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ICAEW consults on Practising Certificate

4th Jun 2007
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This week the ICAEW begins consultations on the proposed changes to its Practising Certificate (PC). The new arrangements are intended to clarify when a member needs a PC, and make things easier for members returning to public practice after a career break. Rob Lewis reports.

The Institute is also seeking views on a proposed small-income exemption (possibly up to £25,000), a change to the professional indemnity insurance (PII) limit and an exemption for charitable work. The current minimum required PII for a sole practitioner is £50,000, a figure that has gone unchanged since the late 80s. The PII committee, citing the increased complexity of prevalent law and a rising propensity for accountants to get sued, propose doubling it.

“Our research has indicated that many members buy much more PII than the regulations require,” stated ICAEW strategic research manager Julian Zammit. “Considerably fewer than 1,000 practitioners currently have PII of less than £100,000. Based on generic examples, they could possibly buy PII of £100,000 for less than they are paying for £50,000 of cover.”

Jamie Goodier, broker at Pii Brokers, agreed with the Institute. “I wouldn’t say that would be much of an increase,” he said. “The cost of minimum premiums are around £300 to £500, and most of that is administrative. Do it online and you might be able to keep them down. The PII market has been heading downwards at a rapid pace anyway over the last three years.”

The consultation can be contributed to online at the ICAEW website and closes on 2 July.

The ICAEW PC is relatively cheap, currently costing £228 for members practising in the EEA (including the practice assurance fee). The ACCA equivalent is £290, and ICAS charge £433.


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