Irish regulator: A step in the right direction

Its conclusions, especially the establishment of an independent Oversight Board for the profession and on disciplinary and regulatory arrangements, are broadly welcome.

Given the diverse backgrounds of its membership, the Group has shown remarkable intellectual grasp in understanding the nature of issues which often elude members of the profession itself. And the speed with which it has come to its conclusions is also testimony to its success and must contrast favourably with attempts in other European countries to find appropriate mechanisms.

ACCA Ireland is particularly pleased because the disciplinary and regulatory procedures advanced by the Group are closely aligned with those in operation within ACCA. ACCA’s disciplinary hearings are open and conducted by expert lay people. It was, for many years, the only professional body in Ireland to hold its disciplinary hearings in public. We firmly believe that our model must be examined by all other professional bodies which seek to establish modern corporate governance procedures.

If adopted by government, the recommendations suggested by the Review Group, could lead to a professional regulatory framework which places Ireland in the vanguard of change. The oversight board, advanced by the Group, appears to be a serious attempt to deal with previous failures in regulation and is welcome for a variety of reasons. It retains the culture of self regulation while providing a framework for the profession which will ensure that abuse is tackled. It will be important that it is truly independent and that time and trouble is taken to find members of intelligence, experience, good sense and integrity.

We do have a concern about proportionality. The Review Group has done a formidable job in addressing regulatory issues surrounding, in particular, the major financial institutions. But for small companies, it is our view that a lighter tough is called for.

It is easy to understand why the Group’s approach has been so resolute. The background against which it has reached its conclusions would encourage most of us to err on the side of regulation. However, most of commercial activity in Ireland is conducted in the SME sector and the present proposals are out of scale with the nature of any problems which exist there. The cost of compliance for smaller businesses and their accountants may be out of all proportions to the risk and scale of their businesses.

ACCA Ireland has encouraged the Review Group to examine unqualified accountants as well as those who have achieved membership of reputable professional bodies. Unqualified accountants should also be brought under the umbrella of a recognised regulatory structure.

This is an exciting time for the profession in Ireland. An original structure has been developed against demanding deadlines – and it is one which, if adopted, will put the country in the forefront of effective professional governance. To work efficiently, the new Board will need to be fully independent and populated by experienced and talented individuals.

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