Pricing strategies struggle amid supply chain chaos
Team integration, automation, and client education are top accounting challenges
A recent study by Penfold and Kaizen Accountancy Services shows that team integration, automation and client education remain major challenges for accountants and firms today.
While the demand for professional accounting services has risen dramatically due to increasingly complicated market conditions and economic uncertainty, the UK accountancy space is still struggling with generating sustainable growth, with a shortage of talent and skills being a key roadblock. As the talent crisis continues to sweep the nation, the industry has been slow to incorporate technology and innovation, not only into firms but also into educational courses, hindering the field’s ability to attract the next generation of accountants.
Kaizen reported that an organisation’s financial stability, regulatory compliance and overall success were negatively impacted by neglecting to include finance teams in business growth decisions. The study found firms that included accountants and finance teams from the get-go were better equipped for growth periods, resulting in less strain on their teams. However, educating clients and business leaders on the advantages of involving finance teams remains a recurring challenge.
Trade Association UK Finance supports these findings. Commenting on the trend of rapidly developing businesses, they highlighted the critical role finance teams have in generating information to support decision-making.
Penfold co-founder, Chris Eastwood, said: “Business leaders can be hesitant to tackle finer finance details, whether it be payroll software or switching pension providers, so it’s best to share clear and concise information to build their understanding of a service. Whilst switching pensions can feel taboo to some start-up businesses, the visibility of the Penfold service is educational. Our onboarding process has also been found to be pivotal in deepening client understanding of the service, benefits to the finance team resource management and therefore the wider business.”
ACCA and IMAA sign co-operation deal to elevate corporate finance expertise
Two leading global organisations, the Association of Chartered Certified Accountants (ACCA) and the Institute for Mergers, Acquisitions, and Alliances (IMAA), have forged a strategic co-operation agreement.
ACCA, a global body for professional accountants, and IMAA, a leading institute in mergers and acquisitions training and education, aim to deepen the expertise of their members in crucial areas of corporate finance, particularly in mergers and acquisitions. The goal is to equip professionals with the knowledge and skills needed to excel in these increasingly important areas.
Commenting on the agreement, ACCA chief executive, Helen Brand, said: “ACCA is delighted to collaborate with IMAA. Both organisations have a global footprint and share a commitment to excellence in their respective fields.
“Our members are equipped with world-class accountancy qualifications and frequently find themselves involved in businesses where M&A activities and joint ventures are increasingly significant. This co-operation agreement will enhance the educational opportunities that ACCA members can tap into.”
The first milestone in this partnership will offer ACCA members preferential access to IMAA’s certification programs and courses. This will enable ACCA members to gain specialised skills in M&A, adding value to their existing accounting and financial management expertise.
IMAA founder and CEO, Christopher Kummer, added: “We are excited about this strategic collaboration with ACCA, a leading organisation in the global accountancy landscape. Our focus has always been on promoting excellence in M&A education and research.
IFRS Foundation appoints Montreal and Asia-Oceania office directors
The IFRS Foundation has announced the appointment of two new directors for its Montreal office and Asia-Oceania office in Tokyo. Isabelle Mégré has been appointed Montreal office director and Yoshiko Shibasaka will replace Makoto Takahashi, who will retire at the end of 2023, as Tokyo office director.
The appointments add to the team of regional office directors, which also includes Regina Karoline Schueller in Frankfurt and Zhengwei Zhang in Beijing, enhancing the IFRS Foundation’s ability to work closely and collaboratively with its global stakeholders.
Mégré joins ISSB from Global Sustainable Electricity Partnership (GSEP), where she is currently director of outreach and public affairs. Her experience includes managing relationships with a global network of internal and external stakeholders. Before GSEP, she held several public affairs and communications roles in various non-profit organisations.
Shibasaka was a partner at KPMG Japan, working in their sustainable value office and providing information and thought leadership on sustainability-related reporting to Japanese stakeholders. She is also on the steering committee for KPMG ESG Global Strategy and served as a member of the IFRS Foundation’s Integrated Reporting and Connectivity Council. She has co-authored several books.
Rising cost-of-living prompts 40% of UK workers to consider career change
KPMG surveyed 1,500 UK employees about their working habits and career aspirations and found a challenging economic environment is changing their employment priorities.
More than a third (38%) of workers want improved salary and benefits due to the rising cost-of-living, up from 30% last year, 29% want more flexibility to work from home, up from 20% last year, and 23% want more job security, down slightly from 24% last year.
The desire of workers to change career comes despite a period of weaker economic activity and cautious hiring policies. The latest KPMG and REC, UK Report on Jobs survey published earlier this month shows the steepest drop in permanent placements for over three years.
Of the 38% of workers planning to change career due to the rising cost-of-living specifically, over half (57%) will be looking to change roles within a year highlighting the immediate issues facing UK workers.
KPMG’s research looked at perceptions of a career in the financial services sector. The financial services sector is still regarded very favourably by those looking to change career, with 82% of workers who are looking to move job and currently working in another sector saying they would consider a job in Financial Services.
The most common reason given for this was high salary and bonus expectations (47%), followed by the fact that it sounds interesting (31%) and has a good work-life balance (25%).
PayPal’s CEO says the US consumer has been resilient but is showing signs of fragility
The US consumer has been a source of strength for the economy in the wake of the Covid-19 pandemic. But cracks may be starting to show in consumer finances, according to PayPal CEO Dan Schulman. While the economy is “not out of the woods yet,” he adds, inflation is beginning to fall and we’re “moving in the right direction.”
“The consumer has been pretty resilient — I think everyone’s seen that,” Schulman said in an interview with Goldman Sachs chairman and CEO David Solomon at the Communacopia + Technology Conference in San Francisco. “But I do think the consumer is somewhat fragile right now.”
Schulman points to household savings that are “coming down quite meaningfully,” as pandemic-era government benefits are exhausted and spending on so-called “revenge travel” peaks. Schulman also cites data showing that consumer credit is reaching record levels. “You’re beginning to see credit defaults tick up a little bit,” he says.
That assessment aligns with other company leaders’ views expressed during second-quarter earnings. Goldman Sachs Research found that a theme during the most recent earnings season was “newfound concern” about the health of the lower-income consumers due to rising delinquency rates on credit cards and subprime loans for cars. But the team also noted that its analysis of retailer financial results indicates the lower-income consumer is “outperforming.” Credit card data tells a similar story of outperformance, though spending by lower-end consumers is expected to slow somewhat in the fall.
ISCA and CPA Australia sign mutual recognition agreement
The Institute of Singapore Chartered Accountants (ISCA) and CPA Australia have signed a mutual recognition agreement (MRA). The MRA provides a pathway for ISCA members to be members of CPA Australia, and vice versa.
Professional accountants are highly regarded by businesses and are in high demand worldwide. As businesses globalise, organisations frequently transfer their senior finance and accounting staff members to helm key positions across regions. This MRA thus facilitates talent mobility within the global accountancy profession.
Under the MRA, ISCA members can apply to be a CPA Australia member without having to fulfil additional professional or educational requirements. To be eligible, the ISCA member must be a CA (Singapore), have completed the Singapore CA Qualification, and have held ISCA membership for five consecutive years.
CPA Australia members seeking ISCA membership must have completed the Certified Practising Accountant (CPA) Program, the Singapore Chartered Accountant Qualification (SCAQ) Programme’s Integrative Business Solutions module and other applicable qualifications and experience requirements to qualify under the MRA.
To reach this agreement, ISCA, CPA Australia and the Accounting and Corporate Regulatory Authority (ACRA) conducted a review of the qualifying requirements in education, examination, practical experience, professional standards and regulations of both professional accountancy bodies. This was to assess the equivalence between the Singapore Chartered Accountant Qualification (SCAQ) and the CPA Program, as well as the membership requirements of ISCA and CPA Australia for the purpose of entering the MRA.
Term ends for PCAOB internal oversight director
The Public Company Accounting Oversight Board (PCAOB) has announced the conclusion of the office of internal oversight and performance assurance (IOPA) director Ryan Sack’s five-year term. Brian Janda, IOPA’s deputy director, has been named the office’s acting director while the board continues the recruitment process for a new IOPA director.
By charter, the IOPA director serves a five-year term to promote the objectivity of the office, which provides independent assurance on the efficiency, effectiveness, and integrity of PCAOB programmes and operations. During Sack’s tenure, IOPA completed numerous performance reviews and made significant strides in developing its capabilities.
Commenting on this, PCAOB chair, Erica Williams, said: “Ryan Sack‘s leadership has raised the bar for the PCAOB’s internal oversight function, and his work will leave a lasting impact on the efficiency, effectiveness, and integrity of our operations.
“We thank Ryan for his service, and we are pleased that Brian Janda will bring his experience and expertise to the Acting IOPA Director role.”
Sack added: “I am proud of all the work that IOPA has done over the past five years to provide the Board with insights on ways to achieve key objectives and improve effectiveness.”
Prior to joining the PCAOB in 2019 Janda worked at Northrop Grumman, leading the launch vehicles division’s government compliance function. He has also held various internal audit, accounting, and information technology roles at other commercial organisations. A certified public accountant and a certified internal auditor, Janda earned both a bachelor’s and a master’s degree in accountancy from Brigham Young University.
AFRC comments on the reappointment of its chairman and NEDs
The Accounting and Financial Reporting Council (AFRC) has welcomed the government’s reappointment of the chairman and nine non-executive directors (NEDs), and the appointment of two NEDs for a term of 2 years from 1 October 2023 to 30 September 2025.
The AFRC also welcomes the Government’s announcement that while the recruitment exercise for the chief executive officer (CEO) of the AFRC is still in progress, Janey Lai Chui-pik has been appointed as an executive director to act as the CEO with effect from 12 October 2023 until further notice.
Commenting on this, AFRC chairman, Kelvin Wong, said: “I feel deeply honoured to be reappointed together with the other Board Members. On behalf of the Board, I would like to warmly welcome James Lin and Andrew Fung to join the AFRC Board. Their abundant experience in legal and financial sectors will further enhance the Board’s diversity, thereby benefiting the AFRC as a whole. I look forward to working even closer with the NEDs in the next two years. With their wise counsel, I am confident that the AFRC will be able to upholding financial reporting quality effectively so as to promote the long term healthy development of the accounting profession.”