Home Accounting and Auditing New accounting charter on its way after professional bodies intervene

New accounting charter on its way after professional bodies intervene

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A new BEE Charter for the accounting profession is on its way after objections were raised to the CA Charter, which was an attempt to further entrench the monopoly on accounting privileges enjoyed by the SA Institute of Chartered Accountants.

SA Institute of Business Accountants (Saiba) has lodged its objections to the CA Charter, and you can read them here and here.

Other professional bodies lodged objections of their own on grounds largely similar to those of Saiba.

Saiba members will be pleased to learn that at a meeting of the BBBEE Unit and professional bodies that objected to the CA Charter, Saiba was requested to review the CA Charter with a view to formulating a charter that will address the entire professional accountancy sector.

Says Nicolaas van Wyk, CEO of the SA Institute of Business Accountants (Saiba): “Based on what we understood from the meeting the request was to only consider a charter for designated members of the professional bodies at this stage as to allow the work that has been done on the CA Charter to continue but with the inclusion of the designated members of other professional accounting organisations such as the Chartered Institute of Management Accountants (Cima), the Association of Chartered Certified Accountants (Acca) and Saiba.

“We understood from the meeting that the intention of the BBBEE unit is to expand the charter’s reach in a phased approach. Whereas the original charter was exclusive to CAs the latest charter would include designated members of professional accounting organisations and a future version will also include accounting technicians, bookkeepers and others.”

The proposed revisions to the charter will be for the benefit of all professional accounting bodies that offer designations to their members. In effect, this means Saiba members (and members of other professional bodies) will be eligible for engagements with state-owned companies and private companies adhering to the Code. Members of professional accounting bodies (and not just CAs) will enjoy the benefits of skills development, enterprise and supplier development and management control as required under the Code.

Proposed changes to the Code

Saiba proposed the following amendments to the draft charter:

  • Change the title to Professional Accountancy Sector Charter
  • Include designated members of professional bodies i.e. members that have been awarded a designation which entitles them to perform statutory work.
  • The revised charter would also have to include new definitions to expand the reach of the charter to other professional bodies.

Definitions

The new charter should clearly define what qualifies as a Professional Accounting Organisation (PAO): that is, an organisation that is recognised by statute to issue designatory letters indicating the achievement of certain competencies required to perform work or services within the Accountancy Profession, within an institutional statutory framework.

Another definition to be included in the revised charter is Designated Accountant (DA), meaning a person who has expertise in the field of accountancy, achieved through formal education and practical experience, maintained through continuous learning and development, and who is held to high professional and education standards, as determined and enforced by a PAO by issuing designatory letters.

The revised charter should also create a definition for Professional Accountancy Sector (PAS): meaning a sector within the broader accountancy industry that is governed within an institutional framework that provides for the awarding of designatory letters by PAO.

Another key recommendation is the adoption of a definition for Learnerships, as defined in the SETA Workplace-Based Learning Programme Agreement Regulations (2018):

Learnership: a period of workplace-based learning culminating in an occupational qualification or part qualification.

Candidacy: a period of workplace-based learning undertaken by a graduate as part of the requirement for registration as a professional in the required professional designation as stipulated by a professional body.

Student internship: Category A: A period of workplace-based learning undertaken as part of the requirement for the Diploma, National Diploma, Higher Certificate or Advanced Certificate as a vocational qualification stipulated in the Higher Education Qualifications Sub-Framework (HEQSF).

Student internship: Category B: A period of workplace-based learning undertaken as part of the requirement for a professional qualification.

Student internship: Category C: A period of workplace-based learning undertaken as part of the requirement for the Occupational Qualifications of the Quality Council for Trades and Occupations (QCTO).

Student internship: A period of workplace-based learning for a person who is enrolled at an education and training institution for a SAQA registered qualification and may include vacation work.

Graduate internship: A period of workplace-based learning for the purposes of allowing a person who has completed a post school qualification to gain workplace experience or exposure to enhance competency and/or employability. This may include academic staff with existing qualifications that need industrial exposure or experience. 

The above definitions are aligned to the Companies Act, Close Corporations Act and National Qualifications Framework Act and therefore negates the need to base these definitions in an authority that is not recognised in South African law e.g. IFAC (International Federation of Accountants).

The effect of the above definitions are however the same as if IFAC was used as a reference but is now more grounded in the South African landscape.

The word Professional Accountant was removed from the comment document as its use would just replace the use of Chartered Accountant with Professional Accountant which again raises the same legal objections originally aired against the CA Charter. This should not be a SAIPA charter but a charter for professional accounting organisations that oversee designated members.

The BBBEE Unit is now tasked with deciding to include all professional accounting organisations as participants in the revised charter.