All members need to ascertain whether their activities constitute engaging in public practice.
Why is it important?
Members whose activities fall within the scope of the definition of engaging in public practice will usually require a Practising Certificate and professional indemnity insurance, and fall within the scope of Practice Assurance.
The definition
The definition is given here. For guidance on its application to your own circumstances, see below.
A member is engaged in public practice if he is a *principal in:
- a **public practitioner; or
- the parent entity of a public practitioner; or
- an entity which is a principal of a public practitioner.
* Principal
A principal is:
- an individual in sole practice, a salaried or equity partner, a member of a limited liability partnership, a director or a trustee regardless of the role of the principal; or
- any individual who is held out as being a principal
** Public practitioner
A public practitioner is an entity which provides accountancy services to clients in anticipation of reward where:
- a substantial part of the activities of that entity (more than 10%) is the provision of such services; and
- if the entity is part of a group, a substantial part of the activities of the group is the provision of such services.
Detailed guidance
The Council Statement on engaging in public practice provides detailed guidance on interpreting the definition in your own situation.
It considers a wide range of circumstances including sub contractors, ex-principals, consultants, groups of entities, retired members, voluntary work and interim managers. It details the services which are and are not usually regarded as accountancy services and includes a flowchart for determining your status.
Anyone in any doubt as to their public practice status after consulting the Council Statement should contact the free Ethics Advisory Services on +44 (0)1908 248 250.