Keynote address by Minister of State for Trade and Industry, Mr Teo Ser Luck, at the Singapore Accountancy Convention’s ISCA Accounting Conference on 31 July 2014, 8.30am at Marina Bay Sands Expo and Convention Centre
1. It is my pleasure to be here with you at the Singapore Accountancy Convention 2014, themed, “Staying Ahead of the Curve”.
2. What does it mean for an accounting professional to stay ahead of the curve in this day and age? According to Yale University’s Professor Richard Foster, companies are getting bumped off the S&P 500 at an accelerating rate. Back in 1958, a company could expect to stay on S&P 500 for six decades. Now, the average is just 18 years. Since 2002, Google, Amazon, and Netflix have joined the list; while Kodak and the New York Times have fallen off the list. Fast paced technological innovations are creating a cascade of changes in all spheres of life. The leading companies of today could well be very different for our future generations.
3. Today’s businesses cannot stand still. They must tap innovation to raise productivity, improve products and processes, and enter new markets. To remain competitive, companies must also embrace change, and be ready to transform their business models in response to the changing environment, or they risk being overtaken by more agile competitors.
4. Against this backdrop of fast-changing business environment and disruptive technology, coupled with increasing regulatory complexity and globalization, it is therefore important for accounting professionals to stay ahead of the curve.
5. It is with this in mind that ISCA, as the national accountancy body, has organised this year’s Singapore Accountancy Convention. This year’s convention will focus on the key issues in Accounting, Auditing and Assurance, Ethics and Integrated Reporting.
6. Beyond embracing change, accountants should also seize the opportunities brought about by changes. Accounting professionals need to move beyond offering traditional statutory audit services to high value-added corporate advisory services such as business valuation, internal audit, risk management and international tax.
7. There are also opportunities for accounting professionals to take on a more strategic role, offering holistic counsel, which goes beyond financials. Integrated Reporting is one such opportunity. It is fast gaining traction as a new norm for communicating corporate information and corporate social responsibilities. Integrated reporting aims to integrate all the key elements of a business, going beyond performance reporting to provide a holistic picture of the organisation. With the release of the International Integrated Reporting Framework in December 2013, it will soon play a bigger role on the corporate reporting front. And as integrated reporting takes off globally, there will be an opportunity for the Singapore accountancy profession to lead the transformation and be a pioneer of the corporate reporting evolution in the region.
8. Another key area of concern to the profession is audit quality, a complex issue that requires the collaboration of diverse stakeholders. It is also an area of opportunity where the profession can demonstrate expertise and add strategic value. For audit to remain relevant and play a key role in the value creation process, the profession needs to expand its role, moving beyond results and numbers to include information on matters that are important to users’ understanding of the audited financial statements or the audit. There are important developments which our accountants should keep abreast of, understand the implications, and prepare themselves.
9. In Singapore, the accountancy profession continues to play an important role that is tied to our country’s growth as an international capital and financial centre. Singapore is regularly voted one of the best places to do business in globally, and has built a strong reputation as a trusted business hub with robust corporate governance practices and regulatory environment. Our status as a global hub is underpinned by a strong professional services eco-system, supported by a vibrant accountancy sector. Accounting professionals play a vital role in economies as their work gives investors and the public the confidence that a company's financial reports and corporate disclosures are reliable, and truthfully prepared.
10. Upholding high ethical standards is a definitive factor in maintaining public trust. Globally, the International Ethics Standards Board for Accountants or IESBA has been enhancing the IFAC Code to strengthen public confidence in the profession.
11. Locally, the Accounting and Corporate Regulatory Authority (ACRA) is in the midst of revising its Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities. ISCA will also embark soon on a revision of its Code. Beyond this, ISCA has also formed the Ethics Committee to provide support to accounting professionals in addressing ethical issues and raise awareness for ethical standards.
12. These developments reflect the importance of establishing trust and ethical leadership to the profession. Indeed, ethics is the cornerstone upon which the accountancy profession is built.
13. On this note, I would like to wish all participants a fruitful and insightful time here at the Singapore Accountancy Convention, where many of these topics will be discussed. Tonight, ISCA will also hold the Singapore Accountancy Awards Dinner, where the winners of the inaugural awards ceremony celebrating excellence in accountancy will be unveiled. This is a laudable initiative that I hope will further elevate the profession to greater heights and uncover more inspiring accounting firms and individuals in the profession. Thank you.