Setting up your practice
Setting up your practice
Calum Fuller looks at the requirements AAT licensed members must meet when choosing which services to offer
At a glance
Understand what you want your firm to offer
Ensure you comply with your licence conditions
Read AAT’s guidance before applying
Once you’ve taken the not insignificant step of deciding to set up your own practice, you’re quickly faced with another major decision: what services should you offer?
Working out the answer and setting up is a mix of meeting certain licence requirements and, of course, pursuing your own interests and preferences.
An AAT licence is also a key point of differentiation over unregulated accountants – a mark of high standards, competence and reassurance to the public, particularly given the potential for recourse when problems arise.
AAT takes the preservation of those standards and the profession’s reputation seriously through regulation. Here we look at the requirements you must meet and the process you need to follow to gain AAT’s approval to provide your desired services.
Choose a licence that matches your experience
Will Blower MAAT founded his firm Realise Finance in 2020, having spent three years gaining a wide range of experience working in accountancy practices. The breadth of his experience meant he was able to meet AAT’s requirements for a significant number of the services available to Licensed Accountants.
“I wanted to attract sole traders, partnerships, limited companies and individuals,” he explains. “I had worked in two practices that offered the services I was looking to provide and that put me in good stead.”
Heather Palmer FMAAT (pictured above) owns Ascot Bookkeeping and Accountancy and, having owned and run her own clothing manufacturing businesses previously, knew that she didn’t have the experience a practice background can provide. Given she wanted to provide an end-to-end service to businesses, she gained the additional experience required through volunteering with another AAT licensed member she knew.
“I worked with them prior to being qualified and AAT verified my work and that I had the experience required in those areas,” she says.
Don’t stray outside your licence
There are two types of practising licence that AAT offers: AAT Licensed Bookkeeper (Level 3 qualification) or AAT Licensed Accountant (Level 4).
AAT Licensed Bookkeepers can apply to provide up to five services, while AAT Licensed Accountants can apply for up to 18. Each is ranked between tiers 1-4 based on the level of risk, with one the highest and four the lowest. The risk level is determined by the nature of the services themselves, and the potential impact should anything go wrong.
“There’s a public interest element to all these services, which is why we regulate them,” explains Helen Barrett, professional standards manager at AAT. “It’s in the interest of the public, the reputation of AAT and the accountancy profession for us to ensure the quality of these services.”
Where services are deemed to be higher risk, members must demonstrate greater competence and experience. If members stray into services where they have not had their competence assessed during their application, they may be subject to disciplinary action.
How you meet the licensing requirements
A key element of meeting the licensing requirements is demonstrating work experience and competency in the areas of service you wish to offer.
“It’s based on knowledge, skills and experience,” explains Sarah Burbidge, customer operations project support manager at AAT, explains.
“We wouldn’t want anyone offering services, particularly in the complex areas, without a certain level of experience in that service.”
To that end, applicants must not only select the areas they would like to offer services in, they must also confirm they have a minimum level of skills and experience in that area.
“If someone can’t confirm they meet those expectations, they can’t be approved,” Burbidge adds. New service selections can be made at any time, provided you have the required work experience. Members who do so must notify AAT of changes at the time, rather than at the point of renewal.
With that in mind, over the coming months, AAT will be rolling out CPD pathways in a number of the service areas available to licensed members to allow them to reach the level required to offer them. Initially, this will be in financial accounts and management accounts, with more to follow.
