Special Reports - CPD - Enhancing our reputation

Anna Coen outlines the new approach to continuing professional development and explains why its introduction is needed to protect and enhance the institute's brand, which is vital to all members.

Research repeatedly suggests that the thing members most value about the institute is its reputation. If the institute is held in high regard, then so are those who hold the chartered accountant qualification. The institute is a brand which needs to be protected and enhanced for the benefit of all members.

Enhancing this reputation and the brand is a key driver behind the introduction of the new CPD scheme. Unlike the present system which applies only to certain groups of members such as those working in 'reserved' areas, the new scheme will include all members, regardless of their role.

For the majority of members, particularly those who work in business, being part of an institute CPD scheme will be a new experience.

But for such a scheme to work properly, and to ensure full and proper protection and enhancement of the institute's reputation and brand, it needs to be applied to all members.

A professional and business imperative

The new CPD scheme will sit alongside other institute efforts aimed at protecting and enhancing its reputation, such as representing members' interests with government, regulators and international bodies - and exercising an effective disciplinary process.

It is our view that, along with such efforts, the introduction of this new across-the-membership approach to professional development will ensure our brand remains strong and highly valued.

There is, therefore, a professional and business imperative to introduce such a scheme for all members in order to promote every individual's commitment to the highest standards of professional expertise and conduct. This is why the institute is introducing it and asking you to support its introduction by voting for it in advance of, or at, the June 2004 institute agm.

Professional ethics

It is worth reminding ourselves that all of us are required to operate in line with the Fundamental Principles as contained in the institute's Guide to Professional Ethics. In particular, Fundamental Principles 3 and 4 require that each of us undertakes only work that we are competent to do and that we adopt proper regard for the technical and professional standards expected of us as members.

Professional judgment

The new CPD scheme is founded on the premise that all members should continually exercise professional judgment based on ethics, regardless of their role or the industry they work in. In order to exercise the highest standards of professional judgment, all members need to ensure that they keep themselves up-to-date with appropriate changes and developments in the business environment in which they are operating.

The Proceeds of Crime Act and the Money Laundering Regulations 2003, the Combined Code on corporate governance incorporating Higgs and Smith, and the introduction of International Accounting Standards in 2005 are all examples of issues that chartered accountants, depending on their roles, will need to keep abreast of.

The institute's new CPD scheme, explained on the following pages, recognises how important professional development is to the membership and has been developed to support members. The approach will allow you to focus on that which is important and relevant and give you the chance to follow your preferred approach to development.

What will I have to do?

All members will have to submit a standard annual declaration to the institute confirming their commitment to CPD. An outline of how this works, and more details about exemptions for fully retired members, are given on the following pages.

What does the new approach involve?

The new CPD scheme is based on an ongoing commitment to exercising the highest standards of professional judgment based on ethics.

For most members, this is already an integral part of their roles; good business professionals assess a situation, identify what the key issues are, what they need to know more about and what the many and varied interested parties expect of them. As one finance director said to us during the CPD consultation: 'I am expected to know what can and cannot be done, what should and should not be done and then to recommend an appropriate course of action.'

The new CPD scheme will support what you are already doing as a business professional.

It requires members to consider and reflect on the many expectations and assumptions that are held by employers, customers and clients, professional bodies and the public - the stakeholders that you are answerable to within your role and profession.

In considering the expectations, you will think about:

•   the business imperatives;

•   the regulatory and legal pressures;

•   gaining access to the appropriate expert technical advice;

•   how you interact with your colleagues; and, of course,

•   ethical implications of any decisions or recommendations that you are to make.

All the knowledge you gain and development you undertake as a result of these reflections will work towards improving your capacity to exercise the highest standards of professional judgment.

In order to complete the process, the institute will require that you confirm that you adopt this professional approach to your role and to your development through an annual declaration of commitment.

Monitoring Reviews

Your annual CPD declaration is your way of informing us that you are demonstrating your commitment to an ongoing programme of professional development.

The institute will carry out a series of monitoring reviews of a sample of members. The review process will confirm that you are adopting a professional approach to your development and will, in the process, aim to provide you with information, support and guidance which may enhance your future development process.

For those members who work in reserved areas, the role of the regulatory committees remains the same.

How have members contributed to this initiative?

The institute has worked closely with members and, in June 2003, a consultation exercise commenced and members' views were obtained through a questionnaire, national roadshows, pilot programmes and member representative groups.

There has been further extensive coverage in Accountancy and other professional publications.

Both business and practice members have been engaged with us during the development process; this gives us the confidence that we have a flexible and highly relevant policy.

CPD: MAKE YOUR VOTE COUNT

The institute is formally proposing this new CPD scheme and is asking for your support. You will receive your voting papers with the agm pack in the post over the next month. You can vote by post or at the institute's agm on 8 June. You may also vote online at www.icaew.co.uk/agm. You will need the two digit ballot code being sent to you in the agm pack. The result will be announced at the agm. The institute recommends that you vote in favour.

What will you have to do?

In the context of your role, responsibilities and changes in the regulatory and business environment:

Reflect

Consider what is expected of you.

Take action

Keep up with those expectations by undertaking appropriate development activities.

Consider the impact

Assess whether and how your development activities enabled you to meet expectations.

Confirm

Each year you will be asked to submit a standard declaration. If selected as part of an annual sample of members, you may also be asked to submit evidence for a review.

There are examples on the next page.

EXEMPTIONS FOR RETIRED MEMBERS

There is one situation - that of fully retired members - where a group of members will be exempted. The consultation process highlighted that it would be inappropriate for fully retired members to be subject to the new CPD scheme. Retired members who are not undertaking any paid or unpaid work and who have no plans to return to work in the future will not be required to fulfil the requirements of new CPD. However, if you are undertaking any work, however small, you should affirm that you are keeping up to date appropriate to your role.

WHAT MEMBERS THINK

•   Neil Lerner is chairman of the institute's ethics committee and a partner in KPMG.

Neil says: 'The new approach is positive for the brand of chartered accountants, bringing the requirement for CPD more in line with the business of members.' He considers that the new approach to CPD allows members to set their own framework for keeping up to date and monitor themselves in a way that suits their own business. The members then have a responsibility to demonstrate to the institute that they have done what is appropriate and necessary.

•   Graeme Gordon is group financial director of Macro4 plc, a mid-cap listed company in the software industry.

Graeme says that he is 'very much in favour of the new approach to CPD as a non-practising member'. Graeme has a varied role including company secretarial responsibilities, IT and is accountable for the financial health of the company; the new approach to CPD 'enables me to undergo a broader and more pertinent set of development activities which, in turn, enable me to be a more professional individual.'

•   David Walker practises in a three partner firm in York, he is the president of the West Yorkshire District Society, a member of council and national vice chairman of the General Practitioner Panel.

David emphasised that his attitude, at the outset, was that we have always had a system of CPD points and he would like to stick with this approach. After some initial discussions and presentations that David attended, we invited him to take part in a pilot. David said: 'At the beginning, I wasn't convinced - then I did the pilot. It suddenly gets you to think out of the box - the scope is massive. Before it was narrow, technical and probably boring.' My overriding impression is that the new approach to CPD is 'not a threat but an opportunity for all members'.

HOW MIGHT IT WORK?

These two examples illustrate how the new scheme will work

Louise, a financial controller

Louise is an experienced financial controller reporting to the finance director and group controller. As issues arise such as the need to comply with International Accounting Standards (IAS), her company starting to accept customer payments over the internet and her new responsibility for both the sales and purchase ledger team, she gets further advice and identifies ways to improve her knowledge.

Louise does some research on IAS, books a two-day IAS training course, researches control issues resulting from internet trading and updates operational procedures appropriately. She is also considering an update on management approaches and has asked a peer to work with her.

As an ACA, Louise regularly reviews her responsibilities and the expectations of her and identifies any development needs. She is happy to make her declaration this year.

Tariq, a sole practitioner

Tariq is a sole practitioner. He has been in practice for five years and has a varied client base for which he prepares accounts and tax computations.

The issues facing Tariq include the impact of the money laundering guidelines; he paid particular attention to the special report published in January's addition of Accountancy and attended a discussion group of peers.

Tariq, with some new larger clients, needs to upgrade his accounting software. He looks at some independent reviews and visits a local accountancy practice to see what they do before contacting a local supplier.

Tax legislation changes frequently and Tariq attends an annual update course covering both direct and indirect taxation.

Tariq makes his declaration this year via the institute's website.

HOW WILL MEMBERS BE SUPPORTED?

We will be providing support and guidance on the institute's website, www.icaew.co.uk.

The support will be role based, focused and relevant. It will include frameworks which will provide a baseline of knowledge, regular updates and commentary and guidance on topical issues.

It will support members in their reflection by providing guidance on the process and by giving them the opportunity to share experiences with other members.

We will also provide signposts to relevant learning and development resources.

0
Be the first to vote

Rate this article

Related Articles
Subscribe