Professional standards and the IFA's conduct committees

The disciplinary regulations set out the process that begins with the IFA’s receipt of a complaint. That complaint may come from one of a wide range of sources, including from within the IFA itself (arising, for example, from its compliance or practice review function).

After an initial assessment by a case manager, a matter will sometimes be prepared for formal investigation by a conduct committee – the Investigation Committee for complaints from outside the IFA, or the Disciplinary Committee for most internally generated matters.

All four of the IFA’s conduct committees comprise independent decision-makers. The need for proportionality means that it is sometimes appropriate for the disciplinary case manager to reject a complaint as trivial, vexatious or lacking in evidence.

Nevertheless, a complainant in such a matter has the right to have that decision reviewed by an independent conduct committee chair. The process of investigation by the Investigations Committee or Disciplinary Committee is a further example of proportionality.

Their role is only to determine whether there is a prima facie case to answer and, if so, to off er the respondent a consent order. This minimises the costs incurred in the disciplinary process while providing the respondent with the opportunity to reject the consent order and attend an open hearing of the Disciplinary Committee, at which the respondent may be represented. When updating the IFA bye-laws and regulations from 1 July 2022, opportunities were seized to shape the way the conduct committees are constituted and operate.

The IFA considers it important that a legal assessor is present at every disciplinary and appeal hearing. Although some of the conduct committee chairs are highly qualified and experienced legal professionals, the presence of a legal assessor at each hearing makes it unnecessary for the chair to hold a legal qualification. In fact, removing that requirement from the disciplinary regulations allows for greater diversity across the conduct committees.

In addition, longer terms of service for committee members are now permitted by the regulations, to allow the IFA to make full use of the experience gained by committee members while serving on the IFA’s committees. A policy was also introduced to allow a committee member to sit on any of the four conduct committees, rather than be appointed to serve on just one type of committee. This will provide more opportunities to sit, which will help to ensure that conduct committee members maintain their high levels of technical competence. 

Objectivity in decision-making

In case it is not clear from the above, I should highlight that the IFA’s conduct committee members add objectivity to the IFA’s disciplinary and enforcement procedures. A committee usually comprises three people and, in any event, lay persons must form the majority of the committee. A committee member may not be (among other things) an IFA board member or member of staff . Only the committee members may participate in the decision-making process at a committee meeting or hearing. Therefore, it is important that any conflicts of interest are identified and declared at an early stage, to avoid the risk that the committee may not be quorate. Anyone else present at a hearing will usually be a party to the proceedings, a witness, a legal assessor or a silent observer. However, a member of IFA staff is permitted to attend a hearing or committee meeting only to support the committee should they be called upon to do so.

The new conduct committee members

In late 2021, a process commenced to recruit a new cohort of conduct committee members. After a rigorous selection and interview process, seven new conduct committee members were appointed, bringing the total within our committee member pool to 15.

This is sufficient to ensure that, on the rare occasion that a respondent goes through the entire investigation, disciplinary hearing and appeal process, a committee can always be constituted that has not considered the matter at an earlier stage. Therefore, no committee members are likely to be conflicted.

All of the new appointees attended a training day in June and most have observed at least two conduct committees in action, including a disciplinary hearing. The training day was also an opportunity for the IFA to thank those reappointed committee members for their service to date as they approached the end of their initial term of appointment.

In constituting its conduct committees – a process that requires the involvement of the existing conduct committee chairs - the IFA continues to demonstrate the highest standards of professionalism and reliability. High standards of professionalism are supported by a strong ethical foundation. We champion integrity, fairness, diversity, transparency and responsibility.

In other words, we are guided by doing what is right in any given situation. As an organisation and individually, IFA staff interact with members in a professional manner; but we are also enterprising and commercial, recognising that we are an organisation that exists for its members.

As such, we must be able to support our members – individually at times, but always as a collective. A fundamental element of this is being seen to require high professional and ethical standards, and not allowing our regulatory activities to be prejudiced by our support for individual members and students.

This is where our conduct committees serve the IFA and its membership so well. The regulatory and disciplinary decisions they make are published on the IFA website and in Financial Accountant. The independence and objectivity built into that decision-making process are fundamental to raising and maintaining standards and to public trust in the accountancy profession.

Ian Waters is director of professional standards at the IFA