Consternation is rippling through the fusty corridors of the accountancy profession after a company chaired and majority-owned by the president-elect of the Institute of Chartered Accountants in England and Wales was awarded two contracts by the professional body, potentially worth hundreds of thousands of pounds.
Emile Woolf International (EWI), which is 60 per cent owned by the institute's deputy president Graham Durgan, has been named the "recommended supplier" of training towards its ACA qualification in Russia and China, two of the world's fastest-growing markets.
Accountancy industry experts said each mandate could generate contracts with accountancy firms potentially worth £200,000 a year to EWI.
There is no suggestion of any impropriety in the awarding of these mandates, which were won after a competitive tender. But Mr Durgan's senior role within the institute (where he assumes the presidency next month) and at EWI has fuelled concerns over potential conflict of interest.
Some within the profession are calling for him to relinquish his commercial interests or step aside at the institute. One member of the profession familiar with the matter said: "It's a bit shabby that he was allowed to pitch. If you want to be a commercial business, then don't be president.
"He [Mr Durgan] is going to be privy to all sorts of inside information there, and it can't be a level playing field [between different companies tendering for ICAEW contracts]. I don't think it presents accountants in a terribly good light. It's a bit grubby."
Others said they had been "very disappointed and concerned" when EWI was allowed to pitch for an earlier, lucrative contract to produce syllabus material for the institute. That was awarded to a rival of EWI.
A spokesman for Mr Durgan said: "During his deputy presidency, Graham has stepped away from any commercial decisions by the institute that could benefit his firms. During his presidency, he will play no active executive role in his businesses."
The institute stressed the mandates were put out to open tender and the decision on which firm to choose was taken by operational managers at arm's length from ICAEW office holders.
An institute spokesman said: "Throughout the process, the deputy president declared a financial interest in EWI which had been approached to do the work. He was not involved in any way in the evaluation process."
The institute also said no agreements with EWI have been signed. A committee of past presidents has been asked to look into the selection process and will report in the next few days.
The institute described the agreements with EWI as "non-exclusive", but Eric Anstee, its chief executive, said in a letter: "We do not envisage working with further training firms until the volume of students in each location builds".
And despite the institute's insistence that the tender process was "open", ATC International, a leading provider of financial training in the CIS, was not asked by the ICAEW to pitch for its contract for Russia.Reuse content