2010 - December
Address by Dr Ernest Kan, President of ICPAS, at the SMU School of Accountancy Research Centre Launch
15 Dec 2010 Category: Speeches
Ladies and gentlemen,
I would like to take this opportunity to thank Professor Arnoud De Meyer, SMU President, and Professor Pang Yang Hoong, Dean of SMU School of Accountancy, for inviting me here for the opening of the SMU School of Accountancy (SOA) Research Centre.
I am also delighted that today, ICPAS and SMU SOA will be signing a Memorandum of Understanding (MoU) that promotes high quality practice based research with an Asia perspective.
• Asia has proved itself to be the next engine of global economic growth by leading the world recovery. According to World Bank estimates, the average real GDP growth of Asia and the Pacific is 7.9% over the period of 2010 to 2012, whereas, the average real GDP growth for the world economy is just 3.4% over the same period. This startling statistics suggests that Asia is growing more than twice the rate compared to the world economy.
• Advanced economies are experiencing much slower growth compared to the developing world due to the rapid rise of emerging economies including China and India. The declining trend of GDP growth of advanced economies has been accelerated by the global financial crisis in 2008-2009. By 2020, the global balance of economic power may shift. China is projected to overtake USA to become the world’s largest economy by around 2020.
• The rise of Asia creates a window of golden opportunity for Singapore to establish a strong presence in the region. Singapore, arguably regarded as the gateway to Asia for the Western world, is well-positioned to seize this opportunity. Singapore has to remain dynamic and relevant in the new world order to stay ahead of competition.
• The release of the Economic Strategies Committee (ESC) Report by the Singapore Government this year marks the beginning of an exciting change that will transform Singapore over the next decade. “Highly Skilled People, Innovative Economy, Distinctive Global City” form the core pillars of ESC’s 2020 vision for Singapore.
• National productivity has to grow through deepening skills and expertise in every sector of the economy. The economy has to undergo improvements, innovation and restructuring across sectors, enterprises and within industries. Lastly, Singapore’s future rests on being a global city and a meeting point in Asia for enterprise, talent, cultures and ideas. Thus, the accountancy sector can play a key role in Singapore’s growth by creating higher value-added services and being a regional hub for global accountancy entities with operations in the Asia Pacific.
• All this talk is not without an impetus. As you are aware, the Committee to Develop the Accountancy Sector (CDAS) was set up to conduct a comprehensive review of the accountancy sector to transform Singapore into a leading global accountancy hub by 2020. The pro-tem Singapore Accountancy Council has already begun work to implement the CDAS recommendations. This is a national vision and the race is on.
• Being dynamic often means being innovative. Innovation is typically associated with research. CDAS recognises this correlation and has highlighted the importance of research through one of its recommendations.
• CDAS recommendation 3 describes the setting up of the Accounting Services Research Centre (ASRC). The objective of ASRC is to ‘promote high-quality and market-relevant research in order to position Singapore accountancy sector strongly for new and emerging opportunities in the professional services market’. In short, ASRC is to provide thought leadership for Singapore through its work. This is now translated into action, as the pro-tem SAC, in the first month of its inception, has set up four sub-committees to look at key areas. One of the key areas is the establishment of the Accountancy Services Research Centre.
• The ICPAS Research Funding Grant was started by ICPAS research division to encourage quality and timely applied research pertaining to accountancy and business, especially in the region. This provides the impetus and the funding for researchers to explore issues that will impact the accountancy profession.
• With ICPAS Research Funding grant, we aim to do our part to support efforts to promote research projects. Till date, we have supported more than 5 research grants in the areas of China, fraud responses in Singapore, fair value accounting and XBRL Reporting.
• More information on the grant and the application form can be found in the ICPAS Research website as seen in this slide.
• Throughout the decades, accounting research has significant impact on the accounting practice. In order to influence and shape the accounting profession of the future, we must understand the concerns of businesses and explore practical solutions to tackle them.
• The signing of the Memorandum of Understanding (MoU) between ICPAS and SMU School of Accountancy today demonstrates the readiness and commitment of ICPAS and SMU to contribute to the profession. This partnership creates synergy and serves as a platform to connect the accounting profession and the academia, to co-develop research projects and thought leadership research activities.
• Recently, the EU Green paper on Audit Policy: Lessons from the crisis, covered issues such as the concentration in the audit market and its implications on financial stability, the emergence of small and medium sized practitioners, the audit of SMEs and international standards on auditing. Countries outside the EU are already looking to the Green Paper and considering whether they want to adopt similar proposals. So what are the implications for Asia?
• As we ponder over it, one can expect more forums and seminars to discuss such thought-provoking and revolutionary issues in the accounting industry. I will greatly encourage active participation from ICPAS members, the academia and the business community. This is a strong catalyst in understanding business concerns and trends, which ultimately enhances the capacity and the capabilities of the accountancy profession.
• Eventually, this creates a thought and practice leadership multiplier effect and supports the CDAS recommendation to position the Singapore accountancy sector strongly for new and emerging opportunities in the professional services market.
• This partnership is about actively creating value for the many stakeholders of our industry, namely, businesses, the government, the professional accounting bodies, accounting professionals and academia institutions, both locally and internationally.
• During the 2010 IFRS Regional Policy Forum in Singapore, Sir David Tweedie, International Accounting Standards Board (IASB) Chairman urged Asia, ‘to stake your claim to an international standard... Asia’s economic power is rising and it has a voice. It's been pretty quiet but now as you are moving into the standards, we want you to speak up and speak up loudly.’ As the regional gains greater prominence in the global marketplace, Asia should be more active in shaping international accounting standards.
• The landscape ahead is one filled with creating value through collaborations and partnerships for the purpose of advancing the accounting industry.
• Singapore is no longer just a passive receiver of international accounting standards and regulations. We are joining in the discussion to share our experience and in the process, creating value for the international community.
• This is illustrated through SMU hosting IAAER World Congress of Accounting Educators and Researchers in November 2010. This brought together researchers and industry practitioners from the International arena to discuss and share leading accountancy issues. The free public symposium on IFRS allows for increase networking opportunities and knowledge sharing with the public. In November 2010, two auspices (Accounting Education and Ethics) under the International Federation of Accountants (IFAC) also held their meetings in Singapore.
• To ensure that the accountancy sector maintains our dynamism, we must constantly innovate, build new knowledge and capabilities, and raise our competencies and effectiveness. High quality market relevant research positions the Singapore Accountancy sector strongly for new and emerging issues relevant to Singapore and the Asia-Pacific marketplace.
• The ten recommendations by the Committee to Develop the Accountancy Sector (CDAS), which have been adopted by the Singapore Government, support the key strategies of the ESC to anchor Singapore as a Global-Asia financial and business hub that connects the global and Asian business community. I hope all of us here are inspired to be more engaged and proactive in being a voice for the profession and shaping policies.
• Singapore’s ten-year journey to become the leading global accountancy hub in Asia will require us to forge confidently ahead and be agile to adapt to changes. Echoing the recently concluded Singapore Accountancy Convention’s theme, we must be “A Profession on the Move” to achieve this vision.