Post Qualified Experience

System
System Posts: 100,537 🤖 Admin 🤖
edited June 9 in General accounting discussion
Hi All,

I have read a number of posts both on the MIP forums and the student forums about people completing their exams and going straight into self-employment.

Does AAT not have a certain timescale whereby you have to obtain some post-qualification experience before going self-employed?

I would have thought they may do. I know some of the Chartered bodies do (ACCA particularly) and I would have thought the AAT would have such a policy.

Kind regards
Steve

Comments

  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Hi Steve,
    I'm not sure if there is a set time for post qualified experience but I didn't think is was as easy as just getting a "successful" on your exams and going self employed. There is only a certain type of work that can be carried out and without association with the AAT if you are not a full member. Being a full member shows you have gained at least one years experience and have a professional referee to confirm suitability of membership. The professional Ethics have to be adhered to and also the CPD maintained. I would say that post qualification experience would be a matter of course before becoming self employed.
    Regards
    Mandy
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Oh I see. I've never actually looked into it. I just found it very odd that you can gain membership and then go straight into self-employment.

    Don't get me wrong. There are some truly excellent MIPs on this forum who have obviously got a great deal of experience at the back of them. Sue02, Sheelagh, Claudia, JodieR and Dean Shepherd just to name a few. However, the above have gained vast experience as well as their qualifications. It just worries me that someone can get their AAT certificate and then start doing accounts and tax without having enough practical experience and knowledge to deal sufficiently with the public.

    I - personally - don't think 1 year's work experience is sufficient enough to go it alone. Undeniably, there are ambitious students who wish to pursue a self-employed career but who may not have enough experience to "go it alone".

    Kind regards
    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    peugeot wrote:
    There are some truly excellent MIPs on this forum who have obviously got a great deal of experience at the back of them. Sue02, Sheelagh, Claudia, JodieR and Dean Shepherd just to name a few. However, the above have gained vast experience as well as their qualifications
    Maybe this would seem an excellent opportunity to write the article I messaged you about a short while ago Steve - what happens beyond the AAT qualification for those considering going into self employment? The people you mentioned above were surely novices themselves at some point yet to many of us now reading some of their posts, they communicate in an entirely different language! I'm sure it would prove an invaluable article for those taking the huge leap from initially gaining the qualification to becoming self employed to the highly respected Forum contributors they are today and whose regular input is now sadly missing.

    Regards,

    Robert
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Aww, you make me blush :oops:

    In my mind, experience is everything and gaining the qualification is merely the starting point.

    In response to Steve's question about becoming an MIP, there is certainly a feeling amongst many students that once they have the qualification under their belt then that is their licence to go out and set up business on their own.

    Although I don't believe the AAT have a pre-requisite period of post-qualification experience, you do need to convince the licensing panel that you are competent in the areas you wish to practice in.

    When I first applied for registered MIP status I was tax manager in a top 40 firm, yet I still had to provide my CV, CPD details and full details of experience that qualified me to complete a few tax returns in my spare time.

    Similarly, I have a friend with a considerable number of years post-qualification experience who was not given MIP status for corporation tax until he had attended a number of specific courses to bring his knowledge right up to date.

    I therefore believe the system lacks openness in its structure but it does appear to be very thorough in its application.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    I guess that to answer the question of whether post-qual experience SHOULD be mandatory before getting a licence, you have to consider how valuable 'pre-qualification experience' can be. Take, for example, someone who's got 10 years experience of working in practice before deciding to study for AAT with a view of becoming self employed. They'll probably fly through the exams and it might be seen as unfair expecting them to complete further years experience before getting a licence.

    I think that there is a risk though that licences will be/have been granted to members with insufficient experience, for example someone who's prepared a few basic tax returns and done the personal tax module at AAT would be able to convince the panel to issue a licence to complete personal tax returns, but this of course doesn't mean that they'll be compteant to advise on all aspects of personal taxation. While it may be 'better' if the practical experience here is post-qualification (ie putting the theory learned into practice), it can still never cover every scenario, which explains why part of getting your licence involves doing CPD and having professional cover and you're reminded at every turn not to take on work that you're not competent in.

    As for me, I was a serial job-hopper while I was studying AAT so do have experience in a munber of different areas, but when I eventually got round to finishing my portfolio in order to complete the AAT qualification I was working soley in personal tax, and since then my only 'proper' job was as a funding supervisor for business link. So really I have no post-qualification experience of accounts preparation, VAT returns or even bookkeeping! I'm personally very glad that it wasn't a requirement to get my licence.

    Jodie
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    When I applied for my licence a year ago, I was only able to offer sole trader accounts, bookeeping, vat and personal tax due to the exams I had taken and the experience I had gained over 5 years in industry.
    Now with the relevant CPD that I have undertaken and additional work experience I am able to take on some business tax (partnership)and payroll. I am now studying ATT to further my knowledge and hope to add Tax Advisor to the list once qualified.
    I completely understand your point Steve and agree that a year's experience is not enough.
    Working in industry is very different to going it alone self employed as many of you will know and budding MIP's should be aware of this.
    However, people have to start somewhere and will hopefully build on their existing knowledge and experience without compromsing theirself and the AAT.
    If I need clarification or advice, I have this forum, the Croner helpline and my old finance director to turn to.
    The AAT guidelines state that you should not undertake any work that you do not feel competant to do and this has always been my golden rule.

    Sharon



  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    So it appears the AAT do have some sort of policy in existence whereby you can't just put your certificate in a frame and then jump in feet first (so to speak).

    The reason for posting the thread is stemmed by a general feeling on this site from several posts I have read that as soon as you're admitted to membership - regardless of your experience - you can just set up a practice on your own. Over the last few weeks I have gained an insight from various sources of students even at technician level who appear to lack the basic understanding of the rudimentaries of accounting and/or tax issues. It concerned me that this lack of knowledge derives from an obvious lack of experience and certainly some of the people I have been in contact with (not just on here) don't even know how prepayments or accruals work despite having passed or awaiting results on DFS.

    In terms of Robert's post. I have thought in detail about your idea for an article, but the hurdle I am up against is that I'm not self-employed. I know there are different rules for self-employed AAT MIP's and certainly there is the new CPD policy. I would hate to write an article that appears, on the face of it to be self-centred and basically a two page interpretation of a CV. I will speak to the Editor and see what other ideas she may have for your request.

    Many thanks for your input and best regards.

    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Steve, i'm glad you've posted this.

    There are an awful lot of posts out there at the moment saying "I'm just waiting on my technician results - I want to go self-employed".

    First of all, this is the requirement for full membership i.e. the use of the letters MAAT:
    http://www.aat.org.uk/students/display/store4/item35896/

    To quote from the "Guidelines and Regulations for Members in Practice" the services potentially offered by an AAT MiP are:-
    Services
    The services covered by the scheme are as follows:

    Accountancy:

    Book-keeping (BK)
    Book-keeping is that part of accounting which deals with the recording of actual transactions in monetary terms. This classification only includes recording and not the calculation of the actual transaction. For example, the calculations of depreciation, accruals/prepayments and work-in-progress are not included. Effectively, this means the preparation of accounts up to trial balance without any adjustments.

    Financial Accounting and Accounts Preparation (FA & AP)
    Financial Accounting is the preparation of accounts that are required for statutory purposes.

    Budgeting and Forecasting (B & F)
    Budgeting includes the preparation of financial reports prepared before the accounting period(s) usually showing planned income, expenditure, capital employed or cash flow. Forecasting is the prediction of relevant future factors affecting a business and its environment and may be used as the basis for preparing budgets.

    Management Accounting (MA)
    Management Accounting is the preparation of financial reports that are required by management on a more frequent basis (for example quarterly, monthly or weekly) than financial accounts. Some examples of management accounting reports are:
    • monthly profit and loss statement
    • monthly sales analysed by product or division
    • standard costing reports

    Payroll (P)
    Payroll includes the calculation (manually or by computer) of net pay by deducting income tax (PAYE) and national insurance from the gross pay. The following is a list of some of the activities included within this classification:
    • recording employee details
    • recording payroll details
    • calculation of bonuses, statutory sick pay, statutory maternity pay
    • deductions (eg pension, healthcare, season ticket)
    • preparing pay slips
    • processing Inland Revenue notifications
    • preparing Inland Revenue returns
    • calculation of PAYE and National Insurance liabilities
    • preparing payroll reports
    • preparing the payroll journal

    Taxation:

    Value Added Tax (VAT)
    VAT is the tax levied on goods and services at the standard rate, reduced rate or zero rate and does not include exempt goods and services. This classification includes the preparation of VAT returns, dealing with HM Customs & Excise on behalf of the client, advising what VAT rate should be applied to the goods or services of the business.

    Personal Income Tax (PIT)
    Personal Income Tax is the income tax payable by an individual under all relevant Inland Revenue schedules. This classification includes the completion of all relevant Inland Revenue returns. A member practising in this area of work can be expected to provide their client with:
    • an explanation of the principles of personal income tax
    • calculations of personal income tax due
    • advising on personal income tax planning

    Business Income Tax (BIT)
    Business Income Tax is the tax payable by an individual on their business related activities but not included within the category of Corporation Tax. This classification includes the completion of all relevant Inland Revenue returns. A member practising in this area of work can be expected to provide their client with:
    • an explanation of the principles of business income tax
    • calculations of the business income tax due
    • advising on business income tax planning

    Corporation Tax (CT)
    Corporation Tax is the tax payable by an organisation. This classification includes the completion of all relevant Inland Revenue returns. A member practising in this area of work can be expected to provide their client with:
    • an explanation of the principles of corporation tax
    • calculations of corporation tax due
    • advising on corporation tax planning

    Capital Gains Tax (CGT)
    A member practising in this area of work can expect to provide their client with:
    • an explanation of the principles of capital gains tax
    • calculations of capital gains tax due
    • advising on capital gains tax planning

    Inheritance Tax (IHT)
    A member practising in this area of work can expect to provide their client with:
    • an explanation of the principles of inheritance tax
    • calculations of inheritance tax due
    • advising on inheritance tax planning

    Consultancy:

    Business Plans (BP)
    A member in practice in this area of work might be expected to provide their client with a comprehensive business plan which may be used for the purposes of, for example, obtaining government grants or business finance. A business plan is a comprehensive report which could contain:
    • the organisation’s mission statement
    • a written report summarising the business plan
    • market research
    • budgeted expenditure and sales forecasts
    • budgeted profit and loss account
    • cash flow or funds flow statement

    Computerised Accountancy Systems (CAS)
    This classification would include a consultant who demonstrates, installs or provides training of accountancy and accountancy related software. For example accountancy software to produce financial or management accounts, payroll software and software that can calculate a client’s tax liability.

    Company Secretarial Services (CSS)
    In the context of a member in practice providing company secretarial services the duties may include some of the following examples:
    • filing Companies House returns
    • maintaining the register of directors and secretary
    • issuing share certificates and recording transfers of shares
    • maintaining the register of members and debenture holders
    • arranging for charges to be registered and recorded in the register of charges
    • preparation of minutes

    Independent Examination (IE)
    The Charities Act 1993 introduced the concept of Independent Examination as an alternative to audit, for unincorporated charities whose total income is in the range £10,000 to £250,000. However this concept is not restricted to charities. A member in practice providing an independent examination must comply with prevailing relevant legislation.

    These services CAN be offer by someone with the RELEVANT practicing certificate. What I mean by the 'relevant' practicing certificate is that when you apply to become an MiP you have to go through a series of detailed questions on each of the above "potential" services you want to offer.

    You are asked which ones you want to offer, how many years experience have you had in each feild, what percentage would the make up of these services be on your overall practice and who are these services being offered to (individual, corporate etc.).

    You are then asked to provide a CV confirming your work experience, details and proof of the CPD undertaken in the last 12 months, proof of any other qualifications (chartered etc.), a copy of your up-to-date Professional Indemnity Insurance(PII) cover, you must then include a suitable person to be your "professional cover" i.e. someone your clients can call on in the event of your absense.

    Once you get through all the above you then sign a declaration stating that you will comply with the data protection act, you will follow the AAT rules and guideline, comply with CPD and that you have no bankruptcy, criminal convictions or civil offences against you. You also agree to pay AAT fees promptly and failure to do so will result be your licence revoked.

    So that is the application form complete! Send it back in the post and the board review your application, they decide from the information made available what they will issue a practicing certificate for, in anything!

    Qualification to self-employed is a huge step and a massive responsibility not a decision to be taken lightly.

    Just because you have shown "competency" in the AAT exams does not necessarily mean you will be a competant professional advisor in all areas.

    I hope the above will give an idea of what the MiP status is all about and answers some of those "I'm just waiting on my technician results - I want to go self-employed" questions/posts.

    Regards

    Dean
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    peugeot wrote:
    In terms of Robert's post, I have thought in detail about your idea for an article, but the hurdle I am up against is that I'm not self-employed. I know there are different rules for self-employed AAT MIP's and certainly there is the new CPD policy. I would hate to write an article that appears, on the face of it to be self-centred and basically a two page interpretation of a CV. I will speak to the Editor and see what other ideas she may have for your request
    My idea wasn't just restricted to the self employed Steve, but more generally towards the success stories of those who've completed - and gone beyond - attaining their AAT qualification and the hurdles they face afterwards. I think you already have a good groundwork for any future article in this thread which is really where I was leading towards with my last post.

    Although I've now almost completed my own AAT qualification, there's no way I would - or could - consider becoming an MIP at this stage and it's unlikely I ever will. I know I'm worlds away and it's in a different direction but just like yourselves, I do read many of the posts with slight bemusement at those thinking "passed AAT today, MIP tomorrow"...

    EDIT; I've also just posted a link on the Technician Forum guiding them to this thread in order to try and prevent the same questions being asked repeatedly.

    Regards,

    Robert
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    One thing to remember about people becoming MIPs is that not all of them want to do so as a general practice.

    If you have an industry background and are very conversant in Sage then there is no reason why you cannot become an MIP offering book-keeping services in Sage.

    Provided you do not also try and offer services that you may not be so experienced in then there is no problem.

    Not everyone wanting to become an MIP wants to set up as a general practice offering a full range of services.

    For those that do, I would say 5 or 6 years experience in all areas of general practice would really be a minimum requirement. I had about 8 years experience before I went off on my own and I was lucky to have worked for some very good firms that enabled me to learn a wide variety of areas. Even then some of my colleagues thought that perhaps it was a little too soon.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Wow Dean how long did all that take you to post! :shock:
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience
    peugeot wrote:
    Wow Dean how long did all that take you to post! :shock:

    And you didn't even included me in your post! :lol:

    In all seriousness though, I do think this is a very relevant thread. I hope it goes some way to show that it is not just a case of passing exams and going self-employed, not offering a full service anyway.
    One thing to remember about people becoming MIPs is that not all of them want to do so as a general practice.

    If you have an industry background and are very conversant in Sage then there is no reason why you cannot become an MIP offering book-keeping services in Sage.

    Provided you do not also try and offer services that you may not be so experienced in then there is no problem.

    Not everyone wanting to become an MIP wants to set up as a general practice offering a full range of services.

    Completely agree with that too!

    Anyone wanting to start a full service, my advise would be to start with one or two services and build on that. Use your new found experiences and CPD to offer more services in the future. Keep within your capabilities and you can't go far wrong.

    Regards

    Dean
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Also, as this thread and this section of the website highlights, there is an abundance of support offered by MiPs to MiPs.

    Always ask questions. You will never know everything and you will never stop learning.

    Regards

    Dean
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    I know the AAT encourages the keeping of a portfolio but wouldn't it be a good idea to also maintain a logbook, containing all aspects of the profession covered by the AAT and for students to get it "signed off" by their manager when they have reached the level of competancy required to work unsupervised.This is slightly different to the portfolio, which only shows that you have done for example, a tax return or a vat return. The portfolio doesn't necessarily mean that you are proficient and able to work unsupervised.. This could also be used by new students who already have years of experience in accounts. It should be signed by a MAAT or ACCA/CIMA.
    This logbook should then form the basis of an application for MIP.
    I believe a similar type of log has to be kept by ACCA students?
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Hi Farmer Giles,

    The logs for ACCA are in fact, twofold.

    You have to keep a log of your studying whilst a student because there are a lot of elements which you have to gain experience in. I seem to remember there were about 9 mandatory elements including managerial elements and a few optionals depending on which sector you were in. They have changed it since I qualified - Bluewednesday will be able to confirm because she is nearing completion of her ACCA. These records are checked for completion during your studies as I had a visit from ACCA when I was a student with them.

    If you want to become a practitioner, they then demand a further 3 years post qualified experience. Again you have to achieve certain minimum mandatory and optional elements which have to be completed during the 3 years post qualified term. These the have to be signed off by a qualified accountant and submitted to ACCA. As well as all that,you have to undertake another course "Audit Orientation Course and Test" and complete a case study.

    It's a long arduous task. I think this is the reason why AAT members who want to get into self-employment don't bother studying ACCA because, unfortunately the ACCA don't recognise AAT and won't allow you to do anything other than basic bookkeeping if you don't hold their practising certificate.

    A lot of people who I have spoken to who want to continue to do ACCA after AAT but are self-employed think it is very unfair - but I can see why the ACCA do it.

    Kind regards
    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    The logbook for ACCA does seem a long winded affair and probably too complicated for AAT. There must be a way, though, of using a similar idea for AAT, to cover the three to four years studying plus post qualifying experience for at least one year, better two years.
    This would then ensure that people are able to set up accounts for small businesses or do partnership accounts and know their debits from their credits.

    A comparison is like going into hospital for an operation and the surgeon telling you that he's been training, he can do veruccas but has never done open heart surgery before but you'll be ok because he's just going to log onto surgeons-r-us for a bit of advice!
    OK, a bit far fetched but I think you get my point.
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    That's quite an interesting comparison FG!! :lol:

    Interesting but rather apt!

    Kind regards
    Steve
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    But would it elicit any response from the AAT?
  • System
    System Posts: 100,537 🤖 Admin 🤖
    Re:Post Qualified Experience

    Not really sure that there is anything else meaningful that I can add to this - except I feel that I ought to because:

    a) I was mentioned :oops:
    b) To prove to people that I am still alive and kicking :wink:

    Actually, about the forums at the moment, as I don't get emails saying that a reply has been posted, I don't bother to log on very often, also being busy busy busy provides me with more profitable things to do!

    Claudia

Categories

Privacy Policy