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Key Facts and Trends in the Accountancy Profession 2002

Contents

The Review Board 117 Houndsditch London EC3A 7BT www.accountancyfoundation.com

Introduction

The Review Board is a pivotal part of the new system of non-statutory independent regulation of the accountancy profession. Its remit is to monitor the regulatory functions of the six CCAB1 accountancy bodies and the operation of the associated bodies of the Accountancy Foundation to ensure they are operating in the public interest. The diagram below illustrates how the new system works:

The new system

A diagram illustrating the relationships within the new system. The Accountancy Foundation Limited provides funding to The Review Board Limited. The Review Board Limited provides scrutiny to: * The Auditing Practices Board Limited (APB) * The Ethics Standards Board Limited (ESB) * The Investigation and Discipline Board Limited (IDB) * Matters including: Training, Qualification, Registration, Monitoring * Investigation and discipline of members (except IDB cases)

Each of APB, ESB, and IDB also receive scrutiny from The Review Board Limited. All these bodies (APB, ESB, IDB, Training/Qualification/Registration/Monitoring, Investigation/Discipline of members) are linked back to Accountancy Bodies (implying they relate to or serve these bodies).

The Review Board believes that it would be useful if some key facts2 and trends in respect of the accountancy profession were made available to those who are accountants, those who employ accountants and those who purchase the services of accountants. As set out in the Review Board's publication 'Protecting the Public Interest' (February 2002), its preliminary studies included an analysis of data in respect of members and students of the CCAB bodies.

This document is the result of that analysis and provides information in respect of:

  • members of the accountancy profession
  • students of the accountancy profession
  • the income and staffing of the accountancy bodies
  • comparisons between the accountancy bodies
  • the functions and turnover of the accountancy firms

It is intended that 'Key Facts and Trends in the Accountancy Profession' will be an annual publication. In future years it will be published in the autumn to enable the inclusion of data from both the accountancy bodies and accountancy firms on a comparable five year basis.

Main highlights

The Accountancy Bodies 1996-2001

  • The accountancy bodies have almost 307,000 members and 278,000 students worldwide (Tables 1 & 6, pages 7 & 14)
  • The accountancy bodies have over 237,000 members and over 126,000 students based in the UK and the Republic of Ireland (Tables 1 & 7, pages 7 & 15)
  • Membership has been growing at an average rate of 4.6% per year worldwide and 3.9% per year in the UK and the Republic of Ireland (Table 1, page 7)
  • Student numbers have been growing at the rate of 6.4% per year worldwide (Table 6, page 14)
  • 48% of accountants were employed in industry and commerce in 2000 (growing at the rate of 6.9% per year) compared with 27% in public practice (growing at the rate of 5.5% per year) (Tables 2 & 3, pages 9 & 10)
  • 24% of members and 48% of students of the accountancy bodies are female (Tables 5 & 8, pages 11 & 16)

Accountancy Firms 1996-2000

  • 96% of accountancy firms have annual sales of less than £1 million whilst only 1% have sales in excess of £5 million (Table 28, page 55)
  • The annual average income of the Big Five firms has increased by 16.6% whilst that of the other accountancy firms has increased by 10.7% over the period 1996 to 2000 (Tables 32 and 33, page 60)
  • The annual average growth in income for the Big Five firms from consultancy services (26.2%) and tax and legal services (16.5%) has been substantial over the period 1996 to 2000 (Table 32, page 60)
  • The annual average growth in income from audit and accounting services for the Big Five firms (11.8%) is substantially higher than for the other accountancy firms (3.4%) over the period 1996 to 2000 (Tables 32 & 33, page 60)

Members of the Accountancy Bodies

Membership: 1996-2001

Table 1 shows the number of members of the accountancy bodies worldwide (UK/Republic of Ireland and the rest of the world) over the period 1996 to 2001:

Year UK and Republic of Ireland Rest of the world TOTAL
1996 196293 48620 244913
1997 205028 53031 258059
1998 212292 56291 268583
1999 219853 59717 279570
2000 228341 64503 292844
2001 237126 69803 306929
% growth 20.8 43.6 25.3
% annual average growth 3.9 7.5 4.6

Notes:

  1. The location of members is based on the registered address supplied to the accountancy bodies. This may be either the place of employment or the place of residence.
  • There were almost 307,000 members of the accountancy bodies in 2001.
  • 77% (237,126 members) were located in the UK and the Republic of Ireland as opposed to 23% (69,803 members) in the rest of the world.
  • The number of members worldwide has increased by 4.6% on an annual average basis since 1996.
  • The number of members in the UK and the Republic of Ireland has increased by 3.9% on an annual average basis since 1996.

National and international membership

A line chart showing national and international membership trends from 1996 to 2001.

Legend: * UK and Rol (Red line) * Rest of the world (Blue line)

X-axis (Year): 1996, 1997, 1998, 1999, 2000, 2001 Y-axis (Membership): 0 to 250000

Data points (approximate from visual): * UK and Rol: * 1996: 196,000 * 1997: 205,000 * 1998: 212,000 * 1999: 220,000 * 2000: 228,000 * 2001: 237,000 * Rest of the world: * 1996: 48,000 * 1997: 53,000 * 1998: 56,000 * 1999: 60,000 * 2000: 64,000 * 2001: 70,000

The UK and Rol membership consistently increased from around 196,000 in 1996 to 237,000 in 2001. The Rest of the world membership also consistently increased from around 48,000 in 1996 to 70,000 in 2001.

  • The number of members in both the UK/Republic of Ireland and the rest of the world has increased each year since 1996.

Sectoral Employment of Members: 1996-2000

Table 2 shows the sectoral employment of members of the accountancy bodies worldwide over the period 1996 to 2000:

Year Public Practice Industry and Commerce Public Sector Retired Other TOTAL
1996 63996 106637 18881 25225 30174 244913
1997 68199 114645 20965 26944 27306 258059
1998 70139 122123 20609 27464 28248 268583
1999 73181 127288 21238 28402 29461 279570
2000 79267 139239 23165 29975 21198 292844
% growth 23.9 30.6 22.7 18.8 -29.7 19.6
% annual average growth 5.5 6.9 5.2 4.4 -6.7 4.6

Notes:

  1. CIPFA does not presently differentiate between those employed in public practice, industry and commerce and 'other'. The table above assumes that they are classified as 'other'.
  2. ICAEW, ICAI and ICAS presently provide combined figures for those employed in industry and commerce and the public sector. The table above assumes that they are classified as 'industry and commerce'.
  3. 'Other' includes those members who are unemployed, taking a career break, undertaking full time study or maternal absence and those who are unclassified (i.e. those who have not provided the necessary information to enable classification). The figures for 'other' decline over the period 1996 to 2000 which reflects a reduction in the 'unclassified' component of 'other'.
  • Between 1996 and 2000 the employment of members in industry and commerce showed an annual average increase of 6.9% compared with an increase in those employed by the public sector (5.2%) and public practice (5.5%).

Table 3 shows the percentage of members in each sector in 2000 compared with 1996:

1996 % 2000 %
Public practice 26 27
Industry and commerce 44 48
Public sector 8 8
Retired 10 10
Other 12 7

1996: Sectoral Employment of Members

A pie chart showing the percentage of members in different sectors in 1996.

Legend: * Public practice (26%) * Industry & commerce (44%) * Public sector (8%) * Retired (10%) * Other (12%)

2000: Sectoral Employment of Members

A pie chart showing the percentage of members in different sectors in 2000.

Legend: * Public practice (27%) * Industry & commerce (48%) * Public sector (8%) * Retired (10%) * Other (7%)

  • The number of members in industry and commerce increased from 44% to 48% over the period 1996 to 2000.
  • 27% of members were in public practice and 8% in the public sector in 2000.

Sectoral Employment of Members: 2001

Table 4 shows the sectoral employment of members of the accountancy bodies worldwide in 2001:

Public Practice Industry and Commerce Public Sector Retired Other TOTAL
2001 66065 164785 23705 30483 21891 306929

Notes:

  1. The number of members in public practice has declined significantly between 2000 and 2001 with a proportionate increase in the number of members in industry and commerce. This is mainly due to the reclassification of those members employed in management consultancy firms which were previously classified as accountancy firms and are now classified as commercial companies. For this reason, figures for 2001 are not included in Table 3 to avoid artificial distortion of the growth rate.
  • 21% of members are currently in public practice, compared with 54% in industry and commerce and 8% in the public sector.

Gender of Members: 1996-2001

Table 5 shows the percentage of female members of the accountancy bodies worldwide over the period 1996 to 2001:

Year % females
1996 18
1997 20
1998 21
1999 22
2000 24
2001 24

Notes:

  1. ICAI did not analyse its members by gender before 2000 and is omitted from the table above from 1996 to 1999.
  • The percentage of female members of the accountancy bodies has increased from 18% to 24% over the period 1996 to 2001.
  • Comparison with solicitors and hospital doctors suggests that the accountancy profession has proportionately less female members3.

Age of Members: 2001

The pie chart below shows the age range of members of the accountancy bodies worldwide in 2001:

A pie chart showing the age range of members of the accountancy bodies worldwide in 2001.

Legend: * Under 25 (0%) * 25-34 (27%) * 35-44 (31%) * 45-54 (22%) * 55-64 (11%) * 65 and over (9%)

  • 31% of members of the accountancy bodies are in the age range 35-44 compared with 27% in the age range 25-34, 22% in the age range 45-54 and 11% in the age range 55-64.
  • Only 9% of members of the accountancy bodies are in the combined age range of 'under 25' and ‘65 and over'.
  • Comparison with solicitors and hospital doctors suggests that the accountancy profession has an older age profile3.

AGE OF MEMBERS: 2001

The pie chart below shows the age range of members of the accountancy bodies worldwide in 2001:

Pie chart showing Age of Members: 2001

The chart is divided into segments representing age ranges with their respective percentages: * Under 25: 0% * 25-34: 27% * 35-44: 31% * 45-54: 22% * 55-64: 11% * 65 and over: 9%

  • 31% of members of the accountancy bodies are in the age range 35-44 compared with 27% in the age range 25-34, 22% in the age range 45-54 and 11% in the age range 55-64.
  • Only 9% of members of the accountancy bodies are in the combined age range of 'under 25' and '65 and over'.
  • Comparison with solicitors and hospital doctors suggests that the accountancy profession has an older age profile3.

STUDENTS OF THE ACCOUNTANCY BODIES

STUDENTS: 1996-2001

Table 6 shows the number of students of the accountancy bodies registered worldwide over the period 1996 to 2001:

Year Total worldwide
1996 203871
1997 213593
1998 241277
1999 256437
2000 265343
2001 278179
% growth 36.4
% annual average growth 6.4

Table 6

Notes: 1. The figures include ACCA affiliates and CIMA passed finalists (i.e. those who have completed their examinations but have not yet been admitted into membership). 2. The figures for ICAEW, ICAS and ICAI refer to the number of students in registered training contracts.

  • 278,000 students of the accountancy bodies were registered worldwide in 2001.
  • The number of students worldwide has increased by 6.4% on an annual average basis since 1996.

LOCATION OF STUDENTS: 2001

Table 7 shows the location of students of the accountancy bodies registered worldwide in 2001:

No. %
UK & Republic of Ireland 126491 45
Rest of the world 151688 55
TOTAL 278179 100

Table 7

Notes: 1. The location of students is based on the registered address supplied to the accountancy bodies. This may be either the place of employment or the place of residence.

  • 45% of students (over 126,000) were based in the UK and the Republic of Ireland as opposed to the rest of the world in 2001.

SECTORAL EMPLOYMENT OF STUDENTS: 2001

Pie chart showing Sectoral Employment of Students: 2001

The chart is divided into segments representing employment sectors with their respective percentages: * Public practice: 25% * Industry and commerce: 56% * Public sector: 16% * Other: 3%

Notes: 1. CIPFA does not presently differentiate between those in public practice, industry and commerce and 'other'. The table above assumes that they are classified as 'other'. 2. ICAEW, ICAI and ICAS presently provide combined figures for those in industry and commerce and the public sector. The table above assumes that they are classified as 'industry and commerce'. 3. 'Other' includes those students not in employment, i.e. studying full time.

  • 56% of students were in industry and commerce compared with 25% in public practice and 16% in the public sector in 2001.

GENDER OF STUDENTS: 2001

Table 8 shows the percentage of female students of the accountancy bodies registered worldwide over the period 1996 to 2001:

Year % females
1996 43
1997 44
1998 46
1999 47
2000 48
2001 48

Table 8

Notes: 1. The figures for ICAI and ICAS students refer to the proportion in the student intake, not the total number of students.

  • The percentage of female students of the accountancy bodies has increased from 43% to 48% over the period 1996 to 2001.

AGE OF STUDENTS: 2001

Pie chart showing Age of Students: 2001

The chart is divided into segments representing age ranges with their respective percentages: * Under 25: 37% * 25-34: 48% * 35-44: 12% * 45-54: 3% * 55 and over: 0%

Notes: 1. ICAEW figures are estimated based on the percentage in each age band of responses received, since not all students provided information in respect of their ages.

  • 48% of students were aged between 25 and 34 whilst 37% of students were less than 25 years of age in 2001.

THE ACCOUNTANCY BODIES

Income and Expenditure

Table 9 shows the income of the accountancy bodies over the period 1998 to 2001:

1998 (£000) 1999 (£000) 2000 (£000) 2001 (£000)
Income 121604 132822 140870 170686

Table 9

These monies are expended on:

  • education and training
  • member services
  • management and governance
  • regional and international activities
  • publications, courses and conferences
  • regulation and discipline
  • promotion and development
  • policy and technical

The income of the accountancy bodies in 2001 comes from a variety of sources:

Pie chart showing Income Sources of Accountancy Bodies in 2001

The chart is divided into segments representing income sources with their respective percentages: * Members' fees: 27% * Students' and examination fees: 31% * Regulation: 8% * Investment: 2% * Member services: 9% * Trading subsidiaries: 21% * Miscellaneous: 2%

  • Members' fees and students' and examination fees accounted for almost 60% of the income of the accountancy bodies in 2001.
  • Income from regulation, member services and trading subsidiaries accounted for the majority of the remaining income.

Staffing

Table 10 shows the number of staff employed by the accountancy bodies over the period 1996 to 2001:

Year Number of staff
1996 1274
1997 1277
1998 1290
1999 1370
2000 1447
2001 1631

Table 10

COMPARISONS BETWEEN THE ACCOUNTANCY BODIES

MEMBERS

Members in the UK and the Republic of Ireland: 1996-2001

Table 11 shows the number of members of each of the accountancy bodies in the UK and the Republic of Ireland over the period 1996 to 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
1996 32235 34172 12517 96489 8788 12092 196293
1997 36267 36324 12861 97968 9370 12238 205028
1998 39406 38014 13061 99691 9758 12362 212292
1999 41995 40137 13143 101748 10269 12561 219853
2000 45392 42717 13176 103478 10721 12857 228341
2001 49085 44979 13192 105804 11196 12870 237126
% growth 52.3 31.6 5.4 9.7 27.4 6.4 20.8
% annual average growth 8.8 5.6 1.1 1.9 5.0 1.2 3.9

Table 11

  • The membership in the UK and the Republic of Ireland of each of the accountancy bodies has increased every year during this period.
  • The most rapidly growing accountancy bodies in terms of members in the UK and the Republic of Ireland since 1996 are ACCA (8.8% on an annual average basis), CIMA (5.6%) and ICAI (5.0%).

Bar chart showing Members in the UK and the Republic of Ireland by Body (1996-2001) The chart displays membership numbers for ACCA, CIMA, CIPFA, ICAEW, ICAI, and ICAS from 1996 to

  1. For each body, there are six bars representing the years, with 2001 being the highest for most.

Members worldwide: 1996-2001

Table 12 shows the number of members of each of the accountancy bodies worldwide (UK, Republic of Ireland and the rest of the world) over the period 1996 to 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
1996 52576 44412 12709 111169 9851 14196 244913
1997 60046 47230 13057 112872 10459 14395 258059
1998 66083 49157 13271 114679 10861 14532 268583
1999 71538 51692 13356 116929 11357 14698 279570
2000 79027 54934 13396 118771 11828 14888 292844
2001 86929 57616 13471 121356 12515 15042 306929
% growth 65.3 29.7 6.0 9.2 27.0 6.0 25.3
% annual average growth 10.6 5.3 1.2 1.8 4.9 1.2 4.6

Table 12

  • The membership worldwide of each of the accountancy bodies has increased every year during this period.
  • The most rapidly growing accountancy bodies in terms of membership worldwide since 1996 are ACCA (10.6% on an annual average basis), CIMA (5.3%) and ICAI (4.9%).

Chart: Members worldwide (1996-2001) This bar chart illustrates the membership worldwide of ACCA, CIMA, CIPFA, ICAEW, ICAI, and ICAS from 1996 to

  1. Each body shows an increasing trend in membership over the period.

Location of members: 2001

Table 13 shows the location (UK, Republic of Ireland and the rest of the world) of members of each of the accountancy bodies for the year 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
UK & Republic of Ireland 49085 44979 13192 105804 11196 12870 237126
Rest of the world 37844 12637 279 15552 1319 2172 69803
TOTAL 86929 57616 13471 121356 12515 15042 306929

Table 13

Notes:

  1. The location of members is based on the registered address supplied to the accountancy bodies. This may be either the place of employment or the place of residence.
  • 44% of ACCA's members and 22% of CIMA's members were located outside the UK and the Republic of Ireland in 2001.
  • The other bodies each had no more than 15% of their members located outside the UK and the Republic of Ireland in 2001.

Sectoral employment of members: 2001

Table 14 shows the sectoral employment of members of each of the accountancy bodies worldwide in 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
Public practice 24579 1326 - 31897 4103 4160 66065
Industry and commerce 36103 41130 - 72874 7610 7068 164785
Public sector 10719 4309 8677 - - - 23705
Retired 4559 7267 2673 12619 582 2783 30483
Other 10969 3584 2121 3966 220 1031 21891
TOTAL 86929 57616 13471 121356 12515 15042 306929

Table 14

Notes:

  1. CIPFA does not presently differentiate between those employed in public practice, industry and commerce and 'other'. The table above assumes that they are classified as 'other'.
  2. ICAEW, ICAI and ICAS presently do not differentiate between those employed in industry and commerce and those employed in the public sector. The table above assumes that they are classified as 'industry and commerce'.
  3. 'Other' includes those members who are unemployed, taking a career break, undertaking full time study or maternal absence and those who are unclassified (i.e. those who have not provided the necessary information to enable classification).
  • Very few members of CIMA and CIPFA are employed in public practice reflecting the fact that neither accountancy body has Recognised Qualifying Body status (i.e. allowed to train their students/members to practise in the reserved areas of audit, insolvency and investment business).
  • The percentage of members in public practice varied between 26% and 33% for the other accountancy bodies in 2001.

Gender of members: 1996-2001

Table 15 shows the percentage of female members of each of the accountancy bodies worldwide over the period 1996 to 2001:

ACCA % CIMA % CIPFA % ICAEW % ICAI % ICAS %
1996 25 15 20 16 - 17
1997 27 17 21 17 - 18
1998 29 18 22 17 - 19
1999 31 19 22 18 - 20
2000 33 21 23 19 23 20
2001 35 22 24 19 25 21

Table 15

Notes:

  1. ICAI did not analyse its members by gender before 2000.
  • The percentage of female members of each of the accountancy bodies varied between 19% and 25% in 2001 with the exception of ACCA where the percentage was 35%.
  • The percentage of female members of each of the accountancy bodies has increased every year during the period 1996 to 2001.

Chart: Percentage (%) of female members 2001

This bar chart displays the percentage of female members for ACCA (35%), CIMA (22%), CIPFA (24%), ICAEW (19%), ICAI (25%), and ICAS (21%) in 2001.

Age of members: 2001

Table 16 shows the age range of the members of each of the accountancy bodies worldwide for 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
under 25 561 34 2 154 20 66 837
25-34 32709 13105 2130 27379 4268 3547 83138
35-44 28050 19811 3974 34766 4156 3719 94476
45-54 15436 13510 3922 27915 2228 3122 66133
55-64 5601 5938 1981 17177 1024 2251 33972
65 and over 4572 5218 1462 13965 819 2337 28373
TOTAL 86929 57616 13471 121356 12515 15042 306929

Table 16

Notes:

  1. This data was not collected by ICAEW or ICAI before 2000.
  2. The age profiles of ACCA and CIMA have decreased due to the substantial growth rates of members admitted in the last 10 years.

The diagrams below analyse the age range of each of the accountancy bodies (excluding ICAEW and ICAI) for 1996:

Pie Charts: Age range of members (1996)

  • ACCA: Shows age distribution, with 32% under 25, 34% in 25-34, 20% in 35-44, 7% in 45-54, 6% in 55-64, and 1% 65 and over.
  • CIMA: Shows age distribution, with 23% under 25, 33% in 25-34, 24% in 35-44, 10% in 45-54, 10% in 55-64, and 0% 65 and over.
  • CIPFA: Shows age distribution, with 23% under 25, 28% in 25-34, 30% in 35-44, 9% in 45-54, 10% in 55-64, and 0% 65 and over.

Pie Charts: Age range of ICAS members (1996)

  • ICAS: Shows age distribution, with 25% under 25, 25% in 25-34, 21% in 35-44, 15% in 45-54, 14% in 55-64, and 0% 65 and over.

The diagrams below analyse the age range of members of each of the accountancy bodies for the year 2001:

Pie Charts: Age range of members (2001)

  • ACCA: Shows age distribution, with 38% under 25, 32% in 25-34, 18% in 35-44, 6% in 45-54, 5% in 55-64, and 1% 65 and over.
  • CIMA: Shows age distribution, with 23% under 25, 35% in 25-34, 23% in 35-44, 10% in 45-54, 9% in 55-64, and 0% 65 and over.
  • CIPFA: Shows age distribution, with 16% under 25, 29% in 25-34, 29% in 35-44, 15% in 45-54, 11% in 55-64, and 0% 65 and over.
  • ICAEW: Shows age distribution, with 23% under 25, 28% in 25-34, 23% in 35-44, 14% in 45-54, 12% in 55-64, and 0% 65 and over.
  • ICAI: Shows age distribution, with 34% under 25, 33% in 25-34, 18% in 35-44, 8% in 45-54, 7% in 55-64, and 0% 65 and over.
  • ICAS: Shows age distribution, with 24% under 25, 24% in 25-34, 21% in 35-44, 15% in 45-54, 16% in 55-64, and 0% 65 and over.
  • The age profile of ACCA members becomes younger and the age profile for CIPFA members becomes older over the period 1996 to 2001.
  • The age profiles of ACCA and ICAI members are younger than the age profiles of CIPFA and ICAS members in 2001.

STUDENTS

Students registered worldwide: 1996-2001

Table 17 shows the number of students of each of the accountancy bodies registered worldwide over the period 1996 to 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
1996 128107 58744 2683 10626 2500 1211 203871
1997 134732 61799 2323 11021 2500 1218 213593
1998 156299 67320 2086 11720 2600 1252 241277
1999 167668 71203 2079 11585 2667 1235 256437
2000 174201 73761 2213 10727 2789 1652 265343
2001 185392 75263 2322 10114 3008 2080 278179
% growth 44.7 28.1 -13.5 -4.8 20.3 71.8 36.4
% annual average growth 7.7 5.1 -2.6 -0.9 3.8 11.4 6.4

Table 17

Notes:

  1. Figures for ICAI are estimated for 1996 to 1998.
  2. The figures include ACCA affiliates and CIMA passed finalists (i.e. those who have completed their examinations but have not yet been admitted into membership).
  3. The figures for ICAEW, ICAS and ICAI refer to the number of students in registered training contracts.
  • The student membership worldwide of each of the accountancy bodies (with the exception of CIPFA and ICAEW) has increased over the period 1996 to 2001.
  • The most rapidly growing accountancy bodies in terms of student membership worldwide since 1996 are ICAS (11.4% on an annual average basis), ACCA (7.7%) and CIMA (5.1%).

Chart: Number of students worldwide 2001

This bar chart illustrates the number of students worldwide for ACCA (185,392), CIMA (75,263), CIPFA (2,322), ICAEW (10,114), ICAI (3,008), and ICAS (2,080) in 2001.

Location of students: 2001

Table 18 shows the location (UK, Republic of Ireland and the rest of the world) of students of each of the accountancy bodies for the year 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
UK & Republic of Ireland 57398 51827 2297 9881 3008 2080 126491
Rest of the world 127994 23436 25 233 - - 151688
TOTAL 185392 75263 2322 10114 3008 2080 278179

Table 18

Notes:

  1. The location of students is based on the registered address supplied to the accountancy bodies. This may be either the place of employment or the place of residence.
  • 45% of students were based in the UK and the Republic of Ireland as opposed to the rest of the world in 2001.
  • The vast majority (at least 97%) of students of each accountancy body were based in the UK and the Republic of Ireland, with the exception of ACCA (31% of students based in the UK and the Republic of Ireland) and CIMA (69% of students).

Sectoral employment of students: 2001

Table 19 shows the sectoral employment of students of each of the accountancy bodies worldwide for 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
Public practice 55246 - - 9976 2933 2059 70214
Industry and commerce 91398 63519 - 138 75 21 155151
Public sector 35597 6799 2135 - - - 44531
Other 3151 4945 187 - - - 8283
TOTAL 185392 75263 2322 10114 3008 2080 278179

Table 19

Notes:

  1. CIPFA does not presently differentiate between those employed in public practice, industry and commerce and 'other'. The table above assumes that they are classified as 'other'.
  2. ICAEW and ICAS presently provide combined figures for those employed in industry and commerce and the public sector. The table above assumes that they are classified as 'industry and commerce'.
  3. 'Other' includes those students not in employment.
  • Very few students of CIMA and CIPFA are employed in public practice reflecting the fact that neither accountancy body has Recognised Qualifying Body status (i.e. allowed to train their students/members to practise in the reserved areas of audit, insolvency and investment business).
  • Almost all the student members of ICAEW, ICAI and ICAS are employed in public practice compared with 30% for ACCA, which operates across all sectors of the profession.

Gender of students: 1996-2001

Table 20 shows the percentage of female students of each of the accountancy bodies worldwide over the period 1996 to 2001:

ACCA % CIMA % CIPFA % ICAEW % ICAI % ICAS %
1996 47 37 41 39 46 45
1997 47 38 42 41 45 47
1998 49 39 44 43 49 52
1999 50 41 46 43 51 47
2000 51 42 46 45 49 46
2001 51 42 47 45 54 46

Table 20

Notes:

  1. ICAI and ICAS figures refer to the proportion of females in the student intake, not the total number of students
  • The percentage of female students of each of the accountancy bodies varied between 42% and 54% in 2001.
  • The percentage of female students of each of the accountancy bodies has increased every year during the period 1996 to 2000, with four out of the six bodies stabilising in 2001.

Bar Chart: Percentage (%) of female students 2001 This bar chart displays the percentage of female students for various accountancy bodies in

  1. The y-axis represents percentage from 0% to 60%.
  • ACCA: Approximately 51%
  • CIMA: Approximately 42%
  • CIPFA: Approximately 47%
  • ICAEW: Approximately 45%
  • ICAI: Approximately 54%
  • ICAS: Approximately 46%

Age of students: 2001

The diagrams below analyse the age range of students of each of the accountancy bodies worldwide for 2001:

Pie Chart: ACCA Student Age Distribution

This pie chart shows the age distribution of ACCA students.

  • Under 25: 42%
  • 25-34: 46%
  • 35-44: 10%
  • 45-54: 2%
  • 55 and over: 0%

Pie Chart: CIMA Student Age Distribution

This pie chart shows the age distribution of CIMA students.

  • Under 25: 18%
  • 25-34: 19%
  • 35-44: 57%
  • 45-54: 5%
  • 55-64: 1%
  • 65 and over: 0%

Pie Chart: CIPFA Student Age Distribution

This pie chart shows the age distribution of CIPFA students.

  • Under 25: 16%
  • 25-34: 50%
  • 35-44: 25%
  • 45-54: 9%
  • 55-64: 0%

Pie Chart: ICAEW Student Age Distribution

This pie chart shows the age distribution of ICAEW students.

  • Under 25: 70%
  • 25-34: 29%
  • 35 and over: 1%

Pie Chart: ICAI Student Age Distribution

This pie chart shows the age distribution of ICAI students.

  • Under 25: 93%
  • 25-34: 6%
  • 35-44: 1%
  • 45 and over: 0%

Pie Chart: ICAS Student Age Distribution

This pie chart shows the age distribution of ICAS students.

  • Under 25: 72%
  • 25-34: 24%
  • 35-44: 3%
  • 45 and over: 1%

Notes:

  1. ACCA figures relate to the student intake, not the age profile, of the student body.
  • CIPFA (34% of students above 35 years of age) and CIMA (25%) have more mature students than the other accountancy bodies.

Student registration

The Review Board's document on 'Protecting the Public Interest' (February 2002) suggests that the predominant focus of the accountancy bodies is on outcome (i.e. by ensuring that their students receive maximum benefit from their respective training programmes).

Nevertheless there are differences in the respective educational qualifications of those entering the various training schemes, which is often a reflection of the selection policies adopted by different employers.

The following section deals with three aspects of the different educational qualifications of those entering the various training schemes offered by the accountancy bodies:

  • percentage of graduates
  • percentage of graduates with relevant degrees
  • percentage of graduates with first and upper second class honours degrees

It should also be pointed out that these figures are worldwide and do not reflect the fact that students outside the UK and Republic of Ireland often opt for a professional qualification as an alternative to a degree. In addition some of the accountancy bodies are developing degree programmes with universities which will alter these percentage figures in the future.

Percentage of graduates

Table 21 shows the percentage of graduates registered as students by each of the accountancy bodies worldwide over the period 1996 to 2001:

ACCA % CIMA % CIPFA % ICAEW % ICAI % ICAS %
43 39 52 95 93 98
45 42 58 94 93 98
47 42 57 95 90 97
47 40 45 92 92 98
50 41 58 93 94 92
50 45 52 90 93 92

Table 21

Notes:

  1. CIMA's registration process does not record all previous qualifications. As a result, the percentage of graduates shown above only includes those students known to hold degrees and may actually be significantly higher.
  • ICAEW, ICAI and ICAS have a greater percentage of students with a degree than the other accountancy bodies.

Bar Chart: Percentage of students holding a degree 2001 This bar chart shows the percentage of students holding a degree for various accountancy bodies in

  1. The y-axis represents percentage from 0% to 100%.
  • ACCA: 50%
  • CIMA: 45%
  • CIPFA: 52%
  • ICAEW: 90%
  • ICAI: 93%
  • ICAS: 92%

Percentage of graduates with relevant degrees

Table 22 shows the percentage of graduates with relevant degrees registered worldwide as students by ICAEW, ICAI and ICAS over the period 1996 to 2001:

ICAEW % ICAI % ICAS %
48 82 71
45 75 62
44 77 66
45 79 70
44 79 45
46 75 28

Table 22

Notes:

  1. Information is only available in 2001 for ACCA and CIPFA which suggests that 39% of ACCA students and 23% of CIPFA students possess a relevant degree. No information is available for CIMA over this period.
  2. The figures for ICAI and ICAS refer to the proportion of students in the annual intake, not the total number of students.
  3. The percentage of relevant degree holders for ICAS has decreased in 2000 and 2001 due to a large increase in students from English firms, which tend to recruit graduates from a wider range of disciplines.
  4. The accountancy bodies' definitions of a 'relevant degree' are as follows:
    • ACCA: Accountancy, Business
    • CIMA: Business Studies, Business Administration, Finance, Accountancy
    • CIPFA: Accountancy
    • ICAEW: Accountancy, Business Studies
    • ICAI: Accountancy, Business & Commerce, Finance
    • ICAS: Accountancy
  • ICAI has more students with a relevant degree than the other accountancy bodies.

Percentage of graduates with first and upper second class honours degrees

Table 23 shows the percentage of graduates by the classification of their degrees (the percentage of graduates with first and upper second class honours degrees) registered as students by ICAEW, ICAI and ICAS over the period 1996 to 2001:

ICAEW % ICAI % ICAS %
76 95 76
77 93 82
77 93 82
77 91 82
79 92 85
75 91 82

Table 23

Notes:

  1. Data is not available for ACCA, CIMA or CIPFA over this period.
  2. The approach to further education in Scotland differs from elsewhere in the UK and the Republic of Ireland. In the former students receive ordinary degrees if they complete their course of study after three years and honours degrees after four years. The figures for ICAS refer to all students receiving an honours degree regardless of classification.
  3. Figures for ICAI and ICAS refer to the proportion of students in the annual intake, not the total number of students.
  • The majority of students registered with ICAEW, ICAI and ICAS have first and upper second class honours degrees.

Pass Rates

The following section deals with two aspects of the examination process to determine if there are differences in the approach adopted and/or the relative success of students registered by each of the accountancy bodies:

  1. the percentage of overall passes at the final examination stage for the year 2001
  2. the percentage of first time passes at the final examination stage for the year 2001

Information is not generally available for overall passes at earlier stages of the examination process or in respect of students passing each stage of their examinations at the first attempt.

Table 24 shows the percentage of overall and first time passes at the final examination stage for the year 2001:

Overall passes % First time passes %
ACCA 43 49
CIMA 49 61
CIPFA 51 52
ICAEW 78 82
ICAI 84 87
ICAS 72 77

Table 24

Notes:

  1. The first time passes are a percentage of overall passes.
  • The percentage of overall and first time passes for ICAEW, ICAI and ICAS are higher than the other accountancy bodies.

Income

Table 25 shows the income of each of the accountancy bodies in 2001:

£000 %
ACCA 41020 24.0
CIMA 25567 15.0
CIPFA 28967 17.0
ICAEW 53987 31.6
ICAI 8105 4.8
ICAS 13040 7.6
TOTAL 170686 100.0

Table 25

  • ICAEW (31.6% of total income) and ACCA (24.0%) are the two largest accountancy bodies in terms of income.

Bar Chart: Income by accountancy body 2001 This bar chart shows the income in £000 for each accountancy body in

  1. The y-axis ranges from 0 to 60000.
  • ACCA: Approx. 41000
  • CIMA: Approx. 25000
  • CIPFA: Approx. 29000
  • ICAEW: Approx. 54000
  • ICAI: Approx. 8000
  • ICAS: Approx. 13000

Staffing

Table 26 shows the number of staff employed by the accountancy bodies in the UK and the Republic of Ireland over the period 1996 to 2001:

ACCA CIMA CIPFA ICAEW ICAI ICAS TOTAL
1996 203 168 260 459 74 110 1274
1997 225 177 247 438 75 115 1277
1998 251 198 230 415 75 121 1290
1999 280 216 228 438 81 127 1370
2000 295 223 242 471 84 132 1447
2001 348 240 278 541 87 137 1631

Table 26

Notes:

  1. Figures for ICAEW do not include 50 staff whose costs are borne by the Joint Monitoring Unit Limited although they have contracts of employment with the Institute.
  • ICAEW (541 members of staff) and ACCA (348 members of staff) are the two largest accountancy bodies in terms of staffing.

Line Chart: Staff employed by the accountancy bodies 1996-2001 This line chart shows the number of staff employed by ACCA, CIMA, CIPFA, ICAEW, ICAI, and ICAS from 1996 to

  1. The y-axis represents staff count from 0 to 600.
  • ACCA: Shows a steady increase from approx. 200 in 1996 to 348 in 2001.
  • CIMA: Shows an increase from approx. 170 in 1996 to 240 in 2001.
  • CIPFA: Shows fluctuation, starting at approx. 260 in 1996, dipping, and ending at 278 in 2001.
  • ICAEW: Shows a general increase from approx. 460 in 1996 to 541 in 2001, with some fluctuations.
  • ICAI: Shows a slight increase from approx. 75 in 1996 to 87 in 2001.
  • ICAS: Shows an increase from approx. 110 in 1996 to 137 in 2001.

Table 27 shows staff costs as a percentage of total expenditure in 2001:

%
ACCA 31.9
CIMA 30.0
CIPFA 38.6
ICAEW 31.3
ICAI 30.7
ICAS 34.0

Table 27

  • CIPFA (38.6%) and ICAS (34.0%) have the highest staff costs as a proportion of total expenditure.

Bar Chart: Staff costs as a percentage of total expenditure 2001 This bar chart displays the staff costs as a percentage of total expenditure for various accountancy bodies in

  1. The y-axis represents percentage from 0% to 40%.
  • ACCA: 31.9%
  • CIMA: 30.0%
  • CIPFA: 38.6%
  • ICAEW: 31.3%
  • ICAI: 30.7%
  • ICAS: 34.0%

Notes:

  1. ICAS is the only UK professional body to teach and examine all students.

  2. ICAS is the only UK professional body to teach and examine all students.

THE FUNCTIONS AND TURNOVER OF ACCOUNTANCY FIRMS

Key Note Ltd specialises in providing UK market information in respect of a number of business activities. The firm has produced a wide variety of statistical information on the accountancy profession over a number of years.

Permission has kindly been given by Key Note Ltd to reproduce some of their material 6 with a view to enlarging upon the information which is available to members of the public and interested parties in respect of the accountancy profession.

Market position

Table 28 shows the number of UK accountancy and related businesses by turnover for the year 1999:

Turnover (£000) Number of Businesses % of Total
1-99 41915 65
100-499 17405 27
500-999 2495 4
1,000-4,999 1920 3
Over 5,000 370 1
Total 64105 100

Table

  1. Source: Office for National Statistics

Notes:

  1. In 1999, measured on the basis of the number of VAT-based enterprises, there were 64,105 companies operating in the UK in the primary areas of accounting and book-keeping services, tax consultancy activities, business and management consultancy, financial management, and general management and consultancy services not elsewhere specified. Approximately 22,000 of these are member firms of the CCAB bodies.
  2. Within these numbers are consultancies for public relations, and excluded from these numbers are many other types of independent consultancies offering specialised management advice and services in technology and information technology (IT) systems. Many of these could be self-employed consultants who are not registered for VAT.
  • 96% of the businesses have annual sales of less than £1 million, whilst only 1% have sales in excess of £5 million. The vast majority of the industry is occupied by small businesses with annual sales of less than £500,000.

Market sectors

The accountancy profession serves a number of markets. The main activities covered by accountancy firms are:

  • audit and accounting
  • management consultancy
  • tax and legal services
  • corporate finance and business recovery

In addition other activities are carried out, such as:

  • forensic accounting
  • actuarial services
  • transaction services
  • outsourcing

Each of these is discussed in turn:

Audit and accounting

The examination, preparation and presentation of annual company accounts in accordance with each company's Memorandum of Association, tax law, company law and good practice, in a manner which provides a true and fair view of the company's financial position over the accounting period.

Management consultancy

Many of the largest accountancy practices have grown into management consultancy, either by design or at the request of their clients. However there is a recent trend whereby some of the larger practices are divesting themselves of their consulting arms. Consultancy requires board-level contact and covers advice on all the key management skills, including overall business strategy, IT, finance, production management, logistics and distribution, human resources and organisation and research.

The provision of advice on taxation and the changes in legislation that affect taxation issues. Accountants can be retained to prepare accounts for submission to the Inland Revenue and to help with the preparation of tax strategies and tax planning.

Corporate finance

Accountants can be retained to provide advice and services on a wide range of corporate finance issues, including mergers and acquisitions, disposals, management buy-outs, share issues, stock market flotations, privatisations, project and structural finance, private finance initiative (PFI) activities, large-scale leasing, debt management and factoring.

Business recovery

Business recovery refers to the work that accountants carry out concerned with insolvencies, liquidation and administration. In the first six months of 1999, for instance, figures from Dun and Bradstreet show that there were over 21,287 business failures in the UK, an increase of 10.7% against the total over the same period twelve months earlier.

Forensic accounting

Forensic accounting is concerned with legal, regulatory and investigative work in cases of fraud and other kinds of financial irregularities.

Actuarial services

Actuarial services concern the development of insurance and pensions services, as well as advice on any pensions aspects of takeovers and mergers.

Transaction services

Transaction services involve all kinds of investigative work that might arise at all stages of a transaction such as a takeover or merger. This type of service was used extensively in the course of transactions which transferred nationalised industries, such as the water utilities and railways, into private ownership or part ownership.

Outsourcing

The demand for greater efficiency in cost control and management has raised the importance of outsourcing, which is based on contracting for the supply of key activities (such as computing, debt management, etc.) through an independent third party, as an alternative to the previous practice of in-sourcing (carrying out these and similar activities utilising the company's own resources).

Table 29 shows the total UK market for accountancy and related services performed by accountants by value at current prices for the period 1996 to 2000:

The UK market for accountancy and related services performed by accountants by value at current prices (£m): 1996-2000 1996 1997 1998 1999 2000
Management consultancy 2202 2638 3238 3600 4240
Audit and accounting 2203 2436 2562 2778 3049
Tax and legal services 1215 1339 1553 1849 2101
Corporate finance and business recovery 641 703 781 918 1067
Total 6261 7116 8134 9145 10457
% change year on year - 13.7 14.3 12.4 14.3

Table

  1. Source: Key Note

Note:

  1. The figures are based on fee income.

Table 30 shows the annual average growth of the main activities carried out by accountancy firms over the period 1996 to 2000:

Activities % annual average growth
Management consultancy 23.1
Tax and legal services 18.2
Corporate finance and business recovery 16.6
Audit and accounting 9.6
TOTAL 16.8

Table

  1. Source: Key Note

Notes:

  1. The figures for management consultancy exclude income from Cap Gemini and Accenture (formerly the consultancy arms of Ernst & Young and Andersen Worldwide respectively)
  • The annual average growth of some activities (management consultancy, tax and legal services, corporate finance and business recovery) increased more than audit and accounting services over the period 1996 to 2000.

Size of firm

Table 31 shows the major market shares in the UK accountancy and related services market by size of firm for the year 2000:

The major market shares in the UK accountancy and related services market by size of firm (%): 2000
The Big Five 54.0
Firms ranking 6th to 50th 13.8
Rest of the accountancy profession 32.2

Table

  1. Source: Key Note
  • The market share of the Big Five firms in the UK accountancy market was 54.0% in 2000.
  • This compares with firms in the middle-tier (13.8% market share) and the rest of the accountancy profession (32.2% market share).

Tables 32 and 33 compare the market share of the Big Five firms with the other accountancy firms in respect of the major accountancy activities over the period 1996 to 2000:

Big Five

1996 (£000) 1997 (£000) 1998 (£000) 1999 (£000) 2000 (£000) Annual average growth %
Management consultancy 631 808 1008 1151 1600 26.2
Tax and legal services 734 824 961 1164 1350 16.5
Corporate finance 435 473 533 640 730 13.8
Audit and accounting 1259 1435 1531 1728 1969 11.8
TOTAL 3059 3540 4033 4683 5649 16.6
% of total business 49 50 50 51 54 -

Table

  1. Source: Key Note

Notes:

  1. The figures for management consultancy exclude income from Cap Gemini and Accenture (formerly the consultancy arms of Ernst & Young and Andersen Worldwide respectively)

Other

1996 (£000) 1997 (£000) 1998 (£000) 1999 (£000) 2000 (£000) Annual average growth %
Management consultancy 1571 1830 2230 2449 2640 13.9
Tax and legal services 481 515 592 685 751 11.8
Corporate finance 206 230 248 278 337 13.1
Audit and accounting 944 1001 1031 1050 1080 3.4
TOTAL 3202 3576 4101 4462 4808 10.7
% of total business 51 50 50 49 46 -

Table

  1. Source: Key Note
  • Over the period 1996 to 2000 the Big Five firms have increased their proportion of the market from 49% to 54% compared with the other accountancy firms.
  • The annual average income of the Big Five firms has increased by 16.6% whilst that of the other accountancy firms has increased by 10.7% over the period 1996 to 2000.
  • The annual average growth in income for the Big Five firms from consultancy services (26.2%) and tax and legal services (16.5%) has been substantial over the period 1996 to 2000.
  • The annual average growth in income from audit and accounting services for the Big Five firms (11.8%) is substantially higher than for the other accountancy firms (3.4%) over the period 1996 to 2000.

THE REVIEW BOARD JULY 2002

NOTICE

© The Accountancy Foundation Limited

This document may require specialist knowledge for a proper understanding of its contents and implications. You should consider taking appropriate professional advice. While The Accountancy Foundation Limited believes this document to be accurate, neither it, nor its subsidiary companies, nor the authors of this document, shall be liable for any losses arising from the use of the document. This document is not a financial communication. Nothing in this document, nor in any other communication from The Foundation (including all its subsidiary companies), is intended to be, or should be construed as, an invitation or inducement (direct or indirect) to any person to engage in investment activity. Nothing in this notice shall exclude any liability which cannot be lawfully excluded or limited such as death or personal injury.

  1. The profession in the UK and Republic of Ireland is largely represented by the six members of the Consultative Committee of Accountancy Bodies (CCAB) which comprises: * The Institute of Chartered Accountants in England and Wales (ICAEW) * The Institute of Chartered Accountants of Scotland (ICAS) * The Institute of Chartered Accountants in Ireland (ICAI) * The Association of Chartered Certified Accountants (ACCA) * The Chartered Institute of Management Accountants (CIMA) * The Chartered Institute of Public Finance and Accountancy (CIPFA) hereafter referred to as "the accountancy bodies". ↩

  2. Figures in the subsequent tables are based on year end data unless otherwise stated. ↩

  3. Bill Cole, 'Trends in the Solicitors' Profession: Annual Statistical Report', The Law Society, 2000 and Department of Health, 'Hospital, Public Health Medicine (PHM) and Community Health Service (CHS) Medical and Dental workforce statistics for England', 2001 at http://www.doh.gov.uk/stats/mdwforce.htm ↩↩↩

  4. The DTI is currently considering an application by CIPFA for Recognised Qualifying Body status. ↩

  5. The DTI is currently considering an application by CIPFA for Recognised Qualifying Body status. ↩

  6. Key Note's Accountancy Market Report 2002 (containing figures for 2001) will be available from August 2002. ↩

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