Ministers back Swinson regulation proposals
Profession's leaders say DTI will back review board plan. Jon Bunn reports
The government will back the profession’s regulatory framework proposals in a detailed consultation document due to be unveiled on Monday by trade minister Ian McCartney.
Senior sources within the profession said the government would proceed with plans, outlined in September, to shake up accountancy regulation, by introducing an independent foundation.
The foundation will oversee a review board, an investigations and discipline board, an ethics standards board and a relaunched auditing practices board.
English ICA sources said they expected the document to be released ‘any day now’ and confirmed that McCartney, who has been meeting senior members of the profession over the past few weeks, was due to speak at an institute conference on Monday afternoon. Ross Midgley, ACCA’s finance director, said he expected the document to be released the same day.
Although the government’s proposals were virtually identical to those made by English ICA president Chris Swinson’s review board, the profession and the DTI are at odds over plans to make 60% of board members independent, representing consumers and wider public interest. Swinson favours a 50:50 split. The foundation will comprise an entirely independent membership, but will be funded by a ‘no strings’ endowment from the professional bodies.
Other senior accountants were disappointed by plans to take away institute ethical standard-setting powers.
Peter Wyman, PricewaterhouseCoopers external affairs partner, who broadly accepted the DTI plan, said: ‘It’s the business of the profession to set its own ethics and standards that are above the law, and discipline people who do not behave in accordance with them.’
Roger Davis, PwC’s head of professional affairs, added: ‘The plan’s success depends on the quality of people on the boards. Are there enough quality people to go around?’
Another Big Five source said: ‘Regulation is a secondary issue. We get our reputation from whether the firm is doing a good job.’ It was better left to practitioners who understood the issues, he added.