For many of our readers November has been marked by the World Congress of Accountants held in Rome. Our reporter Vincent Huck and The Accountant editor Carlos Martin Tornero attended the sessions, networking and meeting many of the professions’ elite from around the world.
The theme of the congress was Vision 2020 and questions about the future direction of the profession.
Also this month we had yet another accounting scandal, with Tesco’s accounts under scrutiny in the UK. We also saw yet more investment by the Big Four in analytics business – including KPMG forming a so-called strategic alliance with F1’s McLaren Applied Technologies, as well as chaos with the implementation of the EU audit reform document, as member states start interpreting the rules. One could argue that it really is about time to commit to the future direction of the profession, and of audit, at this juncture when more than just backward-looking assurance on finances is needed.
The Rome congress was also marked by the International Federation of Accountant’s appointment of its first-ever female chair, Olivia Kirtley. I not going to start banging on about diversity in the profession or the lack of it again, but let me just hail this move as a great step forward and wish Olivia all the very best in her new role.
You can read a summery of the WCOA in this issue and the December issue of IAB for more behind-the-scenes content.
As you flick and scroll thorough this month’s edition you might detect a bit of an emerging market theme, as Vincent writes about the 1,000-strong Nigerian delegation at the WCOA. We also feature our first-ever survey and ranking of Nigeria, we speak to a funder of a Middle Eastern network with an appetite to go global, and I visit UC&CS in Mexico City as it marks its 20th birthday. And let me take a few moments to speak about our invitation to present our World Survey findings and meet this Latin American network/association.
It came from its leader Mauricio Mobarak and it was hard to say no. As much as we try at the IAB to present a global view by speaking to people from around the world, nothing can beat going somewhere in person and getting a feel for the market first-hand.
UC&CS comprises small member firms across Latin America, mainly led by former Big Four partners and employees, who have decided to set out on their own. While UC&CS still has a way to go before it can be seen as a competitor to some of the global mid-tier networks, it got me thinking about the emerging trend of non-Anglo Saxon networks, which seem very strongly to have a place in the market. Networks and associations like Chinese Reanda, ShineWing, Spanish Auren and Antea, Latin American SMS LatinoAmerica, UC&CS, Santa Fe, Russian FinExpertiza, Nigerian Stransact etc. All of them clearly show there’s a need for them in the market, and the future seems bright for many of these organisations as businesses turn to emerging markets for growth. I’m not trying to say that these businesses pose too much competition for any of the top 10 networks and some of the largest associations, but I do believe they add to the competition for member firms lower down the market, especially in emerging economies and for firms that are led by people preferring a more local touch.
The advantage these organisations have is knowledge of the local market and cultural know-how, but as many are built by former Big Four staff the technical skill and high quality are often embedded in the business, which to many local SMEs might sound appealing.
And I wouldn’t be surprised if some of these organisations start to connect and sign working agreements as they expand and try to hold onto clients looking to expand. It’s an area of the market far removed from large advisory investments, but nevertheless an important part that’s likely to shape the mid-tier landscape of the future.