PracticeAccounting FirmsInstitutes in three-way merger talks

Institutes in three-way merger talks

The ICAEW, CIPFA and CIMA have held discussions about a possible merger of the three institutes, in a move that could create the UK's largest accountancy body. (The full story)

Link: ICAS rules out merger with ICAEW

All three institutes confirmed this week that they had been involved in ‘exploratory’ consolidation talks, although there is so far no indication of a proposal to put before members.

A merger between the three institutes would create a body of 200,000 members in more than 100 countries, putting it in a much better position to compete internationally with the ACCA. Neither the ACCA nor ICAS have been involved in discussions.

CIPFA chief executive Steve Freer said this week that the institutes had been reviewing their strategies in light of recent changes in the profession, and that consolidation discussions had ‘inevitably’ taken place.

‘It is too early to say if this will lead to consolidation within the profession. That certainly is a possibility, and clearly it might make sense from a public interest perspective. But we know from past experience that these things take time to put together and the devil is always in the detail,’ he said.

The ICAEW also confirmed that talks were under way. ‘Consolidation could be an accelerator to achieving key goals, but it is not an end in itself, nor is it the only route available. The ICAEW’s own development programme is progressing in parallel with these talks,’ a statement read.

Charles Tilley, CIMA’s chief executive, said: ‘Consolidation would be an excellent thing as long as it enhances the strengths of the three bodies.’

If a merger were to go ahead, it would mark the next step in the overhaul of the accountancy profession, after the transformation of the regulatory framework under the reformed Financial Reporting Council.

It also marks the formation of a consensus that a more unified training market is in the public interest.

ACCA president John Brace reacted by calling the talks a ‘back-door’ merger driven by difficulties the institutes face in recruiting new students.

‘It is a reaction to the massively higher growth rate of ACCA, which has doubled in size since 1996 and now has 320,000 members and students around the world,’ said Brace.

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