Archives For Accountants for Business

leaders

By Mark Cornell, market director – Western Europe and North America, ACCA

This week, we launch a new ad campaign called “Aspire to Lead

With posters in London Underground stations (Holborn and Euston for example) and online, we’re shouting loud about the value of accountancy and finance professionals to business.

We have real accountants in the ads – yes, real ones – who have agreed to be the stars of a campaign that illustrates accountancy is a great career choice. They – and we – believe that training to be an accountant gives you the skills, knowledge and strategic insights to climb the career ladder in many sectors, in many countries.

The “skills” word has come up in the news a lot recently – from Barclays CEO Anthony Jenkins in the Sunday Times, to Travelodge’s Chief Executive Peter Gowers, and Dame Pauline Neville Jones from Business in the Community talking about skills on BBC Radio 4’s Broadcasting House recently.

These business leaders expressed concern about whether schools were equipping young people with the ‘life skills’ they need for employability. They said there are still basic gaps in literacy and numeracy and so young people seemingly lack the essential “skills of everyday life”.  Gowers said he has to train apprentices and young staff on how to shake hands, and get eye contact. They were echoing Jenkins’ comments in the Sunday Times, where he said the UK is in danger of having a nation of awkward teens – unable to shake hands and get eye contact.

Helen Brand OBE, ACCA’s Chief Executive, wrote recently in City AM that the lack of soft skills can affect the bottom line, and that we need to see younger people as assets to business.

With the right training, development and mentoring – and perhaps a smattering of natural talent – young people can reach their aspirations to become confident leaders.

The leadership equation

Relevance is also part of this leadership equation. ACCA has always believed in providing a qualification that is relevant to today’s business market, providing accountants and finance leaders that the world needs.

This is why the ACCA Qualification not only covers the technical skills such as taxation and audit, but also management accounting and performance management. And there’s also a soft skills module which all ACCA members can now complete an optional professional skills module during their studies. This includes two modules – Communicating Effectively and also Working Relationships.

As a parent myself, perhaps we’re a bit too hard on youngsters – we’re expecting them to hit the working ground running; we tend to forget that these digital natives are ahead of the curve when it comes to exploiting technology, and this is a definite skills-set business needs.

I know from personal experience, starting as an apprenticeship with BT, just how important it is to not only learn the technical skills to do your job, but also to develop communication skills.

Starting at an apprenticeship level you have to prove you have the all-round ability to rise through the ranks and become a leader. Being a leader is about more than just knowing your job. It’s about being able to communicate effectively with everyone, regardless of their level. Being able to negotiate, being able to inspire confidence in those around you and motivate them.

Apprenticeships are a hugely important route in to the workforce and over the past decade we’ve seen a huge rise in the number of businesses offering apprentice-level training in finance. This has opened the profession up to talented individuals who may not be able to afford to go to university, or who are put off by the ever increasing amount of debt that today’s graduates are carrying. We believe that is a hugely positive thing. ACCA has always believed that becoming a finance professional is about ability and dedication, not ability to pay for a degree.

So for those aspiring to lead, what does the future hold? Previous research from ACCA and IMA called Future Pathways to Finance Leadership revealed that to get ahead, the CFO of the future needs to understand and handle risk, have strategic insights, be tech and data savvy, be prepared to be an excellent deal maker and possess excellent leadership skills, communication skills, strategic skills and change management skills. They need to be The Complete Package.

It’s clear our Aspire to Lead stars have these skills in abundance. They also prove that ACCA members are plying their knowledge and (soft) skills in every sector across most markets across the globe – from traditional accountancy practices, to the Big 4 to oil and gas to technology, to corporate and financial services and of course in the public sector.

I’d love to hear what you think about leadership and meeting aspirations. Leave your views in the comment section below this blog, and I hope you see our ads soon.

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By John Davies, head of technical, ACCA

It has always been the case that the first step for any entrepreneur wanting to set up in business is to work out what structure would be most appropriate for their business.

For many people, the choice of business form will seem fairly straightforward. If you want to protect your privacy and retain complete control of your business, and are prepared to be financially responsible for its debts, you will probably choose to operate as a sole trader or with trusted colleagues in a partnership. If on the other hand you value the protection of limited liability status you will opt to become a limited company. These two fundamental forms have each existed for well over a century and remain hugely popular.

But it is no longer true to say that the choice of form available to new entrepreneurs is quite as black and white as the above would suggest.

Recent years have in fact seen a significant expansion of the diversity of business forms available to new and existing businesses. Here are a few examples of this movement:

  • The limited liability partnership (LLP) was introduced in 2000. The LLP is a hybrid form, half-way between a partnership and a company. It has the hallmarks of the traditional partnership in that its partners are free to arrange the firm’s internal affairs more or less as they see fit, but it resembles a company in that it is a corporate body and is required to prepare and publish annual accounts. The LLP is available to any type of business but is especially attractive to professional firms that wish to take advantage of protection from personal liability for their individual members.
  • The community interest company (CIC) is a company structure which is expressly intended to be appropriate for enterprises with social or community benefit in mind, rather than purely for the financial advantage of its proprietors. To achieve this the format requires profits made by the company to be ‘locked in’ so as to be channelled towards furthering its corporate aims.
  • Public service mutuals are a new vehicle designed to deliver functions hitherto delivered solely by the public sector. The UK Government is actively encouraging the take up of mutuals as a means of cutting central government costs and has raised the prospect of 1 million public sector workers being transferred to mutual by 2015.

A new report by Tomorrow’s Company, contributed to by ACCA, reviews the new landscape of UK business forms and urges entrepreneurs, advisers and governments to consider the opportunities that are afforded by this expansion of choice.

What choice means is that, for the entrepreneur, it need no longer be a straight choice between partnership and company – depending on the motives of the person starting up the business, one can now contemplate becoming a social enterprise or a charitable incorporated organisation as well as a sole trader and a company limited by shares or guarantee.

From the perspective of government, the report argues that more attention needs to be paid to business form when considering its dealings with private sector businesses and the issuing of contracts to them. It poses the question of whether companies with overtly commercial business and funding models are the right sort of entity to be delivering public services, referring, as an example, to the recent case history of care homes being taken over by listed companies which have aggressive funding models.

And for advisers, such as practising accountants, it means that there is a much wider range of information that they can provide to clients wishing either to set up in business from scratch or to review their existing structure or form.

What this all means is that businesspeople today have more options as regards the structure of their firm and more freedom to organise the way they organise their business so as to align it with the expectations of their consumers and stakeholders. The report makes for interesting reading by any one who has ever felt constrained by the choices available to them.

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By Sarah Hathaway, head of ACCA UK

Ask the question ‘what do you want to be when you are older?’ to a group of 12 year olds and you will get a variety of answers from premiership footballer to X-Factor winner, to more familiar careers like teacher. Having those dreams at that age is important, it’s good for children to strive to be famous or rich or to enter a career that helps others. In reality only a very tiny proportion of those that answer premiership footballer will have a career in sport. An even smaller number will be lucky enough to have a career in the music industry. A much larger number will end up in one of the many professions that are vital to the global economy, but how many of those 12 year olds that you ask will mention one of those professions – very few.

There are a couple of good reasons for this. Firstly, many of the professions are not considered aspirational – very few aspire to be an accountant, a banker, an HR manager. However, if you phrased the question differently you might get a different response. If you asked: ‘When you are older would like to work for Facebook, for Apple, for Manchester United, for Universal Records, for an organisation that has offices in New York, Sydney, Singapore and London?’ It would be expected that the number putting their hands up would increase significantly.

The second reason is that young people are often not aware of the vast range of professions out there, and even if they are, have little idea whether they can gain access to that type of career. Social mobility is a buzzword of the moment, but it’s critical that if we want to make sure young talent comes into the professions, we have to ensure they are aware of the opportunities.

While a career in the professions may not be aspirational it is highly rewarding, secure and challenging. During the recent financial crisis most finance professionals, especially accountants, not only remained in employment and received pay rises but also became more and more vital to their organisations. They are now playing a major role in forward planning and business strategy, not just tax returns and audit.

Professions are hugely important to the health of the economy: they keep businesses running, employing staff, paying tax and keeping GDP ticking over. So while being a professional might initially not seem an exciting role, the reality is that you will be at the forefront of your company, your decisions will carry weight right up to boardroom level and you will have the respect of the people who shape the company.

ACCA is one of the founding members of the UK’s first ever Professions Week, and I am the chair of the initiative’s steering group. Starting next week, it aims to raise awareness of what potential career and employment opportunities there are. Get more information via the Twitterfeed too.

“The talent agenda is vital” says Richard Moat FCCA, Chief Financial Officer at Eircom Group and Chair of ACCA’s Accountants for Business Global Forum, in this latest video about the changing role of the CFO.

He adds: “To be an effective business partner, finance people have got to understand the commercial realities of the business – have to have a strong commercial link as well as experience in finance.”

Richard also talks about how managing cost, rather than growth, is a big priority for CFOs today.

The Changing Role of the CFO report explains how the financial and business landscape is changing: greater uncertainty for the global economy, fluctuating energy costs, rises in commodity prices, currency fluctuations, government deficits and cost cutting.

The accountant in 2022

accapr —  6 December 2012 — Leave a comment

Drivers of changeBy Ng Boon Yew, chair of Accountancy Futures Academy, ACCA

As the Accountancy Futures Academy chair, I am often asked ‘So what does the future look like?’ As a practitioner myself, I think that the accountant that we know today will be different in ten years’ time – but how different?

For starters, the accountancy profession does not operate in isolation and its main challenges will certainly mirror those faced by the global economy. The areas that will impact the profession the most are: trust and reporting (strengthening public image by providing a more transparent, simplified but holistic picture of a firm’s health and prospects), regulatory expectations, standards and practices (a global approach), intelligent systems and big data (exploiting the repositories of big data), and finally, organisational remit (the increasing expectations that CFOs and the finance function should play a far greater role).

So how can a global accounting professional be better prepared to adapt and respond in a decade of uncertainty and rapid change?

As businesses adapt to a turbulent environment, accountants need to take on a far greater organisational remit, from strategy formulation through to defining new business models, the accounting professionals will need to embrace an enlarged strategic and commercial role. At the same time, accountants will need to focus on a holistic view of complexity, risk and performance and establish trust and ethical leadership. There is growing consensus on the need for reporting to provide a firm-wide view of organisational health, performance and prospects and must acknowledge the complexity of modern business and encompass financial and non-financial indicators of a firm’s status and potential.

Accountant’s global orientation, the ability to master the technical, language and cultural challenges of cross-border operations will be in the spotlight as the pace of global expansion of firms from developed and developing markets increases.

Lastly, the profession needs to reinvent the talent pool. The diverse range of demands on the profession is forcing a rethink of everything from recruitment through to training and development. Entrepreneurial spirit, curiosity, creativity and strategic thinking skills could be the key competences in the selection of tomorrow’s accountants.

There are significant uncertainties about how the driving forces will play out but the accountancy profession will need to be nimble enough to adjust and evolve and be able to maintain the balance between entrepreneurism and pursuing the highest standards of financial stewardship.

How certain is this? From my point of view, pretty spot on but only time will tell!