Institutes - ACCA braced for #32m Malaysian court hit
The threat of legal action in Malaysia has forced ACCA to include a contingent liability worth a staggering #32m in its annual results, released this week.
Finance director Ross Midgley said the case, brought by an ACCA student who is claiming damages alleging breach of contract, was due to be heard at the end of next month and ACCA was confident of winning. But he acknowledged that ‘the total amount claimed is a very large sum’, and is in excess of ACCA’s income of #8m in 1998.
Midgley declined to comment on how the institute would pay the sum should the judge find in favour of the student. But he said he did not expect there ‘to be any significant exposure at all’.
He added that the case was indicative of running a professional organisation with an international reach and the increased use of legal measures to settle differences.
The potential liability overshadowed ACCA’s latest student figures, which were up by 45,000. Last year, students and graduates numbered 156,294, while there were 66,083 members. Growth in student numbers added #11m to ACCA’s examinations income over the year.
Midgley said ACCA remained committed to pursuing a merger with CIMA and CIPFA, despite the fact that members of both institutes rejected the association’s advances last year.
‘The present structure of the profession is illogical and we are sure that there will be a restructuring along these lines,’ he said.