Accounting to Get Degree of Change (Singapore)

On the table: A new postgraduate degree that will be a prerequisite to becoming a public accountant in Singapore. It will also be a passport to finance jobs overseas.

The new qualification will, at the same time, pave the way for graduates from non-accountancy disciplines to enter the profession.

That's what the Committee to Develop the Accountancy Sector (CDAS) sees in the new qualification that it has proposed - one of 10 recommendations it will be submitting to the Ministry of Finance next month.

A 'homegrown' globally recognised postgraduate accountancy qualification - essentially a Singapore version of professional credentials such as the ACCA - is seen as key to Singapore's aspirations towards becoming a leading global accountancy hub and financial centre.

And the major stakeholders - from the Big Four audit firms to the accounting schools at the local universities - have thrown their full support behind the proposal, which seeks to strengthen the overall quality and capability of the audit and finance professions, and also expand the talent base for the sector to the region.

'I believe that the enhanced qualification will add great value ... and we ... encourage all our accounting professionals to pursue this qualification.'
- KPMG's Mr Tham

Currently, accountancy graduates of the three local universities, as well as those with other professional qualifications, qualify for the Certified Public Accountant Singapore (CPA Singapore) designation after three years' 'relevant work experience' and passing a pre-admission course.

The 14-member CDAS, which released an early report last November for public comment after an 11-month review, sees the new accountancy qualification becoming 'one of the essential criteria' for registration as a CPA here.

Current accountancy undergraduates are likely to be the first cohorts to be affected by the new CPA prerequisite when it is adopted and implemented, but the CDAS has also suggested 'transitional arrangements' for existing CPAs that take into account their experience and qualifications.

At the heart of the new programme is a strong emphasis on structured practical training through a 'compulsory training contract with an approved training organisation which also acts as sponsor'.

The training organisation could be one of the smaller accounting firms, not just the Big Four, or any company, so long as it has qualified accountants who can act as mentors, says CDAS chairman Bobby Chin.

'Some accountancy trained students may not wish to join an audit firm but want to go into commerce and still have the qualification,' he says. 'They could join an organisation such as NOL, for example. It has qualified accountants, it can apply to get accredited, and then graduates who join them can undergo this structured programme.'

The training contract will last two to three years, during which the graduates - including those outside the accounting field - work towards a professional qualification on the job.

'So you're being paid to study,' points out Mr Chin, former managing partner of KPMG Singapore. He cites how he himself, as a young KPMG staffer armed with an accountancy degree from the then University of Singapore, went on to obtain his ACCA during his secondment to the firm's Manchester office in the UK in the 1970s.

The proposed Singapore qualification, like other chartered accountancy credentials, seeks to train not just accountants for the audit profession but also expertise in financial areas such as internal audit, risk management, tax, valuation, as well as CFOs (chief financial officers).

Says CDAS in its early report: 'An accountancy profession with multi-disciplinary skills can play a strategic role in the growth and development of Singapore as an international financial centre and business hub.'

CDAS also proposes specialist professional training to develop expertise in internal audit, risk management, tax and valuation, as well as certification for CFOs.

The Big Four firms say that the introduction of a postgraduate practice-focused qualification is 'both essential and timely'. PricewaterhouseCoopers' top brass also voiced support for any move to help the re-entry of former professional accountants.

And the industry 'can definitely benefit from the diverse range of expertise and experience' that the entry of non-accounting graduates can bring, says Deloitte & Touche LLP.

Says Tham Sai Choy, regional head of audit at KPMG Singapore and a member of CDAS: 'I believe that the enhanced qualification will add great value to the credentials of every accountant in Singapore, and we will therefore strongly encourage all our accounting professionals to pursue this qualification. Needless to say, we will provide strong support to all of our professionals pursuing this qualification.'

The Institute of Certified Public Accountants of Singapore (Icpas), the national accountancy body, is expected to develop and administer the new qualification, together with a proposed new Singapore Accountancy Council that will oversee the sector's strategic directions.

Also proposed is a $10 million Accountancy Sector Development Fund to finance the various initiatives over the next five years, from building skills to encouraging small audit firms to merge and go regional.

Also on the cards is an increase in the audit exemption threshold, from the current $5 million revenue, to probably $10 million.

Mr Chin and his CDAS team held more than 70 meetings with the various stakeholders in their review, including dialogue sessions with accountancy undergraduates.

There are some 16,000 CPAs in Singapore, and another 4,000-plus provisional members. Not all of them practise in the more than 500 audit firms here; many are in finance jobs in industry. The proposed new qualification aims to enlarge the pool - with regional sources as well.