Body says accounting key to corporate moves in COVID-19-period

The COVID-19 pandemic has redefined the role of accounting professionals, increasing their say in corporate decision-making, as sustainable business development has become more important than ever amid protracted uncertainties, said one of the world's biggest professional accounting bodies.

The Association of Chartered Certified Accountants, or ACCA, will seek to help Chinese accounting professionals meet today's requirements by further embracing digitalization and technology, as part of its continuous commitment to the Chinese market, said Jenny Gu, president of the ACCA.

The COVID-19 pandemic has depressed the global economy and shocked the business world. From a global survey of ACCA members in June on the business impact of the crisis, the most widespread concern was regarding the impact on organizations' stakeholders. Stakeholder safety and health remain urgent concerns.

Almost 60 percent of respondents cited reductions in employee productivity, while nearly 40 percent of respondents were experiencing cash-flow issues, a particularly acute challenge for smaller organizations.

For a minority, there are small but growing concerns about financing and debt obligations, which could rise in the coming weeks, the survey indicated.

"Taking immediate actions as a response to the pandemic is important in the short term, but sustainability is more significant in the medium and long terms for enterprises to survive, relying on sophisticated analysis on cash flow and prioritized investment, to ensure the business can recover," said Gu.

Accounting professionals have the responsibility to help enterprises find core value, which they can create even during the pandemic, she said.

To cope with the challenges brought by the health crisis, government spending has increased dramatically all over the world. For the ACCA, the concern is that public sector fiscal commitment and interventions are not being captured accurately by governments, due to the way they account for the spending in the public sector.

In an ACCA research report, experts called for governments to use public sector balance sheets to properly manage financial resources and make sustainable plans amid the pandemic, paying attention to the net worth of public spending. For some, this means a shift in accounting methods from cash-based accounting to accrual-based accounting.

"This approach can improve decision-making, act as the benchmark for new fiscal targets, and support governments to rebuild economies for a more inclusive and greener future," Gu said.

The COVID-19 pandemic has accelerated new innovations and changed ways of working, which also promoted digitalization in financial and accounting services.

"Accountants and finance professionals should improve skills of transferring big data into valuable information and insights, taking advantages of technology," Gu said.

"Embracing digitalization is key to transforming work experience for accountants, and new ways of working will accelerate a move toward digitalization and promote careers that are intellectually challenging and driven by a renewed sense of purpose."

Talking about the development plan in China for the next five years, Gu confirmed that the local strategic plan will follow the global development initiative, aiming to be the world's top professional accounting organization and network, and pave the way for sustainable development.

The immediate focus for this year and the next will be on member support and retention, exam delivery, innovation and financial sustainability. "Innovation is one of the priorities, along with integrity and inclusion, and so all of our work will be aligned with this strategic plan," Gu said.

The ACCA, she said, is expanding its strategic partners, especially from the private sector. It cooperated with Alibaba Group and jointly develop a course on digitalization.

In November 2019, Gu became the first-ever elected female member from China to serve as ACCA president.

"When I became (ACCA) president last year, I made a commitment to champion diversity and inclusion, to make these the main themes of my year in office," she told China Daily.

"The ACCA has a proud record of creating opportunity in our profession, and I am passionate about encouraging diversity, including ensuring that women have the chance to contribute at the highest levels of business and government.

"Our targets have been strong, and we have made strong progress over the course of the strategy to 2020. But we are not complacent about the future, and our new five-year strategy to 2025 aims to future-proof us against the challenges ahead."