PracticeConsultingSmaller firms fear loss of trainees over audit threshold hike

Smaller firms fear loss of trainees over audit threshold hike

Smaller firms are expressing fears that they might become less attractive to trainees as a result of the increase in the audit threshold, announced this week.

‘What worries me are the effects on students’ training in small and medium sizedpractices,’ according to John Malthouse, director of Liverpool-based Malthouse & Co. and English ICA council member.

‘Trainees need a wide range of experience and skills. Audit is going to polarisetowards the larger firms,’he added.

However, he was not entirely despondent about the increase in the audit threshold. ‘From a commercial point of view, it won’t make a lot of difference.’Audit work is no longer key to accountancy practices. But, it isstill a retrograde step on the part of the government.’

Other practitioners were more welcoming.Nobel Hanlon, senior partner at MacIntyre & Co, said: ‘We welcome the initiativeto lift the audit threshold, since we now depend on many other commercialservices as an extra to auditing, we do not feel threatened by the measure.’

As for training students, Hanlon said there would always be a place in trainingaccountants in small and medium-sized firms.

The Scots ICA, however, said it had already anticipated concerns of smaller practices about the issue.

‘We recognise that the new initiative will hit small practitioners harder thanthe larger firms, but the institute foresaw this might happen,’ said ElissaSoave, lecturer and secretary to the student education committee at the institute.

The institute has removed the arbitrary training requisite of 43 days auditexperience from the training programme for the qualification.

Soave said: ‘Audit remains a core part of our syllabus. We still recognise theimportance of audit competencies, but we have made provisions for students to beable to get that experience elsewhere and still train with small practitioners.’

Brian Chiplin, executive director of education and training at the English ICA, conceded that the concernsof small firm trainees were understandable and said the institute would keep it underreview.

But, he insists that small practitioners will not be cut off from the trainingprocess of students, citing the institute’s new exam regime to belaunched in September as an example of the requirements being made to counterany loss of audit work.

‘The new qualification will lay more emphasis on business and advisory skillsthat are more relevant the changing world of business,’ said Chiplin.

Byers raises the audit threshold

Related Articles

5 tips for SMEs to protect cash flow

Accounting Software 5 tips for SMEs to protect cash flow

5m Alia Shoaib, Reporter
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

11m Stephanie Wix, Writer
Managing partner Q&A - the year ahead: Richard Toone, CVR Global

Accounting Firms Managing partner Q&A - the year ahead: Richard Toone, CVR Global

12m Kevin Reed, Writer
Deloitte 'self-imposes exile' on government contracts to defuse PM row

Accounting Firms Deloitte 'self-imposes exile' on government contracts to defuse PM row

12m Kevin Reed, Writer
Managing partner Q&A - the year ahead: Julie Adams, Menzies

Accounting Firms Managing partner Q&A - the year ahead: Julie Adams, Menzies

12m Kevin Reed, Writer
Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

Business Regulation Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

1y Kevin Reed, Writer
Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

Audit Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

1y Kevin Reed, Writer
New head of equity capital markets for KPMG

Accounting Firms New head of equity capital markets for KPMG

1y Stephanie Wix, Writer