A #2m deficit has plunged the ICAEW’s finances into crisis, forcing it to consider cuts in expenditure to balance its budget, Accountancy Age has learned.
The drastic actions were revealed to council members during a confidential session of the institute’s council meeting last week.
In April, the institute disclosed a deficit of some #600,000 for 2000 in its annual review and said at the time it was budgeting for ‘substantial’ losses for 2001.
But now the institute has been forced to consider action to recoup the losses.
One possible remedy is a hike in membership fees, currently averaging #167, but executive officers were against such a move. John Collier, general secretary, said: ‘We are not looking at subscriptions to balance the budget.’ Collier said the institute would look to ‘reprioritise services and would not look for cuts in those services valued by the members’.
The shortfall, according to Collier, has been caused by significant investment in the institute’s new qualification and external factors such as falling income from commercial activities.
He admitted the controversial regional restructuring had dented the institute’s budget. It also recently spent #300,000 on refurbishing the Great Hall at its HQ in Moorgate Place, London.
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