Monday, 19 September 2011

I want to be an Accountant!

I want to be an Accountant!
Accountancy refers to the practice of recording and reporting changes in an entity’s assets, liabilities, revenues and expenses, over a period of time. Accountants worldwide prepare financial statements of companies and other organizations, file tax returns or work as independent or employed auditors and even as consultants and advisers on financial planning and management, taxation and financial decision making. Accountants are mostly employed by audit firms. But they are also employed by almost every organization and sector of the economy i.e. banks, governments, insurance firms etc.

The profession has been one of the most lucrative since the 20th Century, and day by day as economies expand into newer dimensions, and public reporting and the need for compliance with the corporate laws increases, and as the states make smarter tax laws, the need for accountants is set to keep growing in the future too.  According to the US Bureau of Labor Statistics, job prospects for accountants and auditors are expected to grow by 22 percent between 2008 and 2018.

Accountants all over the world, especially those with notable certifications earn well beyond their respective countries’ Per Capita Income, and enjoy a more than modest lifestyle. Estimates suggest, that entry-level accountants in most countries, earn in the range of USD$ 55,000-USD$ 70,000, annually, which jumps to USD$ 70,000-USD$ 80,000 after four to five years of experience and exceeds USD$ 100,000, in case of partners of audit firms.

Moreover, Pakistani accountants are in a relatively high demand, mostly in the Middle-Eastern economies, like the United Arab Emirates, Saudi Arabia, Qatar, Kuwait and Bahrain. This is mostly due to the dynamic and rigorous accountancy courses like the Chartered Accountancy course offered by the Institute of Chartered Accountants of Pakistan (ICAP) and the extensive internship, which the students must go through to earn their certification.

These courses not only meet international standards and requirements, but surpass them as they are supposed to-primarily-meet the requirements of the Corporate Laws of Pakistan, which are some of the toughest and smartest laws, in world. An evidence of the effectiveness of these laws is the ever-resilient banking, financial and corporate sector of Pakistan, under the supervision of the State Bank of Pakistan and the Securities and Exchange Commission of Pakistan.    

However, today accountants are mostly certified by the respective worldwide accountancy bodies chartered by the State. Other than these, some independent private institutes and professional associations worldwide, also offer credible certification programs in accounting. The pursuers are mostly required to clear mandatory examinations and fulfill experience requirements, to be eligible for a Certificate of Practice.

In some cases, a Masters in Accounting or a related field is a pre-requisite for a certification. Notable designations remain the FCA, ACCA, ICAEW, IAT, CPA etc.  Alternatively, students can enter the profession with either a degree in Applied Accounting or a Masters in Accounting, or any other relevant field, with sufficient experience. It could take one, three to five years, depending on the program on an average, to become a recognized accountant.

If you are good at crunching numbers, keeping records, remembering laws and practices and applying them appropriately, time and time again, and have enough motivation and are a diligent worker with a mind for good social status and a top-notch salary, accountancy is a career you could go for.

But becoming an account with a notable certification was never an easy game. It still isn’t! Some of the certifying institutes are well notorious for their unexpected, insufficient release of information to the students about the curriculum and a constant mismatch between the syllabus content and areas which are ultimately examined. This is further exacerbated by outrageous demands on the students’ intellectual capacity, with syllabi that are highly versatile and advance and vast in their approach, along with severe time constraints.

Nevertheless, the esteem and benefits a coveted certification brings, is worth it all! Hence, the number of students opting to be accountants, especially Chartered Accountants, has trebled in the last decade. The traditional charm and the fact that economic recession has left lesser opportunity for other career professionals or made competition tougher for them, more and more students want to be accountants and hopefully, get a highly rewarding job in Pakistan or preferably, abroad!

This has turned this profession into a millions of rupees worth industry. Heavy-weight certification bodies like the Institute of Chartered Accountants of Pakistan and the Institute of Cost and Management Accountants of Pakistan; are also engaged in scuffles (locally and internationally), in order to protect and increase their supplies to the job market and enhancing the credibility and worth of their respective certifications, by virtue of continuously upgrading their syllabi to align with the local and international industrial needs.

In addition, where there were no formal teaching centers two decades ago, there are more than one could count on fingers, today. Each institute battling it out with others to get hold of the best teachers and attract the most students. Not to forget the neighborhood coaching centers and the self-employed house tuitions providers.

Surging demand has made room for hundreds of new and inexperienced teachers, to make good and easy money. Some well-off and experienced players, with a mind for business, are also setting up training institutes effortlessly. In all the drama, students are the major sufferers.

No institute is perfect! Some have the facilities while some have the faculty. Some have results while others have even better results. Some are new, while others have been around for some time and enjoy a good reputation. Each of them is bombarding students with their cheap promotion, scholarship offers and faculty and just about anything they can to sell themselves. And when teachers switch institutes or set-up their own, they use their influence and name, to attract prospective students.

This is confusing for the students, as they must now choose between the teacher and other training centers in the market. Not only this, in an effort to make the right choice, they must research about the background of each subject teacher, because there are just so many of them now! Should I go to a place that boasts high-achievers or should I join a place that has the most renowned teacher on their faculty? Do I have a rational answer to all this penetrating promotion? All this to follow after the grueling process of career selection!

 However, the key to selecting the best training institute is a combination of everything. That is to say, a preferable choice would not only possess a reasonable faculty but an equally good management and experience, along with good results or pass rates, complemented by the caliber of audit or training firms their students land in. As for a preferable certification or degree, it shall be discussed some other time. 

All the same, competition has led to making accountancy one of the most cost-effective programs to choose in Pakistan. Medicine, Business Administration and Engineering, and programs in Arts, if undertaken at private universities, are considerably expensive to be within an easy reach of the common man. On the contrary, state funded institutes are affordable, but are equally deficient in their curriculums as compared to private universities, in most of the cases. 

Plus, a career in accounting is a rewarding career in terms of salary and benefits, with a much significant substantial assurance of job security, and an ever growing number of positions for accountants in the industry. On the other hand, being an accountant still limits the prospects of climbing the organizational ladder in years to come unlike an MBA. Most accountants remain in the same organizations with little or almost no promotions, for their entire careers. This is changing!

Accounting programs are being modified to meet this deficiency, integrating in knowledge from other core areas of business, like management, human resource, marketing, and leadership.  Each addition or alteration makes the course more difficult, the demand for accountants to widen, and the competition in the training industry, crueler.

In any case, be it any profession, it’s the student’s ability, hard-work and commitment, which ultimately make the difference in end. Teachers and institutes are only stepping stones. Solid stepping stones will make the journey to the top, pleasant. Weaker stones or incorrect ones altogether, shall lead to a shaky and bumpy ride, a ride that could cause an accident as well! The war is on and it’s the survival of the fittest. The profession has been among the fittest for decades, but are we prepared to meet its standards?

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Thank you very much for your reading. Your valuable feedback is awaited.

Mustafa Mustansir, CFC