Legally anyone can call themselves an Accountant
Unlike the term Solicitor, Independent Financial Adviser (IFA) or Architect, the word Accountant is not protected. Yes an unqualified solicitor can lose you money, lose your rights, even lose your property so it is important that a solicitor is formally qualified so you are protected. Yes an unqualified IFA can lose your cash in a dubious investment or put your pension into a poorly performing fund so it is important that your IFA is formally qualified so you are protected. And yes an unqualified Architect can design a building which could fall over so your biggest investment you will ever have could be left valueless so it is important that your Architect is formally qualified so you are protected.
But there are no restrictions or protection for the term Accountant. So anyone, including you, can decide to set up an accountancy practice and do accounts, tax and vat for other businesses and many unqualified people have. There are even organisations set up to provide a “qualification” who will grant membership via an online application and a monthly subscription.
So is using an unqualified accountant “safe”? Well I think they can cause as much damage to your financial well-being as any unqualified lawyer, IFA or architect. We recently picked up a new client who was incorrectly advised by an unqualified accountant over VAT. The VAT arrears, penalties and interest could have bankrupted the business but we were able to save the company.
However to use the designation of Chartered Accountant, and belong to the ICAEW (Institute of Chartered Accountants in England and Wales), a member must complete a 3 or 4 year training contract with a firm authorised by the Institute and pass extensive professional examinations encompassing accounting, financial management, audit, business strategy, tax and IT. Even then that is not the end of it as to be allowed to practice as an accountant a member must train for an additional 2 years under the control of a principal before he can apply for a practicing certificate. So that’s six years of training before being let loose on a business client.
To maintain membership of the ICAEW members must maintain high standards of ethical and professional conduct. As a member firm, Wood & Disney follows the framework of quality assurance principles, which covers; laws, regulations and professional standards, client acceptance and disengagement, competence, and quality control. Member firms are visited and inspected on a regular basis by the ICAEW. We also have to have professional indemnity insurance to ensure that our clients are protected.
As a member firm all staff are required to meet the Institute’s scheme of Continuing Professional Development (CPD), ensuring that their knowledge and skills are up to date to best meet the needs of the clients. This CPD means we all have to read tax and accountancy updates as well as attending regular courses. The reading material alone probably amounts to a minimum of 30 minutes every working day. Additionally as a member firm we also follow the Institute’s bye-laws, regulations, standards and Code of Ethics.
So in summary the Institute of Chartered Accountants would say that you use a chartered accountant because:
We have passed difficult professional exams and studied for a minimum of five years to prove that we are competent to advise clients.
We continue to read and take courses to keep up to date and ensure that the advice we give is current, accurate and relevant.
We are independently checked by a professional body on a regular basis to ensure we are maintaining standards and giving the best possible service to our clients.
We are independently checked to ensure we hold sufficient professional indemnity insurance so that if anything should go wrong we can compensate our clients appropriately.
We continue to maintain the highest levels of professionalism, integrity and trustworthiness throughout our careers to ensure we deliver the best service to our clients.
If you have any doubts as to whether your accountant is qualified just ask the question.
wood and disney are multiple award winning Chartered Accountants based in Colchester, Essex.
T: 01206 233170