New ACCA PII Regulations

What if my Accountancy firm is unable to obtain PII?

Qualifying insurance

Do you have equipment that needs protecting? Then an Office Insurance policy can provide cover for your furniture, IT equipment, technical surveying equipment If you don’t want to be personally liable as a Director, a Directors’ and Officers’ insurance policy covers your defence costs and any compensation you must pay. What are the PI requirements for ICAEW, AAT, ACCA, CIMA or CIA? Each regulatory body has its minimum Limit of Indemnity (LOI) levels of Professional Indemnity Cover required by members, which is based on your fee income. You should look at your Associations website for further information. If your firm is unable to obtain PII in the insurance market

Run-off cover — easy to ignore, expensive to forget

This can bet best odds guaranteed bookies come standard with Office Insurance Policies too. Insurance to keep your vehicles and surveyors on the road. What does Accountants professional indemnity insurance cover? Accountants Professional Indemnity Insurance covers claims made against you by a client or third party that alleges negligence, a breach of trust or confidentiality, or defamation. The policy covers the cost of any damages awarded, claimants’ costs and the costs of defending the claim.

So, where to start?

What other insurance does an Accountant need? The other insurance you need will be based on your circumstances. Looking to close your business, then you may need Run Off Cover. If the Limit of indemnity needs to increase, then you need Excess Layer Insurance. Do you need to cover past works, then we can work with you to put a Retroactive Date on your PI Cover If you have employees, you will need Employers Liability Insurance. via your existing broker, then we may still be able to help.

How to Access Our PI Insurance

UK-based expert support, online and on the phone. Specific Claims and Risk Management advice, along with technical bulletins are provided throughout the policy period. Accountants can use our facility whether a sole practitioner or part of a larger practice. MFL is trusted by thousands of Professionals. Compliant quotations can be obtained by completing the Accountants proposal form, which has been tailored to the specialist activities and advice of the Accountancy profession.

Business Use Car Insurance for Accountants

We start with our making sure your Professional Indemnity Insurance cover is based on your circumstances and is compliant with your governing body, you can then choose to add on extras that suit you and your risk appetite. Protection for your business if a client alleges negligent acts, errors/omissions/actual negligent acts or offered poor advice. Financial support for claims made against the company, its senior staff or its Directors’s & Officers’ Add our Office Insurance policy to provide cover for business premises and equipment against disasters such as a flood or fire, accidents, acts of vandalism and burglary. Cyber Cover offers assistance to you and third parties if a Cyber Event occurs. Provides cover for loss of money and other property resulting from fraudulent or dishonest acts committed by an employee or volunteer. As a last resort, you can apply to

enter the assigned risks pool of your Association for

PII Requirements for Chartered Accountants

As fraud becomes increasingly prevalent, many insurers are beginning to leave FGI cover out completely in their accountants' PII policies. To ensure that you have cover that meets the ACCA’s requirements and to adequately protect your firm, we recommend: Check that your policy provides FGI – all insurers construct their policy wordings differently, but generally you can find this under a heading such as ‘Insuring Clause’, ‘Insurance Clause’, ‘Scope of Cover’, ‘What is Covered’ or ‘Extensions of Cover’. The insuring clause should contain language along the lines of: ‘insurers will indemnify the insured for any loss which the insured shall first discover they have sustained by reason of any dishonest or fraudulent act or omission’ Check the policy wording to ensure there are no onerous terms or conditions that must be fulfilled for FGI cover to be valid – these are often found under a separate section of the policy, which may be headed ‘General Conditions’, ‘Policy Conditions’, ‘Special Conditions’, or ‘Conditions Precedent’ It is always worthwhile in checking the ‘Exclusions’ section of the policy to make sure FGI is not excluded. If you are in any doubt, please feel free to call the Lockton helpline on 0117 906 5057, and we will be happy to assist and provide a free health check on your insurance. As ACCA’s recommended and approved broker, Lockton offers an ACCA insurance scheme that is backed by Arch Insurance (UK) and fully complies with the ACCA’s regulatory requirements.

4.3 Excess limits

Quotations can be obtained by calling the number above, emailing ACCAaccountants@uk.lockton.com, or visiting Lockton's website. Professional Indemnity Insurance for Accountants and Accounting Practices Unfortunately, your chosen career path means small mistakes could have enormous consequences if a claim should arise for your clients and you. That’s why Professional Indemnity Insurance for Accountants and Accounting Practices is essential. Choosing a broker to act on your behalf is also essential, as it’s not just a simple case of picking an off-the-shelf PI product. We have worked with many Accountants and Accounting Practices to secure their Professional Indemnity Insurance when they are members of ICA, ICAEW, AAT, ACCA, CIMA or CIA. ’emergency’ cover for a period of up to two years so that you can continue to practice. Do I need Professional Indemnity Insurance after I've ceased to practice?

What affects your premium?

Insurers take a cautious view of insuring firms that advise on or introduce clients to tax mitigation schemes. Section 8 of the guidance, Professional conduct in relation to taxation, gives advice to firms on how they should deal with tax schemes, including if the only involvement is to make introductions to other firms. ICAEW’s engagement letters helpsheet includes material provided by the Tax Faculty for tax practitioners about specialist and ad hoc tax advisory services. T: +44 (0)1908 248 250 E: pii@icaew.com Live Chat Insurance required by the PII regulations must be obtained from a participating insurer. Why it’s time to check your FGI cover Fidelity guarantee insurance (FGI) exists to protect your firm or organisation against theft of the firm’s own money, securities or property by an employee, partner, contractor, or volunteer.

The full picture

FGI can also be known as first-party fraud, theft, employee dishonesty or simply fidelity cover. What are the requirements for FGI cover? ACCA’s regulations require that member firms in public practice with more than one member of staff must have at least £100,000 of cover in place for any one claim, to help protect the business and enable it to continue trading following a fraudulent act. In line with the revised ACCA regulations effective from 1 September 2023, your FGI cover must also extend to cover your sub-contractors. FGI has traditionally been covered by a separate section or clause within professional indemnity insurance (PII), with ACCA practising regulations stating that ‘FGI may, but need not, form a single policy with such PII and all such PII and FGI must remain in force for all of the period during which a relevant practising certificate is held’. Yes – it is essential that you secure ‘run-off’

• UK employers must have Employers' Liability (EL) insurance with a minimum cover of £5 million.
• The EL certificate must be displayed at each business premises where employees work.
• Insurance must be provided by an authorised insurer under the Financial Services and Markets Act 2000.
• Cover is required for all employees, including temporary, casual, and contracted staff.
• Certain businesses, like family businesses with no direct employees, may be exempt.
• Failure to have EL insurance can result in fines of up to £2,500 per day.

cover for your previous practice after you cease to practise.

Paul Gillett

Importantly, FGI cover should not be confused with third-party fraud and dishonesty cover. Third-party fraud and dishonesty refers to theft of the client’s money, as opposed to the accountancy firm's own money, and is usually covered within the main insuring clause (civil liability) of a professional indemnity policy. Fraud claims have increased in both frequency and value in the past few years. There are several reasons for this, but the main factor is that online banking makes it so much easier to fraudulently transfer money. Lockton has handled numerous claims for first-party fraud.

11.4 What underwriters look at beyond fees

In one case, a long-standing member of staff was able to transfer funds from both the accountancy firm’s own bank account and those of its clients directly into the bank accounts of their close relatives. This took place over a period of eight years and over £600,000 was misappropriated. The member of staff held a trusted position as a bookkeeper within the firm. How are insurers altering their FGI cover? There are several ways in which insurers are altering their cover: A number of insurers will only offer FGI on an aggregate basis. This is to cover you for claims for work

• Check if your business needs Professional Indemnity insurance as mandated by your professional body.
• Review client contracts, as they often specify minimum insurance levels for Public Liability.
• Assess the value of assets and potential business interruption to determine adequate property insurance.
• Consider Cyber Liability insurance, increasingly required in contracts for handling client data.

done while in practice but arising after the practice ceased.

PII Limit of Insurance Tables for Accountants

This limits the amount insurers are exposed to in a policy period, as once the aggregate limit is eroded by losses, they will not be required to pay any more. This kind of aggregate cover would not be compliant with ACCA regulations as cover must be on an ‘any-one-claim’ basis. Policy conditions may bet betting deals today state that the accountancy firm’s own accounts must be independently certified or audited on an annual basis. Since most firms don’t otherwise need their accounts audited, this has the effect of excluding first- party fraud losses, thereby becoming non-compliant with ACCA’s regulations. It’s becoming more common for insurers that offer FGI to ask for dual authorisation for any financial transactions over a certain amount.

Legal costs

For example, insurers may insist that there are two independent signatures on cheques, or that any electronic transfer of funds is witnessed and documented by another director or employee. If this second authorisation check is not made, any subsequent first-party fraud may not be covered by the policy and insurers may refuse the claim. Often, an insurer will ask on their proposal form or statement of fact whether the annual accounts have been audited and if dual authorisation is in place. This acts to alert the firm that these procedures must be in place for FGI cover to apply. Other insurers will simply include these terms within the conditions or exclusions of their policy wording, so this should always be checked to ensure coverage is compliant with ACCA regulations.