Accountancy trade looks to long term to seal UK/EU deal

● Survey by Icas finds members favour ‘period of pragmatic transition’ necessary

Any transition period after Brexit should last “as long as it takes” to negotiate a durable relationship between the UK and EU, according to a survey of chartered accountants published today.

The response was cited by nearly half of respondents in the latest quarterly Brexit Tracker poll from trade body Icas in association with law firm Brodies.

The majority of those surveyed were based in Scotland (58 per cent), with 27 per cent from the rest of the UK and the remainder from overseas.

Icas said the autumn 2017 tracker suggests that members remain slightly pessimistic regarding the impact of Brexit so far (at -9, level with the summer survey). They were found to be more downbeat (-15, down from -14) over the future impact on them and their organisation, and more pessimistic (-18, down from -16) over the impact of Brexit on the UK economy. It also found that just 9 per cent favour a “clean break” Brexit with no transition and 29 per cent support Prime Minister Theresa May’s proposal of up to two years. Additionally, 13 per cent believe a transition lasting three to five years would be appropriate.

Bruce Cartwright, executive director of policy leadership at Icas, said: “Our members recognise and respect the privacy of the current Brexit negotiations. Nevertheless, the continuing public uncertainty is not helpful and is reflected in our members’ views.

“To counter this uncertainty, our members’ preference is for a period of pragmatic transition the length of which should be defined by the degree of change required depending on the outcome of negotiations.”

More than 80 per cent of chartered accountants surveyed said they would be happy to see continued UK membership of the EU Single Market, and freedom of movement, as part of a transition deal, while 49 per cent said continued jurisdiction of the European Court of Justice would be acceptable during that period.

Additionally, 57 per cent agreed that it would be acceptable for EU regulations to apply to UK businesses during the transition period.

Christine O’neill, chairman of Brodies, commented: “It is clear that there is widespread support for transitional arrangements around Brexit, but increased business confidence will depend on whether a transitional deal can be agreed and what it will look like”.

Meanwhile, a survey of Scottish law firm leaders also published today found that 70 per cent believe technology will have the greatest impact on client relationships in the next five years.

The report from accountancy and business advisory firm BDO said this compared to 40 per cent in the rest of the UK. Martin Gill, lead partner for BDO in Scotland, said legal leaders adapting and embracing technology is essential “but so too is the importance of listening to what clients want”.