PracticeAccounting Firms2003 salary survey: All Change

2003 salary survey: All Change

Less than a year ago, Accountancy Age published research that revealed the first clear picture of the UK's accountancy industry.

The findings, from the then fledgling Accountancy Foundation, were enlightening.

It showed the UK’s two most traditional accountancy institutes, the ICAEW and ICAS, lagging behind their newer rivals, ACCA and CIMA, in significant areas.

Now, just seven months on, the picture has changed again, according to the findings in the 2003 Accountancy Age/Robert Half Finance and Accounting salary survey.

Some 26% of our 5,000 respondents hold CIMA qualifications. That’s put the management accountancy qualification ahead of those offered by the ICAEW, whose qualification is held by 22% of you.

What is most significant is that, agewise, both CIMA and ACCA are surpassing the ICAEW in attracting younger candidates. Of the CIMA-qualified respondents, 48% are aged between 26 to 35, while only 11% are aged between 46 to 55.

Compare this with the ICAEW, where 39% of our respondents are in the 26 to 35 age group and 16% aged between 46 to 55.

Could this mean the beginning of the end of the gold standard of chartered accountancy? These findings offer food for thought as, arguably, nowadays the main difference between the qualifications is the title and length of existence of the institutes.

And longevity does not always equate to excellence or superiority.

Despite her decision to study for the CIMA qualification, Rosemary Thorne, FD of FTSE-100 company Bradford & Bingley, says there’s little difference between chartered and chartered management career paths. ‘There’s not a lot of difference between the two and, as you can see from my CV, I’m still actively involved with the technical side. I think my expertise is no different here,’ explains Thorne.

‘And if you look at the top 100 FDs, there’s a real mixture,’ she adds. ‘They all used to be chartered accountants of the ICAEW. Now there’s a mixture.’

Both ICAS and the ICAEW are governed by Royal Charter and were established in the 19th century. Their qualified accountants are the only ones to be legally called chartered accountants.

The ICAEW’s website states: ‘The institute’s powers and duties derive from the authority given by its Royal Charter, originally awarded in 1880 and amended in 1948. In summary, the powers conferred on the institute by the charter relate to the protection of the public interest through superior education and training; the maintenance of high professional standards; and technical excellence in the field of accounting in all its forms.’

Receiving its Royal Charter in 1854, ICAS is the oldest professional body of accountants in the world. It was the first to adopt the designation ‘chartered accountant’, and according to its website, ‘the designatory letters “CA” are still an exclusive privilege in the UK for members of the Scottish institute’.

But this exclusive badge may not be enough for the institutes to maintain their competitiveness, if our findings are anything to go by. CIMA and ACCA style themselves not on their heritage, but on their global reach, business qualifications and flexibility.

Rather ironically, the majority of CIMA and ACCA respondents to our survey say they describe their role to people as accountants, despite their institutes’ focus being primarily on business management, rather than the traditional skills of accountants, such as auditing and technical ability.

In contrast, just a little over half of ICAS and ICAEW respondents say they refer to themselves as accountants. The rest prefer to call themselves consultants, business advisers or financial directors.

So despite Enron, WorldCom and all the other accounting scandals that have plagued the industry over the past year and a half – which turned on its head the boring image of the accountant – most of you still seem ashamed of your jobs.

So it should be no surprise then that most of the respondents, irrespective of qualification, would not want to be an accountant if they could have any other job.

Indeed, and this perhaps is still a reflection of a male-dominated industry, a large proportion said they would want a sports-related job. While on the subject of Enron, an emphatic majority of those polled say they do not believe the damage the Enron affair inflicted on the reputation of accountancy has negatively affected their short, or long-term, aspirations.

And a large percentage of respondents from all the institutes consider North America to be their ideal destination for an overseas assignment. It’s a strong indication of our longstanding close ties with the US and Canada, or perhaps, more cynically, further proof of our abysmal foreign language skills.

Nevertheless, ICAEW-qualified accountants continue to earn more, work fewer hours and enjoy better packages and perks, such as flexible working, than their counterparts. A significant 51% of ICAEW respondents say they work from home while only 40% of CIMA and ACCA members do.

Despite the growth and attractiveness of the CIMA and ACCA qualifications to new members in the UK and around the world, ICAEW-qualified accountants remain the UK’s best paid. While the average salary for an ICAEW-qualified finance director is £54,668, for a CIMA FD it is £48,901.

But as the other institutes’ profiles grow, salary disparities may change dramatically.

Alternatively, it could be time to merge into one or perhaps two bodies.

Now there’s an idea that hasn’t cropped up for a year or two. Maybe it’s time has come. Again.

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