A chartered accountant is a qualified accountant who is a member of a chartered accountancy institute. In England and Wales that means ICAEW, whose qualification is the ACA. To qualify, a student passes 14 exams and completes at least 450 days of professional work experience over a training period that usually lasts three to five years. They then remain bound by the institute's ethics code, continuing professional development requirements and disciplinary rules. In Scotland the equivalent body is the Institute of Chartered Accountants of Scotland (ICAS), and in Ireland it is the Institute of Chartered Accountants in Ireland.
What "chartered" means
"Chartered" refers to the institute, not to any government licence. ICAEW was founded in 1880 and operates under a Royal Charter and bye-laws, which set out how it admits, regulates and disciplines its members. Membership is what entitles someone to call themselves an ICAEW Chartered Accountant. ICAEW reports more than 211,600 members and students worldwide and says it supervises more than 11,500 firms.
Other UK accountancy bodies also carry the word "chartered" in their names, notably the Association of Chartered Certified Accountants (ACCA) and the Chartered Institute of Management Accountants (CIMA). Their members are professionally qualified as well, but they follow different syllabuses and training routes. When people say "chartered accountant" without qualification, they normally mean a member of ICAEW, ICAS or the Institute of Chartered Accountants in Ireland.
How someone becomes a chartered accountant
The ICAEW route, the ACA, combines three elements:
- Exams. 14 exams across three levels: Certificate, Professional and Advanced;
- Professional skills and ethics. These are built across five competency areas during training;
- Practical work experience. At least 450 days, gained with an employer authorised to train ACA students. This does not have to include audit work.
ICAEW describes the minimum as at least three years of on-the-job training, and the qualification typically takes three to five years depending on prior study and the route taken. Many chartered accountants train in practice, at a firm of accountants, and then move into industry. Others train directly in business or the public sector.
What a chartered accountant does
The work falls into a few broad areas:
- Audit and assurance. Independent examination of financial statements, statutory or voluntary;
- Accounts and reporting. Preparing annual accounts under FRS 102, FRS 105 or IFRS, and management accounts;
- Tax. Corporation tax, personal tax, VAT and planning;
- Advisory. Valuations, due diligence, transactions and business planning;
- Industry roles. Financial controller, finance director and chief financial officer.
What the title does and does not guarantee
There is a key difference in the UK between protected and unprotected activities. Anyone can describe themselves as an accountant or a tax adviser. HMRC's own guidance says that "anyone can call themselves a tax agent — they do not have to have qualifications or professional training and HMRC does not regulate agents." The chartered title matters because it brings a qualification, an ethics code, continuing professional development requirements and a disciplinary regime.
Some work is restricted by law:
- Statutory audit. Under section 1212 of the Companies Act 2006, only a member of a recognised supervisory body who is eligible under that body's rules can be appointed as a statutory auditor. The Financial Reporting Council names the recognised supervisory bodies as ICAEW, ACCA, ICAS and the Institute of Chartered Accountants in Ireland. Being a chartered accountant is therefore not enough on its own: the individual or firm also needs audit registration. ACCA members can also qualify;
- Anti-money laundering supervision. Under regulation 7 of the Money Laundering Regulations 2017, external accountants and tax advisers must be supervised either by a professional body listed in Schedule 1, which includes ICAEW, ICAS and the Irish institute, or by HMRC.
Chartered accountant or other accountant: which do you need?
For bookkeeping or a simple tax return, a member of any recognised professional body may be suitable. A chartered accountant is a sensible choice when the work is technical or carries significant consequences. Examples include statutory accounts for a company with investors or lenders, group or consolidated accounts, a sale or acquisition, a tax enquiry, or an audit, where audit registration is a legal requirement. Whoever you choose, HMRC's guidance is clear that "even if you use a tax agent, you remain responsible for your own tax affairs." Check the person's membership on the institute's public register and ask whether the firm holds audit registration if you need an audit.
Sources: ICAEW: who we are, ICAEW: how ACA training works, Companies Act 2006, section 1212, FRC: audit firm supervision overview, Money Laundering Regulations 2017, regulation 7 and GOV.UK: how to choose a tax agent. For help choosing a firm, see our guide on how to choose a chartered accountant.
Acumon is a firm of chartered accountants. If you need accounts prepared or audited, our statutory accounts and statutory audit teams can help.