of how our freedom is to be reduced!
This shows the extent that we have become used to being controlled and how unwilling we seem to be to oppose additional control. It is not surprising perhaps when over the last thirty years or so we have seen a continuous increase in powers of HMRC, continuous increases in penalties from HMRC, and continuous reductions in deadlines from HMRC. You might think each one of these was introduced for a good reason. Perhaps each one was, but taken as a whole they add up to a massive difference in the powers of HMRC and regulations for accountants to follow, and a marked reduction in freedom that affects all of us.
Each time a new power, penalty or deadline was introduced our freedom was reduced. And there has been no opposition to this. The accountancy bodies have let each one of these introductions go without any effective challenge.
One problem is that the accountancy bodies have dual roles of regulation and representation, which are to some extent mutually exclusive. There is therefore a question-mark about who the accountancy bodies are representing.
Back in the 1970s the accountancy bodies had virtually no external regulatory duties. They would respond to complaints about members but this was an internal matter and there was no pro-active regulatory function. The Companies Act 1981 (correct me if I am wrong) introduced the need for registered auditors, and since then the accountancy bodies have introduced active quality assurance schemes (called by different names depending on the body) and more recently they have taken on money-laundering regulatory duties. These additional regulatory functions mean that the accountancy bodies cannot easily represent their members where opposition to additional regulation would mean opposing those who give them their regulatory powers.
So where will this process of increased regulation stop, and who will monitor when it should stop? At the moment it seems nobody has that role or responsibility.
For many accountants this latest proposal from HMRC is a step too far, but there is no one to oppose it. We cannot rely on our professional bodies to do it. So is it time to set up a truly representative body for accountants in public practice; a body who will monitor proposed changes in power and regulation; a body who will consult their membership; a body who can wholeheartedly represent their members' views?
Do you think that there should be a new body whose sole aim should be to represent accountants in public practice (including those qualified by experience), whose remit is to voice the concerns of accountants to government and to consult and represent their members effectively?
Or am I the only one who thinks so?