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The shortage of specialists who can comply with the latest rules also has corporates rethinking attitudes towards clients

HONG KONG AUDITORS are busier than ever with the need to apply international financial reporting standards to financial statements since the beginning of last year and other new, stringent accounting regulations.

The simplest way to lighten their workload is for firms to hire more people. But with a global shortage of qualified auditors and strong demand for them in booming economies, such as the mainland's, this is not always easy.

Instead, accounting firms in Hong Kong are focusing on staff retention and cherry-picking clients.

Careful selection of clients is happening across the board at Big Four firms.

Ernst & Young is implementing specific strategies to take on new clients or more work from existing clients.

'We're very careful with our client acceptance and continuance, and for those clients that we don't think are appropriate in terms of risk, we don't accept them or we don't continue to work with them,' said Catherine Yen Ka-shun, Ernst & Young human resources partner for China.

'Our client list mainly consists of big multinationals and locally listed companies, but client selection is more to do with the particular company, whether it poses a risk or has management problems - we don't tend to take on those engagements,' Ms Yen said.

However, auditing firm partners said client selection alone was not the solution.

If the firm encounters a must-have client one day, lacking the resources to accept their work is a poor excuse.

Instead, a more long-term approach would be to concentrate on staff retention.

Although retaining staff is about more than just salary levels, inevitably competition with other firms in remuneration does matter and the shortage of qualified auditors is driving salaries up.

According to recruitment consultant Ambition's mid-year market trends and salaries report for 2006,  accountants switching jobs can expect a pay rise in the region of 12 to 15 per cent for rank and file positions, and more than 20 per cent for specialist roles.

Apart from competitive salaries, staff retention also means measures ranging from fruit bowls to employee welfare programmes, all of which have been introduced by the Big Four and mid-tier firms to reduce staff turnover. The firms are also investing time in training qualified staff.

Deloitte Touche Tohmatsu  has launched an employee assistance programme across offices in Hong Kong and the mainland, which aims to improve the staff's quality of life.

The programme placed emphasis on workplace health.

Richard Ho, audit partner at Deloitte and a vice-president at CPA Australia, said: 'We have to work long hours sometimes and when we do we want to do it in a healthy way. So, for example, we have started providing fruit for our staff every day, and we have put up posters and information in our audit department reminding people about the importance of having a harmonious work-life balance and the importance of rest.'

The firm tries hard to attract and retain good quality auditors by setting a clear career path for fresh graduates joining the firm. The company also provides structured learning support, particularly during the first five years of work.

'To support their auditing work and skills we provide updated courses on standards and regulations, as well as industry-specific training,' Mr Ho said.

'We expect our accountants to pass their professional exams in a reasonable period of time and we provide them support for this.'

Professional development programmes in place at many of the firms also mean that recruits can take advantage of transfers to overseas offices, which last for six months to several years, once they have their professional qualifications.

Most new recruits relish the chance to do so.

At KPMG, retention and grooming staff were the best long-term strategies, said Carlson Tong Ka-shing,  head of the firm's audit practice in China and Hong Kong.

'What we're trying to do is recruit more than what we need to build for the future. This year we recruited more than 1,100 graduates for Hong Kong and China and we are constantly devising programmes to help us identify good graduates and attract them to join us,' Mr Tong said.

One KPMG key strategy is to become an 'employer of choice' in Hong Kong and globally.

The British firm was recently voted Britain's 'Best big company to work for' in The Sunday Times' Best Companies survey. KPMG topped the 'big companies' category for organisations with more than 5,000 employees.

Mr Tong said: 'Our people are the key and we want to distinguish ourselves by looking after our own, and then they become our best advertisement.'



Companies focus on keeping their employees happy