William Ellis
Co Law & Investigations Directorate 2 b
Bay 4101
1 Victoria Street
London SW1H 0ET

Monday, 01 March 1999

Dear Sir,


My comments for the consultation of November 1998 are as follows:

1 - A clear-cut procedure needs to be devised for appeals arising from
Disciplinary Hearings since professional bodies with a Royal Charter are not
answerable to anyone other than the European Court of Human Rights, not even
the Crown via the Lord Chancellor. This has been clarified by:
(a) formal advice by Bellof
(b) Adabole Bankole -v- ACCA case which shows the courts have no
(c) the Lord Chancellor has confirmed this in his judgement in 1998.
Defendants in contested disciplinary cases need to be heard in a Court of
Law because the committee members simply do not have the qualification or
the breadth of experience to hear and adjudicate on specialist matters of
evidence and natural justice. I am happy to provide further information on
this point.

2 - The "Proxy Vote" needs to be abolished, as it is outmoded in today's
world of open democracy. The way the proxy vote is obtained and used is
considered by the wide membership as anything from mesmeric to an abuse of
privilege. Ruling groups stay in power in the final analysis only because of
the proxy vote. Predictably, this unsatisfactory state of affairs has caused
a widespread apathy amongst the membership of accountancy bodies. Apathy is
redolent of decline.

3 - The accountancy profession in the UK is fragmented, with about a dozen
established bodies. When the UK's legal profession can operate with just one
Law Society and the UK's medical profession can operate with just one BMA,
why not UK's accountancy profession? The countries competing with UK's
accountancy system are not held back by fragmentation of their accountancy
profession. The ex-USSR countries are being courted by accountancy systems
of many countries.   I have personally seen a Baltic country do an about
turn on the British auditing system. A compulsory merger needs to be
legislated with tight deadlines since merger attempts have had a consistent
pattern of floundering.

4 - The audit exemption turnover limit (currently £350,000) for all small
companies needs to be raised to £2.8 million to conform with Companies Act
definition of a small company. An owner-managed wholesaler corporate with a
typical gross margin of 7% on sales cannot be classed as anything other than
a "Micro" business because its margin on sales does not allow it to employ
even 9 people.

5 - The financial statements of UK's accountancy bodies do not comply with
even the Related Party disclosure under FRS 8. This anomaly is questionable
when the UK accountancy bodies are the ones who set the accounting

6 - The officers of the council and the secretariat of accountancy bodies
should have modest if not subservient titles, such as Secretary and Servant,
instead of the current fashion of assuming awesome titles such as "Chief
Executive" and "Director of so and so". The ordinary members, who are their
masters, should not have to face a secretariat with intimidatory official

I have sent copies of this to both Austin Mitchell MP (since he takes an
interest in the accountancy affairs) and the Chair of Company Law Reform
Study Group of Labour Party Finance & Industry Group. I shall be grateful if
you would please put me on your mailing list.

Yours faithfully,

Jaffer Manek FCCA FCEA