The ACCA rules on referral arrangements, explained plainly

There is a persistent myth among accountants that accepting a commission or referral fee is somehow improper. It is not. ACCA's Code of Ethics and Conduct recognises that members receive and pay referral fees and commissions, and sets out how to do so without breaching the fundamental principles. The activity is allowed; what matters is that it is handled transparently and does not compromise your objectivity.

The Code is built on fundamental principles — integrity, objectivity, professional competence and due care, confidentiality, and professional behaviour. Referral arrangements are assessed against these. The question ACCA asks is not 'did you take a fee?' but 'did taking it create a threat to your compliance with the principles, and if so, did you deal with that threat?'

ACCA uses a conceptual framework: identify threats, evaluate them, and address them. For referral fees the principal risks are:

• A self-interest threat — that the prospect of a fee influences your judgement, so you refer the client where the commission is best rather than where the client is best served
• An objectivity threat — that your recommendation is, or appears to be, coloured by what you stand to gain

The Code does not pretend these threats can be wished away. It requires you to recognise them and apply safeguards, the most important of which is disclosure to the client. Once the client knows an arrangement exists, the threat to objectivity is substantially reduced because the relationship is transparent.

The single most important requirement is that you tell the client. Before or at the point of making a referral for which you will receive a fee or commission, the client should be informed that such an arrangement exists. The spirit of the rule is that a client should never discover, after the fact, that their trusted accountant was paid to point them somewhere and never said so.

Good practice goes further than a bare mention. Disclosing the nature of the arrangement, and being willing to explain how it works, keeps you comfortably on the right side of the Code. The disclosure does not need to turn every introduction into a formal negotiation, but it must be genuine and clear enough that the client understands the position.

Two further principles bear directly on referrals. Professional competence and due care means you should not be advising on matters outside your expertise — which is exactly why you refer rather than opine. Introducing a client to a specialist is consistent with this principle; pretending to competence you lack would breach it. Confidentiality means you must have the client's agreement before sharing their information with the firm you are referring to; you cannot pass personal details onward without consent.

Finally, professional behaviour requires that the whole arrangement be one that would not discredit the profession. Referring into a network of vetted, regulated specialists supports this; referring clients to unchecked contacts for a fee would not. The quality of who you refer to is itself part of your ethical compliance.

In practical terms, an ACCA member operating a referral arrangement compliantly does a handful of things consistently: refers on the basis of what genuinely serves the client, discloses the existence of the fee arrangement to the client, obtains consent before passing on any personal information, refers only to specialists who are themselves competent and properly regulated, and keeps a simple record that these steps were taken.

Done this way, referral income is not a grey area — it is a recognised and legitimate part of practice. A referral network that builds disclosure, consent and vetting into its process makes this straightforward, because the safeguards the Code expects are handled as part of the workflow rather than left to memory. The result is that you can accept a share of the fee — commonly a 60-70% member share in this model — with full confidence that you are inside the letter and the spirit of ACCA's requirements. This is general guidance, not a substitute for the current Code, which you should consult directly.