Singapore, 7 March 2017 – Regionalisation efforts are better for multi-disciplinary practices, as shown from the findings of the Accounting Entities (AE) Regionalisation Survey 2016. Among AEs that are less reliant on providing audit services, 33% are found to generate higher overseas revenue, as compared to only 11% for AEs with a higher reliance on providing audit services.
1. The survey also shows that AEs that are on accounting networks generate more overseas revenue. 18% of AEs on accounting networks generate over 15% of their annual revenue from overseas, while among AEs that do not belong to any accounting network, none generate over 15% of overseas revenue. Collaboration is also high in priority among the AEs as the majority (46%) prefers to partner with other AEs from another country in their regionalisation efforts. The other preferred modes are joining an international network (44%) and setting up an overseas entity (34%).
2. Jointly developed by the Singapore Accountancy Commission (SAC) and the Association of Chartered Certified Accountants (ACCA) and supported by International Enterprise (IE) Singapore, the AE Regionalisation Survey 2016 seeks to provide insights and to better understand the concerns of AEs venturing overseas. The survey report also provides key recommendations aligned with those of the Singapore Government’s Committee on the Future Economy (CFE), in particular strategies that seek to deepen international connections, strengthen enterprise capabilities and enhance partnerships to enable innovation and business growth.
3. The survey findings come on the back of the establishment of the ASEAN Economic Community (AEC) in 2015, where the integration of the ASEAN economy is poised to bring vast business opportunities for the ASEAN market. With Singapore as the regional business hub, AEs in Singapore can play an important role as valuable business partners to aspiring companies looking to regionalise.
Setting their sights on regionalisation
4. About two thirds (63%) of respondents are expecting growth in overseas revenue this year. They look to offer new business services overseas of which the top five are accounting (17%), risk management (15%), due diligence (15%), business valuation (12%) and business consulting (12%).
5. AEs have also set their sights on venturing into Southeast Asia, of which the top five countries are Malaysia (27%), Indonesia (22%), Vietnam (10%), Thailand (5%) and Myanmar (5%). On the preferred mode of regionalisation, 46% of respondents would like to partner AEs from another country, while 44% preferred to join an international network and 34% would set up an overseas entity.
Concerns and challenges of regionalisation
6. Although many AEs are keen to venture overseas, there are various concerns and challenges when considering regionalisation. 54% of AEs cite the limited understanding of foreign legal
regulations or standards as the top concern or challenge while 46% indicate that restrictions on providing accounting services imposed legally or by regulations are the largest barrier to expanding overseas. 37% cite constraints in management or manpower resources.
7. The survey findings offer valuable insights from which key recommendations for AEs looking to grow regionally are put forward. These are broadly categorised as 3 Cs:
8. Mr Evan Law, Chief Executive of SAC, said: “The survey findings are a reflection of Singapore’s current state of play in charting our next phase of growth. As the accountancy sector developer, the SAC will be developing strategies with industry partners to better equip AEs with the capabilities and connections to expand overseas. This is very much in alignment with the CFE recommendations to deepen economic partnerships with the region and to support enterprises to scale up. We hope that AEs will be able to leverage on these recommendations as well as opportunities brought about by the AEC to grow their business in this region.”
9. Mr Lee Yee Fung, Group Director of Lifestyle Business Group, IE Singapore, said: “Singapore’s professional services sector, having gained expertise from servicing the regional and multinational companies based in Singapore, is well-placed to serve the global market. The AE Regionalisation Survey 2016 provided valuable insights on the challenges and opportunities faced by AEs when they internationalise. IE Singapore, through its market presence and networks, will continue to partner SAC and AEs to navigate new markets and opportunities.”
Collaboration with ACCA
10. The survey marks one of the first collaborations between the SAC and ACCA since the signing of a Memorandum of Understanding in January this year to promote thought-leadership and professional development as strategic partners in the Accountancy Sector of Singapore.
11. Helen Brand OBE, Chief Executive of ACCA, said: “ACCA is pleased to be a strategic partner with SAC and embarking on the first collaboration for the Accounting Entities Regionalisation Survey 2016. The findings of this study indicate that AEs generally have positive expectations about growth beyond Singapore, and we see more AEs taking the next step to grow their business overseas in the coming few years. We are confident that this study marks the first of future collaborations with SAC in shaping the profession in Singapore and helps AEs better understand the opportunities and challenges associated with regionalisation.”
About the Survey
12. The AE Regionalisation Survey was administered to AEs deemed to possess the manpower capabilities to expand overseas and these comprised the Big 4, Large, Medium and several Small AEs. A total of 41 AEs responded to the survey which was conducted online over a one-month period. The full report can be viewed at www.sac.gov.sg
About Singapore Accountancy Commission
Established in April 2013 as a statutory body of the Singapore Government, the Singapore Accountancy Commission (SAC) is the lead agency in spearheading the development of the accountancy sector in Singapore. The SAC’s Vision is for Singapore to be the Leading Global Accountancy Hub. This will be achieved through developing for Singapore a vibrant accountancy sector that enables the economy to grow, businesses to thrive and talent to flourish. In fulfilling this mission, the SAC seeks to uphold the values of being relevant, insightful, collaborative and advocative. For more information, please visit www.sac.gov.sg
About the Association of Chartered Certified Accountants
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. It aims to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. It aims to develop capacity in the profession and encourage the adoption of consistent global standards.
About International Enterprise (IE) Singapore
International Enterprise (IE) Singapore is the government agency promoting international trade and partnering Singapore companies in going global. Our vision is a thriving business hub in Singapore with Globally Competitive Companies and leading international traders.
IE Singapore attracts global commodities traders to establish their global or Asian home base in Singapore. Today, Singapore is a thriving trading hub with a complete ecosystem for the energy, agri-commodities and metals & minerals trading clusters.
Through our Global Company Partnership and Market Readiness Assistance, we also work with Singapore-based companies in their various stages of growth towards being globally competitive.
Our global network of overseas centres in over 35 locations provides the necessary connections in many developed and emerging markets.
Visit www.iesingapore.gov.sg for more information.
For more information, please contact:
Assistant Head, Corporate Communications, Singapore Accountancy Commission
DID: 6325 0514
Shirlynn Oh PR & Marketing Manager, ACCA Singapore
DID: 6637 8173