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The ICB Career Path - qualifies me to do what?

  • 7 posts
  • # 86406

Hi, I am currently studying on the ICB Career Path with an accredited provider. Something has just begun to dawn on me - rather late in the day! Am I correct in thinking that, once I have studied & passed Lvl III Manual & Computerised B/K, I will still only be able to prepare accounts for Ltd companies to draft level? And to prepare and submit full accounts for sole traders?

If so, are these the ICB restrictions? 

If this is the case, can anyone tell me why? - when any Director (trained in B/K and qualified or not) can prepare and submit their accounts to Co's House and HMRC.

And if so, is there any way to get around this limitation without being 'unprofessional'?

Are these contentious questions? 

I'm expecting a deluge of replies in capital letters...please spare me the verbal lashing :-)


Thanks, New To It All   

  • Member PM.Dip
  • Practice Licence
  • 51 posts
  • # 86449

Hello

Anybody at all can submit accounts to Companies House and to HMRC, you do not need a quallification of any kind. The ICB guidance is that we get accountants to finalise our work on partnerships and limited companies; that is something that I would wish to do anyway, both in my clients' best interests and my own.

Th UK has one of the most complex tax codes in the developed world, and few people can claim to be familiar with all of its provisions, which is one of the reasons why my practice works with accountants. 

  • 153 posts
  • # 86465

Legally speaking, anyone can produce accounts for limited companies under the audit threshold.

However, that's because we are working in an unregulated environment, in the same way anyone can work as a bookkeeper, submit tax returns etc.

However the ICB is here as a professional body and so if someone chooses to be a member, they are required to adhere to the ICB rules, which include offering only services that you are qualified to offer. As such, you need to do level 4 to cover the production of final accounts for limited companies, the knowledge required simply isn't covered in level 3.




Edited at 10 Nov 2012 09:53 AM GMT

  • Member PM.Dip
  • Practice Licence
  • 8 posts
  • # 86474

Just add you, you also need to consider PII. If you make a real mess of something and your client decides to sue, your PII won't cover you, so you'll poentially need deep pockets!

Joe FCCA 

  • 135 posts
  • # 86493

Hi, and thank you for this question.  It’s one that several students have probably been asking themselves too.

Peter made the distinction between bookkeepers who draw up company accounts and the accountants who finalise them and Ruth underlined the knowledge you need. In fact the current Companies Act has well over a thousand sections.  We don’t want to seem to be poaching there then!

I feel this goes to the heart of the question, “What is the difference between a bookkeeper and an accountant?”  Some people emphasise the similarities but there are practical differences.  And not just in fee rates.  We get paid more.  (Not!)  

Joe mentioned Professional Indemnity insurance.  This raises an important point because accountants have greater legal liabilities than bookkeepers – and pay higher premiums for their insurance too.

I have come across a few overlaps between the two roles, such as payroll, self-assessment returns and AML activities.  However the Professional Conduct Regulations say that ICB members must not give advice on tax and must not describe themselves as being an accountant, unless eligible through membership of an accountancy body.  

Anyone else have examples of similarities and differences?

  • 1159 posts
  • # 86494

Macsaid:

However the Professional Conduct Regulations say that ICB members must not give advice on tax



This is one of the parts of the ICB regulations I find strange.  Especially since the introduction of the self assessment diploma.  It's very hard to complete a self assessment without giving some sort of tax advice.  

Even for those who don't do self assessments there is probably tax advice in our day to day role.  Does the client claim a percentage of their vehicle costs or 45p per mile?  Surely the only reason we choose one over the other is because it is more tax efficient than the other?

I'm sure we can all think of many other situations where we cannot operate within this rule.

Kris 

  • 7 posts
  • # 86495

Hi all, Thanks for your responses. The comment from Kris in response to Mac's reply seems to exemplify the cause of my confusion. I have telephoned and then emailed the ICB to seek clarification regarding the services I can offer at each level of qualification, as I go through the exams. When I receive a response I may well post it here....in the meantime do please continue to reply, as all information is very welcome.


New To It All 

  • 1159 posts
  • # 86496

To go back to your first question, bookkeeping and accounting are unregulated professions.  This means anyone can call themselves an accountant or bookkeeper.

ICB, like other professional bodies, exist to inject the professionalism into the field.  The only way we can do this is by saying at certain levels of education and experience you can do different things, and all members buy into this.  You are right in saying that anyone could submit limited company returns and compile limited company final accounts, but by joining a professional body we are saying that although anyone can, not everyone should.

We all agree that we should only do the work we are compentent to deliver, and by doing this we are able to stand above the unregulated section of the industry.  

If you want to 'get round' this you can.  Just don't join a professional body.  This in itself will bring it's own challenges.  While I don't agree with everything the ICB says, I do beleive that we should be striving for a regulated profession where businesses can have faith in their accountants and bookkeepers.

A professional logo or crest should be seen as the kitemark of the industry, a bear minimum to deliver the services.

Having said this, the ICB do need to look at their regulations and address them where they do not really make sense, as outlined in a previous post.

Kris

 

  • 7 posts
  • # 86520

kjmccullochsaid:

".......If you want to 'get round' this you can.  Just don't join a professional body.  This in itself will bring it's own challenges.  While I don't agree with everything the ICB says, I do beleive that we should be striving for a regulated profession where businesses can have faith in their accountants and bookkeepers.

A professional logo or crest should be seen as the kitemark of the industry, a bear minimum to deliver the services."

Kris

 ”

Thanks Kris, I agree.  I must state that my reason for raising this question was (for me) the lack of clarity re the preparation and submission (to HMRC / Co House) of draft final accounts when qualified to level III. I need to be certain of the ground on which I stand prior to applying for a Practice License with the ICB. If I apply for a license I of course intend to adhere to the Professional Code of Conduct (don't we all? Wink). 

Upon searching the forum prior to raising the question I found many conflicting and out of date responses to my query. Some of those responses now appear to be inaccurate - they are opinions only, seemingly based on incorrect or out of date information. I have today had a telephone conversation with someone at Member Services, and have received a clear and articulate email response. I have asked whether I may cut and paste the email content into this topic. I have also raised the thorny question re the grey area of tax advice....watch this space...

Having not been extensively 'out there' into the swampy land of bookkeepers / accountants / chartered accountants (qualified and unqualified), I can only imagine what some of the charlatans are up to. I will be no charlatan - whether governed by codes of practice or not. I have come across a couple of supposedly qualified, registered accountants whose practices were dubious to say the least; I expect we all have.


Again, thanks to all who have responded.


NewToICB  



Edited at 12 Nov 2012 06:16 PM GMT

  • 135 posts
  • # 86524

kjmcculloch said:

“ICB, like other professional bodies, exist to inject the professionalism into the field.  .  .  . I do believe that we should be striving for a regulated profession where businesses can have faith in their accountants and bookkeepers.  A professional logo or crest should be seen as the kitemark of the industry, a bare minimum to deliver the services.”

 

Yes, Kris, I entirely agree with you about the kitemark and ‘the bare minimum’.  There’s more could be done to demonstrate professionalism and help ICB members to stand out above the rest.  (That’s another topic perhaps!)

Back to the tax bit.  If the ICB’s regs say no tax advice, is that somewhere in members’ PI policies too, I wonder?  Are members actually covered if a client makes a claim against them concerning tax advice?

Looking forward to reading the ICB’s explanation, NewToICB, and especially the question of tax advice.



  • 1159 posts
  • # 86527

Morning James,

Thank you for my morning chuckle.  So ICB see's offering advice on some tax as tax advice but offering advice on other taxes as bookkeeping advice?  This is actaully more unclear than before.

So, we can offer advice to minimise Income Tax on a self assessment, we can offer advice on Value Added Tax, we can offer advice on National Insurance.  What about capital gains tax?

Perhaps a definitive list would help, as one thing that is clear from this thread is that no one really has a handle on it.  Failing that perhaps revisiting the regulations.

Kris 

  • 7 posts
  • # 86529

Hello All, 

As I mentioned earlier, I had asked Members Service for clarification re 'what I can do at level III' under the professional conduct rules. Here is their reply (below). I had not at that point asked for clarification re tax advice; that has been covered by James within this topic (see other posts)..and by the looks of things may continue further.... 

Response to my original question from Member Services follows:

As discussed, ICB members can submit accounts (as long  as the Company Directors have signed and agreed the accounts).
 
 As you are aware, and to reiterate:
  • the signing of accounts (for submission to   Companies House/ HMRC) can only be done by a Company Director
  • the signing of an Accountants Report can only   be done by a qualified accountant (although an Accountants Report is not   normally required)
  • Once the accounts have been signed and agreed by   Company Directors, anybody can submit them. ICB   considers this to be an admin function that can be carried out by client,   bookkeeper, dog walker, anyone who happens to be on the way to the postbox and   has been given the permission of a company director
  • Certified Bookkeepers (those members who have reached   Full Member status and have completed Level III qualifications) are qualified   to prepare ‘Draft Final Accounts’ and they are called Draft Final Accounts   because they need to be agreed on and then signed by Company Directors
  • Abbreviated Accounts (submitted to Companies House on   therefore on public record) cannot bear the details of an ICB Bookkeeper nor   the fact that they have been prepared by a bookkeeper as this is the reserve   of Chartered Accountants.

    As far as ongoing guidance, an ICB member must only  carry out work that they are qualified to complete. The Level IV cannot cover  everything, and there will always be companies who have complicated accounts, or  off shore dealings etc, and ICB advises that its members may have reason to get  their work overseen/signed off/or passed on to someone more qualified at any  stage in their career no matter how qualified they are. There is a reason we  have auditors, and specialist financial accountants etc. You must know your own  limitations and work within your own ethical boundaries!

    Critically, any bookkeeper who is a registered Agent  with HMRC, and submitting anything on behalf of their clients, must remember  that HMRC can very easily monitor performance and have indicated that in future  the online agent function may be a way to stop unqualified unskilled bookkeepers  from practising. See this newsletter article for more details http://www.bookkeepers.org.uk/news/1317 
For information about membership and what you are  permitted to do, please see the chart available to view on the website at: http://www.bookkeepers.org.uk/Membership/Joining%20by%20Examination

[Response ends]

I hope this helps to clarify things for any other confused members!

Thats all from me,

NewToICB   

  • 153 posts
  • # 86532


Quote:  Abbreviated Accounts (submitted to Companies House on   therefore on public record) cannot bear the details of an ICB Bookkeeper nor   the fact that they have been prepared by a bookkeeper as this is the reserve   of Chartered Accountants.


This isn't correct.

Abbreviated accounts are just a 'cut down' version of the full accounts, which have to be signed by the Director but do not have to be prepared by a Chartered Accountant. The whole point of level 4 is to enable ICB members to do this (within, as mentioned, the confines of their knowledge and skills in respect to any individual company which might have complicated affairs).   Other non chartered bodies similarly provide training and practise licences to cover this eg the ATT and IFA.

  • 7 posts
  • # 86535

Hi again,

Ref RuthAns last comment:

..I read the ICB quoted email: 'abbreviated accounts cannot bear the details of an ICB bookkeeper' - meaning we can't put our names on  them; that is, we can prepare them, and submit them, but without our details on them...and only Chartered Accountants can identify themselves on the abbreviated accounts - should they be the ones to prepare / submit them...


...am I wrong?  D'oh! I'm getting confused again...

NewToICB

Edited at 13 Nov 2012 05:34 PM GMT

  • 135 posts
  • # 86541

Unfair to dog walkers!

I don't think all of the Members Services official reply should be taken at face value.  As a director of a small company, I or my co-director takes the signed-off accounts for posting Recorded Delivery.  If it's too close to get a duplicate to Companies House in good time, I or our accountant will hand-deliver them to the London office of Companies House and get a date-stamped receipt.

Definitely no dog walkers need apply.  (I am one BTW!)

I agree, Ruth.  And yes, I am sure you are right too, 'NTICB'.  Our accountant produces the company's abbreviated accounts but her name does not appear anywhere on the document.  In fact for many years I did it myself myself, with the blessing of the (chartered) accountant. 

I believe the 'draft final accounts' and directors' report must be approved by the Board before anyone signs.  I think the ICB will confirm.

And I agree wholeheartedly, Kris. 

  • 1159 posts
  • # 86547

How incredibly defensive, James.  Surely by explaining the benefits of a combination of a lower salary and dividends you are minimising Income Tax.  Surely by talking to the client about use of home as an office you are minimising Income Tax.  Many of the things we do day to day is to minimise Income Tax.

You're right we do tell client when they reach the VAT theshold, but we also explain the various VAT schemes surely this is advising them a tax?

If you mean we prrvide information rather than advice I would suggest this is a game of semantics.

Interesting that you mention the line between bookkeepers and accountants as this is now so blurred I doubt many people, including bookkeepers and accountants know where it is.

Kris

Edited at 14 Nov 2012 12:25 PM GMT

  • 29 posts
  • # 86713

Hello all,


I submitted a reply to this topic but it has not appeared so at the risk of repeating myself, the main points were as follows:


Should the ICB website not contain clear concise details as to what Level 3 can do?(and all other levels) the response from Member Services was challenged on some points but no reponse to the challenges have been posted.


A previous topic on "what can Level 4 do?" has not had an update since March. 


What can Level 4 do that Level 3 cannot has also been queried but not satisfactorily answered.


As over 900 people have read this topic surely a clear consise response would benefit many members and potential members.Smile            


      


  

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