ICAEW’s Practice Assurance (PA) Regulations, and other regulations covering audit, local public audit, DPB (Investment Business), probate and the licensed practice scheme, require regulated firms to notify ICAEW of changes in their details and company structure, including change of address, change in role, retirements, additions, and similar, within 10 business days.
“Your firm’s record on our database is used to populate other records that the public and profession can view. It’s part of our duty of care as an improvement regulator to ensure the details we keep on regulated firms are as accurate as possible,” explains Helena. “It helps strengthen trust in the profession. If your firm's record is inaccurate or out of date, it may constitute a misdescription of your firm and that can lead to more serious regulatory and disciplinary issues.”
Firms must report any changes to a wide range of details, including, for example:
- the name of the firm and any trading names;
- addresses of offices in the firm;
- the principals (partners, directors or members);
- the PA contact principal and contact principals in specific regulated areas;
- voting rights of partners in a partnership and members of an LLP (including corporate partners or members); and/or
- shareholders and the voting rights and nominal value of their voting shares, as well as the nominal values of their non-voting shares.
The above list isn’t complete, but it reflects the most common reasons firms should be contacting ICAEW about changes in their circumstances.
You must notify us of the changes as soon as is practicable, but not later than 10 business days after the change was made. This mitigates the possibility of inaccurate data we have on you and/or your firm.
Why is it important?
“At the basic level, it’s important you inform us of these changes so that we have up-to-date and correct information for the firm,” says Helena. “It means we always have the right contact information, and we know the right people to communicate with.
“We also use a lot of that information for billing purposes,” she adds. When ICAEW issues pro forma invoices to regulated firms in November (for the following fee-year), they are based on the structure of the firm shown on the database at that time. “If you haven't notified us about any principal retirements or ceased offices, the amount you are charged may be incorrect and you may incur higher costs.”
The data on a firm’s record also feeds into registers and databases, such as the following resources.
- Register of statutory auditors (audit registered firms)
- FCA’s financial services register (DPB Investment Business firms)
- ICAEW probate register (ICAEW probate firms)
- CAA’s list of ATOL Reporting Accountants
- Find a chartered accountant
Information about changes to the structure of the firm, such as in shareholders, voting rights and management boards, is used to determine the firm’s ongoing eligibility to hold certain regulatory registrations (for example, audit registration and probate accreditation). It’s also used in deciding whether a firm meets the definition of an ICAEW member firm and if it is eligible to use the term ‘Chartered Accountant’.
“Some changes, for example in voting rights and principals, can affect firm eligibility,” explains Helena. “So, when you’re telling us about those changes, check to make sure the firm remains eligible for the specific regulated areas you work in, for automatic AML supervision by ICAEW and use of the description ‘Chartered Accountants’. It’s the firm’s responsibility to ensure the data we hold is up to date, and that it continues to meet the various eligibility requirements.
“Another important point to bear in mind is that your annual return is based on the information we hold,” adds Helena. “The annual return is not a mechanism to make changes to the firm’s record. It’s simply to confirm that at that particular point, the information we hold is correct. So, if you’ve properly updated and maintained your record throughout the year, the annual return will contain the correct information.”
Submitting changes
“You need to inform regulatory support of changes as soon as possible, but always within 10 business days,” says Helena. “We have five different standing data change forms available online that allow you to do this. They’re maintained on our website.”
These forms cover changes to principals, offices, trading names, structure of the firm, and regulatory contacts and roles. If the changes are as a result of a merger or acquisition, you may inform us of the changes using the Mergers and Acquisitions form.
“You’ll often need to complete more than one form,” notes Helena, “as one change can have knock-on effects. For example, where you're appointing a new principal and they take on a formal compliance role, you would need to complete the principal and the regulatory contact and role forms.”
When the forms are complete, the relevant contact principal needs to sign them, and they need to be emailed to regulatory.support@icaew.com.
It’s important to note that if a firm isn’t working in the specialist areas of audit, ATOL reporting, DPB (Investment Business) or probate, changes to the firm’s record can be requested using the following online form.
Common pitfalls
“Probably one of the most common things people omit to tell us in a timely manner is a change in a firm’s principals,” says Helena. “And another, often related issue, is changes in voting rights and shareholders.
“Some things don’t change very often, for example firms’ names or addresses,” she explains. “But principals do change more regularly, and you’d expect that, so this can be where we see firms falling down.
“So, you might have changed principals and not told us, but this has then affected voting rights, so again, you've fallen down on that. It’s also these kinds of changes that are more likely to have a knock-on effect on eligibility, and then you may be committing further regulatory breaches.
“ICAEW’s regulatory committees do take failure to notify quite seriously,” she emphasises. “And they do have the option of offering penalties. In the Guidance on Sanctions, the starting point for a failure to notify of a change is £1,000.”
Efficient administration
ICAEW’s latest PA monitoring report shows that errors in ICAEW records and the annual return were the third biggest non-compliance issue identified during firm visits in 2023.
“Failure to notify is an avoidable mistake that we see too often,” says Helena, “and we want to remind firms they have a duty here.
“It’s simply down to efficient administration to stay on the right side of the requirement,” she emphasises. “But if you fail to comply, it can have significant consequences, including potential knock-on effects relating to eligibility and misrepresenting your firm.
“Please recognise the requirements and tell us about any change to your firm,” she urges. “Use the forms available and, if there's a change you think you want to tell us about and it doesn't fit neatly within one of those forms, tell us anyway, and we can guide you through what to do and what it means.”
