IAASA has recently advised that it is considering the application from the Institute of Chartered Accountants of Scotland (ICAS) for the revocation of ICAS’ status as a Recognised Accountancy Body (RAB) under Irish company law from December 2021. This would mean that after the relevant date in December 2021, ICAS would have no authority to qualify or approve statutory auditors or statutory audit firms in Ireland.
This has implications for Institute firms who include ICAS members amongst the firm’s responsible individuals (RIs) or amongst the qualified majority of owners and management board members of the audit firm. The Institute has considered the issues involved earlier this year when the Institute of Chartered Accountants in England and Wales (‘ICAEW’) ceased to be a RAB on 21 July 2021. At that time the Institute identified a solution which causes minimal disruption to these Institute firms as a result of ICAEW’s cessation as a RAB and the same approach can be applied in the event that ICAS ceases to be a RAB.
Eligibility for statutory auditor (responsible individual/RI) status in Ireland is dependent on being a member of a RAB as well as holding the appropriate qualification. An ICAS member who is a RI at an Institute firm should become a member of another RAB before the date on which ICAS RAB status is revoked. The Institute (a RAB) has in place a reciprocal membership agreement with ICAS under which a member of ICAS can easily become a member of the Institute so long as membership of ICAS is also retained.
Similarly, ICAS members who are currently counted in the qualified majority of owners and management board members at Institute approved audit firms will need to become members of another RAB by the agreed revocation date to ensure that the firm’s ongoing eligibility for Irish audit registration is unaffected.
The Institute will continue to recognise the audit qualification awarded by ICAS before the revocation date as an appropriate qualification for audit approval purposes.
ICAS members who wish to apply for reciprocal membership of the Institute can do so by contacting the Registry and Subscriptions team.
In the coming weeks, the Institute’s Professional Standards Department will write to the audit compliance principals at Institute firms approved for audit in Ireland in relation to the matters outlined above. Queries on these matters can be addressed to Professional Standards by email.
If ICAS ceases to be a RAB then its status as a prescribed accountancy body (PAB) under Irish company law also comes to an end. This has implications for ICAS members who undertake insolvency appointments in Ireland. Individuals who are affected in this regard should contact ICAS for further advice.
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