The small company audit threshold rose last week from £350,000 to £1 million. It is also set to rise again to £4.8 million.
Currently, very few ACCA members conduct audits. After the raising of the threshold to £4.8 million, hardly any ACCA member will be involved in the audits. All this should result in lower regulatory costs and licensing fees. But the ACCA leadership has no plans to reduce the regulatory costs. It has decided that it will regulate members working in the unregulated sector (e.g. consultancy) and thus continue to charge substantially the same fees. The burden of monitoring and bureaucracy will not be reduced. This will help to keep the empires built by the bureaucrats but will inevitably make ACCA members uncompetitive. How many will continue with their ACCA designatory letters?
ACCA leadership has also failed to take a strategic view of the changes going in. In an effort to emulate the ICAEW, it agreed to underwrite the new audit regulatory regime in the UK. Its costs are expected to be £5 million per year. The ACCA, with hardly any members doing external audit has agreed to pay 28% of the cost. ACCA has not told members of this obligation. In contrast, CIMA will make a maximum contribution of only £38,000 per annum.
Previously ACCA members raised their concerns through the Practice Society,
but the ACCA leadership has unilaterally decided to disband it. Thus members
have no voice. Members raise their concerns at the AGM but the leadership
massages the minutes and fails to provide a faithful account of the proceedings.