Updated June 2023: Investigations and Disciplinary Proceedings by the ICAEW

On 1st June 2023, the Institute of Chartered Accountants in England and Wales (ICAEW) made a number of important changes to its disciplinary framework and processes. In addition to changing the disciplinary process, the ICAEW streamlined the Disciplinary Bye-laws (DBLs), replaced outdated and confusing language, and introduced new non-financial sanctions. In this article, we will explain how complaints are handled by the ICAEW and what Chartered Accountants need to know about the updated ICAEW disciplinary process when facing disciplinary action.

How Are ICAEW Complaints Handled Initially?

Complaints received by the ICAEW initially go through an “assessment stage” to check whether the member or firm complied with the relevant ICAEW standards, guidance or regulations. If it appears that they did, the complaint may be rejected. If the standards, guidance or regulations were not followed, the complaint may be handled by way of conciliation, or if this is not possible, the matter may be investigated further. Conciliation is always a preferred outcome and allows both parties to reach an agreement regarding the complaint without the need for further investigation.

What Will Happen If I Or My Firm Is Investigated By ICAEW?

If there may be a case to answer, your case will be referred to the ICAEW’s “Conduct Committee”. Where necessary, some cases are first referred to the “Fitness to Practise Committee”, whose role it is to assess whether the subject of the allegation is fit to take part in disciplinary proceedings. The Conduct Committee is a group made up of ICAEW members and non-members who will determine if there is a case to answer. If they believe there may be a case to answer, they will then decide whether to either a) take no action, b) agree on a caution, c) issue an order or d) refer the complaint to the ICAEW Tribunals Committee.

The Tribunals Committee will consider the matter further and then either impose a sanction or dismiss the case. Possible sanctions include reprimands, fines, the requirement to undertake certain training, removal or suspension of an ICAEW Practising Certificate and exclusion from ICAEW membership.

Changes To The ICAEW Disciplinary Framework For June 2023

Several key changes to the ICAEW disciplinary framework came into effect on 1st June 2023; these are summarised as follows:

• ICAEW disciplinary process provisions have been taken out of the “Disciplinary Bye-laws” (DBLs) and placed into the new “Investigation and Disciplinary Regulations” (IDRs). This has had the effect of reducing the number of DBLs from 49 to 16
• Language has been simplified by removing archaic language and Latin phraseology
• The principles of the Code of Conduct for Complainants have now been incorporated into the regulations
• Non-financial sanctions are now available (e.g. requiring a member to receive or a firm to provide certain training)
• Introduction of a ‘lie on file’ procedure which means that new complaints relating to members who have already been expelled will be paused to be reassessed if there is a future application for readmission to ICAEW membership
• Interim orders are no longer only available in extremely limited circumstances. This is to enable temporary measures to be implemented during an investigation if there is a risk of significant harm to the public
• New “Designated Criminal Convictions” list. Those who have received a ‘serious conviction’ will have their cases referred directly to the Tribunals Committee via a fast-track process (e.g. offences of dishonesty and jail sentences over 5 years, amongst others)

According to the Chief Officer for the Professional Standards Department (PSD) at ICAEW, Duncan Wiggetts, “We wanted to make our disciplinary scheme more transparent, simpler to understand, and more efficient for everyone involved”.

The changes also mean that the appeal process will change. Previously, anyone could appeal against an order made against them. Under the ICAEW’s new regulations, members and firms must first seek permission to appeal.

Final Words

If you have any reason to believe that you are being investigated by the ICAEW in relation to a professional accounting complaint, do not delay; seek legal advice. By co-operating fully with the ICAEW at every stage, you will increase the chances of your matter being resolved quickly by means of conciliation. Reputational harm from ICAEW disciplinary proceedings can be avoided by taking a proactive and clear-headed approach from the outset. It is important to understand the ICAEW’s complaint against you, their disciplinary approach, processes and procedures, and what the committee members take into account at each stage. With the aid of an experienced disciplinary and regulatory solicitor, your matter may be capable of resolution by a sensible and proportionate outcome, and potentially no further action, allowing you to refocus on your accounting career/business.

Jonathan Goodwin has been helping professionals with disciplinary and regulatory matters and hearings for 25 years. If you have any questions relating to ICAEW investigations or disciplinary proceedings, please call us on 0151 909 2380 or complete our Free Online Enquiry.