15 Nov 2023
Chartered accountants and practitioners like you are currently adapting to new rules around continuing professional development. This is because on 1st November 2023, the ICAEW (Institute of Chartered Accountants for England and Wales) made significant changes to CPD rules.
Change is prevalent in the accountancy profession, particularly amongst the professional bodies. How you adapt in your accounting practice is key, both as an individual and when considering the CPD requirements of your firm.
This article provides further information on the steps you can take to comply with ICAEW CPD rules.
ICAEW chartered accountants may be unlikely to read through the new rules in their entirety. As with many in the accounting profession, time constraints play a role. With that said, your firm must appoint individuals to read through the updated regulations fully for due diligence.
These individuals should then be responsible for relaying information to all practitioners in your firm. This ensures that your accountancy practice has experts in house.
Your remit should be to drive the designing of policies and processes amongst other important attributes, ensuring that you deliver on your training agreement with the ICAEW.
You can also offer support to clients who are ICAEW members, especially if they question whether or not the new rules apply to them.
CPD reporting is as essential as financial reporting. Your firm needs to ensure that individuals remain compliant with changing CPD rules. A recording process for ICAEW members is key to safeguarding your firm and providing the evidence you need to fulfil your compliance requirements.
To do this, you need a documentation processes. CPD is a regulated area, so you should involve formats for recording the Reflect, Act, Impact process (see below). You also need to create and maintain spreadsheets so your firm can monitor individuals’ CPD in the year and enforce an expectation that line managers review the process regularly.
Whatever way your firm decides to fulfil compliance responsibilities, you should make this clear as soon as possible. You will have been informed as part of your ICAEW membership that a full range of changes were implemented from 1 November 2023, or whenever your firm’s CPD year starts.
Note that the 20:20 Innovation website has a number of resources to help in this process and the website itself is an excellent platform for tracking CPD from all sources. For more information on our resources and to book a free 30-minute demo, please reach out to our team today.
Like most professional bodies, the ICAEW are working hard to communicate CPD rule changes to members. The changes are likely to impact:
In all cases preparation is key. The difficulty for many in chartered accountancy is getting the message across to everyone who will be impacted. Your firm can help with this process by strengthening your internal communication and appraisal processes to ensure all relevant people know the importance of the new rules and how your firm ensures compliance.
Services are available for external general compliance reviews or procedures reviews if you are unsure.
The updated CPD rules determine that the amount of CPD an individual is required to complete depends on the type of work you perform and the types of clients you work for.
For individuals working in practice, there are 3 categories and with different amounts of total and verifiable hours.
Any accountant concerned about meeting your individual or firmwide CPD should look at some of the resources available on the 20:20 Innovation website. Alternatively, you can use the ICAEW’s CPD self-assessment tool to assist in determining your category.
It is necessary to keep a record of your self-assessed category and you can do this in the “My Account” area of the 20:20 Innovation website if you are a member.
Your current CPD activities don’t need to change. What you should consider, however, is that under the new CPD rules some of these activities may not class as verifiable. They still count towards the total CPD of an individual. From a professional perspective, they should naturally be part of your professional life. These are examples of activities that can qualify as CPD:
Of course, CPD is not restricted to improving technical knowledge and so consideration should be given to developing soft skills, such as communication, leadership and change management.
Once you have identified the category you fall into, you will be able to see how many “verifiable” hours of CPD you need to perform. For most individuals in practice, you are likely to need 20 hours of verifiable CPD. This may feel like a lot, however, a range of activities may qualify as verifiable. The key is ensuring there is independent evidence of the CPD undertaken. This could include:
For 20:20 Innovation members, all of your 20:20 Innovation webinars are verifiable and supported by CPD certificates. For any ‘other’ CPD you choose to enter into the 20:20 Innovation ‘My other training’ website area, you can self-assess whether it is verifiable and make a note of where you’ve saved the evidence of this activity.
In most cases, the actual learning areas identified in an individual’s CPD plan are up to you, as the ICAEW member. However, the ICAEW has decided to mandate that all members in practice must complete at least one hour of ethics-related training each year. This activity must be independently verifiable.
The ICAEW have created their own free Ethics CPD course, but it is 12 hours long and individuals (or firms) will need to determine which part of the course is most relevant to them.
Alternatively, 20:20 Innovation have a range of ethics courses and members can access these for free, with a record of attendance automatically saved on the 20:20 Innovation website.
While the updated regulations have mandated a minimum number of CPD hours, they have not removed the requirement for individuals to ensure they target the training to meet their assessed training needs / personal learning objectives. This in turn is based on the areas worked in and the clients they have (as well as the compliance areas they are responsible for – such as Anti-Money Laundering).
So, all ICAEW individuals (supported by their firms) need to continue to:
As most firms like yours are so busy, there is often pressure on senior staff to skip training events or to log in and not pay attention.
While we understand the issue, it is worth noting that the ICAEW will inspect firms’ and individuals’ training records next year and non-compliance can be a disciplinary issue.
Therefore, completing appropriate (and sufficient) CPD must be a priority for firms, and this should be modelled by you and your senior staff, or more junior staff will be less likely to engage themselves.
This article has focussed on members in practice, however the rules also apply to those not in practice. For many firms, you will have clients (such as companies and charities) where directors, trustees and senior finance employees are members of the ICAEW and will need some CPD, according to the new rules.
It is also worth noting that the rules apply to members even if they are working on a voluntary basis.
For some firms this may be an opportunity to provide some training for your client’s directors and trustees, both to demonstrate your firm’s knowledge and to help these individuals meet their CPD requirements. This would of course be verifiable, as long as the firm maintains a record of who attends.
You may also want to refer them to your favourite training provider – 20:20 Innovation, naturally!