Hong Kong accounting firms are likely to recruit about 10 per cent more staff next year in light of increased stock market activity and more takeover deals. Clement Chan Kam-wing, president of the Hong Kong Institute of Certified Public Accountants, said many accounting companies started to hire more people in the fourth quarter in response to increasing numbers of initial public offerings in the city. Overall, he said, accounting firms have recruited about 5 to 10 per cent more staff this year, and he expected the number of new hires to be even higher next year. "Initial public offerings have become more active since the fourth quarter, and we can expect more new listings in the first quarter of next year," Chan said. "This would demand more audit work and many firms have expanded their teams accordingly." More than HK$160 billion was raised through listings in the city this year, up 78 per cent from HK$90 billion last year, according to a survey by financial firm KPMG. The positive outlook for the economy had also prompted accountancy firms to increase their staff numbers, said Chan. "We have seen recovery in both the United States and Japanese economies. Most importantly, China's economic growth rate will remain very positive next year, and this has boosted confidence and led to accounting firms hiring more staff." One of the challenges for the industry is that accountants need to make preparations to work on the mainland, Chan said. To do so, they would need to pass the mainland's qualification examinations - and to date only 150 of the city's 36,000 accountants had done so. "The Shanghai free-trade zone and other zones are going to attract many international firms. In addition, scores of H shares have shifted to appointing mainland accounting firms to audit their accounts since they were allowed to do so in 2011," Chan said. "If Hong Kong accountants do not prepare themselves to work on the mainland, they will find it hard to compete."