No training contract?
It is a little known fact that many insolvency professionals have ended up there as a result of either completing a law degree and the LPC, but then failing to get a training contract. It’s actually a really common trait in the insolvency world due to the ever-decreasing opportunities to gain a training contract with a firm of solicitors.
The insolvency world is made up of many professionals with an aptitude for both accountancy and an ability to understand the complexities of law, but who also have strong skills in client facing tasks with an emphasis on advising.
I am aware of many graduates with an LPC qualification that didn’t want to waste their skills by working in industry, so gave insolvency a go and never looked back. As a person who never went to university and who didn’t finish off their ACCA qualification, I am always grateful to work alongside law-minded individuals who can help me interpret the ever-changing insolvency legislation.
I am not saying that insolvency is only full of students who have dropped out of their chosen subjects, as there are still many fully qualified accountants and highly academic individuals in the industry. However, it is not the be all and end all to study with an aim to become a solicitor but then eventually not pursue other professions.
Insolvency is law based…
Insolvency is still law based, as insolvency professionals are governed by the Insolvency Act 1986, the Companies Act 2006 and many a guideline or statutory procedure. Therefore, a large majority of the role of an insolvency professional involves law based skills. Insolvency also involves preparing basic accounts, together with reviewing the records of the businesses and individuals you are advising, and therefore accountancy accompanies law as a large part of the profession.
The main reason why, in my opinion, insolvency should be chosen above any other finance career, is that each day is made up of different amounts of these accountancy and law tasks (along with advisory work). Therefore, the variety of day-to-day work keeps the role interesting.
Also, one big favourable point to this profession is that if you manage to turn around a failing business or get an insolvent individual back on track, it can be extremely rewarding.
A career change to insolvency
Your first step on the ladder usually involves taking a job with an insolvency firm as either an office junior or a trainee of some sort. Most insolvency firms will offer you the opportunity to continue studying on day release, either towards completing your current studies or gaining an insolvency qualification. Your initial salary may not be quite as high as you’d like, but there is a lot to learn in order to become competent in advising clients. Your salary will, however, increase very quickly as you gain passes in each exam you take.
What insolvency qualifications can I study?
Aside from starter courses, there are two main qualifications. These are:
The Certificate of Proficiency in Insolvency (CPI) – This is the qualification new professionals to the insolvency industry usually take (and some experienced professionals looking to push on to the next level). Its complexity is no more difficult than a degree. You sit one exam, partly made up of multiple choice questions. It is considered a notable achievement to insolvency employers and a stepping stone to full qualification as a licensed Insolvency Practitioner.
The Joint Insolvency Examination Board (JIEB) – This is the qualification you must pass in order to become a licensed insolvency practitioner. It is made up of three separate exams and designed to be taken by experienced professionals. It’s known as being extremely difficult, but once gained the rewards make the many hours studying all worthwhile.