they get their first job, many accountants worry that they will be pigeon-holed by their qualification. ACA is seen as the City gold standard in some quarters, and those who aren’t offered it might worry that their ambition of becoming a FTSE 100 CEO will be thwarted. On the other hand, ACCA is a more international qualification and people with overseas ambitions might think it is necessary for overseas success. But is any of this actually right? Which qualification is best for an ambitious accountant in the City?
The two main accountancy qualifications offered by City firms are the ACA – run by the ICAEW – and the ACCA – which is offered by ACCA. On the face of it, ACA might seem to lead the pack. Around 70 per cent of people on FTSE 100 boards have the ACA – to put that in context, about 20 per cent have an MBA. One big four accountant estimates that four in five of his firm’s accountants are ACAs.
But that is largely a result of ACA’s historical popularity. ACCA has grown rapidly in the recent past and in 2009 the number of ACCAs overtook the number of ACAs. The Professional Oversight Board found that by the end of 2009, ACCA had 137,233 members worldwide, while ICAEW had 134,698. Globally, ACCA membership has increased 5.6 per cent over the past five years, while ACA grew by 1.2 per cent in that period. Worldwide, 404,000 people are studying for the ACCA. Much of this lead has been built up overseas, however: in the UK, the ACA still retains its lead, with 114,468 compared to ACCA’s 68,907.
Sheer numbers aren’t everything, of course, and what is good elsewhere is not necessarily good for the City. Heather Bygrave, the partner responsible for learning in Deloitte’s UK audit business, says that the vast majority of its accountants take ACA. “ACA is seen as a higher hurdle to jump,” she says. But does that perception have any grounding in reality? She admits that there is a “snobbery factor”, and says that the ACCA is still a “very good qualification”. Deloitte does sometimes offer it, she says, especially to people who find it hard to deal with the intense, academic style of the ACA.
Michael Walby, director of professional qualification training at Big Four accountant KPMG, agrees that it is no longer quite so clear that ACA is the leader. “In the UK the ACA has been seen as the premier qualification, in the past there was a good reason for that. However in the past five years the ACCA has been catching up,” he says.
The accounting bodies work hard to try to differentiate themselves, but the reality is that the differences are largely cosmetic. ACCA is keen to promote its internationalism, and Michael Walby agrees that accountants have taken this on board. “The ACCA has a high profile across the world, especially in East Europe and Asia,” he says. “Many graduates in 2010 see the ACCA as a pathway to a global career.” If you are thinking about working on your own, rather than for a big accountant, then the ACCA could help you, he says. But he also points out that having the ACA in no way disqualifies you from an international career if you work for a major accountancy firm.
In fact, for the would-be accountant both are good. City accountancy firms have a symbiotic relationship with the accountancy bodies, and this ensures that accountants are trained to do the things that the firms need them to be able to do. As the market has grown more competitive, ACCA and ICAEW in particular strain to meet the Big Four’s requirements. This has led to innovations; ACCA offers a good distance learning option, partly because of pressure from City accountancy firms who wanted to give that option to employees.
Accountancy firms sometimes need people with a specific qualification – for example, KPMG worked with ICAS, the Scottish audit body, on the Scottish tax system, and so when it recruits people to work in that area they take the ICAS. But KPMG also wants those people to have a good, solid grounding in accountancy that will allow them to work elsewhere later. Hence ICAS makes sure that its offering is just as good as the ACA or ACCA.
In short, the market has spoken, and the result is that all the major qualifications prepare you for a successful career. Some people feel strongly that they want to be an ACA, or want to be associated with the Scottish ICAS, but in reality both are a fantastic springboard for a career. As Michael Walby says: “It’s like choosing between Pepsi and Coke.”
ABC OF ACCOUNTANCY | QUALIFICATIONS
ACA Run by the ICAEW, this is the most popular professional accounting qualification in the City. About four-fifths of City accountants are ACAs and it has traditionally been seen as the gold standard.
ACCA Run by ACCA, this is the fastest growing accountancy qualification worldwide, with numbers up 5.6 per cent over the past five years. Globally the largest accountancy qualification, it is often perceived as the best for those with international ambitions.
ICAS A Scottish accountancy body whose members are allowed to put the letters CA after their name.
CIMA A more generalist qualification, often taken by those who want an accountancy qualification to help with a general business career.
CIPFA Accountancy qualification tailored specifically to the public sector.
AAT The entry level vocational qualification, often taken by school-leavers but open to everyone. Gives a solid grounding in accountancy and is a fast track route to chartered accountancy.
It is recognised by all the professional bodies.