Practice structures

Key Points

  • The Institute does not limit the type of structure used to provide services although legislative limitations may apply
  • Restrictions apply in relation to firms entitled to use the CA description.

Permissible structures

The Institute doesn’t set limitations on the type of structure and members may practice in their own right as:

  • A sole practitioner
  • Partnership 
  • Incorporated company
  • Trust 

or any combination of partnership and any of the above practice structures.

Whatever the structure, it is the individual members who holds a Certificate of Public Practice, not the entity itself. However the benefit of professional indemnity insurance must apply to all members and entities providing services to the public.

Rather than setting arbitrary capital requirements, the members have an obligation to ensure that any practice entity must maintain the financial capacity and ability to meet the excess obligations under the professional indemnity insurance policy.

Legal limitations

Limitations or additional restrictions do apply, particularly in relation to specific appointments such as audit and insolvency. Generally the choice of practice structure is limited by law rather than Institute regulation.

Chartered firms

A related (and significant) issue where the Institute does set restrictions is the practice’s ability to use the description Chartered Accountants and the Chartered Accountants logo as a chartered firm. These are set out in full in Regulation 9/1205. If you are in any doubt about whether your practice is a chartered firm contact the Professional Standards team.

By updating your practice details using the Practice Details Advice Form, you can ensure our information on your practice is up to date and, when appropriate, correctly reflects your practice’s status as a chartered firm. Should any non member owners appoint a Chartered Accountant as an Authorised Representative a supplementary form is available.

For further assistance and guidance on practice structure issues, members can contact the Professional Standards team.

Article last updated 2 September 2011