The government is considering allowing companies to recruit accountants from overseas.
However, before they decide to make the move, these professionals should consult industry players about Hong Kong’s training and qualification system.
Big accounting firms have a different playing field than their smaller rivals.
Typically, they have big clients such as listed firms or multinational companies. They are the first choice for many new graduates.
However, big accounting firms have not been recruiting fresh graduates in recent years.
Instead, they prefer to hire graduates who did not major in accounting but who were educated overseas and have a decent family background.
These graduates have obvious advantages in foreign-language communication.
In many cases, accounting firms offer contracts of one to two years and a “conversion program” for new graduates.
Leading accounting firms have no talent shortage but they would hire from their rivals or move people up within the company.
That means there is little chance for those who have worked in smaller local firms to break into the big league.
By contrast, smaller local accounting firms face hiring challenges.
There is little motivation for fresh graduates given the uncompetitive salaries and limited recognition in the community.
The starting salary at these firms is about HK$10,000, sharply lower than those offered by bigger firms.
Moreover, these smaller players are grappling with intensifying price competition and soaring labor and rental costs.
Also, regulatory authorities and industry bodies such as the Hong Kong Institute of Certified Public Accountants, the government and the public have increased their scrutiny of auditors.
Small firms have weak pricing power and insufficient resources, limiting heir ability to train new employees.
The institute has 40,000 members and 17,000 student members but the industry still lacks the proper talent.
Some fresh graduates struggle with balance sheets and the basics of accounting, such as double entry.
More than 80 percent of fresh graduates are in that category.
And even those who have had two to three years’ experience are not much better.
The examinations organized by the institute barely cover the basic principles of double entry.
This is because the tests are geared toward candidates who have already completed a bachelor’s degree in accounting or undergone the “conversion program”.
That is one of the reasons substandard accountants are flooding the market.
This article appeared In the Hong Kong Economic Journal on Jan. 23.
Translation by Julie Zhu
– Contact us at [email protected]