Who needs the ICAEW?
Today I did something I never expected to do: I resigned my chartered accountant membership.
Before I was a member of the Institute of Chartered Accountants in England and Wales (ICAEW). Now I’m just me.
Becoming a chartered accountant really isn’t easy. I fought my way through fifteen tedious and time-pressured exams. I gave up more nights and weekends than I care to admit.
So when I made it, I was over the moon. You get a big certificate, your name printed in the Financial Times and a fancy graduation ceremony.
Who wouldn’t be proud after all that? If you’d told the 25 year old me that I’d be tearing up that big certificate, I’d have been devastated....
Here’s why I did it:
First, the money...
Before going any further it's worth making the point that accounting membership is expensive:
- The ICAEW annual rate is £395. The other bodies are set at similar levels.
- If you’re self employed you also need a Practising Certificate, which costs a further £369 a year.
- It’s common practice for employers to pay for their employees’ subscriptions, putting a significant burden on small firms.
- You can also get fined at any time if you don't comply with the by-laws which, yes, they can change at any time.
Before long we were footing an annual bill approaching £10,000. This is substantial for a small business like ours.
So what do you get back?
When you navigate to resign your membership on the ICAEW website you are presented with a list of “benefits.” Here it is:
If you’re anything like me you’re probably not using many of the services on that list. Certainly not £395 worth.
The only one that sounded important to me was the confidential support. Sadly, in my experience you can safely cross that one off too. I was unfortunate enough to actually need some urgent legal advice in Spring of last year. The phone rang off the hook and in the end I had to go elsewhere for help.
It was hard to escape the feeling that after paying for all these years they weren’t there for me when I needed them most.
The real reason we pay
With all due credit to the writers at Economia (I’ve never read your work but I’m sure it's excellent) I’m pretty sure nobody pays to remain part of the ICAEW for the magazine.
In fact, none of those reasons listed on the website are the real reason people pay each year. I know what the real reason is because I felt it myself: Fear.
The moment I sent the cancellation email my head was spinning:
What if I regret it later?
Will I still be able to get another job?
Did I do all those exams for nothing?
Accountants are often characterised as a risk averse group, and burning a bridge feels like a risky thing to do.
So why take the risk?
For me it’s not just about the fees and the benefits, it’s about the impact these bodies have on our profession and how it’s perceived.
Today accounting has a real image problem. If you ask any member of the public they'll be familiar with the 'boring accountant' stereotype.
I’ve experienced this stereotype myself. Soon after qualifying I attended a house party in South London. I was talking to a girl, who asked me what I did for a living. When I told her that I was an accountant she rolled her eyes, and promptly ended the conversation.
These days it’s very rare to meet a young person who’s proud to tell their friends they’re an accountant.
This has been the case for so long that we tend to ignore it, but it's not OK.
One of the primary roles of the membership bodies like the ICAEW is to promote the profession to the public. It's my belief that they haven't just ignored the problem, they've actively made it worse.
What went wrong?
Bodies like the ICAEW have worked hard to associate accountancy with trust and prestige, and they have done this by drawing heavily on the traditions of the past.
In moderation this is an excellent strategy, but it has been carried too far. In fact the profession has become so fixated on the past that it has lost sight of the future.
The accounting exams
For example when I think back to my accounting exams, we learnt about archaic methods like T accounts and books of prime entry but incredibly software was never mentioned.
The training we did was more appropriate for a 16th century Florentine banker than a 21st century FinOps professional.
Prestige and pomp over practicality
Similarly, when you step into Chartered Accountants Hall in London you’re greeted by photographs of Presidents stretching back hundreds of years. You don't see role models for the next generation.
Despite the best intentions of many great people, the culture of these membership bodies is rooted deep in the past.
How do we fix it?
At RORA, we want to revolutionise the accounting sector using technology. Regrettably supporting organisations like the ICAEW now seems inconsistent with that mission.
Instead we need to put forward a new model that looks to the future. We’ve already made a start on that path with the FinOps Academy, a new training programme that focuses on how to run a modern finance function.
But we still have a long way to go.
Yes, burning a bridge feels scary. But I believe if we are serious about making a change, we need to be willing to fight that fear and stand up for a brighter future.