With the rise in emerging enterprises across the global, in
GCC specifically, the requirement of accounting profession has raised as well.
However, with this rise in demand, the accounting profession is facing a huge
shortfall which is expected to reach 3.5 million by the year 2025. This set of
circumstances has put an intense accounting and finance services demand on
businesses and their finance leaders and Chief Financial officers (CFO). GCC,
Dubai particularly is surging forward toward the evolving of its economy
therefore it is one of the top countries that require accountants in present
and near future. Here we will investigate the reasons for GCC's downturn and
solutions to address them. Additionally, we will discuss how companies that are
affected by this downfall should outsource the existing expert accounting firms
to maintain their need of accounting and finance.
Factors behind GCC's Accounting Deficit
With the boost in businesses and the strict laws and
regulation of GCC, the demand for accounting firms has risen significantly,
with even small and medium-sized enterprises (SMEs) now prioritizing their
accounting needs. This surge in demand has intensified the shortage of
accounting professionals in the region, here are some key factors of this shortage:
Taxation Roadblocks
With the introduction of value added tax (VAT), it increased
the demand of accountants across the area since VAT compliance require proper
calculation and filing of tax at time which needs understanding to be done.
Besides, Tax regulations also change according to the different tax zones, in
GCC there are many foreign investors dealing in cross country transactions,
which increases the needs to understand and follows the laws according to each
zone, this further highlights the need of additional number of adept
accountants.
Stricter Regulatory Standards and Their Impact
In GCC the laws and regulations are quite strict and
inflexible (i.e., economic substance laws), staying updated with the
ever-changing laws can be a heck of a task for accountants. Hence, require
expert accounting professionals to meet the demand of regulatory standards.
Differences in Accounting Standards
GCC follows multiple accounting laws which includes; International
Financial Reporting Standards (IFRS), IFRS for SMEs, Sharia Compliance
Considerations, and sector-specific compliance structures. These multiple laws
require a keen knowledge and additional burden on accounting companies, also
the IFRS laws doesn’t not go with Islamic finance laws. Companies that fail to
comply with these laws lower their ratings and withdraw from the market,
opening space for additional accounting firms.
Skills Gap in the Workforce
GCC lack in skilled accountants who holds the degree of ACCA
or CPA or required certifications along with the knowledge of the
implementation of latest technology and data analytics. Local accountants may
lack the necessary expertise, leading the region to rely on foreign talents,
which are already deficient across the globe.
Competition from International Markets
With the intense competition with the growing top markets,
like south Asia, India and western countries, results in raising competition
and need of attracting talented accountants. Hence, GCC maintains a competitive
edge in attracting the best talent, which makes it unable to meet the accounting
demands of the companies.
Impact on Corporate Growth
The accounting functions directly relates with the company’s
health, without proficient and experienced accounting professionals a company
might struggle with financial reporting and compliance with regulations. This
lack of professional accountants also leads to flaws and inaccurate financial
data, which risks the company’s growth and stakeholder’s trust. This creates
added pressure for CFOs, who must manage finances amid these challenges.
Moreover, without expert accountants’ financial management
becomes a tough task rising the scalability issues. With no or low financial
management, Strategic Planning and decision making gets complicated rising issues
and chances of frauds. That being the case, one can say that without a
proficient working accounting system, organizational growth becomes
significantly hindered, making rapid and sustainable expansion nearly
unattainable.
Tackling the Accounting Talent Deficit in GCC
GCC can overcome the lack of accounting profession around
the region, by working on the following areas that need attention.
1. Strengthen local workforce Development
A major challenge faced by many GCCs today is the lack of
visibility into their internal talent pool and how to effectively manage and
leverage that talent for optimal performance. Government should work on the
local accountants by launching programs and investing in trainings that could
help in learning or transforming the accounting practices, it would attract and
strengthen the local talent. Furthermore, private companies should also
emphasize on working on the skill building of local talent to fill accounting
roles.
2. Improve Skill building and Education
GCC should encourage in providing accounting and finance
programs by collaborating with global accounting organizations. They should
further offer scholarships for local talent to attract more students.
International accounting certifications such as ACCA, CMA and CPA should be promoted
by offering incentives and sponsorships.
3. Encourage and Retain Global Expertise
By simplifying visa processes, supplying work permits to
qualified accountants, and providing competitive salaries and facilities, more
international accounting professionals can be drawn in. This could potentially
replace the need for accountants in the GCC, streamlining financial management
processes.
4. Strengthening Technological Capabilities
Dubai recently invested a hefty amount on technology,
similarly other countries in GCC should also invest in and modify the methods
of accounting by Implementing automation in accounting duties, which mitigate
the demand of manual work of finances, these latest software and technologies
not just increase productivity but also reduces the burden of hiring more
accounting experts.
5. Encourage Collaborative Industry Efforts
Government and Private sectors should work together to
create accounting talent pipeline, by offering attractive packages, incentives,
and promoting accounting as a prestigious profession to attract young and
energetic talent.
The Evolving Challenges for Accountants
As the need of accounting profession is increasing the
challenges for accountants are also rising with the evolution of technology, AI
and strong attacks, thus without a professional accounting expert it’s
impossible to manage the forthcoming challenges. Let’s discuss few the major
obstacles accountants can face in today’s day and age.
- Remote work: It can be critical for accountants to manage
finances and productivity with the rise of remote jobs.
- Cyber Security: With the electronic data storage systems,
the risks of frauds and breaches have increased significantly
- Artificial Intelligence: The rise in AI has automated many
routine tasks leaving many low-grade accountants jobless and can lead to
further job displacements for less skilled accountants in future.
- Big Data: Managing and analysing the vast amount of data
and its continuous increment is a demanding task which require expertise and
advance tools.
- ESG Reporting: The surge in requirement for ESG reporting
which are the non-financial indicators, has made it difficult for the on-going
incompetent accounting firms to provide these facilities.
SS&Co: Your All-in-One Accounting Solution
SS&Co. is a comprehensive solution to all the emerging
issues. Companies facing the concerns of accountant’s shortfalls or less
skilled accountants can outsource their accounting functions to SS&CO. We
have a skilled team of workers who executed various projects skilfully, we
further understand the need of robust accounting system that could deal with
the upcoming cyber security risks and management of big data. At SS&Co we
use latest technological tools and softwares that minimizes the financial risks
and manages team working remotely to assure full productivity. Our team is not
just expert in financial reporting but non-financial reporting like ESGs as
well. With us as your accounting partner, your firm’s present and future are
well-protected.
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