Going for a constitutional

A solicitor's review of the practices of the Institute of Chartered Accountants may have snowballed into a fundamental revamp, reports Roger Trapp

If, when it asked the eminent solicitor Peter Gerrard to conduct a review of its "constitutional arrangements", the Institute of Chartered Accountants expected a brief rundown on the effectiveness - or otherwise - of its by-laws, it must have been disappointed by what it was delivered a few days ago.

Perhaps surprisingly for a lawyer, Mr Gerrard took a wide view of his remit and examined the whole role of the organisation.

This was, he says, because he was encouraged to do so "by a considerable number of representations to the effect that a fundamental approach is needed to the relationship between the institute and its members".

From the off, then, he can be regarded as having been at odds with those who appointed him. And his report, published last week, continues in similar vein.

For its part, the institute is stressing that the document, which will be debated by council next month, just contains the views of one individual. Yet it is understood that some of the recommendations, particularly those relating to strategy, will get a more sympathetic hearing than might be expected. After all, the institute has already set in train its 2005 programme and intends to build on this once members' views of the first phase have been ascertained.

Mr Gerrard accepts that the moves to establish an external review board and an internal professional standards office should go some way to resolving the conflict over the institute's dual role as regulator and trade association.

But he feels there should be "more visible separation of the regulatory and non-regulatory functions".

As part of this, he calls for a streamlining of the working of the executive and the council. The executive, says Mr Gerrard, former senior partner of the City law firm Lovell White Durrant, should be reconstituted to combine senior volunteers and members of the secretariat, or the organisation's officials, as a "visible central authority with responsibility for proposing policy as well as implementing it".

Committees that presently report to council should, with few exceptions, report to the executive.

The council, on the other hand, should be made smaller - and more representative, with constituencies for members in business, those working overseas and in such areas of practice as audit, tax and information technology in addition to those based on geographical areas. Council should decide "high policy" and control the executive.

Of course, any such changes would be bound to produce winners and losers. Consequently, the secretariat would be headed by a secretary-general, who would enjoy wider powers than those given to the current secretary and chief executive, Andrew Colquhoun. But direct election to the council of representatives of members in business is envisaged as making the Board of Chartered Accountants in Business redundant, while the General Practitioners Board should be redesignated a committee and the need for it reviewed in the light of the development of the regional structure.

Moreover, the call to end the central funding of the district societies is unlikely to play well in the provinces, where such an idea will no doubt fuel the widely held conviction that the institute is dominated by the big London-based firms.

Finally, the institute is urged to increase accountability to members by publishing more information and to consider monitoring members' opinions. This is presumably aimed at avoiding a repeat of the fiasco surrounding the planned link-up with the Chartered Institute of Management Accountants, through regular professional polling of random groups.

But with all kinds of professional bodies having to face up to the fact that their members are growing increasingly diverse, such a move could beg as many questions as it answers.

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