The U.K. government is raising the bar for finance leaders in further education colleges, setting forth new rules that require CFOs at these institutions to hold a professional accountancy qualification.
Under the Department for Education’s 2026 college financial handbook, beginning Aug. 1, 2027, further education colleges with more than 3,000 students must now require CFOs to hold a relevant accounting qualification from a recognized professional accountancy body. These institutions include the Association of Chartered Certified Accountants, the Institute of Chartered Accountants in England and Wales, Chartered Institute of Management Accountants and others.
Institutions in this category seeking to appoint a CFO without a recognized accounting qualification will need approval from the Department for Education.
The move comes as education institutions in both the U.K. and the U.S. face mounting financial pressure. In April, the Higher Education Policy Institute warned that many English universities are taking “excessive” financial risks that threaten their long-term sustainability, citing high borrowing levels, dependence on international students and rapid enrollment growth.
Across the Atlantic, colleges and universities including UCLA, Florida A&M University, Siena Heights University, Ohio State University, Pennsylvania State University , Temple University and Oklahoma State University are among the many that have faced budget pressures, leadership changes or public scrutiny over their financial management.
New handbook raises expectations for CFOs
The Department for Education said the change is intended to ensure the people responsible for overseeing college finances have the expertise needed for the role.
“It is only right that those entrusted to manage their finances are equipped with the skills, expertise and experience relevant to their college, including, where appropriate, a professional accountancy qualification,” a department spokesperson told FE Week.
Association of Colleges Deputy Chief Executive Julian Gravatt said the organization worked with the department on the policy and noted that most colleges already employ qualified finance leaders.
“The vast majority of people in this role have relevant qualifications, but there are times when it’s necessary to use people with experience in related disciplines or to combine roles to save management costs,” Gravatt told FE Week. He added that the “comply or explain” approach gives colleges flexibility in exceptional cases while establishing a clear professional standard.
The updated handbook also strengthens financial governance in other areas. Colleges must continue to seek approval for certain large severance payments, renew Cyber Essentials certification annually and provide financial training for governors and finance and audit committee members.
The argument for why credentials matter
The new requirement also comes as finance leaders continue to debate the value of maintaining professional accounting credentials after moving into executive leadership roles.
In a recent interview with CFO.com, ACCA President Melanie Proffitt argued that maintaining a professional accountancy qualification, such as those offered by ACCA or other recognized accounting bodies, provides value well beyond technical expertise.
“If you employed me to work in your organization as your CFO, you know I have a higher level of ethics in terms of consequences than someone who’s not bound by that code of conduct,” Proffitt said.
She said continued membership requires finance leaders to adhere to a professional code of ethics while committing to ongoing professional development, giving employers confidence that executives continue to maintain relevant skills throughout their careers.
“Maintaining your membership demonstrates continuous professional development, a continuous learning mindset, and integrity and trust,” Proffitt said. “I think, in today’s world, trust is really key.”
The discussion contrasts with a common career path among accounting-centric corporate finance leaders who begin careers in public accounting before allowing their CPA licenses or other professional credentials to lapse as they take on broader business leadership responsibilities.
The Department for Education’s policy raises a broader question for the finance profession: As the CFO role continues to expand beyond the traditional realms of finance, should professional qualifications remain an expectation for those entrusted with overseeing an organization’s finances, and are they enough to hold the weight they bear?
