Accountants for business – a challenging role ahead
31-AUG-09
By Quinton Simpson, head of ACCA South Africa
ACCA (the Association of Chartered Certified Accountants) has a new theme for 2009 /2010. For the next year, we will be championing the theme of Accountants for Business, of how the finance professions help small, medium and large business grow, prosper and survive in Africa.
Research concluded by the ACCA for South Africa has indicated that over 60% of CFOs and FDs within the targeted sample agree that they find the biggest challenge for business is the financial skills shortage and that their biggest challenge was in finding the required financial professional.
The top three concerns in South Africa business is the lack of general business skills and leadership and therefore the theme of the Accountants for Business has an immediate business directive within South Africa. A financial professional that is fit for business is crucial to retaining a growing economy.
When it comes to business, one of the hallmarks of sustainable enterprise and development is a strong finance function. Organisations, whether in public or private sectors, benefit strongly from the discipline of financial management, and especially when it is central to the business function, where it is part of its very culture.
Finance professionals add value in whatever roles they are employed, and are promoters of sound business practices, champions of sustainable business development and they also identify new opportunities that can lead to high-performing organisations.
Research has indicated that 74% of the finance function is not outsourced and therefore economically, accountants add considerable value to business by driving down costs and identifying areas for value and profitability – and never more so than in the current global economic environment.
South Africa has just reported the 3rd successive quarter of decline in the retail sector, demonstrating cautious spending amongst consumers. This impacts on business generally and ultimately the economy through reduced tax revenues, leading to greater pressure on government, employment and service delivery.
They can help an organisation steer itself through difficult trading conditions, while seeking to keep their eye firmly on their longer-term goals.
Not only has the Chief Financial Officer (CFO) become more important in recent years as a guardian of financial performance and a key player in creating long-term value, but is also increasingly the guardian of the brand and reputation, ensuring that the company adheres to good sustainable practices.
As such, it is no accident that professional accountants are found on the boards of listed companies in South Africa and around the world. Accountants are no longer just reporting to the shareholders and to comply with regulation. They must play their part in maintaining and building the reputation of the business.
With cross sector relevance spanning from the small business sector to the public sector and government, they need to bring to industry skills that include financial reporting, management accounting, compliance with tax and other regimes, risk management and performance analysis, grounded in professional and ethical practices and with the knowledge appropriate to provide well-rounded advice to company owners and managers.
The accountant in business has a pivotal relationship with other key stakeholders essential for the ongoing success of the organisation, from presenting financial statements for quoted companies, in a timely fashion and professionally prepared in compliance with International Financial reporting Standards (IFRS), is absolutely essential.
Accountants through their technical expertise have to make it possible for companies to comply consistently to technical standards. This holds especially true in a developing nation like South Africa where the costs of compliance remains an issue.
The accountant can often be a motivator for other employees. charged with a financial or budgetary responsibility. Understanding the motivations of others, demonstrating in practical terms why finance matters to them can be a source of huge value to the organisation, in terms of controlling cost, and of optimising income.
What business needs now is discipline over the immediate short term, but also the confidence of knowing they possess a business model which is sustainable. Finance professionals now have every opportunity to emerge as leaders, a requirement that is rated as one of the top 3 sought after skills– but ultimately it will depend on their willingness to rise to the challenge.
