There is nothing more precious in this life than your reputation. Not least if you are an auditor! Does anyone remember Arthur Anderson? Via the AFR:
Government regulator the Professional Standards Councils has confirmed that public practice CPAs in Victoria will lose their protection from multimillion-dollar malpractice lawsuits, and that CPAs in other states and territories are also likely to lose the legal shield from October.
PSC said CPA’s application for a new professional standards scheme was refused over concern about conflicts of interest arising from the unprofitable financial planning business established by former CEO Alex Malley, as revealed by The Australian Financial Review almost three weeks ago.
“A new scheme cannot now be made in time for CPA practitioner members in Victoria, and likely in other mainland states and territories, to avoid a lapse in their Professional Standards Scheme’s continuity,” the PSC said in a statement released on Tuesday.
…Rival body Chartered Accountants Australia and New Zealand has moved to exploit the growing anger in CPA ranks by highlighting a little-known and simplified pathway for unhappy CPAs to defect.
CA ANZ is the predominant qualification in the audit and tax practices of the big four accounting and consulting firms, Deloitte, EY, KPMG and PwC, while the CPA designation is the qualification for commercial accountants who work primarily in companies and small businesses.
…Greg Angelo, a CPA for 45 years and an outspoken critic of the way CPA is being run, said he had “no hesitation” in applying to become a CA now he knew about the simplified pathway.
“I personally know several CAs who could provide an appropriate reference,” he said, adding that “any affinity with CPA Australia has been totally destroyed by the machinations of Alex Malley and the capturing of the CPA board and senior executives by self-interested individuals feathering their own nests at the expense of members. I would encourage any other CPA with the appropriate credentials to transition ASAP.”
The CPA now faces an existential crisis. If it doesn’t fully reform its governance then its reputation is in tatters. If it does do it then it faces years of horrible brand destroying legal stoushes trying to claw back the Naked CEO’s plunder.
I can’t see how it can take any other than the second course but the damage will be severe as competitors pick over its carcass.
Such is life under the Naked CEO.
