AAT has launched an interactive guide designed to help licensed members explain to consumers the risks of using unregulated accountants.
What You Should Know Before You Appoint An Accountant forms part of the Accountable campaign to raise standards across the profession.
The guide draws consumers’ attention to the lower standards of service and protection and the higher risks of using an unregulated accountant.
It presents many examples of malpractice, incompetence and even dishonesty witnessed by AAT members and shared with us in a recent survey.
Licensed members are encouraged to download the guide and share it through their websites and social media.
The survey, conducted in April, found that 77% of AAT members had witnessed lower standards from unregulated accountants, while 68% said these incidents had affected clients.
The Government is concerned about the level of complaints concerning unregulated accountants and is consulting over whether to make Private Indemnity Insurance compulsory for all advisors to raise standards.
However, insurers say the approach would be unattractive and ineffective. AAT has deemed the proposal inadequate and advocates compulsory membership of an appropriate professional body – a move supported by 92% of AAT members surveyed.
Compulsory membership would guarantee that all accountants:
- are properly qualified,
- undertake regular Continuing Professional Development (CPD),
- hold Professional Indemnity Insurance (PII),
- are subject to a formal disciplinary procedure and are
- signed up to PCRT (Professional Conduct in Relation to Tax5).
Adam Harper, Director of Professional Standards and Policy at AAT, said:
“Our members have shown us the widespread impact that unregulated accountants can have on small businesses,
“Many small businesses are still on a knife-edge in terms of their viability. Poor advice from an unregulated high street accountant or tax advisor could plunge them into a dire financial situation, potentially leading them to shut their doors altogether.
“We need the Government to take decisive action on this issue now. However, their current proposals that would require unregulated accountants to hold professional indemnity insurance simply do not go far enough.
“Mandatory membership of a relevant professional body for anyone offering paid-for tax and accountancy services would put accountancy on a par with professions such as nurses, architects and solicitors. This would cut the number of agent-related complaints to HMRC and reduce money laundering and tax evasion issues.
“In the meantime, we would caution small businesses to beware of unregulated paid-for tax advice—download AAT’s interactive guide to see the facts for yourself.
“We advise you to protect your interests by choosing an accountant or tax advisor who is a member of a relevant professional body, such as AAT. Doing so will help reduce the risks of costly financial mistakes that could significantly damage your business, as well as giving you a viable route to raise any concerns if things do go wrong.”
Employing an accountant – consumer guide
What You Should Know Before Employing An Accountant is available free of charge for AAT licensed members to distribute to clients via their websites and social media.
David Nunn is Content Manager at AAT.