A universal Gold Standard in accountancy is presumed, but not always delivered

If we cast our minds back to the Spring Budget, plans to tackle the ‘perennial taxation thorn’ in Government’s side came to light. As a result, a HMRC consultation aimed at raising standards in the tax advice market was opened. It closed on May 29, and I’m intrigued to see the published findings and the recommendations made as a result, writes Ross Boyd, founder and director of Belfast-based chartered accountancy, RBCA.

The preferred option of HMRC is seemingly to put in place mandatory membership of a recognised professional body, as outlined in its recently published Professional Conduct in Relation to Taxation (PCRT) code, co-authored by seven of the leading professional bodies.

The accountancy sector has been viewed unanimously for centuries as a respected profession, so it may shock some people to find that membership of a professional body is not yet mandated. Furthermore, a key point of difference that could come from this consultation is that HMRC will bring consistency by ensuring all leading professional bodies align on the sector’s definition of good standards and practice.

Granted, the main motivation here is to ensure that our tax gap – the difference between taxes collected by HMRC and in theory what should be collected – is kept down. This does not happen when agents do not act with integrity and in respect of the law.

This reform could be great news for the industry, and for the businesses we support. After all, consumers wouldn’t trust an unqualified doctor or dentist, so why should a hard-working business owner find they have come to trust an unqualified accountant to manage their tax planning and compliance?

It should be said that just as RBCA is a member of Chartered Accountants Ireland, most agents and firms are members of professional bodies, and take their responsibility to their clients seriously. This change is trying to bring industry alignment to ensure all practitioners understand the expectations on them.

The standard is currently set by HMRC’s own list of principles which do not always quite align with those set by our professional bodies. Providing a universal industry standard through industry bodies means that on a practical level, the agents and firms who are members, will have reassurance, and will no longer carry the administrative burden of having to adhere to two separate codes of conduct. Whilst on an operational level, it ensures that business owners can take confidence in their selection.

Only the agents that don’t already meet a professional body’s standard should be displeased or worried by the potential change.

HMRC already has a range of powers to deal with agents who it finds are not upholding the standards. – blocking access to HMRC’s agent services, issuing dishonest conduct notices, issuing penalties, and even enter into a criminal investigation if an offence is suspected. These enforcements will be put into greater action if, or rather when, this new universal standard is agreed.

As the SME community here in Northern Ireland, the backbone of our economy, continue to navigate an unpredictable economic climate, trusted advice has become a lifeline. Our business community have enough on their plates without also having to navigate a Wild West of providers. And despite the introduction of software, many business owners do not have the time nor the know-how to complete self-assessments or follow compliance procedures without the support of an accountant. Hence, this is why I ensure to invest in my team, to ensure that they become qualified in their various fields. As it stands, all our 20 staff have completed or are undertaking Chartered Accountants Ireland training and six are fully Chartered.

Whilst I recognise that this is just one of many issues HMRC needs to take an urgent lead on, this should be viewed as a positive step forward in safeguarding the sector’s reputation.

For more visit rbca.co

 

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