CityU survey reveals “bottleneck” in local accounting sector
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The development of the accounting sector in Hong Kong may probably be in “bottleneck”, according to a survey conducted by City University of Hong Kong (CityU).
The results showed that local accountants rated their present job satisfaction and future prospects as 6.07 and 6.14 (out of a maximum score of 10), respectively, and rated the current and future advancement of the industry as below 6.
The survey, jointly organised by CityU’s Department of Public Policy and Department of Accountancy, studies the prospects and upward mobility opportunities in the accounting sector, one of the leading industries in Hong Kong. It was sponsored by the Public Policy Research Funding Scheme of the Central Policy Unit from the Hong Kong SAR government.
The survey was conducted by a team led by Professor Linda Li Che-lan from the Department of Public Policy (POL), with members including Professor Phyllis Mo Lai-lan from the Department of Accountancy and Dr Chan Ho-mun, Associate Professor in POL.To understand different factors affecting the operations of accounting firms, the team used questionnaires to interview a total of 428 accounting professionals from the big four accounting firms (Big 4), non-Big 4 accounting firms with listed clients, and small and medium-sized accounting firms with no listed clients between March and May this year.
Also, to understand the factors for choosing accounting for academic studies and the intention of joining the accounting sector, the team used questionnaires to interview 952 students majoring in accounting at eight local tertiary institutions.
According to the survey, respondents rated their satisfaction about their current position as 6.07 (against a maximum score of 10) and 6.14 for the future prospects of the profession.
In addition, respondents rated as 5.9 and 5.75 out of 10 for the current development status and future prospects of the profession, respectively. Both scores are close to the median and show that respondents don’t have high expectations about the future development of the profession.
The survey also studied respondents’ perceptions towards the stagnancy of the accounting industry. Among the factors affecting the operation of an accounting firm, it showed that the two worst internal management problems were “long working hours” and “high staff turnover”, with scores of 4.09 and 3.97 out of 5, respectively. It is noteworthy that the scores given by employees of the Big 4 for the above two aspects were 4.24 and 4.11, respectively, which are higher than the scores rated by employees in the other two categories of accounting firms.The area that received the second highest scores is the regulatory factors of accounting practices, with the scores of 3.72 and 3.71 out of 5 for “frequent changes of accounting standards” and “stringent regulatory oversight”, respectively.
“Rising rent” is also a factor affecting the profession, with an overall score of 3.61 out of 5 and a score as high as 4.14 given by small and medium-sized accounting firms with no listed clients. It shows that rental increases have had a serious impact on the operation of this category of accounting firms, which is similar to the situation of other small and medium-sized companies in Hong Kong.
In addition, respondents rated 2.88 out of 5 for “networking support from Hong Kong Institute of Certified Public Accountants (HKICPA)” and 2.70 for “attracting business investment to Hong Kong by Hong Kong government”. It reflects that the industry widely believes measures by the HKICPA and the government to exploit business opportunities are insufficient.
In the survey on undergraduates majoring in accounting, it was found that more than 75% of local students selected majoring in accounting as their first choice. However, if a second chance was given, 42.9% of respondents said they would not choose it as their major. Many of them (65%) indicated that it was too harsh to work in the accounting sector.
The research team suggests that with a view to the quality of young accountants, and changes in the needs of accountants due to technological development, the education sector may need to review the current curriculum such as the curriculum of the accounting profession to enable graduates to contribute to the future development of the Hong Kong accounting profession.