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Chartered accounting firms employ accountants with a specific professional qualification. Such firms can provide a range of services, mainly categorized as preparing accounts, auditing accounts, and providing consultancy services. Some specific services from chartered accounting firms require additional qualifications among the accountants.
The phrase chartered accountant can usually only be given to members of a specific organization, such as the United Kingdom's Institute of Chartered Accountants. Similar organizations exist in many countries that are members of the Commonwealth, such as Canada. The term and concept works along the lines of the certified public accountant system in the United States. One key difference is that unlike CPAs in many U.S. states, the chartered accountant role in some countries is simply a professional qualification and is not a legal requirement to practice accountancy.
The main service of most chartered accounting firms is the preparation of accounts. This requires an understanding of the relevant country's legal requirements for the format and content of company accounts, as well as mathematical and organizational skills. Such requirements are designed both to keep shareholders informed and to allow a fair comparison between different companies' financial performance.
Many chartered accounting firms also carry out audits. This is a review of accounts that have been already prepared either by a company itself or by an accounting firm. The audit is designed to be an independent review of the accounts, which gives readers confidence that the details are both correct and not misleading. In some countries, such as India, auditing can legally only be carried out by chartered accountants.
Another common area of work for chartered accounting firms is consultancy services. From a financial perspective, this can involve highlighting ways in which a company might be able to work more efficiently or get a better deal with loans or investments. It is generally regarded as best practice that accountants offering consultancy to a company do not also work as its auditors, though the legal regulations on this point vary from country to country.
Charted accounting firms may also offer specialist services. This can include preparing tax returns for a company or offering advice about minimizing tax liabilities. It can also include services related to bankruptcy proceedings. Some countries have laws that mean chartered accountants must gain additional qualifications before offering such services.
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