ACCA vs ACA: what’s the difference?

ACCA vs ACA: what’s the difference?

Find out what the difference is between the two accounting qualifications and which one is best for you

ACCA vs ACA: what’s the difference?

There’s more than one way to become an accountant – and when planning a career in this field, it’s important to consider which professional qualifications will best pave the way for your chosen route. The ACCA and ACA qualifications are both prestigious accounting qualifications which can open up a variety of attractive career opportunities – but there are also significant differences between the two options. So how do these routes compare?

A tale of two accounting bodies

The ACCA and ACA qualifications are delivered respectively by ACCA (the Association of Chartered Certified Accountants) and ICAEW (the Institute of Chartered Accountants in England and Wales). Headquartered in London, the two organisations are both major accountancy bodies with long histories.

ACCA

Founded by eight accountants in 1904 as the London Association of Accountants, ACCA introduced its first examinations the following year and opened its first overseas branch in 1913. By the 1950s, ACCA was opening branches in locations including Hong Kong, Trinidad and Malawi – and in 1974 it was granted a UK Royal Charter. More recently, ACCA doubled the number of exam sessions offered to students in 2016.

Today, ACCA has over 208,000 fully qualified members, as well as 503,000 students around the world. The organisation has 17 joint exam partnerships with national accountancy bodies in other countries, allowing students to study for the ACCA Qualification. ACCA is also working to establish joint continuing professional development programmes with accountancy bodies in Cyprus, Malawi, Botswana and Zambia.

ICAEW

ICAEW’s history is even longer. Formed by the amalgamation of five different accountancy associations, ICAEW was incorporated by Royal Charter in 1880. Some of ICAEW’s early presidents, such as Frederick Whinney and William Welch Deloitte, went on to found firms that were the predecessors of today’s big four accounting firms. The Chartered Accountants’ Hall, ICAEW’s headquarters, was opened in 1893.

ICAEW currently has offices in Beijing, Brussels, Dubai, Hong Kong, Jakarta, Kuala Lumpur, Shanghai, Singapore and Vietnam. The organisation has over 150,000 members and 27,000 students globally. It provides qualifications and professional development as well as sharing knowledge and technical expertise.

How do the qualifications compare?

With only one letter to separate them, the ACCA and ACA qualifications may sound almost interchangeable – and there are certainly many similarities between the two. That said, there are also some significant differences.

The ACCA Qualification

Globally recognised, the ACCA Qualification enables members to use the letters ACCA after their names. The ACCA qualification is also seen as the broader and more international of the two. Providing a strong grounding in accounting principles, the qualification opens the door to a wide range of career paths across different countries and industry sectors, as well as the ability to work in practice.

Minimum requirements

The minimum requirements for entry are five secondary school qualifications – including two A-levels and three GCSEs or equivalent – which should include English and Maths. While a relevant degree from an ACCA-accredited university is not a prerequisite, this may mean that candidates are eligible for exemptions for some of the exams required for ACCA membership. Candidates who do not have the required qualifications can still embark on ACCA membership, but will need to join at the foundation level.

What’s involved?

The ACCA Qualification has three different components: students are required to complete three stages of exams and an Ethics and Professional Skills module, as well as obtaining the necessary practical experience.

  1. The ACCA exams include:
  • Applied Knowledge exams – providing a broad understanding of essential accounting techniques, these include Accountant in Business, Management Accounting and Financial Accounting exams.
  • Applied Skills exams – these build on existing knowledge and include exams in Corporate and Business Law, Performance Management, Taxation, Financial Reporting, Audit and Assurance and Financial Management.
  • Strategic Professional Skills – these include both ‘Essentials’ (Strategic Business Leader and Strategic Business Reporting) and ‘Options’ (Advanced Financial Management, Advanced Performance Management, Advanced Taxation and Advanced Audit and Assurance).
  1. The Ethics and Professional Skills module introduces students to advanced ethical and professional skills and exposes them to realistic business situations. It comprises the following six interactive units:
  • Ethics and professionalism
  • Personal effectiveness
  • Innovation and scepticism
  • Commercial awareness, analysis, evaluation and problem solving
  • Leadership and team work
  • Communication and interpersonal skills.

These are followed by a final assessment. ACCA advises that this module should be taken before the Strategic Professional exams.

  1. In order to obtain the ACCA Qualification, candidates also need three years’ practical experience in a relevant role. The Practical Experience Requirement (PER) can be gained before, during and after the other components of the qualification and candidates need to update their PER record regularly.

Timings

The time taken to obtain the ACCA Qualification can vary. Students who gain their practical experience while studying may complete the qualification within three or four years, while others may take longer to do so. Once a student has passed the first Strategic Professional exam, they will need to pass the remaining exams within seven years.

Costs of training

Employers may pay some or all of the costs of studying, although this is not always the case. Costs currently include registration and annual subscription fees (£79 and £105 respectively), exam fees (ranging from £103 to £307 per exam depending on the exam taken and whether entry is early, standard or late) and a £60 fee for the Ethics and Professional Skills Module. Additional invigilation and accommodation fees may apply in some cases.

Exemption fees are also charged for each exam a candidate is exempt from – these currently stand at £76 per exemption for Applied Knowledge exams and £103 per exemption for Applied Skills exams.

The ICAEW Chartered Account qualification (ACA)

The ACA qualification enables successful candidates to use the title ‘ICAEW Chartered Accountant’. The course is generally seen as tougher than the ACCA and the earning potential is high: ICAEW states that globally, ICAEW Chartered Accountants earned £108,000 on average in 2018.

The ACA is often seen as a route to a career in practice, although potential career paths include corporate finance, the charity sector, forensic accounting, insolvency, public sector and tax. According to ICAEW, 78 of the FTSE 100 had an ICAEW Chartered Accountant on their board as of December 2016.

Minimum requirements

Where educational requirements are concerned, there are many different entry routes. These include a recognised degree from a UK or Irish university or college, GCSEs and A levels and Scottish Qualification Certificates. Entry can also be based on professional accountancy qualifications, and there are entry routes for members or students of overseas accountancy bodies.

In order to obtain the ACA qualification, candidates must also secure a training agreement with an ICAEW authorised training employer, of which there are over 5,000. Candidates can choose to register as an independent student in order to start studying the ACA exam modules without a training agreement, but they will still need to fulfil later requirements with an authorised training employer or principal.

What’s involved?

The qualification comprises four elements:

  1. Practical work experience – candidates must complete 450 days of relevant experience in an area such as accounting, audit and assurance, tax, financial management, insolvency or information technology. Work experience must be completed with an ICAEW authorised training employer or authorised training principal. This typically takes between three and five years to achieve.
  2. Exam modules – candidates must study and pass 15 exam modules across three levels and a broad range of topics:
  • Certificate level – includes modules in Accounting, Management Information, Principles of Taxation, Assurance, Business, Technology and Finance, and Law. The Certificate level also comprises an independent qualification, ICAEW Certificate in Finance, Accounting and Business (ICAEW CFAB).
  • Professional level – includes modules in Financial Accounting and Reporting, Business Planning, Business Strategy and Technology, Audit and Assurance, Tax Compliance and Financial Management.
  • Advanced level – includes modules in Corporate Reporting and Strategic Business Management, as well as a Case Study which tests professional skills in the context of a business issue and which must be completed last.

Exemptions are available for some of the modules – these are known as Credit for Prior Learning (CPL).

  1. Professional development – students must apply professional development to real-life scenarios and demonstrate improvement across seven areas of professional skills:
  • Adding value
  • Communication
  • Decision making
  • Ethics and professionalism
  • Problem solving
  • Teamwork
  • Technical competence
  1. Ethics and professional scepticism – ACA students are also required to demonstrate knowledge of the ICAEW Code of Ethics, practical application of ethical conduct and decision making, and transparency and honesty in all business relationships.

Costs

Employers typically cover some or all of the costs of studying the ACA on behalf of their students. However, independent students will need to cover costs themselves. These include a standard annual student fee (£165 plus VAT), tuition fees and exam fees, which range from £70 to £260 per exam. When applying for credit for prior learning, a fee is also payable for modules (£70 per Certificate level module, or £100 per Professional level module). Students may also need to purchase up-to-date learning materials.

Conclusion

Both the ACA and ACCA are prestigious qualifications which provide attractive career opportunities and are highly valued by employers. That said, it’s important for students to understand the differences between the two in order to identify the option that will enable them to fulfil their career aspirations. From understanding the structure of the course to considering whether they are working towards a future career in business or in practice, candidates will need to do their homework to make the route they choose is the one best suited to their goals.

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