3 November 2006
To: All Members
Dear XXXX,
The Council has decided to increase the annual membership fee by HK$250 from HK$2,100 to HK$2,350 beginning in 2007.
You'll notice that the Institute has not revised its annual membership fee or any other fees and charges since 2002 (and before that, 1998). The Institute's annual membership fee is also lower than many accounting bodies, which do not perform as many functions as the Institute.
The Council has been making and will continue to make prudent financial decisions in the interest of members and to invest in the future of the profession. As the public expectations of the accounting profession continue to grow, so does our obligation to invest in our members. This obligation is more likely to deepen than diminish in the coming years.
The Council is planning to make small incremental fee increases over the next few years to ensure adequate financial resources are available to fund the initiatives that fulfill the Institute's statutory and membership responsibilities. The fee adjustment seeks to align our finances with our responsibilities.
We have changed the organisation in order to better support members and their standing in the community. The introduction of QP on the mainland, the new Beijing office and our expanded presence in the international arena are part of our investments in order to take the Institute to the next plane. Our expanded space, including the library, new training centre and members' lounge, costs more to operate than our old premises, but it provides great facilities for our members in CPD and fellowship. We're also exploring offering members more opportunities to specialise in order to increase the market value of their skills and expand their career opportunities.
Our regulatory duties also consume a great deal of resources, but these are important to keep within the Institute. We need to keep regulation in our own hands rather than allow it to devolve completely into the hands of an outside regulator, as we've seen happen in the United States, Europe and other parts of the world. The Institute is the only accountancy body in Hong Kong with regulatory responsibilities. Despite the formation of the Financial Reporting Council, our regulatory duties will continue to be heavy - as they should be.
The Council has approved several other fee increases, including a $150 surcharge for members who continue to choose hard-copy correspondence with the Institute. This amount will cover the additional costs for printing and postage. So far, we have 16,000 members who have opted to communicate with the Institute electronically and we thank them. The surcharge for members receiving hard-copy correspondence is so that in this day and age, with the emphasis on reducing paper wastage, members using electronic communication will not be subsidizing those who do not.
Annual fees for practising certificates for individuals and for practising partners of a firm or member directors of a corporate practice will be raised from $4,600 to $4,800. Fees for non-practising partners of firms or non-practising member directors of corporate practices (except for sole-practitioner corporate practices) will increase from $9,200 to $9,600. These fees will be used to cover part of the new practice review programme, which has far greater depth than the previous programme and is an integral part of the reform of our regulatory regime and compliance with our membership obligation with IFAC.
The annual registration fee of a non-member director of a sole-practitioner corporate practice will be reduced from $9,200 to $2,400. Section 153A(1) of the Companies Ordinance was amended in 2004 to allow a single shareholder to incorporate a limited company. Members passed a resolution at the 33rd AGM held on 16 December 2005 to amend section 28D(5) of the Professional Accountants Ordinance such that a single practising member of the Institute shall be entitled to register a corporate practice, so as to align with the changes to the Companies Ordinance. However, we have been advised by the HKSAR Government that there is unlikely to be a time slot for an amendment bill in the next two years. Until the PAO is amended, the Institute has a statutory responsibility to regulate a non-member director of a sole-practitioner corporate practice. But to mitigate the situation, the Council has decided to reduce the annual registration fee for non -member directors of corporate practices to $2,400.
Members who are 65 years of age or over and have been a member of the Institute for 20 years or more will pay a reduced fee at 25 percent of the regular fee (i.e. HK$588). Those members now registered under the "retired" category will continue to pay reduced rates.
Please refer to the attached schedule for the new fees and charges from 1 January 2007.
The Council has asked me to thank all members for their continued support for and commitment to the profession and believes that the improvements over the p><e Institute on behalf of members. Members now have bigger and better facilities, more CPD and other member services, greater international representation and mobility, and a qualification programme of which we can be proud.
I trust you will find this modest increase a worthwhile investment for the profession as we search for continuous improvement on behalf of members.
Sincere regards,
Winnie C.W. Cheung
Chief Executive & Registrar
Encl.
