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Accountancy profession’s image is ‘at risk’ from tax avoidance, says ACCA

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The accountancy profession’s image is at risk from a range of issues, including ‘perceived collusion with corporations and individuals who improperly deny governments much-needed tax revenues’, the Association of Chartered Certified Accountants said as it reported that 80% of accountants responding to a recent survey ‘blamed their own profession for tax avoidance’. But the professional body’s Head of Taxation emphasised that any comment about avoidance ‘has to be put in to context as it is not a black and white answer’.

Research suggests that the accountancy profession will ‘continue to lose credibility’ if it fails to educate the public and its stakeholders of its value and take steps to rebuild trust, ACCA said.

A report titled Closing the value gap: understanding the accountancy profession in the 21st century revealed that ‘three-quarters of accountants believe that the general public consider them to be trustworthy, while just 55% of the public agree’.

ACCA has 154,000 members and 432,000 students in 170 countries. It said the finding highlighted ‘the huge gap between how the industry sees itself and what the public actually thinks’. This was partly due to a lack of understanding of the accountant’s role in ‘driving the success of businesses of all sizes, which are so crucial to economic growth and recovery’.


‘Convoluted tax planning schemes that do not have any business purpose or economic substance but are expressly designed to exploit loopholes in the law cannot be supported. Such arrangements are considered by ACCA to be unethical … 99.99% of us work in the mainstream and only ever deal with very straightforward tax return work for both individuals and companies.’

Chas Roy-Chowdhury


ACCA’s press release did not mention tax but its report said that ‘some 80%’ of the accountants surveyed ‘blamed their own profession for tax avoidance by companies and/or high-net-worth individuals’.

No definition of tax avoidance, which is legal, was given in the report. Exchequer Secretary David Gauke said in a recent article in The Times that there must be a distinction ‘between ordinary tax planning and aggressive tax avoidance’.

Chas Roy-Chowdhury, ACCA’s Head of Taxation, told Tax Journal today: ‘We all condemn without reservation tax evasion. But when talking about tax avoidance any comment has to be put in to context as it is not a black and white answer. However, convoluted tax planning schemes that do not have any business purpose or economic substance but are expressly designed to exploit loopholes in the law cannot be supported.

‘Such arrangements are considered by ACCA to be unethical and damaging to the interests of the client, the employer company and the adviser, as the case may be.  ACCA takes the view that individuals and organisations who try to exploit such schemes also risk damaging their reputation in the longer-term, both in terms of public perception and their relationship with the tax authorities.

‘Clearly some accountants are involved in schemes which might constitute aggressive tax avoidance but 99.99% of us work in the mainstream and only ever deal with very straightforward tax return work for both individuals and companies.’

The ACCA report did quote several times the views of Robert Herz, a former chairman of the Financial Accounting Standards Board, of Connecticut. On tax avoidance, he said: ‘For the profession to maintain its value, it’s important to be seen to be objective, credible and skilled – rather than just, “Find me a way to avoid taxes”.’


'Accountants were asked: To what extent is the accountancy profession to blame for tax avoidance by companies and/or high net worth individuals?'

  • Considerable blame: 33%
  • Some blame: 48%
  • No blame: 16%
  • Don’t know: 3%

Source: ACCA: Closing the value gap: understanding the accountancy profession in the 21st century (August 2012)


ACCA said: ‘All told, about three-quarters said that accountants are at fault for public distrust in the motives and behaviour of business. This highlights the urgent need for the profession to bolster its standing in society ...

‘Value and trust go hand in hand: without trust in the profession, there can be no value. Yet that trust has been challenged by the continuing financial crisis, corporate failures, cost-cutting exercises, accusations of unethical or unprofessional practices (for example, work on tax arrangements regarded as unpalatable by the public) and a lack of understanding of the value the accountancy profession provides. All these factors endanger much needed trust in the accountancy profession.’

The press release noted: ‘Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.’

Longitude Research surveyed more than 250 accountants, 1,500 consumers and ‘key opinion leaders’ around the world.

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