As the digital age continues to evolve, staying up to date with the latest industry regulations is an essential part of keeping your business operations on track. Particularly in sectors such as finance, compliance is not only integral for maintaining your reputation, it’s also vital for avoiding legal implications and even sanctions.
As we approach November 1, 2023, this is why there’s no better time to consider some of the changes being introduced by The Institute of Chartered Accountants in England and Wales (ICAEW).
In line with the changing face of accounting (and the finance industry in general!), the ICAEW is rolling out revised Continuing Professional Development (CPD) Regulations for its members and affiliated firms.
In this article, we'll be taking a closer look at the updated CPD professional development
regulations and the potential impact they’ll have for both individuals and accounting firms.
Ready to dive in?
Why CPD Matters For Accounting Practices
Professional development through the CPD cycle isn't just something to tick off your accounting compliance list; it's a strategic process that helps keep your workforce professional, current, and agile. But with industries moving faster than ever, keeping up with CPD standards requires an ongoing commitment to training courses and individual employee development.
However, for accountancy firms that do manage to keep up, here are some of the benefits to look forward to:
Competitive edge: Stay ahead in the global marketplace and ‘future-proof’ your accounting practice by establishing a workforce that embraces change, can master new skills quickly, is highly innovative, and can adapt to disruption with ease.
Positive reputation: A good CPD continuing professional development strategy can help you build a reputation for excellence and instil investor confidence. This will help attract clients, partners, and top talent in your industry.
Regulatory compliance: When you’re ahead of the curve on accounting best practices, you’ll be able to adapt to change and demonstrate your commitment to high professional standards.
Talent retention: Training and development opportunities can greatly contribute to employee enrichment. This helps increase employee retention and contributes to your overall success in a competitive job market.
Tip: From financial reporting to your management of resources, additional compliance rules can be overwhelming for accounting firms. This is why it’s always best to adopt a proactive approach to compliance and ensure your entire team is keeping up with the latest industry developments.
Changes to CPD Regulations
Whether you’re an ICAEW member, part of an ICAEW regulated firm, or participate in ICAEW regulated activities, CPD regulations should be on your radar. But what exact changes are the ICAEW about to bring in?
Minimum CPD hours: Starting from November 1, 2023, CPD compliance mandates that a minimum number of CPD hours must be completed annually. The exact number of hours varies depending on your category, which is why we recommend using the ICAEW’s CPD self-assessment tool to determine your specific requirements.
Verifiable CPD hours: Alongside the minimum CPD hours, the revised regulations state that a portion of these hours must be verifiable. This means you must provide evidence of your learning activities (including self-directed learning activities), creating greater transparency and accountability.
Ethics training: A new addition to the CPD requirements is at least one hour of ethics training aligned with the ICAEW Code of Ethics. This highlights the importance of ethical behaviour within the accounting profession.
The Shift in Responsibilities
One significant shift triggered by these changes is the transfer of responsibilities. It's no longer solely an accountant or finance worker’s individual responsibility to track and manage CPD compliance; firms are now integral to the process.
Firms must now ensure their members meet the CPD requirements and maintain compliance records — a change that will provide greater assurance that ICAEW Chartered Accountants are continually enhancing their competence.
The latest regulations also recognise the value of firms taking a more proactive role in their members' professional development.
Tip: In the same way that basic accounting principles involve effectively managing financial statements to avoid financial misconduct, files associated with CPD regulations should be securely retained and stored by firms for an appropriate period.
Impact on Businesses
These changes in CPD regulations have a direct impact on accountancy practices in the UK. Firms must adapt their internal processes to accommodate these new requirements and ensure their systems and workflows are well-aligned.
To do this, accountancy practices in the UK should consider the following key tips:
- Early adaptation: Be proactive as an accounting practice to give yourself a competitive advantage and reduce the risk of non-compliance.
- Strategic planning: Develop a strategic plan for integrating new measures (including the CPD ethics course). This can include allocating resources, identifying training providers, and establishing a clear timeline for implementation.
- Investment in technology: Consider investing in digital tools (such as Workiro!) to help streamline document storage and sharing.
- Employee engagement: Engage your employees early by updating them on upcoming regulatory changes and providing guidance on individual development plans.
- Ethical focus: Emphasise the importance of ethics training within your firm's culture. This will help highlight your commitment to ethical conduct and make aligning your processes with the new CPD additions more seamless.
- Craft an evaluation strategy: Once your new CPD programs are in place, tracking their progress is important. This is why it’s advisable to think ahead and consider ways to evaluate and improve systems.
The launch of the new CPD ethics course also means firms need to incorporate a completely new type of training into their professional development programs — something that will require careful planning and a strategic investment of resources. This includes organising and managing CPD-related documents, such as course materials, certifications, and transcripts to ensure compliance with the new regulations.
Collaborating with colleagues or mentors on CPD-related tasks like reviewing coursework, assignments, and research papers will become a more collaborative effort that requires channels for interaction. To stay on track, implementing software for managing tasks to set reminders and deadlines for CPD requirements will be crucial.
To thrive in this evolving landscape, it's essential for businesses to align their processes well in advance and equip themselves with the necessary tools and resources.
How Workiro can help you navigate CPD compliance
As you set your sights on getting ahead of CPD compliance, consider how Workiro can be your trusted ally. Workiro offers an all-in-one solution for enterprise content management, enhanced workflow, and facilitating collaboration with clear processes and a user-friendly interface.
In addition to keeping your balance sheet and financial transactions in order, Workiro can be integrated into all sorts of regulatory and accounting matters. Combining task, communication and document management capabilities, you’ll have all the essential tools you need to plan, build, and implement your new CPD strategy in one place.
Discover the power of Workiro’s intuitive platform for your accounting firm — book a demo today.