The first principle is the evolution to a single designation, Chartered Professional Accountant, or CPA. Once provincial legislation is passed, all current members in good standing would be granted a CPA. However, for a period of ten years, members using the new CPA designation would be required to use it in conjunction with their existing designation. Following the ten year period, a member could choose to use the CPA on its own, or continue using it in conjunction with their legacy designation, subject to legislative approval. Ultimately, the move to one designation will eventually reduce confusion in the marketplace. As the transition takes place, this allows consumers to recognize the training background of professional accountants, and protects the equity members have in their legacy designations.Second, members would continue to use their existing designations along with the CPA, and no one would be granted a designation for another professional body.Third, the unification framework also protects all existing rights of members, such as public accounting licensing rights or rights under existing Mutual Recognition Agreements, without granting new rights, and the CPA body would negotiate new Mutual Recognition Agreements. It is important to note that any member not authorized to practice in a restricted area such as audit prior to the merger would be required to complete any necessary provincial programs to qualify post-merger.Fourth, what we have heard loud and clear from our members is the need to maintain our rigorous education standards. We will address the new certification program in greater detail in the next section of the We expect that like other professions, such as medicine or law, post-designation specialty programs would be developed. A number of specialties are being considered, such as tax, forensic accounting, strategic management, and public sector accounting.Early in the transition process, the new CPA organization will focus branding efforts on the CPA designation and there would no longer be any branding of the legacy designations.The unification framework als addresses the need, and value in creating a uniform regulatory regime for Canada’s professional accountants. While there may be some differences across jurisdictions, if the legislation is similar from province to province it will simplify things for those who practice multi-jurisdictionally. In addition, a new, common regulatory framework reflecting the best practices of the existing organizations, including codes of conduct, practice inspection, disciplinary processes and an effective, nationally consistent public accounting regime would be developed, and as part of our recommendation to government, we would also ask that the new CPA legislation establish a common regulatory regime for all accountant, including those who are undesignated. The new CPA organization would also be responsible for standard setting in the profession.Lastly, there would be merged operations and governance at the provincial and national levels.
The government has told us both through our legislation and in our meetings with them that they want to consider public interest, consumers and members. If we only report on what members think, we risk losing credibility with the government … and possibly the ability to influence the outcome.Secondly, with only 13% of Canadian CAs in BC, moving in isolation does not seem prudent, so we want to be sure we stay aligned with the national profession. And we want to monitor the progress made on these important areas.
Firm SupportOver the past month, the leaders of the seven national accounting firms have been communicating with their staff about the unification initiative. Six of the seven national firms have indicated national support for the initiative and all have encouraged members to get informed and participate in the process across the country. QuebecCPA legislation was enacted in May, and the CPA designation is now established, with over 20% of the professional accountants in Canada now holding the CPA designation.OntarioRecently, CGA and CMA Ontario withdrew from unification discussions and this was the catalyst for CGA bodies across Canada withdrawing—with the exception of Alberta. However, the ICAO remains committed to unification discussions and is continuing on. ManitobaManitoba held an advisory vote, with 48% of their membership making their views on unification known. 59.5% of CAs in that province voted to support a merger with CMA Manitoba. AlbertaThe Alberta CA Institute has withdrawn from the initiative process citing challenges with member support. The Alberta Council unanimously supported the initiative, but they feel more detail is needed than everyone else. However, CGA and CMA Alberta both reaffirmed their commitment to the initiative and have released a provincial merger proposal.We expect several other jurisdictions to hold votes in June, and with the exception of Alberta CAs, and Ontario CMAs, every CA Institute and CMA Society is participating in unification. Agreement on Internal TradeThe AIT Panel reviewing the dispute between Manitoba and Ontario have ruled in favour of Manitoba (re: Ontario’s exception to public accounting under AIT). Their report recommends that “All Parties [being the provinces] take steps to reinvigorate consultations with the other Parties directly or through the appropriate regulatory authorities to develop a consistent standard for public accountants across the country.”
Where do we go from here? The majority of the country’s professional accountants are still represented by bodies who are involved in the unification discussion. Council has said from the start that we support unification as part of a national initiative where CPA emerges as the predominant designation. This could look a number of different ways and this is a very fluid situation.Currently, 20% of the country’s professional accountants are already CPAs, and CPA Quebec is aligned nationally with the CICA.The CPA certification program is being developed, and will be offered in Quebec in September 2013.The national firms, who hire roughly two thirds of CA students, have expressed an interest in using the new CPA program. If this proceeds, the CPA program will be the only accounting program available nationally.We expect that provincial CMA bodies may also switch to the new CPA program.
At this point, we will monitor developments in other jurisdictions and continue to play a leadership role at the national table to ensure our members views are heard.
Gordon Holloway - ICABC
Unification Initiative Update Fraser Valley CA Association June 7 Gordon Holloway, FCA, Vice-President
Unification Timeline 2011 • May 24—National and all provincial CA & CMA bodies, and CGA Quebec jointly release unification proposal • Summer/Fall—28 of 40 accounting bodies at the table in every jurisdiction, representing majority of Canada’s professional accountants • October—CGA Ontario entered merger talks, followed by CGA- BC, and CGA-Canada. Most other CGA bodies quickly followed suit 2012 • January 17—national Unification Framework released • January 24—all three BC bodies release Merger Proposal • January 24-April 30—ICABC held member consultation 4
The National Unification Framework8 Guiding Principles1.Evolution to a single designation, i.e. John Smith, CPA, CA2. Continued use of existing designations—tagging for 10 years3. Retention but no expansion of rights – licensing/recognition4. New rigorous certification program5. Specialties6. Branding—Focus on building Canadian CPA brand7. Uniform Regulatory Regime8. Efficient and effective merged operations and governance 5
Recommendations to Government Draft report to government and recommendations released to members April 27 Member vote held May 1 to 18 Reflects feedback from members and multiple stakeholders Unification subject to CPA emerging as the predominant accounting designation nationally Subject to continued positive progress on key principles: • Common designation with tagging (i.e. CPA, CA) during transition (10 years); • Rigorous certification program accepted by firms; and • Nationally consistent common regulatory framework 6
Member Vote Members voted to endorse Council’s recommendations 4,800 BC CAs voted—largest response rate in recent memory, of those who voted: • 52% support unification and a further 9% believe that elected Council should decide; 39% do not support unification; • 63% support a common regulatory framework; • 63% support a new rigorous internationally recognized certification program; • 58% support offering a separate, intermediate certificate program; • 52% support a new common designation (CPA) • 74% support the use of legacy designations for 10 years 7
Unification: On Balance In BC Firms/CA Training Offices Public Representatives Consumers Regulators Vote expected June Academics PEI BC CGAs 84% supportive Bermuda BC CMAs 91% supportive Saskatchewan Newfoundland & Nationally Labrador Quebec legislation enacted National and Provincial Manitoba CA vote supportive Vote TBD CGA bodies (exception Ontario Council Nova Scotia of CGA Alberta) Agreement on Internal Trade decision Alberta CMA Ontario National and Provincial Leadership of New Brunswick CA and CMA Accounting Bodies BC CA Members 52% support unification 39% do not support unification 9% want Council to decide Positive Negative National Unification 8
Unification: On Balance Quebec CPAs Ontario CA CA Alberta (?) BC CA vote 61% supportive CMA Ontario BC CMA/CGA surveys supportive National and Provincial CGA bodies (with Alberta CMA/CGA proposal out the exception of CGA Alberta) Manitoba CA /CMA vote supportive 50,000+ professional accountants Saskatchewan CA/CMA proposal out Atlantic Canada 110,000+ professional accountants Committed Withdrawn to from Unification discussions National Unification and CPA Certification 9
Where do we go from here? May 18—Quebec CPA legislation enacted, creating 4 bodies End of May—National and provincial CGA bodies withdraw (except CGA AB) June 1—National and all provincial CA and CMA bodies (except CA AB, and CMA ON) still participating in unification discussions 27 of 40 accounting bodies at the table in every jurisdiction, representing majority of Canada’s professional accountants September 2013—CPA program offered in Quebec CPA program offered nationally (?) Going forward door open for CGA bodies to return 10