“Under the CPD Regulations, ICAEW member firms and other firms regulated by ICAEW have three main responsibilities,” says Sophie Wales, Director, Regulatory Policy, ICAEW. “The first is to ensure that all their ICAEW members and other ICAEW-regulated individuals comply with at least the minimum CPD hours for their CPD category, including the verifiable hours and mandatory ethics training.
“Their next responsibility is to keep records of those minimum, relevant and verifiable hours,” she explains. “And the third is to make those records available to our Quality Assurance Department (QAD) for inspection on request.”
In practical terms, firms need:
- a process to review and monitor employee CPD records;
- to consider whether individuals have correctly assessed their CPD category;
- to check individuals have conducted the minimum required hours, including verifiable hours and mandatory ethics training; and
- to retain records, including evidence of verifiable CPD, for three years after the completion of a CPD year.
Which category?
An individual’s CPD category determines the minimum number of CPD hours they must complete. “So, the key thing firms need to do is to identify which CPD category each of their staff members sits in,” says Wales.
“To simplify the process, we’re seeing some firms taking a blanket approach and allocating all professional staff to category 1, with the highest requirements, and making sure they all meet those requirements,” says Liz Shaw, Senior Manager, Quality Assurance Department. “And some firms are taking this approach just for certain business areas. For example, those working in audit may all be allocated into category 1.”
Other firms are leaving it up to the individual staff members to determine their category. “There’s no right or wrong way,” stresses Shaw. “The important thing is to make sure everyone is doing at least the minimum hours for their CPD category, and when we begin to visit firms to check on CPD compliance, we will expect firms to be checking if people have assessed themselves correctly and are doing the right amount of CPD hours.”
“It’s also worth clarifying that, as a firm, you are only responsible for CPD compliance related to the work an employee does for the firm,” adds Wales. “Someone might be in category 2 for the work they do for you, but they also have another role, perhaps as a charity trustee, which puts them in another category. If a staff member has CPD requirements because of roles outside the firm, that doesn’t come within the firm's responsibility.”
“When we are asked questions about how specific scenarios fit the categories,” says Shaw. “We usually signpost people back to ICAEW’s website on understanding CPD categories or the CPD categories tool. These will tell people which category they should be sitting in. If anyone is still unsure after that, they can call our helpline.”
What’s verifiable?
“We are often asked about what counts as verifiable CPD,” says Shaw. “And in a nutshell, for CPD activity to be verifiable, there needs to be evidence of its completion, and that evidence must be objective, corroborated and retained.”
This means the evidence must be fact-based, corroborated by an independent source and retained in a format that can be included in a staff member’s CPD record rather than based on personal perspectives. “If you’re wanting to make CPD verifiable, you need to make sure the evidence meets all those criteria,” says Shaw.
Verifiable CPD is not limited to structured courses. Independent evidence can be provided for a wide range of day-to-day activities, such as attending peer discussion groups, on-the-job research and writing academic articles.
“There are lots of examples of types of verifiable CPD which can be found on our website to help people decide which CPD is verifiable,” says Shaw. “And it’s also important to remember that if you can’t obtain the evidence for the activity to classify as verifiable, it can still be counted as CPD and recorded as part of your overall hours.”
Under the regulations, there is also a mandatory one-hour ethics learning requirement per year. To support this, ICAEW has created its own ethics learning course. “Firms don't need to use it,” says Shaw. “But if they choose their own ethics training, it must meet ICAEW’s learning objectives for ethics.”
The ethics learning also needs to be verified. “If a firm carries out ICAEW’s ethics training in a group scenario where everyone isn't logged in to the ICAEW website, the firm should record who attends that as evidence of completion,” explains Shaw. Individuals logging in directly will be able to evidence its completion using the +CPD icon linked to their online CPD record.
Keeping a record
Under the CPD Regulations, firms must keep records of how their staff are meeting their CPD requirements. “There is no prescribed format,” emphasises Shaw. “But the records do need to contain details of their CPD activity, including the total number of hours completed. Where the activity is verifiable, the records also need to contain sufficient evidence to support this.” For ease, ICAEW has developed digital tools to record and verify CPD, including an online tool accessible through a member’s dashboard to record CPD.
“Members and firms should not send us their CPD records as a matter of course,” says Wales. “Firms just need to have them available if QAD staff ask to see them.” These records, including verifiable evidence, need to be kept for at least three years after a CPD year ends.
The records also should show all CPD undertaken. “We’re looking at CPD as a whole; it doesn’t have to be verifiable to be valuable. So, whichever category someone is in, we will check that they have adhered to the total minimum hours,” says Shaw.
In the end, it’s up to individual firms to decide how to record and retain staff CPD information. “Some firms have their own learning management systems (LMSs), which retain their records centrally,” says Shaw. “But some may use a simple spreadsheet-based approach or leave staff to keep their own records.
“And that's absolutely fine,” she emphasises. “When we conduct CPD visits or ask for CPD records, we don't mind how we see them. As long as we are given a complete record, it can come from various locations and shown in various ways.”
Risk-based monitoring
QAD reviewers will be starting monitoring visits to firms from the beginning of the second ICAEW CPD year under the new regulations, which is 1 November 2024. “This monitoring process will be on a risk-based cycle,” explains Shaw. “If your firm isn’t selected in the first year, it may be visited during a future cycle.
“We often get asked whether a firm’s CPD year needs to align with ICAEW’s CPD year,” says Shaw. “And we understand why this can be an issue because firms may have CPD and appraisal plans that are more broadly linked to their financial year-ends.
“We don’t expect firms to change this; it’s fine if they want to use their own CPD year. If, for example, there is a 31 December year-end, then the firm can carry out its CPD requirements to that date and, when we carry out visits, we will look at the latest completed year to assess compliance, ” she adds.
Monitoring visits to firms to check CPD compliance will be standalone. “If we select your firm for monitoring, we’ll contact you just as we do for practice assurance visits,” says Shaw. “We will come in and seek to understand your CPD system, and how you determine and know what learning your people are doing. We’ll also be looking at how you are recording CPD and how you monitor adherence to the processes and regulations.”
Reviewers will pick a sample of ICAEW members working within the firm and test check their records. “If we find individuals that haven't complied or there are other issues, we will talk to you about those and we’ll ask you to develop an action plan to address them,” says Shaw. “We will then follow up, just as we would do with other monitoring visits.”
If in doubt, ask
The CPD Regulations place responsibilities on individuals and firms for a reason. They are there to ensure members are maintaining the necessary skills, knowledge and experience to carry out their work to the standards expected of the profession. This mitigates the risk of issues arising within members’ work and strengthens trust in the profession.
“It’s up to the firms and individuals to consider the work that they do and ensure they are complying with the minimum requirements,” says Shaw. “We support them in this by providing a wealth of information and guidance on our website, including tailored advice for sole practitioners. We urge everyone to use these tools and check the guidance.
"And, if they still have any doubts, they should call our Technical Advisory Services helpline on +44 (0)1908 248 250.
“Our CPD monitoring visits will be similar to the other reviews we carry out across firms, and we’ll be talking to you and keeping you informed throughout the process. We will also provide feedback at the end of the first monitoring year to help firms improve their processes by being aware of issues that we have seen, together with examples of good practice. ”
