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ICAEW’s role as a world-leading improvement regulator

Strengthening trust in the profession

Our mission as a world-leading improvement regulator is to strengthen trust and protect the public. We do this by enabling, evaluating and enforcing the highest standards in the profession. This ensures our firms, members and students uphold the highest standards and act in the public interest.

ICAEW’s regulatory and conduct roles are separated from ICAEW’s other activities so that we can monitor, support or take steps to ensure change if standards are not met. These roles are carried out by the Professional Standards Department (PSD) and overseen by the independent ICAEW Regulatory Board (IRB).

Our regulatory and conduct role

  • authorise ICAEW firms, members and affiliates to undertake work regulated by law: audit, local audit, investment business, insolvency and probate;
  • support the highest professional standards in general accountancy practice through our Practice Assurance scheme;
  • provide robust anti-money laundering supervision and monitoring;
  • monitor ICAEW firms and insolvency practitioners to ensure they operate correctly and to the highest standards;
  • investigate complaints and hold ICAEW firms and members to account where they fall short of standards;
  • respond and comment on proposed changes to the law and regulation; and
  • educate through guidance and advice to help stakeholders comply with laws, regulations and professional standards.

Educate, monitor, investigate

All ICAEW-supervised/regulated firms and insolvency practitioners (IPs) are monitored to ensure they meet the expected requirements and standards and abide by the regulations and ICAEW Code of Ethics.

Monitoring is carried out by the Quality Assurance team (QAD) who have many years of industry experience and receive regular training for their monitoring roles. On average, they carry out around 2,000 monitoring reviews a year.

In addition to the monitoring reviews, QAD provides guidance and support to firms and IPs to help them achieve the high standards expected of them; by us and by their clients. This support includes webinars, roadshows, helpsheets, reports and training films.

QAD also provide monitoring services for third party organisations.

If standards are not met, we will take steps to ensure change. The independent regulatory and disciplinary committees monitor compliance with the regulatory requirements of firms and IPs. They consider reports prepared after monitoring reviews and can and will instruct firms/IPs to take remedial actions. If concerns are serious or persistent, these committees refer the firm/IP to the Professional Conduct Department for further investigation.

Our strategy

Independent governance

ICAEW’s regulatory and disciplinary roles are separated from ICAEW’s other activities so that we can monitor, support or take steps to ensure change if standards are not met. These roles are carried out by the Professional Standards Department (PSD) and overseen by the independent ICAEW Regulatory Board (IRB).

To further ensure independent governance, independent regulatory and disciplinary committees oversee PSD’s monitoring activity, review firm applications to carry out work regulated by law (eg audit and probate) and hear disciplinary cases. The work of these committees is overseen by the IRB. The work of the PSD in areas of work regulated by law (audit, anti-money laundering, local audit, investment business, insolvency and probate) is overseen by oversight bodies including the Financial Reporting Council, the Financial Conduct Authority, the Office for Professional Body Anti-Money Laundering Supervision, the Insolvency Service and the Legal Services Board. In the same way as we monitor the work of our members, students, affiliate and firms, these oversight bodies monitor our work to ensure we maintain the highest standards in our regulation.

The ICAEW Professional Standards Department supervises and monitors over 12,000 firms and 840 insolvency practitioners.

The ICAEW Professional Standards Department (PSD)

Founded in 1880, ICAEW has a long history of serving the public interest and continues to work with governments, regulators and business leaders around the world. As an improvement regulator, the ICAEW Professional Standards Department (PSD) supervises and monitors over 12,000 firms and 840 insolvency practitioners, holding them, and all ICAEW members and students, to the highest standards of professional competency and conduct.

On behalf of ICAEW, PSD undertakes the responsibilities of a regulator under statute in the areas of audit, insolvency, investment business, anti-money laundering and most recently legal services. We also monitor compliance with the ICAEW Practice Assurance scheme. The scheme provides ICAEW-registered firms and practising certificate holders with a framework of principles-based quality assurance standards to operate to.

The work of PSD is carried out by five teams, including:

  • Quality Assurance (QAD): help preserve the highest professional standards of ICAEW- registered firms by monitoring their compliance with applicable laws, regulations and standards and their adherence to the ICAEW Code of Ethics.
  • Regulatory Practice and Policy: enable only appropriately trained and experienced individuals to carry out the highest risk work (eg audit, probate and insolvency). This team also maintains current regulations and develops new regulatory arrangements that our firms, members and affiliates are governed by.
  • Conduct: regulate and discipline ICAEW members, firms and ACA students. The team investigates complaints which may result in disciplinary action.

The ICAEW Regulatory Board (IRB)

The IRB is an independent board. Its primary objective is to ensure that ICAEW’s regulatory and disciplinary work, undertaken by the Professional Standards Department (PSD), is carried out in the public interest. It provides assurance to government, oversight regulators, and members of the public that these tasks are carried out independently and objectively.

The public interest is at the forefront of everything that the IRB does.

There is also a wider objective at the heart of its work. This is the quest to promote and maintain the highest professional standards among ICAEW members and firms and for ICAEW to act, and be seen to act, as an improvement regulator.

To further protect the public interest, at least 50% of IRB and regulatory and disciplinary committee members (which oversee our monitoring activity, review firm applications and hear disciplinary cases) are non-accountants.

Our regulatory work

The stats

ICAEW is*:

  • the largest recognised supervisory body (RSB) and recognised qualifying body (RQB) for statutory audit in the UK. There are 2,561 firms and 7,295 responsible individuals registered with us under the Companies Act 2006;
  • the largest recognised supervisory body (RSB) for local audit in England. We have eight firms and 101 key audit partners registered under the Local Audit and Accountability Act 2014;
  • the largest insolvency regulator in the UK. We license over 840 insolvency practitioners (out of a total UK population of 1,550) as a recognised professional body (RPB) under the Insolvency Act 1986;
  • a designated professional body (DPB) under the Financial Services and Markets Act 2000 (and previously a recognised professional body under the Financial Services Act 1986). We license over 1,900 firms to undertake exempt regulated activities under this Act; 
  • a supervisory body recognised by HM Treasury for the purposes of the Money Laundering Regulations 2017, dealing with over 11,000 firms; and
  • an approved regulator and licensing authority for probate under the Legal Services Act 2007. Over 340 firms are accredited by ICAEW to carry out this reserved legal activity.

and:

  • more than 330 firms are accredited to perform ATOL returns work under the ICAEW Licensed Practice scheme for ATOL Reporting Accountant work. This was set up in 2016 after the Civil Aviation Authority (CAA) gave approval for ICAEW to license, register and monitor firms which perform ATOL returns work.
  • Our Practice Assurance scheme provides ICAEW members working in practice with a framework of principles-based quality assurance standards. We monitor over 12,000 firms to ensure they comply with the Practice Assurance standards.

* Data is correct as at 31 December 2020.

Responding to consultations

As an improvement regulator, the Professional Standards Department (PSD) will initiate and respond to consultations on issues that relate to our regulatory responsibilities. This includes specific regulatory issues or matter that relate solely to regulation. We invite the views of the ICAEW members and the individuals and firms regulated/supervised by ICAEW, consumers of accountancy services and other stakeholders.

Why use a regulated ICAEW Chartered Accountant?

If you are seeking accountancy advice, you want to be reassured your accountant has the appropriate education, experience and qualifications to provide high quality independent advice and services – after all, you wouldn’t go to an unqualified or unregulated doctor for medical advice. If you select an unqualified or unregulated accountant to handle your finances or tax work, you may have nowhere to turn if there are problems with the quality of their advice, their conduct or their standards of service. This is where ICAEW, ICAEW Chartered Accountants and ICAEW firms can help.

To check if your accountant is an ICAEW member or the firm is supervised by ICAEW, you can use the Find an ICAEW Chartered Accountant or Firm Directory service.

You can also check if there are any disciplinary decisions against a member or firm by using the ICAEW Disciplinary Database and access information about disciplinary hearings.

Make a complaint

If things go wrong, we can help. We act in the public interest and it is part of our role to ensure ICAEW Chartered Accountants and ICAEW supervised/regulated firms act with integrity and undertake work correctly and to the highest standards. If your accountant is registered with us and their work falls short, you can make a complaint to ICAEW. Remember we can only get involved in your complaint if the individual, student or firm is regulated by ICAEW.

Diversity

We are committed to diversity in the chartered accountancy profession, within our regulatory and disciplinary committees and in PSD. We believe the profession, and our own organisation, does best when it reflects the society we serve. The ICAEW Regulatory Board (IRB)’s terms of reference require the board to take account of inclusion and diversity in relation to its activities.

We encourage applicants from diverse backgrounds to apply for vacancies within PSD, the IRB and the regulatory and disciplinary committees and we try to promote recruitment from under-represented communities.

We pay ICAEW Chartered Accountants who serve on certain committees to encourage volunteers from smaller practices who may face an economic impact by giving their time to serve on a committee. Regulatory committee training includes a specific diversity focus.

All probate firms are required to monitor diversity and we report the outcome of that monitoring publicly. We will continue to focus on diversity.

Sustainable Development Goals

In 2030, ICAEW will be acknowledged as having made a leading contribution over many years to the achievement of the UN Sustainable Development Goals (SDGs) to end poverty, protect the planet and promote peace and prosperity around the world, by having mobilised its own expertise and influence, and that of its members and partners, to analyse, articulate and address the economic and business challenges.

PSD contributes to the systematic creation of sustainable economies by encouraging our members and firms to operate under the SDGs.

We aim to maximise the use of staff’s sustainability days to support a vast variety of charitable work. We continuously form and maintain relationships with charities and support these wherever possible.

We champion ICAEW’s £100,000 social mobility fund which is used by the Milton Keynes Community Foundation (MKCF) to support projects which improve social mobility in the black communities. These projects provide support and inspiration to those with aspiration and ability but are disadvantaged. Initiatives will include life skills development particularly relating to finance and business and encouraging further studies such as professional qualifications and peer group learning.

Compliance and professional conduct during COVID-19

During this uncertain time, we recognise there are unprecedented challenges facing ICAEW firms and members. We continue to expect the highest professional standards by all ICAEW firms and members. This includes abiding by ICAEW and statutory regulations and continuing to meet the high standards expected by the public.

Latest news

There are three ways to keep up to date with all the latest regulatory and conduct news from the ICAEW Professional Standards Department:

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