“We should look forward to the next 40 years”

As part of our series, AAT at 40, we asked chief executive Mark Farrar to take stock of the association’s 40 years of operation and to look at what’s to come in future.

Q. When you took on the chief executive role in 2014, what was the state of the organisation and what were your immediate goals at that point?

 “AAT was in a good place and it commanded a lot of respect, particularly in the educational world. It had also recently become a full member of the International Federation for Accountants (IFAC), and the organisation’s pitch at technician level was highly regarded.

“At the time, I could also see that the wider world of accountancy was changing – primarily because of increasing technological developments, which have been present ever since and will stay with us through Covid-19 and beyond.
“We recognised the need to widen our activity and reach not just those who wish to attain the qualification and achieve membership, but also reach people who needed more general finance training in business – for example those in small business, or employees in larger corporate or public sector entities.”

Q. Have you found any additional priorities coming in that you think are important?

 “While we’re seeking to develop our own initiatives, we always find, given the nature of the world our members and our education structures operate in, that we have to be responsive to external changes. For example, it may be regulatory changes such as the tightening of anti-money laundering regulations, or new developments on the educational side, such as the recent government’s initiatives on apprenticeships, or other changes.

“We need to support members on those and ensure we stay well-positioned for the future. Of course, at a macro-level, you will then also get changes such as what the Chancellor may or may not be doing with tax, small business regulation, or matters such as exiting the EU. Brexit has been ongoing for a long time. I suspect it will be running for a while yet, even with the breakpoint at the end of this year.”

Q. We’ve got two momentous things happening simultaneously – Brexit and Covid-19. What kind of impact do you think those events will have?

“I remain extremely wary of what the UK’s economic position might yet be early in the new year as we enter winter with Covid-19 still present.

“We seem to be positioned for some serious changes with regard to tax, tariffs, and customs procedures early in the new year because of Brexit. In particular, I think, the SME community is going to be under huge strain. On the one hand, desperately concentrating on surviving tomorrow, while also having to plan for some pretty major changes coming their way within a matter of weeks.

“I think it’s going to be very tough. There will be fallout in terms of businesses – in the sense that more will go into administration or insolvency. It feels like unemployment rates will markedly increase. We have a role to play in all of that, to help both on the information and communication side. Also, in helping or facilitating skills training for those who find themselves looking for a change of direction, a change of career, or seeking to simply improve their marketability and the functions they find themselves in, such as finance.”

Q. How do you see the future for AAT and its members?

“Bright. I think accounting technicians are in a great place, probably more so than the wider accountancy community. I say that very carefully as a chartered accountant myself. All the anecdotal evidence about people that come through our ranks says that they’re hands-on, they’re practical, they’re experienced, and they can get the job done. They largely will be driving the technology now, and as they learn, in the future as well.

“That puts all our members in a very strong position. No matter how good or how efficient the technology is, people are needed to translate it, to spot where things aren’t quite right. I think that’s where technicians excel.”

Q. Looking back over the history of AAT, there’s been several major recessions. How has AAT has come through all of them and developed in that time?

“The first thing I did when I joined AAT was to look at the books – I looked at the volumes in those recent years to see what had happened over the previous five years. I was pleasantly surprised to see that AAT had fared well. It hadn’t experienced the deep recessionary conditions that other organisations had, primarily because training and skills needs had held up. Over many years AAT has weathered many storms, and I’m certainly intending that it’s going to weather this one as well.

Q. Given the current challenges and opportunities, how is the demand for accountants and accounting technicians looking?

“Finance is at the core of all businesses and that doesn’t change.

“Right now, all organisations are hugely focused on their cash flow and their forecast cash flow, and this is where the accountancy community can come into its own – translating for managers. Again, the skills here are not just for the students who wish to become members and go on to a career in accountancy, but it’s a skill set that we can help facilitate for business managers generally. Whether they are in a small business or maybe managing cost centres in large businesses.

“You’ve got to manage your finances carefully and you need people to help you do that. You need people that are hands-on and practical. That’s where technicians come in.

“I think it’s a difficult period ahead and certainly the further education world is under huge stress. This is where  the Government has a role to play to support that area of the economy and what it can do to help people.”

Q. Putting those factors to one side, what are the other priorities you’d like to pursue?

“I think while our own infrastructure and technology will remain a key development area, we need to also help members adapt to new tools while also reaching out into the wider business community. We have a role to play in assisting that wider community in financial and business skills, and we are actively trying to do that at the moment.

“Not necessarily activity that would lead to full membership of the organisation, but activity that gives people those bite-sized finance training skills or analysis skills that they need. In the case of UK businesses, particularly SMEs, it improves the productivity and the profitability of those businesses.

“I think that’s where the future lies for us. It’s to broach out into those new areas. When we do get into businesses, they absolutely welcome us and want more of
what we have to offer.”

Q. Any final thoughts to summarise?

“It’s great to see how far the organisation has travelled over 40 years and all the successes it’s had, but it’s only 40 years old. Let’s look forward. We should look forward to the next 40 years as well. It doesn’t stop here. There is a long way to go and it looks like an exciting journey. That’s where my focus for the organisation, its members, its staff and everyone connected would be – to enthuse about what’s to come next and the role we will play in it.” 

Mark Farrar is the Chief Executive of AAT.