Table of Contents

Introduction. 3

Encouraging us to think and act global 3

Global Financial System (GFS). 4

Heads-up to plan ahead. 5

Holding up the fort. 6

            At personal level 6

            At guardian level 8

Conclusion. 9

Acknowledgement. 9

Introduction

Like many of us I despair when I still find we are relatively passive. Instead, we could be excitedly busy preparing ourselves to hold up people of our title, who have been landing on our realm in multitude from other countries to supplant our jobs.  Paths have been paved.  Most of the regulations and standards, name it financial reporting, auditing, taxation, laws, regulations etc, of our country are imported.  This is the mechanism of globalization; things have to be alike to live smoothly in a global village accommodating each other in reciprocity.  More and more of these convergences will happen in coming days.  This is a healthy practice, breeding opportunities for us to be internationally acclaimed for our feats, if and only if, we are par for the globalised competition.  Quite challenging indeed, but attainable!  No choice is left; we must be up to same level to survive, to cash in on those friendly gestures.

Encouraging us to think and act global

This article contains my favorite monologue to stir me up, to prepare myself for the ongoing globalised competition in the accountancy profession.  Accountants, produced by numerous accountancy bodies—locally and internationally, are finding the world their oyster, because in this era of globalization, governed by a maze of unified standards and regulations, there is no limit to the opportunities open to an accountant possessing core accounting knowledge with right skills.  Bangladesh along with Asia is growing.  There would be much need for capable accountants to play multifarious roles beginning with that of an accountant, progressing to consultants and many more designations.  If we pursue it to the fullest, we may end up being a business leader or the leader of the nation’s financial system to direct and drive a business or national finance of any size.  In fact, we have already happened to see a few ministers in our country including a finance minister who was an accountant.  Thanks to our pre and post-qualification training decorating and keeping us always ready to deal with developments in Global Financial System (GFS).  GFS is the seedbed for change in financial reporting standards and concurrent audit techniques.    

Global Financial System (GFS)

Global Financial System (GFS) is “The financial system consisting of institutions, their customers, and financial regulators that act on a global level.  It is defined as “various official and legal arrangements that govern international financial flows in the form of loan investment, payments for goods and services, interest and profit remittances.  The main elements are the surveillance and monitoring of economic and financial stability, and provision of multilateral finance to countries with balance of payments difficulties.  The organization at the centre of the system is the International Monetary Fund (IMF), which has the mandate to ensure its effective running.”

In a nutshell, it is the flow of funds without borders.  Many institutions interplay in this complex system for their best advantages.  We know funds are needed where there is a demand for their usage in productive or profit seeking activities.  Companies need funds either for survival or expansion, multinationals may redirect money routing back to its legitimate account in some polished location.

Therefore, financial companies, regulators and institutions operating on a supranational level in the global financial system can be divided into regulated entities (international banks and insurance companies), regulators, supervisors and institutions like the European Central Bank or the International Monetary Fund.  The system also includes the lightly regulated or non-regulated bodies – this is known as the “shadow banking” system.  Mainly, this covers hedge funds, private equity and bank sponsored entities such as off-balance-sheet vehicles that banks use to invest in the financial markets.”

Bangladesh will eventually enter into this rules-ridden financial market.  Then, off-shoots of these funding arrangements will inevitably be some items or instruments which we call derivatives—commodity based and cash flow based.  They will warrant high technical knowledge coupled with accounting skills, and prudence to play with fair value options within permitted limits.

The accountants’ role is vitally important in calculating the value and assessing the performance of those recognized items.

 

Heads-up to plan ahead

Built on earlier hints, domestic economies are increasingly being drawn into a global economy with a global financial system which will offer lucrative funding options to our government as well as to local business houses.  Loanable funds market has been shifting from West to East.  In the East, particularly in Asia, over last decades few countries have reached the equilibrium with enough savings to lend money to neighboring countries.  Contractual rules associated with those loans may bring about new and different set of rules contrary to or in addition to Western rules.  Established jobs and occupations may also disappear and new ones will emerge for accountants.  Given the difficulty of predicting which skills will be in demand in the years ahead, Chartered Accountants’ best career preparation is one that prepares us for those unforeseen roles.  Global finance in globalization facilitates this process.

Despite the pressure to keep our current job duties at bay, concepts of green business, green accounting, green taxation, agent banking (latest phenomenon) etc will demand accountants to do something more.  The team would be bigger with room for more experts, and guidelines will be in abundance suggesting us to work together.  Rules and alibis will be there to grind us.    

Holding up the fort

Sooner or later regardless of our dislike, we have to face the competition.  It is wise to get prepared for the onslaught rather than repentantly whining later about the burgeoning problems.  As Jack Welsh, the former Chairman and CEO of General Electric, said, “Control your destiny or somebody else will”, we must act now to control ours.

The following are indicative options, effects of which might not be visible as expected due to numerous reasons beyond our imagination or control.  However, sincere adoption of those suggestions may increase our competitiveness, because the recommendations are built on tested fundamentals to progress in life.

At personal level

• BEING GOAL ORIENTED is the best solution to this conundrum.  Goal orientation stems from our principles including Objectivity on which the whole profession hinges.

Pursuing a planned, set goal before starting the career can keep us self-motivated and full of energy.  Of course, personality traits and intuitions should be considered while we fix our career objective.  There may be better ways of calculating the profit and loss associated with a Chartered Accountancy degree than merely looking at salaries.  Chartered Accountancy degree can open up a vast horizon to explore letting us find pleasure in work.  Pleasant work will essentially drive away the three great evils (as Voltaire identified): boredom, vice, and need.

• We MUST KNOW WHAT WE DO—a building block for what we can do ahead.

• If I rank the qualities an accountant should hold to meet expectations of the business community at large, COMMUNICATION SKILL, unequivocally, is the most desired one we think of in particular.  Whatever we know, we must conceptualize it.  We should be at ease to present our repertoire in any circumstance.  Our work requires us to be able to transfer and receive information, defend our views comfortably, logically, and steadfastly. The ability to communicate effectively and in a pleasant manner, is essential to remain competitive and to succeed in our profession

Speaking in English before a group, like writing, is often an important part of our daily professional work.  In this activity, unfortunately, we do not always do justice to our pride of being accountant.  Planning before speaking can remove nervousness during a deliberation.  These are plain and handy tips.  Planning is the term frequently used in our audit guidelines!  Yet, at times we fail to plan!!

• The ICAB members, mainly the young members including myself, should BE FLEXIBLE, AMICABLE, ADAPTABLE, CREATIVE, PROBLEM-SOLVING, AND COMFORTABLE WITH NEW AND DIFFERENT THINGS.  We should not only be a bearer of traditional number crunching, but one who has the ability to think logically and to reason a problem.  We should be able to communicate the solution in the right format and so contribute to the improvement of ICAB’s image.

• We should ACQUIRE AND NURTURE SOCIAL SKILLS to find us more acceptable to others in the society.  When we meet people, they should cherish the memory of meeting us!

At guardian level

• EMPLOYERS SHOULD OFFER FAIR, REASONABLE WORKING ENVIRONMENT considering the fact that people spend almost half of their great time of a day at office tolerating nuisances, coping with more disagreements at work than they can at home.  Undeniably, job satisfaction is not independent of working ambience.  Professionals like ICAB members hanker after intellectually challenging, task-oriented jobs.  We like to work for goal pursuing organizations with an equitable reward system and congenial working conditions, to foster our motivation level for mutual benefits.  Thus, confidence of the people will be boosted and they will come to work feeling vibrant and energetic.  By adhering to Bangladesh Standard On Quality Control 1 (BSQC 1), Accounting Firms can be better employers in the job market.

• ICAB SHOULD SERIOUSLY CONSIDER THE LOOMING THREATS, AND FIND TIMELY, INNOVATIVE WAYS TO TRANSFORM US.  This would help us achieve our overall competitiveness, as desired for the sake of the benefit that ICAB can reap in its entirety.

Conclusion

“Survival of the fittest” is an evolutionary theory and it has an inspiring message for all of us.  For our combined efforts, if we can stand out then we would be exemplified by other professional bodies.  We would be respected, valued and given prestigious social status for our good karma.      

Acknowledgement

I owe thanks to all of the following for influencing my thoughts while writing this article.  They include:

1. http://en.wikipedia.org for supplying useful information
2. James W Vander Zanden, the Social Experience, An Introduction to Sociology
3. Stephen P. Robbins, Organizational Behavior, Fifth Edition
4. And, particularly my wife Fatema Akter MSS (MPhil) for her constructive criticism!