Approach with caution

After all the cognitor debacle – which saw the attempts by a handful of institutes worldwide to launch a global qualification fail ignominiously – is still extremely fresh in the mind. But this new drive deserves our attention, if for no other reason than the potential opportunities it offers.

By 2005 the European Union will require (almost) all listed European companies to use international accounting standards. But how useful are global rules for global companies if the training of the people who will actually use them is still organised on a national level?

Imagine a world – or at least a continent – where accountants share a common training in most subjects. If accountants are the financial heart and soul of a company, then surely a global economy demands common financial training.

The institutes – covering England and Wales, Ireland, Scotland, France, Germany, Italy and the Netherlands – hope to get something in place within five years. By then as much as 80% of their syllabuses could be portable, with the remaining 20% devoted to national issues – probably practice specific.

It is then easy to imagine that, given the size of these institutes (between them they cover many of Europe’s largest economies), institutes from other countries could be invited to join later to create a pan-European qualification that would be a match for anything else in the world. Including the US.

On the other hand it is equally easy to conceive a situation where petty infighting and political division causes it all to unravel within a matter of months. After all, that’s what did for the cognitor qualification.

This time, however, the stakes are higher. Failure might not just threaten the institutes’ ability to work together in future, it could undermine international standards themselves.

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