We have been lobbying on your behalf
ACCA regularly responds to policy documents and consultations that are relevant to our members and your clients.
In particular, we have responded to the Tax Administration Framework Review, Raising Standards in the Tax Advice Market and the Public Accounts Committee’s call for evidence on HMRC service levels – these being the most urgent and important recent consultations affecting our practitioner community. ACCA would like to thank the members who provided their feedback and comments on these consultations.
Here’s a summary of recent responses to some other consultations.
TCFD-aligned disclosure Exposure Draft for Phase 2 (26 February)
The UK government continues to work towards its net zero goal and we recognise this ED is an important step in the continued introduction of climate-related reporting requirements.
ACCA believes that governments must provide organisations of all sizes access to practical guidance, support and the tools they will need to reduce carbon emissions if net zero goals are to be achieved and this ED has reasonable clarity and guidance.
Given that the guidance should be clear, concise, and consistent with existing reporting requirements to avoid undue burden on preparers, ACCA recommends establishing a mechanism for regular review and update of the guidance to reflect evolving best practices and regulatory developments. We encourage the government to consider how stakeholder engagement can be effectively integrated into the reporting process.
While the proposed timeline is ambitious, we understand the urgency of climate action and encourage the government to provide adequate support and resources to enable timely compliance. We support the phased approach to implementation, allowing for a smoother transition and capacity building within the public sector.
FRED 85 Draft Amendments to FRS 101 Reduced Disclosure Framework - 2023/24 cycle (4 March)
ACCA is supportive of the proposed amendment to FRS 101. ACCA has consistently been an advocate for improved reporting and consistency with international reporting standards, contributing to enhanced international coherence.
Although this amendment does not seem to impose a disproportionate burden on qualifying entities, we believe that the increasing demand for businesses to collect data on a variety of metrics, coupled with existing capacity constraints, should be considered, and the FRC should provide continuous support and guidance to qualifying entities on how to apply this disclosure requirement.
Addressing the local audit backlog in England (7 March)
We support the reforms proposed by the system partners, clearing the backlog by September 2024, and setting deadlines for future audits, and streamlining procedures for timely financial reporting. These are ambitious steps.
To reiterate, though, the proposed backstop dates for the publication of audited financial statements up to 2022/23 (Phase 1) and for financial years up to 2028 (Phase 2) will not on their own be sufficient to address critical areas essential for an effective financial management cycle and returning to full and timely reporting.
Measures must address underlying problems of shortages of experienced staff in local authority finance teams, attraction and retention hurdles in the profession, increased workload pressure on finance and audit staff, and the impact of reduced local government funding, among others.
A world-class education system: the Advanced British Standard Consultation (20 March)
We support the government’s ambition to ensure that the Advanced British Standard has a clear offer for all students. Improving levels of awareness around the broad range of entry routes to a fulfilling career in the Accountancy profession is one of our core priorities; this includes work being undertaken across schools and education institutions in the UK and worldwide.
Code of Practice on Local Authority Financial Reporting in the United Kingdom (28 March)
We broadly support CIPFA/LASAAC’s proposed temporary measures to the 2023/24 and 2024/25 Codes, aimed at streamlining the recovery process following the DLUHC’s proposed reset for all financial years up to and including 2022/23.
However, reducing reporting requirements to streamline financial information preparing comes at the cost of financial data accuracy, among others, which would further erode public trust and damage council’s reputation. As such, it is important for system partners to manage expectations on the potential outcomes of temporary measures and avoid putting additional stress on finance professionals working in local authorities.
These temporary measures will not address the underlying systemic problems that have led to the current backlog. Addressing these is essential to allow for a sustainable system on local authority financial reporting, and surely requires wider and more comprehensive approaches that appropriately balance the need for quality information and the burden and capacity on auditors and preparers.
Proposal to adopt a Sustainability Assurance Standard in Ireland (19 April)
We agree with the rationale behind adopting an interim sustainability assurance standard in Ireland while awaiting the European-wide standards.
On balance, ACCA believes that the adoption of the ISAE 3000 (Revised) (ISAE 3000) as the interim standard is the best option until a standard is agreed and adopted at the European Union (EU) level by the European Commission (EC).
Adopting ISAE 3000 will capture firms more experienced in using the standard and avoid fragmentation of professional standards guiding the performance of assurance engagements and ensure that practices are as consistent as possible during the transitional period.
Internal code of practice draft (8 May)
The decision to produce a combined Code was supported by the views of our stakeholders. The revised code is considerably clearer and more concise in reflecting and adopting the global standards, while maintaining its relevance. ACCA believes the principles-based approach is practical and the accompanying outcomes introduction section improves its usefulness.
Overall, looking across an organisation’s operations to include all connectivity and interdependencies (for example, organisational culture, and capital and liquidity risks) is appropriate. We do, however, shared some concerns.
Whole of Government Accounts 2021-22 (9 May)
ACCA agrees with the recommendations of the Public Accounts Committee (PAC) during the 2019-20 Inquiry and reaffirms, for the 2020-21 accounts, that the publication of financial statements over two full years after the reporting date has a detrimental impact on their usefulness. The financial statements of many of the organisations that are consolidated into the WGA include comparisons of their actual expenditure against their budget.
This is useful information for stakeholders and should support wider understanding of the information by the public. It would be useful if the WGA included an explicit and clear comparison of actual income and expenditure against the consolidated budget for the UK government, for example, as set out in the Chancellor’s Budget.
The Tax Administration Framework Review: enquiry and assessment powers, penalties, safeguards (9 May)
Moving to a single set of powers across all taxes presents a number of opportunities, including simplification of the broader system, a principle ACCA has long supported. Taxpayers would have a clearer understanding of their rights and obligations, promoting fairness and equity in the tax system. HMRC service level improvement and effective communication are priorities for ACCA members.
One of the greatest risks associated with not moving towards a single set of powers across all taxes is continuing poor service levels for taxpayers, causing significant challenges across a range of areas. While changes to assessment and enquiry powers are likely to lead to additional costs for HMRC, agents, and taxpayers – ACCA believes these costs should be viewed through the lens of potential longer-term benefits.
To see a full ACCA consultation responses, together with other resources which may interest you, visit our website.