The Association of Chartered Certified Accountants (ACCA) has adopted ‘accountants in business’ as its global theme for 2009-10.
ACCA director of technical policy and research Steve Priddy told The Accountant there is generally a good understanding of accountants who work in practice, but less understanding of how accountants fit into the business life cycle.
“We decided that we would take that as the theme to try to point to some of the areas where the accountant as the professional adds value to business generally,” Priddy said.
There has never been a more crucial time for accountants to show their value in business than the present, Priddy added.
“Over the last 18 months, as a systemic banking collapse has evolved into significant worldwide recession in many countries, a range of presumptions about accounting, organisations and society will be questioned. We believe that the role of the accountant will emerge into a golden age as a champion of sustainable value in business,” he said.
Priddy said there has been a “resounding” message from surveys conducted around the world recently that the CFO is valued more highly now than it was a year ago.
This increased regard equates to added pressure and more expectation that CFOs must be focused simultaneously on the present and the future.
“The CFO not only must have an iron grip on the present, but must also have an input into, and be a key part of, scenario modelling, stress testing, looking at whether the business model is a sensible business model that will be around in five years or not,” Priddy explained.
There have been a number of guidance pieces the ACCA has released that tackle immediate short-term issues CFOs might be facing. This includes advice on cash flow management, on how best to keep the books and the controls that should be in place. Risk management has also been identified by CFOs as an area needing more focus.
“I think what the banking crisis has shown is that so many people’s risk models in the banking sector assumed normal distribution, assumed that they were spreading risk, diversifying risk, when actually they were all in the same boat. They were all correlating in the same place and as a result the almost unthinkable happened,” Priddy said.
“I think that has made CFOs especially think about risk management. We have really got to spend more time on that and make sure we are up to date with the training, the latest thinking.”