THE UK’S accounting umbrella body, approaching middle age, has had what could loosely be termed an existential crisis.
Recent years have seen the CCAB, formed in 1974 to represent the institutes as a whole, make the headlines more for disagreements than showing solidarity.
Back in 2005 the ICAEW’s failed merger attempt with CIPFA led to heated debate as to the CCAB’s structure. CIMA quit the CCAB earlier this year over discontent that, through its membership, it paid what it considered a disproportionately high figure towards funding the Financial Reporting Council (FRC).
ICAEW chief executive Michael Izza, who serves as secretary for the CCAB, said the institutes underwent “soul-searching” to decide whether the umbrella body had a future.
“When CIMA left everyone got around and thought ‘do we want to continue’? We took a hard look, and the conclusion was yes,” said Izza, citing support from both the government and the FRC.
The current consultation into the FRC’s future structure, plus Michel Barnier’s plans to reform the rules in an attempt to open up the audit market, provide scope for the institutes to find common ground and speak as one, the institutes believe.
The CCAB will take a public stance on these issues where agreement between its five institutes: ICAEW; ACCA; CIPFA; ICAS; and Chartered Accountants Ireland, is found.
He points out that besides its public face, the CCAB also works hard behind the scenes on behalf of the profession.
Despite CIMA’s departure and subsequent navel-gazing that took place, there is little else that has changed in terms of the body’s remit and structure. Each institute will own a single ‘vote’ in the body. Physical shares in the limited company are: ICAEW 606; ACCA 202; ICAS 86; CIPFA 70 and Ireland 36, which compares to the previous structure where the ICAEW was majority shareholder.
The institute’s chief and president will hold the secretary and chairman roles respectively.
CIMA’s departure has failed to force the institutes to cough up more towards the FRC.
“We’re paying the same amount we were, less CIMA’s [share].”
However the five institutes are each a few quid out of pocket in managing the changeover, as the previous corporate structure was liquidated by KPMG, costing them a total of £10,000.
The reform also saw the CCAB consider widening its membership to other senior accounting and tax institutes. For the time being, there are no plans to change the composition.
For what it’s worth, Izza said that the CCAB would welcome CIMA back into the fold, citing that the umbrella body was formed at the behest of government in 1974.
But it would appear a long way off. Neither the ICAEW, nor the other bodies, are working with CIMA on any projects.
“I don’t think we’re not on speaking terms,” said Izza. “If they wished to rejoin, that’d be good from a profession’s standpoint.”
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