Bad patch for banks great for auditors
While bloodletting continues at banks and hedge funds, one part of the financial sector plans to hire thousands next year despite - or perhaps because of - the uncertain economic outlook: accounting firms
Accountants are in high demand as more companies seek expert bookkeeping advice.
'The capital markets may be slowing down a bit recently, but there are still a lot of international companies seeking listings in Hong Kong,' Keith Pogson, the new president of the Hong Kong Institute of Certified Public Accountants, told the South China Morning Post.
'There are a lot of mergers and acquisitions in Europe as some companies and governments need to sell assets amid the financial crisis,' he said. 'They need accountants to provide auditing and taxation services.'
Pogson, who is also managing partner for Asia-Pacific financial services at Ernst & Young, said regulatory reforms in Western markets after the global financial crisis have increased demand for accounting services from companies needing to ensure they comply with the new regulations.
Some firms that are in trouble will also need restructuring or insolvency accounting services.
'Even in bad times, we still need accountants,' he said.
As such, Pogson said the industry as a whole would not be following the banks' example and laying off large numbers of staff, and some plan to hire more next year.
Experts say the global total of planned layoffs by financial institutions, including HSBC and Bank of America, could reach as high as 90,000 in the next few years. In contrast, Ernst & Young plans to hire 1,000 next year for its Hong Kong and mainland practices, Pogson said.
He said accounting firms still need to hire more staff on the mainland and in Hong Kong because many mainland companies planned to list here and some mainland banks and companies planned acquisitions, which would require accounting services.
The only cloud on the horizon for city accountants is a new rule implemented by Hong Kong Exchanges and Clearing in December last year allowing mainland accountants from 12 firms endorsed by the Ministry of Finance in Beijing to audit Hong Kong-listed mainland firms.
Until the change, all financial statements of mainland firms listed in Hong Kong had to be audited by local auditors.
But Pogson played down the potential threat from mainland accountants. Of 164 H-share companies affected by the new rules, 24 had so far shifted to mainland auditors.
'But then, the mainland auditors belong to the 12 mainland accounting firms, which have affiliations with Hong Kong firms,' he said, adding that he hoped to see more integration between local firms and their mainland counterparts.