PracticeAuditICAEW readies £700,000 reputation war chest

ICAEW readies £700,000 reputation war chest

The ICAEW has earmarked around £700,000 to be spent this year on defending the reputation of auditors and accountants, Accountancy Age has learned.

Link: ICAEW pushes for greater audit transparency

The contingency funds can be called upon by the institute and the Accountancy Foundation as they respond to the growing crisis in corporate governance following financial scandals in the US.

So far this year an extra £200,000 has been put aside to cover costs that could arise as the institute responded to various government inquiries.

Of this, £50,000 is available for the Foundation, with the remaining £150,000 forming a contingency fund for the institute’s technical directorate should additional research be required. But an institute spokesperson said so far only a small amount of the funds had been spent.

A further £500,000 will be added to the institute’s technical department, pushing its budget through the £2m barrier and reversing pervious cuts.

Staff in the technical department have played a key role in providing the ammunition in the debate over audit and accounting reform.

The extra money has come from the £33 increase in members’ subscriptions, which was approved at a special general meeting in the summer.

But institute council members hit out at the expenditure. Outspoken council member Douglas Llambias said: ‘It’s not the amount that’s important, it’s the way its spent on a policy of “do nothing, no knee-jerk reaction”.’

Llambias has urged the institute to implement the recommendations of the Treasury Select Committee’s report on auditor independence.

Other institutes have yet to copy the ICAEW. A spokesman for ACCA said there was no specific budget for post-Enron work.

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