Invaders on chartered territory

Management accountants are stealing the show from professionals in the rival camp. By Roger Trapp

It was barely two years ago that the accountancy profession was said to be on the brink of a fundamental restructuring. In the event, the sages were right: rationalisation is as far away as it ever was. Even the planned merger of the Institute of Chartered Accountants in England and Wales with the Chartered Institute of Management Accountants, which was born of the messy attempt to establish a single professional body, has ended up on the rubbish heap.

Yet amid this devastation one body has fared well. The Chartered Institute of Management Accountants may not be as well known to the public as the much larger Institute of Chartered Accountants, but it is generally thought to be on something of a roll.

Cima's president, Allan McNab, who has seen most of his year of office taken up by the abortive negotiations, agrees. The Cima qualification has gained in popularity as more members have joined the likes of J Sainsbury's finance director, Rosemary Thorne, in prominent positions. Indeed, members of the organisation now account for 16 places in the 100 Group of leading finance directors, adds Mr McNab.

The rise of the management accountant - who can now use the coveted "chartered" designation - has added to the pressure on the Institute of Chartered Accountants, which has already been hit by the advent of the MBA. Recently, the institute would have accounted for just about all the seats in the 100 Group; now its share is down to about 50-60 per cent, with those seats not taken by Cima members going to MBAS.

This is why - despite the original Bishop plan for rationalising the profession being painted as an institute takeover of the other bodies - it is assumed that chartered accountants needed the merger more than their brethren in management. And it is all the more ironic that, while the Cima rank-and-file was always enthusiastic about merger, the chartereds' "backwoodsmen" gave it an emphatic thumbs-down.

Mr McNab, a management consultant with Coopers & Lybrand, is disappointed with the outcome, regarding it as a missed opportunity for changing the fabric of the profession. Linking two bodies that could operate two separate streams - business and public practice - without conflict was the most practical first step towards rationalisation. He is now pressing for reform of the Consultative Committee of Accountancy Bodies, the organisation that is concerned with regulation and other issues across the profession. He expects this week's meeting to be lively.

But with mergers off the agenda, the institute is free to concentrate on the strategy formulated back in 1993 and restated last month. "We still have a major aspiration to be the leader in management accounting worldwide," says Mr McNab.

This could be a bigger deal than it sounds because of his belief in the ways that accounting is developing. "When I did the exams 40 years ago, we were cost accountants," Mr McNab says. "It was really a specialist profession."

Since then, computers and data analysis have made management more complex. This has made management accounting a good all-round business training, which offers openings into such areas as strategy.

Although the emphasis on the external aspects of the finance director's role has created a trend for auditors and merchant bankers to be considered for posts, Mr McNab believes that management accountants are especially suited to the strategic elements. "I think the way our members qualify equips them extremely well for that job," he says.

Other aspects of the strategy are more prosaic, including enhancing the benefits of membership and a pilot scheme to supply certain services to non-members. The institute's development of training initiatives for students and employers can be seen as an attempt to keep the organisation at the forefront of the latest techniques.

"The challenge to management accounting is to keep ahead of management, to help them," says Mr McNab. "Maybe that's why the qualification is so valued - because we've always risen to the challenge."

One way of achieving this is to raise the standard of training. The institute believes its awards system and policy of promoting best practice help to do this. For example, the Coopers scheme that he helped to set up enables consultants to do exchanges with client companies so that they swap their experience of projects for line management.

Mr McNab, who has switched between consultancy and management throughout his career believes this widens horizons and reduces the risk of losing of employees after qualification because they have had some of their curiosity about life elsewhere satisfied.

But just because they choose to stay does not mean that they will not be sought by others. This sort of experience presumably makes them more attractive to other employers, since they have strong groundings in both finance and management. But isn't that where we came in?