Monumental Incompetence
at ACCA
Just how incompetent are the people running the
Association of Chartered Certified Accountants (ACCA)?
A couple of years ago ACCA was criticised by the Financial Reporting
Council (FRC), UK's accountancy regulator, for its educational
failures. Now its 2014 report contains even more damning information
about recurring failures.
Page 66 of the FRC's
2014 report said this:
"We reviewed a sample of applications for
a practising certificate with audit (PCAQ). Our purpose was to follow
up how ACCA had implemented measures in response to recommendations we
had made in previous years and to obtain further evidence to confirm
that ACCA is granting applications appropriately. We were disappointed
to find cases in our sample where the PCAQ had been awarded to
individuals who did not meet ACCA’s requirements. The main reason for
this was that ACCA staff were unable to correctly apply the rules, as
they apply to complex cases. We also found that the verification of the
audit experience of applicants for the PCAQ was weak, in some cases
because ACCA staff were unable to correctly apply the rules, as they
apply to complex cases. We also found that the verification of the
audit experience of applicants for the PCAQ was weak, in some cases
because ACCA staff were unable to identify when information received
from applicants was incomplete, and because they lacked the background
knowledge of audit work required to assess the nature and quality of
the audit experience. These failings in the award of the PCAQ led the
FRC Board to consider whether it might be necessary to issue a
direction to the ACCA under our enforcement powers".
ACCA's 2014 annual accounts contain a provision of £100,000 to
deal with the fallout from the above fiasco, with minimal information
which is less and qualitatively inferiror to the disclsoures mad eby
the FRC. At the AGM held in London on 18th September, ACCA president
and the chief executive gave their usual self-congratulatory
speeches and said nothing about the above episodes or their
consequences for reputation. One member asked whether any of the
officials would be disciplined for this incompetence. There was no
response.
ACCA council is responsible for good governance but no council member
accepted responsibility for the failures of internal controls,
staff training, monitoring and risk assessment. For the year to 31
March 2014, ACCA chief executive picked up a remuneration package of
£339.772. (£293,117 for 2013). Unlike many corporations,
ACCA does not permit its members to vote on chief executive's
remuneration. So members can't show their displeasure by rejecting the
package.