How long is a piece of string?!!!
The cash outlay of training an apprentice is the course cost, based on 5% of the cap for each level is:
- Level 2: £300 + VAT
- Level 3: £600 + VAT
- Level 4: £400 + VAT
- Level 7: £1,050 + VAT
The cost of lost chargeable time depends on how much of the 6 hours per week off the job training is provided out of office by the training provider and how much is provided by the employer, the apprentice being provided guidance on how to undertake new functions at work. Those in industry will look at the salary cost of this time or its opportunity cost. Those in accounting practice will look at their lost chargeable time. An easy way to look at it would be to say “If we are losing 1 day a week on day release, we need a 0.2 employee to cover them. What is 20% of the cost of that extra employee” If you had 4 apprentices, would you need a 5th, to cover their 4 days of study leave each week.
However, this ignores the increased productivity you should be expecting/demanding from your apprentice as they progress through their apprenticeship. For those in accounting practice, are you expecting an improved “recovery rate” on their client work each month, or are you increasing their charge out rate every 3 months to reflect the improvement in their knowledge and skills.? If not, why not?!
We should all be looking at the cost of the apprenticeship as an investment, not an overhead. As such, we should be working together to ensure that employers obtain a proper return on that investment. The benefit should exceed the cost.
Are you measuring the increased productivity that you should be expecting from your line managers as they are increasingly able to delegate higher-level work to their apprentices?
Additional costs for training an apprentice
Since the introduction of the new AAT Q2022 syllabus in September 2022, those registering under the new syllabus will be charged the following one-off fees for each level. This lasts for the whole level, with no annual renewal required.
- Level 2: £175
- Level 3: £228
- Level 4: £244
The annual student membership for ICAEW is currently £197 + VAT p.a.
AAT exam fees are often paid for by the training provider, but this is unlikely to be the case for the ICAEW exams. For the latter, any residential fees involved will be the responsibility of the employer and cannot be covered by the apprenticeship funding.
It is important to note that, under the current funding regulations, an apprentice cannot be asked to contribute to the cost of their apprenticeship, even after they have completed it. It is likely, therefore, that any training costs clawback clauses you might have in your employment contracts will not be enforceable for apprentices.
It will make sense to agree with your training provider what their policy is for a. how many resits they will support and b. who pays for them. For AAT level apprentices, the training provider will probably pay for the first sitting, may possibly pay for the first resit, and will probably not pay for any further resits – although hopefully no resits will be required!
However, the training provider may also have conditions such that they will only pay for the resit if the apprentice first submits the required progress tests and practice assessments and meets a minimum mark – to warrant sitting the exam. For example, for our Standard Plus distance learning course package, we offer a guarantee which includes us covering the cost of resits. However, these conditions are imposed to prevent us from writing a blank cheque to a student that sits exams without any studies!!
