Monday, January 20, 2014

The Institute of Chartered Accountants is misleading student entrants

I have a huge axe to grind with the above Institute, as I believe it has lost its initial value, and is in danger of becoming extinct unless radical measures are urgently enacted and the emphasis directed differently.

The existing members (I am a member of the ICAEW since 1981) appear to rubber stamp the various proposals that look good on paper, and ensure the longevity of their exclusivity! The massive new building for which I am sure there is a considerable loan that needs to be repaid is just an example of the extravagance, and Empire Building, and the Degree Awarding status is just a ruse to expand the power without adding value. Why compete with hundreds of other programs, and maintain yours is the best, when you have every opportunity to design a more equitable course to benefit those unable to pass the Institute Exams as shown below. That will be a real service to your failing students who can now pass!!!

The Institute have over 20,000 students, but they have made the exams so hard, that fewer than 5% of those will end up as qualified Chartered Accountants. This is not going to preserve your exclusivity in the club, as the main reason this happens is that the papers get tougher, NOT better. I was talking to an accountant a few days ago, who said that the CIMA students have a far more practical and meaningful syllabus that is relevant to the workplace of today. The employers know this, and the stock of the CIMA qualified product has gone up considerably. This would have been anathema in my day, as the stock of the Chartered was so much higher, but it is the Institute only to blame for being behind the times in their syllabus, and relevance.

The above two issues taken to together mean that the Institute owes it to these students to find an alternative way out of their predicament. I propose, the setting up of a subsidiary qualification for public accounting, as the current Govt. public accounting qualifications are unreliable and not catering to the needs. If the institute has their own qualification, I can assure you the Govt. qualification will naturally disappear to be replaced with the Institute version, and the students who find the Chartered too difficult can be diverted to this and have a ready opening of employment in the public sector.

This will kill two birds at once, by finding an opening for thousands of intelligent accounting students to qualify in a profession, and provide the public sector with capable accountants able to clean up the mess in their accounting systems and make the departments and ministries more efficient in their use of resources.

Students it is time for you to speak up and make a sound proposal so that all stakeholders will end up in a win win situation. You can bump up the considerable egos of the Institute's governing bodies in order to enact your ideas, which will help the accountancy profession as a whole, and the quality of the resulting output, by improving efficiencies in the public sector and maybe upgrade the Institute's syllabuss so at to be relevant for tomorrow and thereafter.  


Anonymous said...

You must be the first person to expose this racket, as Chartered Accountants want to present an image of virtue, when they are a bunch of rogues, at least the ones in control of the Institute and its activities.

The annual membership for students is Rs1750 and so 20,000 students pay Rs35M for nothing. Exam and course fees are on top and expensive, compared to the fact that they are local costs, not the UK rates for CIMA students.

Well done, I am sure this will stir a hornets nest and a debate, and who knows where it may end?

Anonymous said...

The amount of student enrollments to CIMA, ACCA, CIM and other various foreign degrees and professional bodies demonstrates the requirement of local professional institutes to improve their syllabuses and make them more focused towards employment.
I totally agree with the fact that the quality of local exams have dropped drastically, where they try to make it difficult to pass rather than trying to improve the knowledge and practical application of theory.
Students who get stuck in the system have to wait ages to get out of it, this delays their career progression and marketability where students who can afford with same skills can progress with foreign professional bodies who give a better product at a cost.
If Sri Lanka develops local professional bodies focus on the quality of the output rather than the pass rate things could be different.

Jack Point said...

As a CIMA member I have been grumbling about CIMA's fees and training.

CIMA is not, in my view an accounting qualification, although is masquarades as such. It is a business qualification, which is useful to people in marketing, administration, operations, anything other than real finance.

The problem with CIMA is in its training-there is no structured system of training such as one would experience in a good audit firm. (The small firms don't provide much, but are better than nothing, which is what a CIMA student gets).

Accountancy is a practical subject. What is taught in classrooms is a very simplified concept (think of "T" accounts and the like) if one is to work as an accountant grasping the practical aspects is critical and that can come only with practice.

Thus we have a situation where some fully qualified CIMA graduates cannot perform a bank reconciliation in practice and have never seen a cashbook.

In terms of syllabus, I am out of touch but realistically speaking as far as accounting is concerned not a lot has changed in fundamental terms in the last century. Management accounting, which developed from costing matured somewhere in the 1960's.

I believe that the stock of Chartered Accountants has climbed over the last 15 years while CIMA has declined. If you read the advertisements there are now a number that call specifically for Chartered. CIMA is seen as an added qualification.

There are none that I recall that call specifically for CIMA, where CIMA is called for it usually goes as "qualified accountant CIMA/ACCA/ICASL".

In terms of value for money, as a member, forking out 225 plus sterling for exams passed a decade or more ago is criminal.

Ratmale,Minneriya,Sri Lanka said...

Thanks Jack for your inciteful comments. I did not realize CIMA charge so much annually. I must completely out of touch. Just imagine how much they must be receiving from SL!!

You can understand why I dropped my ICAEW membership long ago, as a farmer in the boonies, that was a lot to fork out, and told them I could not afford to pay my dues!

Jack Point said...

For a couple of years I had dropped my CIMA membership but since I am still in the job market I restored it a few years back.

I sometimes think what you have done: farming may be a more interesting pursuit, although I have not had the courag to give it a go!