Some Straight Talk on the Proposed Accounting Merger

Updated January 31, 2012: Since this article was originally posted, CGA-BC has since re-entered talks to unify the Canadian accounting profession. A proposed national Unification Framework and Certification Process has been released and on January 24, 2012, CGA-BC’s Board of Governors, the British Columbia CA Council and CMA Board have released the BC Merger Proposal.

You can stay up to date on the merger discussions by visiting the Merger Discussions page on our CGA-BC website.

Original Post, May 26, 2011:

people speakingThe accounting profession made some big news earlier this week with the announcement that the Canadian Institute of Chartered Accountants and the Society of Management Accountants of Canada are exploring the possibility of creating a new designation called the Chartered Professional Accountant (CPA).

My contacts on campus say that this has grabbed a lot of attention among accounting students and understandably raised a lot of questions. What designation should I choose, what will the new program be like, and which is the best route to success are just some of the issues that come to mind.

Although CGA has always been a strong supporter of competition in the profession, we do see value in a single designation that reflects the strengths and diversities of all three bodies. So, we participated in exploratory discussions. However, the CICA and CMA Canada set out a number of pre-conditions before we would be invited to join in full negotiations. You can read about our position in this message from our CEO.

 So, what does this mean to you as a prospective CGA student?

First off, the proposed merger is just that – a proposal. The two bodies are engaged in a lot of exploratory discussion and won’t be making any final recommendations until at least the fall. If the merger does go ahead as proposed, the CA and CMA designations will continue to exist for 10 years. Current CAs and CMAs along with students who graduate from the current CA or CMA program will identify that they are CAs or CMAs and will have to identify their legacy designation along with the new CPA designation during this time, e.g., CPA-CMA or CPA-CA. This process is called “tagging.” If the merger stays on track, there will likely be a new CPA education program within the next several years. Graduates of the new program will be known as CPAs. It is important to note that the proposed CPA is different from the U.S. CPA designation.

Right now, the proposed merger has very little impact on CGA. We are very confident that we are an alternative designation in the same way that you might choose one university over another based on your preferences.   CGA is a globally recognized designation that can be earned through a variety of open access paths. Our program is equally rigorous and students can choose more readily where they can get their practical experience. CGAs are employed in diverse and dynamic positions across a wide spectrum of business, industry, government, not-for-profit and public practice sectors.

Our Mutual Recognition Agreement with the world’s largest accounting body, the Association of Chartered Certified Accountants (ACCA), as well as those with CPA Ireland and CPA Australia, provide great global opportunities for our members, and we will continue to seek ways to enhance international opportunities for our members and students.

I hope that this answers some of your questions. You can always email me or you can visit www.visioncga.org  or www.cga-bc.org.  I also fully encourage and welcome you to provide your comments in the box below.

Dan Relihan, CGA

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32 Responses to Some Straight Talk on the Proposed Accounting Merger

  1. G. Crawford says:

    Here is my (ad hoc) rant on the 800 lb. gorilla in the room, that is this issue of multiple accounting designations:

    Firstly, the current situation has a deep history, going back over a hundred years. It is now, and has always appeared to be a professional turf war. The very fact that there are more than one professional body in this country (and many others) really underscores the types of disagreements that continue to exist at many levels of the accounting world; whether they be policy issues or disagreements over training regimens or whatever.

    On the one hand, multiple bodies does in fact drive up competition, and therefore increases the pressure to excel in our field. For example, take a look back at the requirements for any designation from 50 years ago, and you’ll see big changes, like a bachelor’s degree was not a requisite to become any type of designated accountant.

    However, on a theoretical level, the redundancy of three governing bodies produces inefficiency and otherwise wasted resources. It seems to me that such inefficiency should be seen, at some level, as the antithesis of the (management) accountant’s creed. Notwithstanding, the time and energy wasted trying to prove the superiority of one designation over the other could be better spent improving the profession as a whole; as in “united we stand, divided…..”

    Nonetheless, the CGA is absolutely right to protect its membership from being treated like the second class accountants the CICA Marketing department would have most people believe. What seems to be hurting all accountants is the confusion created by having multiple designations. The general public and industry, whom all accountants serve in some respect, would certainly benefit from the clarity produced by a single professional designation. Not to mention the fact that in industry, work experience will always trump any letters found dangling behind a name.

    I think that the “Tagging” issue is ridiculous and epitomizes the status-driven / turf-protection nature of the current competitive climate that exists in the Canadian (and other commonwealth) accounting professions. It seems obvious to me that the CICA wants to hold on to its standard setting monopoly until the very end. It uses issues like disagreements over training to hold onto the wedge that divides the three bodies. This is hilarious since many of the people setting the training standards today (in all three designations) themselves were not required to meet the current, increasingly high expectations, yet they are amongst the most experienced, highly competent/compensated and knowledgeable accountants around.

    The other thing that is missed with all of this is while the three designations haggle with and heckle each other, outside competition from MBAs (often with specializations in accounting and/or finance) are increasingly taking on the jobs, like CFO, that accountants traditionally held in Canada. It’s like a bunch of Deer Bucks fighting each other during the “rut” season while the wolf-pack stands by waiting to eat both the tired out losers…and winners.

    The advent of the IFRS, fierce competition, and even some faint calls for a global designation, it seems the days are numbered for multiple designations. Why else would the one with the most clout consider amalgamation when they otherwise have their hands on the wheel?… for now! Is it because they see that all the road signs are saying the same thing ….. “Merge Ahead!”

    Regardless, it really appears that the market dynamics are what are really driving these (and any future) merger talks.

    End of rant.

  2. Mellowchick says:

    Thanks for reducing the confusion. When I received my email from the CICA at first glance it made it seem like CGA’s were in talks as well, but upon further review it was clear that only the CA and CMA’s were in discussion. Also they weren’t clear to clarify the use of CPA was going to exist exclusive of the US counterparts… Great post!

  3. Great comments, thank you.

    DanTheCGA

  4. Michelle says:

    “@DanTheCGA I agree with you! About accounting mergers, can you start more discussion about #CGA’s viewpoint?” Thanks for sharing the information. Dan, I would like to see more discussions on Twitter/Facebook with the members/students.

  5. Hi,

    I would rather not merge. I see greater public interest, member, and student benefits from not merging. If you want to know more why, see my posts at the Vision CGA website or email me. I studied the CA program and I did not find it suitable to my palette (in fact, every CA who graduated my year had a vastly lower University GPA than I had). To me, University is the cream of the crop.

    I completed the Laurentian MBA and very soon during the future a PhD in Organizational Theory and Strategy. I am considering a CMA just out of interest along with a CFE and a BA. I have a CGA, CIA, CPA, ACCA, and B. Comm. (Hons) – with Distinction.

    The person behind the designation matters. And CGA’s are more personable.

    Respects,
    David

  6. Dubby says:

    I don’t know what the big deal is. No way will CAs vote for this and it will be dead in the water. Nearly all I talk to view the value their designation as an elite and exclusive post-graduate degree, reflecting something that has been earned in the past, rather than a professional membership. They would no further accept a different designation than would Harvard MBAs accept the Top 10 U.S. B-schools joining forces, recalling their degrees, and issuing new “B-10″ MBAs that prohibited identification of institution of original awarding. There are many flaws in how these CAs view a self-regulated professional organization, but the belief seems to be widely held.

  7. Tavis McKenzie says:

    We learn Substance Over Form in accounting. It’s the substance of your team and advisors–rather than the designations they hold–that accelerates a businesses ability to reach its goals.

    Right now, the CGA designation is a mark of great substance. Should it be changed? Changing the letters doesn’t matter as much as ensuring all members of the new designation are on equal footing.

    If the CPA brand is meant to embody a high standard of uniform quality, then tagging will only hurt the CPA brand held by all of its members, by creating a perceived lack of uniformity within.

    PS: But of course, if all 3 designations merge equally, there could be huge economies of scale.

  8. Tai Le says:

    Here are my thoughts:

    To me, the tagging for 10 years does not mean for the CAs to keep their status. If this was the case then it would not just be for 10 years as proposed. I believe this is just a transition stage where they tweak their CPA program and eventually everyone will have the same status. Is it not true that if we decide to get recognized in Austrailia for their CPA that we have to still keep the CGA designation or let the public know that we are still in fact a CGA that participated in the transfer agreement?

    With IFRS coming in, CICA does not have the stronghold on standards any longer and they know they have do something now. If the CMA agrees to this tagging, why not CGA? I am sure CMA wants to protect their brand just as much as CGA does since they are a totally different school of thoughts. It would be a move forward for having a single designation in Canada and eventually worldwide. With a body that big it would be more beneficial for everyone with a broad knowledge base instead of just specifically in reporting, tax, and assurance. We eventually will receive worldwide recognition on our own letter base instead of by transfer agreements.

    I know there will be many who disagrees with me, but I do believe that exploring alternatives and changing the strategies of the CGA education and designation has to be made, and if we do not we will be stuck in the stone ages.

    Just my two cents.

    • Brian Lau says:

      Great comment.

      I don’t understand why our board will see this condition as unacceptable while they see the great value of one accounting body in Canada.

      Well, in the end in their mind they have already decided not join the merger discussion just like 10 years ago. To me, keeping their own status in the board is their top priority at the cost of the members.

      I can see that CGA’s will be brushed aside as soon as a national merger is formed without CGA. No matter how we think that we are the best qualified accountants in Canada, it is a fact that we are rated by the general public in Canada and in the world much lower than the CA’s in the accounting profession and in the job market. If one day such a merger happens without CGA, I will definitely tell the young kids not to join the CGA as a student because there is really no career future for CGA in the shadow of such a national merger.

    • Edward Downing says:

      I am the marketing/communications Director for CGA-BC and can provide some added insight into what is a great forum. I especially wanted to comment on Tai’s point that tagging for 10 years isn’t a major issue.

      If the objective is to create a new accounting designation, it would make sense to bring all three major players to the table treating each party as equals with the goal that they all end up with the same designation. Tagging, as proposed, creates four different types of accountants: CA-CPA, CGA-CPA, CMA-CPA and the new CPA designation. This would only aggravate the market confusion that the proposed designation is supposed to eliminate.
      Second, tagging is linked to the structure of the new CPA governing organization. CGA wanted assurance that the rights of CGAs would be respected and that CGAs would have the same benefits as other members in the new organization. CICA and CMA Canada would not provide this assurance. Given the often acrimonious struggle within the profession in other parts of Canada, CGA did not want to risk the achievements of more than 100 years.
      It is complex to answer all of these questions in a short post. What I would suggest is that you go to CGA-Canada’s visioncga.org site. They have lots of good background material that provides the detail.

  9. David Hunt says:

    I strongly support a merger with the CAs and CMAs. In my experience, CGAs (and CMAs) are weak in day by day business knowledge and experience. CGAs know the theory but not the practice. We need more well-rounded CGAs and the CA opportunity should be addressed. To fix my car or roof or whatever I would not hire some one who only knows how to do the job by the book. Tagging is not an impediment. It should be regarded as a recognition to be proud of.
    Maybe there are some who prefer the status quo for self-serving reasons. But if CGAs (the ones outside BC especially) want to grow they need to embrace the future.

  10. Opus says:

    David,

    I disagree that CAs have more “day to day business knowledge and experience” than CGAs or CMAs. It all depends on the background and experience of the individual and the job that has to be done. For an accounting position in industry, I would hire a CGA or CMA with experience in that industry over a CA with just audit experience in a CA firm. Similarly, for an audit position, I would hire a CA over a CGA or CMA with no audit experience.

  11. Opus says:

    Brian,

    In the 40 odd years I have been in accounting, merger discussions have come up several times. In every case, the CA membership voted down the proposal on the basis that CAs are superior to everybody else and don’t want to water down their membership. Until both the CA membership and the CMA membership vote in favour, this not a done deal.

    You think the CGA board has betrayed you? Here, among other things, is what they offered the CGAs and is not negotiable:

    1) CGA must immediately stop all actions to advance the cause for mobility of where you can work before further talks. The CAs want to continue the monopoly over public practice rights they had in Ontario and Quebec for decades.

    2) There is no guarantee that CGAs will have a voice in the new organization or equal benefits as the others.

    This is a lob sided merger with the CAs calling the shots. If we agreed to their demands, we could still end up with nothing in the end. We don’t even know what we are agreeing to.

  12. Tanis Buckton says:

    Thank you so much for the informative piece. As a current CGA student it is very encouraging to see CGA stand up for its integrity. There is a reason we are 10,000 strong with 5,000 students. I took a number of years to decide what designation to pursue and decided on CGA as it is a designation of distinction and the pride CGA’s have for the distinction is bar none. Thank you for clarify what the proposal meant for students.

  13. Heather Barton says:

    I definitely want to see a merger occur, and I do not personally have a problem with the pre-conditions set for negotiations to proceed. Had there been a single, recognized accounting designation back in the 1990’s when I worked at an Ontario-based CA firm, the CGAs who worked there at this time would actually have been invited on the firm’s annual ski trip – yep … (unless of course you had to be a CA-CPA to qualify for the all-expense-paid glide down the slopes). On a more serious note, if a merger will mean more job opportunities for me internationally, then I am convinced that it is definitely time to ‘get on with it!’

    Thank you.

    • Heather, it never occurred to me that the tagging issue might very well prevent CPA-CGAs and CPA-CMAs from going on paid ski trips with the CPA-CAs.

      Dan

    • Opus says:

      I am a CGA and used to work for a CA firm in BC back in the 1970s and 1980s. All senior people regardless of designation attend annual conferences and events along side with CAs in the firm. There were no distinction. Some people don’t even have a designation. I was even one of the speakers at one conference speaking on tax issues on insolvency situations.

    • Edward Downing says:

      Heather, The concern that CGA had was that those pre-conditions including ‘tagging’ would likely have entrenched that multi-tier experience you encountered in the 1990s. CGA was seeking protection of CGA’s rights and fair access to future opportunities. CICA and CMA Canada were not prepared to modify their terms to meet that. If the goal is to make a single designation, then surely it needs to be based on fairness, equality and a readiness to drop the old paradigm.

  14. Amalia C says:

    I think that CGA Canada should embrace all possible means of getting CGAs back into the merger talks. CGAs need to be part of the eventual outcome, even if the terms aren’t all they could be. I feel this is a case of get on board, or get left behind.

    Our association leadership can do more to influence and change things from within the new CPA body, even in a minority position.

    The much talked about “tagging” issue (“CPA – xxx”) isn’t too much of a concerns for me, as we already tag ourselves today (only without the CPA letters), so the marketplace already differentiates among accountants. The exclusion of CGAs from the newly formed CPA accounting body would only create the perception that the CGAs do not “qualify” for the new enhanced accounting body. That could be extremely detrimental to us.

    As for labour mobility and MRAs, those are detailed issues to be worked out and shouldn’t be nonstarters. Everyone’s existing arrangements and policies should be subject to constructive scrutiny.

    One tip for our side is not to bring up the past “competitive history” so often. Standing up for ourselves is fine; we’d just like to see a little less reference to old disagreements and sore points. It comes off as sour grapes or worse, and doesn’t help move things forward.

    Alternatively, I hope a push could be made for common ground with the CMAs. The CGA leadership’s passion and conviction may be better redirected here. The two bodies share some broad philosophical similarities that give voice and standing to people in all industries and roles. Together the two may fare better in terms of competitive balance versus the CAs.

    Thank you,
    Amalia

  15. Tyler says:

    I was looking up career opportunities the other day. Talisman Energy in Calgary was looking for a treasury analyst and they required the candidate to have an “accounting designation (CA or CMA)”. The omission of CGA as an accounting designation was a surprise to me and I am left to wonder why this was the case if CGA is a strong designation. This was not the first time I have seen this happen either.

    • Carla says:

      “they required the candidate to have an “accounting designation (CA or CMA)””
      As an ACCA in the process of completing requirements to obtain my CGA and looking for employment opportunities in Canada, I can say for certain that I often see this sort of thing in job postings. It leaves me wondering if I should pursue another Canadian designation.
      I am a firm believer that the letters after your name only get you so far…but they get you in the door. In my career, I have met many accountants with various international designations and in the end, the level of competency is never certain. I have also met some great accountants with no letters after their name.
      I am in agreement with other posters that say get in on the merger talks, CGA, or you may be left in the shadow of the new (and likely dominant) CPA title in Canada.

      • Tyler says:

        Dan, I have some reasons that I feel that employers in my cases have intentionally left out CGA as a qualification if you read further to this posting.

        I have given it some serious thoughts about whether to continue on with my CGA since I am only in the first course. It will only take me 1 and a half year to complete my CGA courses but I am considering taking the CMA route even though it will probably take me another 2 and a half year to complete. Here are my reasons:

        As stated earlier about the candidate requirement, I have noticed that more companies are omitting CGA as a designation to qualify for the job. For the Talisman case, I can speak with confidence that CGA was omitted for a reason because a majority of the employees, team leads, and managers and higher there are CMAs and CAs. So Dan, I feel that this is a genuine case that CGA was left out intentionally. My company does the same (please read next paragraph). It is true that our experience means more than the letters after your name but when we are not given a fair opportunity then I just do not see how that experience can be achieved.

        I have also noticed the differences in CGAs and CMAs in my own company. My own company favours CMAs and most of the managers and two of the controllers are one as well with the other controller being a CA. The CGAs I have noticed are left to do joint venture accounting. This is what I am stuck doing after many attempts to get into another area, but my employer preferred a first year CMA candidate.

        My supervisor, a CMA, mentioned that the CA and CMA did not want CGAs to be in the merged talks and after reading about the conditions that the CMAs and CAs required before CGAs can participate in the merge talks, I feel that he may be right because of the restrictions on mobility talks and MRAs.

        I know many individuals in the CMA program and they all say that the program is very easy to complete which leaves me to wonder why CMAs are favoured so much in Calgary. BC, from what I have heard, has had CGA dominance for quite awhile. The bottom line is that they are favoured more and I feel that CGA is losing out in market share and perceived by many employers to be less than the other two designation. Maybe CGA has to structure their curriculum to be less like university and more like module/case based.

      • Tyler, thank you so much for taking the time to write this note. You’ve taken the time to express your concerns very clearly and it has helped me much better understand your situation. I did not realize in your first post that you were in Alberta.

        Your comments are very eye-opening regarding the questions and concerns that some CGA students may be facing at present. Here in BC, CA and CGA are equally represented in the workplace and sectors. That creates a very different dynamic here.

        I can’t try to convince you of what decisions to make, I would have to stand in your shoes to do that objectively. Personally I am now even more pleased that CGA refuses to enter into ‘merger’ talks without equal say. I am proud that CGA is standing its ground in defending the professional rights and opportunitities of our members and the hard earmed and well deserved status we have attained accross Canada.

        For many years, CGA has been identified as the fastest growing accounting designation in Canada, this in a study published by the CICA. There are many that feel that this attempt at a merger (and the preceeding one) as well as other inititaives for CA to establish themselves in ‘industry training’ are actually strategic attempts to undermine the success and growth of CGA. The last merger failed as CAs around the country indicated overwhelmingly that they did not want to be equated with CMAs. This makes me wonder why any accounting designation would be willing to enter into unequal merger talks while such mindsets prevail. And they certainly seem to, given your experiences. I would be most concerned for my status, professional rights and career opportutnties if CGA were to agree to enter into these talks with anything less than an equal vote.

        Tyler, you have not indicated where/how you are taking your courses (CGA? through post-secondary?) or what level of studies you are at. I suspect you might actually be in an advantageous situation. Whatever the outcome of the merger attempt, I suspect that your compelted studies should apply well against the requirements of whichever designation you choose in the months to come. It seems to me, at first glance, that you are in a situation where you can continue to study and then make a solid decision later.

        I would be glad to speak to you in person ( or any students for that matter ) and discuss in more detail what courses you are taking etc. Please feel free to call me on my toll free line 1-800-565-1211 x202

        Thanks again Tyler, I appreciate you frankness, and I wish you all the best of success in whatever you choose.

        Dan

    • Very good question Tyler!

      I manage employment initiatives for CGA in BC and I am one of the two authors of this blog. Thanks for giving us your feedback.

      We have seen and followed up on several such incidents over the years. Interesting that here in BC it is often CGA that is mentioned in the ad and CMA omitted. I’m sure that there are genuine incidents where an employer may wish to express a preference, but I found that this was not the case in the vast majority of these postings. Most often the contributing factor has simply been that the author of the posting did not have a full understanding of the accounting industry. Editing errors and simply cutting/pasting a previous posting also contributed to a few of these incidents.

      I’d be most interested in hearing of incidents where a candidate found that the employer was genuinely indicating a preference for one designation over another.

      Thanks again Tyler

      Dan Relihan

  16. John says:

    Whether go for a merger or not, this decision shall be made by all the members of the CGAs. The final rights shall belong to the members, not the board members.

    Also, the CGA- Canada and its affiliated associations would be replaced after a merger and I believe the board of CGA-Canada and its managing stafff are in conflict of interests. They are not in a appropriate positions to make such a decision.

    As CGAs, we all know that we cannot perform our obligations when conflict of interests arise. I believe the board and its members shall have known the principle very well and shall have realized that they are in the position of conflict of interests. They shall pass the obligation to make such a decision to the memmers of CGAs.

    I hope the board of CGA-Canada will do the right thing!!!

  17. Elite CA says:

    Man, you CGA’s have a complex problem.

    EVERYONE, including yourself, knows that people that cannot become CA’s become CGA’s.

    When people finish University, they all apply to CA firms. The smart and the brightest get jobs with CA firms.

    The rest of the pack, who did not do well in school or who went to low end schools, etc, become CGA’s because it is easier to do. Heck, you can get a CGA doing bookeeping for a corner store!!!

    So, please, do not kid yourself. You would all kill to be a CA. Must suck to look up at us and be so envious. You were not smart enough then, and you are not smart enough now. So please, just deal with the hand you were dealt with and move on.

    CA’s set the standards in Canada.. There is a reason why the CGA’s have no power, and it is because everyone knows CA’s are so much better.

    You CGA’s are a super jealous bunch, and I do feel bad for you.

    Thank god I became a CA. Everyone knows most CGA’s are just glorified bookkeepers.

    Enjoy your huge membership, just shows how exclusive and tough it is to become a CA.

    Any moron off the street can get their CGA. Don’t deny it.

    • Thanks for your input Elite CA, we do feel it is important to post all comments and opinions expressed here on our blog.

      Thank you for taking the time to comment,

      Dan Relihan, CGA (drelihan@cga-bc.org)

    • David Albert Newman says:

      Hey EliteCA, I am a CGA who is completing his MBA, then PhD. Hmmm, something tells me I must know something. For instance, you have an inferiority complex by looking down on people to make yourself feel better.

      I could out do you technically and socially any day of the week. Oh wait, I’m stuping to your inferiority level.

  18. John says:

    Qualified public accountants are well respected professionals around Canada. Therefore, such a qualified individual shall at least know how to respect people around her /him. If not, his/her integrity shall be challenged or her/his qualification shall be reviewed.

    Anyway, I believe most of our peers know how to respect people so that people would respect them in return.

    Now, the Canadian accounting profession is in critical times in the new century. All public accountants across this country may need to come together and to shoulder challenges jointly so that they all can have a better future for themselves, for the public, for the profession, for generations of accountants to come, etc.

    How can they come together and work together to achieve their common goals together?There is one single most important thing that maybe every one shall remember and that is “RESPECT”

    Without the least “RESPECT”, we would not understand each other or support each other or work together or take challenges together and we would fail all together. I believe most of our qualified accountants, no matter you are a CA, CGA, or CMA, you know about that quite well and you must know “RESPECT” as RESPECTED professionals.

  19. Rob Farrow says:

    I’ve spent more than 25 years as a CGA – the last 7 of which I’ve been a tax specialist and senior manager with 2 of the largest CA firms in the country. I’ve faced some prejudice from CAs but firmly believe that the designation is less important that the experience you gain in the workplace and the professionalism of those around you.

    The merger is the right thing to do. Let’s just do this!

    I do hope though that the clear superiority of our CGA distance education programs is not lost in the process.

    Rob Farrow

  20. dave says:

    GORDON H. CAMPBELL (deceased)
    Almost single-handedly, Gordon, a federal tax department employee, successfully opposed a move in the 1960s by legislators in B.C. to have CGAs in public practice merge with the province’s CAs, a victory which contributed immensely to the strength of the CGA designation.

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