Best friend of a small business is small practice: ACCA Helen Brand

Brand said that small firms need to upgrade tech and India can have its own big four firm through consolidation of smaller firms

Helen Brand, chief executive of the Association of Chartered Certified Accountants (ACCA), the 120-year-old global body of professional accountants, talked about developing future-ready professionals in the world of artificial intelligence (AI) with sustainability focus, in a conversation with Ruchika Chitravanshi in New Delhi. Brand said that small firms need to upgrade tech and India can have its own Big Four through consolidation of smaller firms. Edited excerpts:

  

Can you elaborate on ACCA's presence in India and your future outlook?

 

We now have around 3,000-plus members in India who are fully qualified and around 60,000 — we call them future members — you might refer to them as students. They are people studying at various levels with the ACCA.

 

We've recently upgraded our audit standards to align with international norms amid some pushback. What do you think is in the best interest of India?

 

ACCA has had a position of promoting international standards for many decades. We were the first accountancy body to incorporate international financial reporting standards into our syllabus in 1996. I wouldn't be able to comment specifically on who should be doing what in any jurisdiction, including India. But, the more you can adopt international standards or at the very least align with them, the easier it is for international businesses and investors. There are usually specific national characteristics that need to be taken into account, but they can still align and be very transparent about why there are any differences if at all.

 

There have been concerns in India about smaller firms losing business to big firms. India wants to have a domestic big four firm as well. How do we address this?

 

It can happen through consolidation of small firms. Always, with these things, it has to make commercial sense. It is the same concern in the totally developed world. Consolidation or the dominance of the large firms is always a risk that the regulators are looking at. A lot of smaller practices in other parts of the world are becoming real entrepreneurs. But that's about small firms and small practices being prepared to change their business model through tech and not relying on traditional audit or traditional ways of performing audit. They need to be able to compete to give different types of services, particularly to small businesses. The best friend of a small business is small practice.

 

What is your view on the current state of India’s accountancy profession standards?

 

The value of the profession is understood here, unlike some parts of the world. The whole world is not yet prepared for sustainability and technology from a business, reporting and assurance perspective. India is working at the same pace as the rest of the world. But nobody has got there yet. So, there's still a lot of work to do.

 

Why has this been a challenge?

 

If you're going to report on sustainability, then the types of information, data and analysis you have to do are so much broader than purely financial. Integrating finance with other forms of performance data is more complex. Developing capacity, individuals and organisations of the systems are going to be a real challenge.

 

Is this something you are working on with professionals?

 

We're working with everyone as ultimately it will go a lot more widely in the market and specifically in supply chains (of bigger businesses) which means smaller businesses. But it's not about compliance, important though is in driving better behaviour and accountabilities to the public. If you're trying to address your carbon footprint, it's no good to just keep reporting that it's really bad. We are actually trying to give people the data and evidence to make the changes that are necessary to protect people, the firm as well as be profitable. If you want a future-ready business, you have to have future-ready people.

 

How do you see the role of AI for this profession?

 

We know all the things that can go wrong…lots of opportunities, but also risks associated with that. Quite often, the professional accountant can be seen as the ethical guardian of a business. So, they have to understand this dimension as well. We're embedding that kind of capability in the qualification and post-qualification as well.

 

Do you think it will cause redundancy?

 

No doubt AI and other forms of technology are going to take on the processing of routine tasks. We also see the scope of accountancy becoming wider. If we are saying that the future of the finance profession was only dealing with figures and financial performance, it might be a different story. But now, we're talking about the total performance of an organisation. It is a very exciting future for the profession.