The Professional Oversight Board has today published its review of the UK professional accountancy bodies’ monitoring of their members who provide non-regulated accountancy services (such as accounts preparation, payroll, tax and bookkeeping but not audit and insolvency work).

The Oversight Board considers improvements are necessary in order to enhance the effectiveness of the arrangements and public confidence in the profession. These include more detailed reviews of compliance with the Code of Ethics, better examination of complaints received and more comprehensive follow up work to ensure that concerns raised during the monitoring visit are adequately addressed.

During the review the Oversight Board undertook a survey in conjunction with the UK professional accountancy bodies to understand what external users want from providers of non regulated accountancy services. The survey shows the importance that they place on the competence, reputation and qualifications of their accountant.

Dame Barbara Mills, Chair of the Oversight Board, said:

“Given the importance that users place on the competence of the UK professional accountancy bodies it is imperative that the professional bodies respond to the issues we have raised and publish information on how they have done so. In particular it is vital that publicly available information on the monitoring arrangements accurately reflects the work undertaken by the professional body and is of a high standard.”

We have asked the UK professional bodies to provide responses to our recommendations by no later than 1 September 2010.

1. The Financial Reporting Council (FRC) is the UK’s independent regulator responsible for promoting confidence in corporate reporting and governance. Its functions are exercised principally by its operating bodies including the Professional Oversight Board.
2.  The Professional Oversight Board contributes to the achievement of the Financial Reporting Council’s fundamental aim of promoting confidence in corporate reporting and governance. It has four main responsibilities:
   1. a statutory obligation to oversee the regulation of auditors by the recognised accountancy bodies;
   2. the monitoring of the quality of the auditing function in relation to economically significant entities;
   3. independent oversight of the regulation of the accountancy profession by the professional accountancy bodies;
   4. independent oversight of the regulation of the actuarial profession by the professional actuarial bodies.
3. The Professional Oversight Board is independent of the accountancy and actuarial professions. Its members have wide experience of business and the professions, the public sector, accountancy, auditing and actuarial work. The Chair is Dame Barbara Mills DBE QC.
4. This review was restricted to the monitoring activities of the accountancy bodies that the Oversight Board has agreed, by voluntary arrangement, to provide independent oversight of in respect of non regulatory work offered by their members. As such the UK professional accountancy bodies included within this review were – Association of Chartered Certified Accountants (ACCA), Association of International Accountants (AIA), Chartered Accountants Ireland (CAI), Chartered Institute of Management Accountants (CIMA), Chartered Institute of Public Finance and Accountancy (CIPFA), Institute of Chartered Accountants in England and Wales (ICAEW), Institute of Chartered Accountants of Scotland (ICAS).
5. Press enquiries should be directed to Paul George, Director of Auditing and Director, Professional Oversight Board on 0207 492 2340.