If you are a principal of a corporate finance boutique, note that changes to the Statement on members engaging in public practice may mean that you now need a PC, even if your turnover derived from accountancy is less than 10%.
Scenario 1: Corporate finance principal
Question
I am a principal in a corporate finance boutique. I prepare information memorandums for the sale of body corporates.
The activity includes:
- collating information from audited and unaudited financial statements that I do not prepare, or file, at Companies House;
- budgets and forecasts presented to me by management; and
- comparison of publicly available industry data.
My turnover derived from the provision of accountancy or reserved services does not regularly exceed 10%. Do I need a PC?
Answer
The guidance on “What is a public practitioner?” has changed. The old statement contained a paragraph stating that if the proportion of an entity’s reported turnover derived from accountancy or reserved services regularly exceeded 10% then you would be considered to be in public practice, therefore under the old statement you did not require a PC.
However, the 10% de minimis has been removed in the new statement to align it with other regulations such as the Money Laundering Regulations that do not contain a de minimis limit for supervision requirements. Therefore, in this situation you would now require a PC.
Need help deciding?
Contact the Ethics Advisory Team
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