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The accounting profession deals with more than numbers. Certified Public Accountants (CPA) firms not only provide audit and tax advisory services, they are also engaged extensively in the provision of business consulting services to their clients in the private and public sectors.
Among the industry players, the "Big Four”, i.e., Deloitte, Ernst & Young, KPMG, and PricewaterhouseCoopers, hold a dominant share of the market. On the other hand, mid-tier international and local accounting firms also serve clients covering medium and small-sized enterprises both in Hong Kong and Mainland China. They all provide a wide range of professional services.
According to the Hong Kong Institute of Certified Public Accountants (HKICPA), its total membership number reached 40,034, with practising members increasing to 4,513 by end-June 2016. The profession keeps gaining momentum and growing, reflecting partly opportunities from China.
HKICPA recently announced that Hong Kong CPAs can now become partners in Mainland CPA firms, as long as they satisfy certain criteria, based on the extension of the scope of the Closer Economic Partnership Arrangement (CEPA).
Indeed, only about 30 percent of HKICPA members work in the practising sector. Among the rest, most of them are working in private business sector, while some work in government, not-for-profit organizations and academia.
Hong Kong CPAs, working in diversified, versatile and leading positions in various industries and sectors, play a very significant role in business and the capital markets. This is because they provide valuable professional services and support to the city which is an international financial market, as well as a trusted business and commercial hub.
Firms and businesses usually recruit candidates of all disciplines across core functions like audit and assurance, tax and advisory. Other lines of business include consulting, transactions and risk assurance, among others. Well-rounded accounting professionals specialize in diverse streams, industries and regions and bring added-value to their clients.
1. Audit and assurance
In accordance with Hong Kong Standards on Auditing (HKSA), auditors exercise professional judgment and maintain skepticism throughout the auditing process. They identify and assess the risks of material misstatement of financial statements, whether due to frauds or errors.
If the auditor concludes a material uncertainty exists, he is required to draw attention to the auditor's report in the financial statements or, if such disclosures are inadequate, to modify the opinion.
Tax is far more than taxes. With in-depth knowledge of local tax laws and practice, tax professionals help identify ways to reduce tax charges within the legal framework, prepare profits tax returns and assist in responding to queries from tax authorities. They offer a wider range of tax compliance and advisory services to meet the increased reporting requirements.
As the firms make excellent use of practical experience and knowledge across industries, they may advise on the corporate tax consequences of transactions, deliver tax advice on a broad picture and manage risks. Other services include tax due diligence and structuring, securitizations, merger and acquisition planning, and global and regional tax planning, among others. A sense of creativity and entrepreneurship helps here!
3. Business consulting / Advisory
Accounting firms can act like a business consultant to the client’s operations. In order to meet the strategic and operational needs of corporations, they may advise on strategy and business intelligence issues which involve regulatory, technology and risk management.
Professionals are exposed to a full range of issues and scenarios. They have to solve complex business challenges and help shape the future. Inspiring viewpoints and insights are very much welcome by the team.
4. Corporate finance
These specialists not only inhabit the glamorous world of initial public offerings and other fundraising measures, they also have grassroots knowledge of valuation and credit analysis. The right specialist is a person with initiative and a knack for problem solving.
5. Corporate governance
This specialization focuses on the establishment, testing and monitoring of internal controls and risk management functions, and understanding the role of directors and audit committees. The right specialist has a keen interest in the operations of a company and how processes and principles that govern a company are set up in order to elevate investor confidence.
6. Forensic accounting
Forensic accountants apply their knowledge to litigation and investigations covering risk management, fraud investigation, litigation support, dispute analysis and expert witness services. The right specialist is a natural sceptic with great interviewing and presentation skills who can simplify complex information for lay readers.
7. Information technology
This specialisation includes identification and assessment of information technology abilities, needs and strategies, covering IT budgets, infrastructure, software, procedures, staff and data. The right specialist is tech-savvy with an interest in translating accounting into technology.
8. Management accounting
Management accountants utilize business acumen and commercial awareness in providing analysis, planning and risk assessment to devise strategies for companies to deliver shareholder value. The right specialist is self-confident, assertive and has passion for the business, whether in engineering, manufacturing or services.
9. Restructuring and insolvency
This specialization requires knowledge of insolvency and winding-up procedures, creditor protection, schemes of arrangement, compulsory and voluntary liquidation and asset recovery. The right specialist has a good commercial mind and a business oriented attitude. He or she won't be so easily demoralized by the downs of the job (for example, losing potential clients).
10. Risk management
Accountants contribute to managing risk through properly executed financial forecasting, budgeting and internal reporting and countering dysfunctional and self-interested management behaviour. The right specialist has great communication skills (written and verbal). He or she also has a sound analytical mind and has the flexibility to travel.
1. Accountants in practice:
Associate -> Senior Associate -> Manager / Senior Manager -> Director / Partner
2. Accountants in business:
Accountant -> Accounting Manager -> Financial Controller -> Chief Financial Officer
Qualification required depends upon the business area you are interested in joining. For auditing, a member of Hong Kong Institute of Certified Public Accountant holding a practising certificate is a must as HKICPA is the only statutory body in Hong Kong to grant practising certificate. For other assurance and tax professionals, being a member of the Hong Kong Institute of Certified Public Accountants (HKICPA), or a member of good standing of a national accounting body in the jurisdiction of the company's principal base is recommendable. As for advisory professionals, apart from being a CPA, gaining a Chartered Financial Analyst (CFA) or Certified Public Valuer (CPV) qualification is recommended.
To become a member of Hong Kong Institute of CPAs, a candidate has to satisfy the following requirements:
1) hold an accountancy degree or equivalent qualification accredited or recognized by the Institute;
2) successfully complete and pass the Institute’s Qualification Programme*;
3) gain relevant practical experience with the Institute’s authorized employers or supervisors complying with the practical experience framework;
4) be of good character and a fit and proper person to carry the title of Certified Public Accountant; and be at least 21 years old.
*The most direct route to qualify as a Hong Kong CPA (practising) is through the Institute’s post-graduate Qualification Programme which equips students with accountancy knowledge and career skills.
1. Hong Kong Institute of Certified Public Accountants:
2. Global Accounting Alliance:
4. Ernst & Young:
7. HKICPA recognition of overseas bodies