Old hand plays it by the book
The 2015 Hong Kong Institute of Certifified Public Accountants president has not only seen but also participated in history in the making. Luo Weiteng reports.
An accounting veteran with over two decades in the profession under his belt, Dennis Ho Chiu-ping, 2015 president of the Hong Kong Institute of Certified Public Accountants (HKICPA), has been a true witness to the industry’s rise in the city and an active participant in shaping its future.
The thriving local economy back in the 1970s to 80s heralded the beginning of a golden era for Hong Kong’s accounting sector, as the city was building up its brand as a global financial center, a feat that called for an army of financial professionals, including those specialized in accounting.
As the mainland economy across the border took off, it made accountancy an even more highly sought-after and lucrative profession here in Hong Kong, as mainland companies queuing up to list in the city were required to hire international accounting firms as auditors.
Today, the city is home to more than 39,000 homegrown accounting professionals, their numbers swelling with each graduation year, and the local outlook for the profession continues to be encouragingly positive, noted Ho.
Accounting-related courses maintain their allure for a good many young local students, with more than 2,000 new accountants reportedly joining the profession every year. One draw may be that accountants are quite highly paid, with 40 percent of HKICPA members earning more than HK$600,000 a year, according to a membership survey published in 2015.
“No matter whether it is good times or tough times, you can always see accountants playing active roles. Demand for accounting professionals is a constant,” said Ho.
While the profession is often perceived as being limited to number-crunching, Ho noted it is much more wide-ranging. It can include careers in business operations, risk management, corporate restructuring, corporate governance or forensic accounting, and cut across a wide range of sectors, including private, government and nongovernmental organizations.
Ho believes accounting skills represent a basic knowledge that professionals can equip themselves with and move into other sectors. It is something that people can leverage to find out how to offer more value in positions held within their own organizations.
“The Certified Public Accountant (CPA) (qualification) is more of a stepping stone to bigger and better things, opening many doors for people,” said Ho. “The possibilities for CPA are far wider than just a career story of working for accounting and auditing firms.”
In the past few years, the accounting profession has constantly generated headlines amid a spate of regulatory dialogue.
The latest supplement of the Closer Economic Partnership Arrangement (CEPA), signed at the end of last November, aims to tear down more barriers to cross-border trade in services and allow more local professionals to set up shop across the border, thus seeing them poised to enjoy greater access to the growing services market in the mainland.
The new agreement, touching on sectors such as accounting, legal services, insurance, securities, banking and telecoms, will definitely help local CPAs boost their presence on the mainland, which has long been the biggest export market for Hong Kong’s accounting services sector, observed Ho.
However, Ho also pointed out that the service-oriented trade pact is “limited” to promising local CPAs enough involvement in the mainland economy and thriving accounting business, as a great deal of professional accounting business in the nonservice sectors still remains out of reach for Hong Kong CPAs.
One prerequisite for Hong Kong’s accounting professionals seeking to enter the potentially lucrative mainland market could be to become partners of mainland firms. Mainland firms, however, would need “a good commercial reason” for them to enter into such a partnership.
Ho believes tremendous work has already been done through the CEPA, which was introduced in 2013 as a way to boost the weak Hong Kong economy following the SARS (Severe Acute Respiratory Syndrome) outbreak. But more work needs to be done to push open the mainland door wider to Hong Kong professionals.
One heartening factor for the Institute regarding cross-border business activities is that a model for regulating listed company auditors is beginning to take shape, addressing another much-discussed issue that has grabbed the city’s attention for quite some time.
When the SAR government unveiled its proposal on the proposed regime-tightening in June, it triggered opposition from small and mediumsized accounting firms, which complained that the proposed HK$10 million maximum fine for misconduct was too high.
Ho said that the proposal, which calls for the setting up of an independent audit oversight body to improve the regulatory regime for auditors of listed firms, needs much more work on the details.
He added that the Institute expects to see a clear definition of the scope of the investigative and disciplinary powers of the new oversight body, as well as due process and checks and balances within the watchdog, which they hope would consist of professionals from the auditing industry.
Ho said the HKICPA will conduct consultations with members and other stakeholders as appropriate on reviewing the Professional Accountants Ordinance, which has been in place for 42 years and seen as outdated. Based on the consultation, the Institute will propose revisions to the ordinance in a bill that will include necessary changes following the introduction of the new regulatory regime.
Looking ahead, Ho believes a world of opportunities for Hong Kong’s accounting professionals would come from the country’s high-profile multi-nation “Belt and Road” initiative and the three pilot free-trade zones in Qianhai, Nansha and Hengqin in the Pearl River Delta.
“Hong Kong’s well-trained and highly professional CPAs are already ready to play a big part in these bold moves,” Ho signed off.
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