ACCA steps up the pressure over unqualifieds

For some time now, representatives of the profession have been locking horns
with the government over the issue of unqualified accountants.

Spearheaded by ACCA, the Department of Trade and Industry has been put under
pressure to stop people without qualifications being able to call themselves

As anyone can currently use this moniker, qualified accountants claim their
reputation is damaged. A similar situation to that which exists for solicitors
is required, said the institute, which would give accountants a legal status.

Under Patricia Hewitt, however, the department gave short shrift to demands
for regulation. The DTI’s belief has been that self regulation is the best way
forward, and it is up to the profession to promote ‘chartered’ accountants as
the reputable choice for customers.

With the post-election change of personnel, hope and efforts were renewed
that progress could be achieved on this front, but that optimism now looks to
have been misplaced, at least for the time being.

The new push for legal changes resulted in a letter from DTI minister Gerry
Sutcliffe to ACCA, reiterating that their position on the subject had not
changed since Hewitt left the DTI to become health secretary.

‘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,’ said a DTI spokeswoman. ‘We would need more evidence to
support the need for further regulation in this area, however we would be happy
to consider it if they wish to supply that.’

She suggested that the current audit quality may forum meeting be the
appropriate place for such concerns to be addressed.

‘Ultimately it is the responsibility of the industry to ensure that
professional high standards and confidence is maintained,’ added the

Given the repeated setbacks that have struck the campaign from an uninteres
ted government, it would hardly be surprising if ACCA gave up on its quest, or
at least let it fade into the background.

The audit quality forum, which the DTI suggested should look at this issue,
has not put the subject on its agenda, as it is currently dealing with much more
fundamental issues of audit quality. It also looks like it will take a lot of
persuasion for the government to change its mind.

But that is still what ACCA is hoping to do. A spokesman for the institute
said that if more evidence was required, it would strive to obtain it, although
it has encountered problems doing so in the past.

‘We get contacted by people who have run into problems with unqualified
accountants all the time, and we are looking for people to come forward
publicly, but they have been reticent to do so,’ said the spokesman.

‘It is the embarrassment factor. They think they are saving a few quid by
using someone known by a friend of a friend and they end up with a huge tax
bill. People are embarrassed to have fallen for it.’

He cited examples of the trouble unqualified accountants have caused: clients
paying thousands of pounds for inheritance tax advice where none was needed;
poor legal advice by unqualified accountants that could leave clients badly
exposed, and of numerous accounts that have been filed at Companies House that
are incorrect.

ACCA is unlikely to progress any further without such evidence, but it would
also benefit from the backing of other institutes.

So far the ICAEW campaigning on the subject has been relatively low key. If
it or the CCAB, which represents the six main accounting institutes, were to
make a major push on this issue, this delicately poised debate could be tipped
in qualified accountants’ favour.

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