As heads continue to roll at the CPA, there is more bad news afoot for CPA members.
On 7 October 2017, all public practitioner members of the CPA will lose the protection of their Professional Standards Scheme. This means that they will no longer have the benefit of liability caps, as provided for under the scheme, and may leave members with uninsured exposure to claims which exceed current levels of insurance.
The Professional Standards Council, which approves such schemes, has confirmed that for “reasons of concern about conflicts of interest arising from the establishment and structure of CPA Australia Advice” they will not renew the CPA’s current scheme, which expires nationally on 7 October 2017.
The PSC has received a new application from CPA Australia, but it is too late to guarantee that there won’t be a lapse in the scheme’s continuity for CPA members.
The PSC has directed that from 8 October, all practitioner members must:
- stop using any letterhead or business documents that carry the statutory disclosure statement.
- advise their PI insurers of changed circumstances regarding limitation of liability (and potentially may be forced to purchase new or more insurance).
The announcement is likely to see a defection of CPA members to rival accounting bodies, the Institute of Public Accountants and Chartered Accountants Australia and New Zealand. CPA members will otherwise risk facing uninsured exposures in relation to any claim over and above their available PI insurance.
For further information or advice about Professional Standards Schemes, please contact Natasha Stojanovich here.