At first glance, public-sector accountancy institute CIPFA looks in good shape as it goes into its annual conference in Birmingham on 15-18 June.
But this masks a past 12 months in which the institute has come under continued attack. Now it must achieve greater stability and expansion if it is to survive in a declining marketplace.
At the helm is CIPFA’s bullish chief executive David Adams. Just after he arrived on 1 April 1997, Adams was tasked by the ruling council to eliminate the institute’s £500,000 deficit, calculated at the end of that financial year.
Now, little more than two years later, Adams has more than fulfilled his end of the deal. This year’s annual report revealed that, not only had CIPFA managed to break even, it had achieved a £200,000 surplus at the end of 1998.
This year, Adams hopes to build on his success and take the surplus even further to reach £500,000 in what will be a remarkable turnaround.
These savings were made during a period of change which saw the senior management team trimmed, while the commercial operations were consolidated into IPF, the institute’s commercial arm.
CIPFA has also switched to a regional provision from its previous sectoral approach which did not work as well as had been hoped.
‘Rationalisation allowed us to cut overheads,’ Adams explains. ‘And we have been able to increase profitability while also managing to operate more cost-effectively.’
The next item on the agenda is the relaunch of the institute’s education and training scheme with a revamped syllabus which will be launched officially at next week’s CIPFA conference.
The move is important for the institute, which has seen student numbers fall, leading to financial losses. Last year, National Health Service Trusts were rumoured to be saying that they saw the supposedly harder-edged CIMA qualification as more relevant in today’s health service.
Adams concedes that CIPFA has lost some ground on NHS trainees but believes this was due to poor marketing. The real problem with the CIPFA training was not its quality or content, Adams believes. It stemmed from perception.
CIPFA must continue to persuade students and employers that its course offers hard financial skills equal to those offered by other accountancy bodies.
‘ACCA and CIMA have said our qualification is not portable, but it is people who are portable, not just qualifications. Ours is at least as good a qualification and training as any other institute’s,’ he says.
A further incentive for future trainees will be the cost of the course itself. CIPFA has been the most expensive qualification as recently as this year. But Adams has pushed forward a drive for a more cost-effective training which will compete with the other institutes belonging to the Consultative Committee of Accountancy Bodies.
Links with other bodies are closer than last year’s failed merger with ACCA indicates. CIPFA members have refused to rule out future rationalisation, a prospect that Adams believes is in the public interest.
‘A united profession would be transparent and accountable and would serve the economy better,’ he says.
CIPFA’s current policy is to seek ways of co-operation, but the institute is not actively seeking a merger with other organisations. The reasons for this are clear-cut. ‘Any initiative on our part would be seen as a sign of weakness,’ Adams explains.
Strength for the institute in the past year has come from depth. Its determination to respond to government consultation documents has seen it comment on about 70 of these during the year.
Visibility and authority are the main attractions here.
‘Public reputation is important if the institute is going to be seen as relevant long-term,’ Adams explains. ‘We have established a good base in responding to government but we are only as good as the next issue that comes up.’
Emerging issues concern the new ethical structure and accounting framework that will underpin the government’s best value regime. The way CIPFA has attempted to position itself with Whitehall has paid off in the past year, with the institute giving written and oral evidence to parliamentary committees on the pertinent issues of today.
But, for emerging issues such as best value, some local authorities have questioned whether CIPFA is preparing its students for the needs of the modern public sector. This is clearly something the institute intends to address with the relaunched syllabus.
As Adams approaches his final months in charge, his iron-fist approach to running the institute has proved its worth. Sweeping reforms have bred success.
His first seven months were marked by dramatic change. At least 20 senior staff lost their jobs and a further 20 senior figures left the secretariat.
He also implemented an institute-wide rationalisation which saw six operational divisions reduced to just three directorates in what he terms the ‘operational core’.
The institute had hoped its proclaimed revolution, begun with the arrival of Adams earlier that spring, would herald the end of sniping and doubts over its viability. Last year’s conference, however, proved not to be a great success. Lacklustre speeches, half-empty meetings, and complaining delegates were a feature of last year’s event, when the talk among the delegates was more of survival than revival.
But now the financial turnaround is almost complete.
As the delegates begin to arrive at the conference in Birmingham next week, it will be with a renewed hope for the institute’s future. The past 12 months has seen considerable change in the public sector and CIPFA needs to keep up with the pace.
The institute’s gloomier past has begun to fade from people’s minds and the times ahead appear brighter.
If Adams and CIPFA stay on course, in the autumn he will be able to hand over to his successor a super-fit institute which offers a highly relevant qualification.
PRIORITIES FOR ACTION
Supporting the government’s agenda of change and modernisation in local government by leading the design and implementation of the best value accounting framework.
Promoting and developing education and training through the launch of a modernised and cost-effective professional education scheme.
Building on the commercial work of the institute with the launch of a number of advisory services and the expansion of benchmarking activities.
Commitment to membership, giving professional support to members in the workplace and developing internet facilities for members, students and customers.
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