The Profession

The future for accountancy

This is an extremely interesting and challenging time to be embarking on a career as a chartered accountant. People making financial decisions need knowledge and guidance based on the highest technical and ethical standards and chartered accountants are able to provide that better than anyone.

Recent developments

In 2010, many of the world’s economies shifted from recession to recovery and it was also a year in which the long-term legacies of the financial crisis started to crystallise. On the positive side, there has been a renewed demand for leadership and business skills, and for better financial management, particularly in the public sector. So despite the pressures to retain clients and keep fees steady, good advice is recognised as one of the necessary outlays in hard times.

Scrutiny of the profession has increased in the last few years. Governments and regulators, particularly in the UK and Europe, have turned the regulatory spotlight to auditors and their role in the crisis. Further changes are expected in the future.

Against this challenging backdrop ICAEW membership rose to over 136,000 and the number of ACAs in training also increased to a 19-year high.


Business Confidence Monitor

The ICAEW/Grant Thornton Business Confidence Monitor (BCM) continues to inform regional and sector specific changes in growth and confidence.

• The Confidence Index has picked up in the second quarter (Q2) of 2011 after four consecutive quarters of decline. Although, it is still 11.8 points lower than a year ago.
• Financial performance continues to improve in Q2 2011. Turnover and profit growth are at their strongest since the third quarter of 2008, while growth expectations are at their highest since before the recession.

To receive quarterly updates at no cost, register at the ICAEW website.


Challenges and opportunities

One of the major challenges will be to maintain clients, persuade them within a challenging macroeconomic environment their financial and business advisers (i.e. their chartered accountants) are a vital part of their business, particularly to see them safely through to real recovery.

Ensuring standards
There is also a need to explain and promote more fully the importance of using a QUALIFIED chartered accountant. ICAEW members locally are still disturbed by the continuing proliferation of non-qualified practitioners who set up shop with little or no professional backing or guarantees.




The training and examination procedures which every ICAEW Chartered Accountant must undertake, and the compulsory Continuing Professional Development (CPD) requirements without which they lose their chartered status and their membership of ICAEW, ensure the highest standards are demanded and maintained.

While ICAEW cannot ring-fence the term ‘accountant’, qualified chartered accountants can and should do more to educate the public and the wider business community to seek qualified help and not just head for the cheapest option when looking for financial advice.

Insolvency as a sector is increasing and the changes to university fees will challenge new entrants to the profession, although a number of academic institutions are now exploring innovative ways to offset the student debt burden. There is also the need to promote the fact that, around 19% of ACA students are not graduates – they went straight into training from school, whether via the AAT/ACA ‘Fast Track’ route or straight after A levels.

Building business
Apparently business is picking up but the going is slow and tough with access to finance remaining a serious problem for most Small and Medium Enterprises (SMEs).

As the UK recovery becomes more established businesses will need finance for working capital and investment to help economic growth. Banks need to start rebuilding these relationships now to give SMEs confidence to seek finance for growth and this should be addressed urgently.

ICAEW members are well placed to broker and build relationships between banks and potential clients. The challenge for 2011 and 2012 will be to build business confidence as a prerequisite for securing strong and sustainable growth in the medium to long term. Business needs to trust in its advisers, and ICAEW Chartered Accountants locally, nationally and internationally are well placed to provide that confidence.

Finally, there will also be a need, with the demise of the regional development agencies and the Business Links, to find ways of helping businesses take advantage of newly designated Enterprise Zones.

Business sustainability
There is also an increase in the importance of sustainability issues. ICAEW members have a critical role to play in helping businesses and markets deliver long-term economic growth. Through projects such as the Finance Innovation Lab, a think tank launched jointly with WWF-UK, organisations are being encouraged to work in more sustainable ways.

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