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Opinion: A Victory for Accountants Everywhere. By Tony Margaritelli

5th Dec 2008
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I am so very pleased that the work of the ICPA in defending the rights of all practising accountants has met with such unequivocal support from the Dept of Business, Enterprise and Regulator Reform whose email is printed below.

In the September issue of this magazine I wrote that the protection of the term Accountant was “back on the agenda”. I also pointed out that the ICAEW having by their own CEO’s admission failed to gain support from H M Treasury had turned his attention to the Dept of Business, Enterprise and Regulator Reform. They in turn have apparently agreed to listen to the case if they can demonstrate a case “in the public interest”.

Their response is a clear indication that any such approach will be rebuffed and that all the arguments put forward by the ICPA have been accepted.

Whilst this ruling should finally put an end to this debate I can report that the countless emails of bad practice by Chartered Accountants already supplied will be kept just in case.

This ruling should not be seen as some sort of Chartered Accountant “bashing” because that has never been our intention and never will. Our case has always been that there is good and bad in every organisation and that the ICAEW are not exempt from this and have no divine right to expect or demand otherwise.

The ICPA have always fought against any one body having sole rights to the title Accountant and we also point out that ICAEW members actually do have the sole right to the term Chartered Accountant which one would have thought was sufficient. If the leadership of the ICAEW had paid their small practice members the attention they deserve and merit rather than focusing on others then maybe just maybe this issue would never have arisen.

If the leadership is uncertain as to exactly what the membership actually need they could do worse than look at the benefits of membership of the ICPA for a start.

The ICPA were the only organisation to spend the time and the money fighting this issue and sometimes, just sometime the good guys do win so to ALL our supporters everywhere a big thank you.

Dear Mr Margaritelli

Thank you for your email of 3 November in which you expressed concerns that about possible restrictions of the use of the term “Accountant” to only ICAEW or similar members.

I can confirm that although the idea of introducing a statutory definition of an “accountant” and regulating the whole market may have some attractions, the Government believes that the balance of the argument is against this. The Government considers that the benefit of introducing a statutory regime for all accountants would be outweighed by the drawbacks involved in statutory regulation of all persons undertaking accountancy work.

Restricting the practice of accountancy to individuals who hold certain accountancy qualifications would be bureaucratic and would add significantly to costs.

Furthermore, it would be anti-competitive by restricting choice and by proving a disincentive to innovation in the supply of services. All of these consequences would particularly affect smaller businesses. The Government also believes that such a measure would be at variance with the OFT analysis of competition in the professions, which was published in March 2001.

We note that you share the Government’s view that the term chartered accountant should continue to be restricted to appropriately qualified members of one of the professional accounting bodies. The Government believes that this is rightly regarded as providing a good basis on which the public may make an informed judgement between individuals who hold a qualification from a professional body and those who do not.

However, as a general principle, the Government does not believe in regulating unless it is convinced that it is necessary, cost effective, and that no other alternative exists. It does not believe this to be the case in this area.

Yours sincerely,

Rufus Rottenberg
Corporate Law and Governance
Department for Business, Enterprise and Regulatory Reform


Replies (21)

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By Anonymous
02nd Apr 2009 10:18

victory for accountants
Victory is to ACCA - they got their numbers ever growing and someone said would overtake ICAEW in 12 months time.

I don't know about the figures of AIA - are they also every growing in leaps and bound like the ACCA also?

As for CIPFA, can someone care to share their numbers?

IFA, CPA Ireland, ICAS, ICAI.....?

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By frauke
15th Jan 2009 16:44

People have their own reasons why they choose to join ICPA.

For example, someone who has passed all the ACCA exams, cannot set up in practice without getting experience within another "approved" practice. Having spent years studying and passing the exams to join the ACCA, what are they supposed to do if they aren't able to get experience within a "approved" practice? Its understandable they don't want to give up!

- So they decide not to be a member of the ACCA and instead set up as a unqualified accountant, or gains experience within a practice not approved by the ACCA. They then gain the experience to join the ICPA instead. Some, depending on if they are allowed to still, will go on to join the ACCA and apply for a practice certificate - but not all will be able or want to do this. People have their reasons why they choose to do things the way they do and only they know why.

I know someone who is a ICPA , but also a member of the Tax Faculty of the ICAEW - does this mean if you lost a client to him, you think it is acceptable for you to say he was not qualified.

Oh - and by the way, you don't need to get a medical degree (5 years at university) to become a Doctor!

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By jon_griffey
11th Dec 2008 17:30

Following on from Paul's point, I cannot understand why any right minded practising CCAB member would foresake their qualification and become an ICPA. For a start its going to get really difficult giving mortgage references, signing certificates for grants and yes, it will give other local accountants an open goal to slag them off. It would be interesting to see what the make-up of ICPA membership is. I cannot think that there are very many who voluntarily left CCAB. I suspect they will be those who have not trained in practice and cannot get a practising certificate, those that cannot cope any more with regulation, the belligerent who keep having run-ins with their institute etc.

I don't think arguing that ICPA is better value holds water. In the same way why bother to spend 5 years at uni to get a medical degree, its far better value to buy a degree off the internet and get a job in a hospital on the back of that.

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By Jason Dormer
10th Dec 2008 21:26

Mark - You either missed Frauke's point or evaded the question.

Tony - Well done, good to see your hard work pay off and yet again demonstrate your commitment to your members.

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By jon_griffey
11th Dec 2008 18:00

Following on from Colin Dunn's contribution it would be interesting to know what the disciplinary arrangements are in ICPA - why are these not available to the public on their website? As one needs no qualifications to join, being excluded from membership is surely no great hardship. Having said that, having some disciplinary structure is a very good thing.

In fact there may dare I say it be some common ground here. ICPA must agree that if a member of theirs does something so heinous that warrants being excluded from membership that is surely an acknowledgment that the public needs to be protected from these individuals. Who represents, regulates and disciplines the ICPA rejects? I would have no objection if ICPA were given a statutory task of gradfathering all the present unqualifieds so at least everybody is regulated, and those who then get struck off face a loss of livelihood. Perhaps that's where the debate should be heading. (I still don't like the Certified bit though!)

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11th Dec 2008 15:32

ICPA doesnt necessarily mean not qualified
You are making an incorrect assumption that people only join the ICPA because they have not gained any other accountancy qualification. This is not true, it has already been mentioned in this thread that some qualified Chartered Accountants who have lapsed their membership of ICAEW use ICPA. I know of someone who has taken ACCA exams but practices as ICPA. I am sure their are others that think ICPA is just better value for money with things like PI insurance included in the membership.
So you cannot put everyone down as unqualified just because they use ICPA.

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By mark.mcmillanrose
11th Dec 2008 11:03

What point?
Jason, I did answer the question "let the public know the facts and let them decide". Only time will tell if she made the right decision. But still, nobody with the made up initials has answered my question, that is, making the public fully aware that ICPA means no professional exam taken!

So I say again...take a professional exam and stop trying to gull the public.

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By ColinADunn
09th Dec 2008 12:31

Well Done Tony
Well done Tony. I know how much effort you have put into this, without your pressure we would not have got this result, and the problem would have continued.
I am sure that the terms ‘Chartered Accountant’ and ‘Chartered Certified Accountant’ are enough to differentiate between those ‘Qualified and those ‘Non Qualified’ , who incidentally make up over 70% of the Practices in the UK (DTI figures)
When the ICPA was set up, the Directors knew that they had to bring something new to the market. Firstly to support the membership they planned to attract, and secondly to give protection to the Public who would use our member’s services. Too many small practices were unsupported, had no PI Insurance, and had very little access to CPE, which was and still is very expensive.
We therefore included PI insurance within the membership fee, and produced a FREE quarterly magazine to keep our membership in the loop of what was happening in the Accountancy World.
We next added a FREE quarterly CPE disc, which has now become downloadable from our website for all members, and followed this with a FREE TAX HELP LINE
Finally we finalised our Rules and Regulations and a disciplinary committee was put in place. This committee handles complaints from the Public, and where complaints are justified, action is taken against the member, including on a number of occasions exclusion.
It has been suggested that the use of the letters ICPA is to enhance our members, in fact it is to identify our membership, so that members of the public with a grievance against a member knows who to contact.
Members of the public who use an ICPA member knows that their Accountant is covered by Professional Indemnity Insurance, has access to the latest Tax and accounts information, and they have a body to contact if things go wrong.
It now surely time to forget this red herring of qualified and non qualified, and all work together to improve the ethical basis of our profession

Colin Dunn
Director ICPA

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By mark.mcmillanrose
08th Dec 2008 20:35

Public awareness
Do you or don't you believe the public should be made aware of who they are dealing with? If a non qualified wishes to put their case to a prospective client, then the client can make their own decision.

As Jon implies, using made up initials is nothing more than a deception!

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By jon_griffey
08th Dec 2008 17:09

The main objection that I have with ICPA is that they allow their members to use the grand description 'Certified Practising Accountant'. I cannot believe that this is anything other than a device to enable their members to 'suggest' to the public that they have been through rigorous professional exams. Their website suggests that membership is available to anyone who cares to apply on a self-cert basis with a reference from 2 clients. That's not a qualification.

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By frauke
08th Dec 2008 15:03


"I have now written to the client and informed him of the fact that this person is not qualified." Qualified at what? (Until 20 years ago, I was led to believe that only ICAEW members where qualified accountants - I know better now).

Really? So please explain why you have decided that just because a person uses ICPA they are "not qualified"?

I understand that many lapsed members of CCAB bodies (or time barred, who in the end decided not to maintain membership of the organisation they initially qualified through, so are no longer members), choose to join this organisation. By not renewing your membership does this make a person unqualified?

It may surprise you to know that I recently received a lovely letter from a client, whose previous Accountant (ICAEW member) had informed her that I was not qualified. (I'm not ICPA either) She felt that his attitude to my professional qualifications showed him to be "small minded and petty" and just enforced her belief that she had made the right decision to no longer be his client.

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By mark.mcmillanrose
08th Dec 2008 08:47

I could write a book on why qualifications are important, as it is has been the worlds system for many generations. Is it not the reason we send our children to school, the qualification proving to the employment sector that they have the potential to carry out the job they will be engaged in?

I recently lost a client to a non-qualified. Before you NAQs get too over exited, let me tell you the story! A dear friend of mine has recently retired and asked me to take over his clients on a drip feed basis until all clients have been transferred. He has asked for no money as his only concern is that his clients should go to a firm HE knows will give them good advice and look after them. One of his clients lives approximately forty miles away and has decided to use someone locally. Fair dues! I then received a letter from an ICPA. I have now written to the client and informed him of the fact that this person is not qualified. The client is now fully aware and can make his own decision as to whether he chooses to use him. The point being, the client has all the facts. Something that Tony is shying away from. Should you not at least put NAQ after ICPA (more letters....................must look good!)?

The bottom line being the public need to know the facts so THEY can make an informed decision.

On the other side of the coin, last week I took over from a firm of Chartered Certified Accountants (the same as myself). I was totally appalled at what appears to be errors in last years accounts. I will today write to the ACCA and ask them to look into it. This is the way that our standards can be maintained. It may transpire that this was a one off mistake or it could be more serious. It will then be ACCAs decision to take the appropriate action, and only them. This is what we as members pay for and the public should expect. So Tony, please send your evidence to the respective accountancy body and let them take the appropriate action.

So, I will continue informing the public to use only qualified accountants and where I come across poor qualified accountants then their body will be notified by me.

If you are means "Not Actually Qualified"! So take a recognised exam and stop the moaning and excuses.

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By stephenkendrew
08th Dec 2008 07:42

Accountability not accountant
If anything needs legislating, it is the accountability of professional advisers rather than the term "accountant".

I'm sure we have all come across work done badly by accountants irrespective of their qualifications - I've certainly seen many examples over the years of poor work done by both chartered and non-chartered accountants.

The "public interest" must surely focus on what a client can do when things do go wrong.

Certain areas of the work (audit and insolvency for example) are regulated. The majority of the work that any smaller business would normally require is, however, not regulated. If things go wrong with a qualified accountant they can complain to their Professional Institute and/or claim on their (compulsory) professional indemnity insurance.

This option is not available if their accountant is not "qualified". It is, however, available if their accountant has PII. Legislation on who can or cannot call themselves an accountant will not protect the public. Legislation on accountability and compulsory professional indemnity insurance will.

Well done Tony.

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By frauke
05th Dec 2008 17:46

Comment ?
"It is unacceptable to have such a myriad of non CCAB bodies handing out misleading credentials to all comers."

I am presuming from this that you consider all the non CCAB Accountancy bodies as "unqualified"!!!!

As a member of the IFA, (a non CCAB body), with PI, and a practice certificate I am insulted that you should not consider me qualified. Its a pity the ICEAW does not agree with you!

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By jon_griffey
05th Dec 2008 17:19

I do agree somewhat with Mark Lee. In my view simply protecting the term 'accountant' would not really work, as unqualifieds could easily sidestep it by becoming 'tax consultants' 'business advisers' etc.

However we really do need to sort this issue of unqualifieds. It is unacceptable in this day and age that it is possible to practice a senior profession without a requirement for competance, PI or any rules of professional conduct (yes - there are some very good unquals). It is unacceptable that accountants can be convicted for fraud, imprisoned, struck off and still carry on in practice with impunity. Can solicitors or doctors do that? It is unacceptable to have such a myriad of non CCAB bodies handing out misleading credentials to all comers.

The answer is to grandfather all existing unqualifieds and the "differently qualified" into a new recognised body that has teeth and then legislate that in future all accountancy service providers (as defined in money laundering law already) must be CCAB or have some other appropriate qualification and thus be regulated properly.

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By thomas34
05th Dec 2008 16:56

All very well but ... let's not jump to conclusions
Krista Webb has cited a case of bad advice given by a client's former accountant and the resulting bankruptcy proceedings. She has given no evidence that the accountant has no P.I. insurance nor that he has insufficient assets in the event of a successful County Court claim.

I'd be surprised if the solicitor's advice was as she describes and suspect that he was merely advising of the hurdles to cross before receiving any compensation.

The protection of the word "accountant" was always going to be a non-starter on a purely practical level.

The pendulum has in my humble opinion swung too far towards the regulation and mollycoddle-the-consumer brigades. I suspect that a lot of baby-boomers must cringe at this phenomenon and yearn for a return to the days of "caveat emptor".

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By frauke
05th Dec 2008 14:48

Who is a Chartered Accountant?

"we also point out that ICAEW members actually do have the sole right to the term Chartered Accountant which one would have thought was sufficient"

Since when?

I have know many non ICAEW members (including ACCA & CIMA members) who call themselves "Chartered Accountants" ......

Last year I contacted CIMA, to ask if members where allowed to advertise themselves "Chartered Accountants" and was told - YES as long as they were registered in practice.

Having said that - according to Rufus Rottenberg "the Government’s view that the term chartered accountant should continue to be restricted to appropriately qualified members of one of the professional accounting bodies" - I presume he means Chartered professional body, rather than any professional body!

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By klw.rawlinsons
05th Dec 2008 14:29

All very well but...
I know some very good non qualified accountants and generally have no specific objections to them trading as accountants. What I do have an issue with is that they have no requirement to keep up with legislation and changes in practice, and they are not answerable to any "body".

I gained a client last year who was previously with another 'accountant' who had assured him he didn't need to worry about VAT registration. When I looked at his figures he needed to be registered over 4 years prior to that. He is now going through bankrupcy procedures as he cannot afford to pay the vat and penalties. He cannot report the accountant to any regulating body as he is not qualified, and his solicitor advised him he wouldn't be able to sue the accountant as even if he won a court action, the accountant would probably plead inability to pay any award.

This is why I disagree with non regulated accountants. And this is just one example of many. I have to do so much CPD to keep up. I have to have practice assurance measures in place so that I apply best practice to all my clients. If I don't, then I expect to be cautioned appropriately. How can the above happen with no come back on the individual for the wrong advice he gave, and for the totally crap service that he charged so much for?

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By jon_griffey
05th Dec 2008 14:17

Now for the certified
Perhaps Tony should follow this up as follows: -

"Dear Mr Rottenberg

Thank you for your email.

I am delighted that you share my view that the term "Chartered" accountant should continue to be restricted in order that the public may make an informed judgement between individuals who hold a qualification from a professional body and those who do not.

May I suggest that the term "Certified" accountant should also be restricted, such that only members of the Association of Chartered Certified Accountants (ACCA) are entitled to use the description. As you know membership of ACCA involves many years of hard study and practical experience before being permitted to use the description "Certified" accountant. Unfortunately a number of accountancy bodies have sprung up which also offer the description "Certified" to their members who are required to have no accountancy qualifications whatsoever. The raison detre of such bodies is to enable their members to use the "Certified" description which will invariably cause them to be confused with members of ACCA. The public are clearly not in a position to make an informed judgement and so I would urge you to introduce measures to restrict the term "Certified" to ACCA members."

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05th Dec 2008 13:42

Sensible Result
Well done Tony, keep up the good work.
I think this was a sensible result and decision by the BERR although I have no doubt that it will rear its head again at some point in the future.
The issue of qualified versus non qualified has been discussed for years and will no doubt continue to do so, however the second to last paragraph of the letter from BERR suggests that all accountants without the word Chartered in their title are unqualified.
I am not a member of a Chartered body but am a practising member of the IFA, AIA and ICPA. I studied long and hard to reach my qualification and therefore do not consider myself unqualified just because I don't have the word Chartered in my title.

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By listerramjet
05th Dec 2008 11:08

sound like much of a victory to me

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