Sum of all challenges: accountants work to adjust to highly regulated business environment and rapid technological developments
CPAs must keep up with new standards while striving to stay up to date with developments in accounts-oriented technology and artificial intelligence
Faced with a steady stream of new regulations and standards to adhere to, certified public accountants (CPAs) need to continually upgrade their skills while meeting the needs of clients or their company’s business operations – without compromising the quality and integrity of their services.
In addition to CPAs adjusting to an increasingly regulated business environment – including greater emphasis on corporate governance, antimoney-laundering, the Hong Kong audit regulatory reform, audit practices on the mainland, and environmental, social and governance (ESG) reporting – the accounting profession is also being affected by technology.
Eunice Chu, head of policy, the Association of Chartered Certified Accountants (ACCA) Hong Kong, says that technology and artificial intelligence (AI) is transforming parts of the accounting industry. Providing a glimpse into the future operations of professional services firms, each of the “Big Four” firms – PwC, Deloitte, EY and KPMG) – have been ramping up the deployment of AI to help with analysing data to provide better insights to meet auditing compliance and reporting requirements.
“We are venturing into a new and largely uncharted future with unknown challenges matched with opportunities,” Chu says, adding that CPAs who stay alert and ready to adapt and exploit the changes could be rewarded. For example, in Hong Kong, Chu says the financial technology and start-up community could provide opportunities for CPAs.
“Accounting professionals can definitely contribute in these areas; given they have sound finance knowledge, they can be the business partners of start-up entrepreneurs,” Chu says, adding that they can also provide traditional services, such as financial planning, budgeting, cash flow management, internal controls and taxation advice.
Meanwhile, Jonathan Ng Tai-sing, Hong Kong Institute of CPAs (HKICPA) executive director (qualification and education), says proposed reforms to the institute’s CPA qualifying process will ensure the qualification remains in step with the continual changes in business and professional markets in Hong Kong as well as international best practices.
“It is important we train professional accountants with the skills, expertise and ethics that can support Hong Kong as an international business and financial centre,” Ng says. The new structure has three progressive levels with 14 modules and a capstone, which integrates technical knowledge across fields of expertise in accounting, business and finance while developing professional skills in analysis and critical thinking, problem-solving and leadership.
“This is something we started planning more than three years ago, however, it should not be rushed because it is crucial we maintain the highest quality standards to attract the best talent into the accounting profession,” Ng explains.
The proposed qualification programme structure is being designed to attract professionals from a wider pool of candidates and provide them with the skill sets and knowledge to allow them to work in more diverse areas of business.
With many stakeholders involved, Ng says the new programme will be launched in stages, with the first stage not likely to be launched before mid-2018. “Because of the huge changes brought about by IT, compliance, new regulations, ethical dilemmas, analytics and big data, we need the programme to be relevant for the next 10 years and beyond,” Ng says.
“As the world of business becomes more complex and sophisticated, we want to train our accounting professionals to be aware of situations where ethical dilemmas can arise and how to solve them by taking the right action.”
Dispelling the impression held by some that Hong Kong has an oversupply of accountants, Raphael Ding, HKICPA chief executive and registrar of the institute, says requirements from the business sector for accountants to work in risk management, compliance and data analytics are fuelling demand for experienced CPAs.
“I concede we have enough accountants at entry level, but an ever increasing regulatory environment will ensure demand for accountants to move from CPA firms to the business sector,” Ding says. According to the recent HKICPA survey, accountants can enjoy a stable income and positive
job prospects. Mobility also plays a big part in the profession, with 68 per cent of HKICPA respondents spending working hours beyond their home base, with the Guangdong Pearl River Delta region still cited as the most popular work destination. About 14 per cent of members travel outside of the Asia-Pacific region, to North America and Europe for work.
“Hong Kong CPAs have strong business acumen, they are well-versed in international best practices and know China. That’s why they are sought-after not just to work locally,” Ding says.