A ground-breaking study into the accountancy profession in Africa reveals 55% of accountants are optimistic about Africa’s economic prospects, but skill shortages, especially in the areas of technology and strategy are a major concern for respondents.
PAFA (the Pan African Federation of Accountants), ACCA (the Association of Chartered Certified Accountants), and PwC joined forces to develop the State of the Profession in Africa report, polling 1,750 professionals to capture their views about the profession’s contributions on the continent, as well as the challenges, threats, and opportunities ahead. The report also captures feedback from 110 participants at various business and public sector roundtables, held to capture opinions of experts across Africa.
The research was analysed under four themes – capacity building, partnerships, influencing for socio-economic development, and future-readiness of the profession.
Focussing on capacity building, technology (53%) was the biggest skills gap identified, followed by strategy planning, market intelligence and performance management (49.3%).
The results revealed a startling paradox for the profession in building ethical and sustainable business while lacking in environmental, social and governance (ESG) acumen. Some 57% say this is limiting the involvement of Professional Accountancy Organisations (PAOs) and their members in climate change and ESG agendas.
Alarmingly, 92% of accountants working in the mining industry do not see ESG among the industry’s top three future-altering trends, and 40% of all surveyed members highlighted the ability to incorporate climate change and ESG into financial reporting as a major skills gap.
The report asserts that partnerships are essential for the accountancy profession to be resilient, and offers various calls to action for accountants, PAOs and the many stakeholders in the finance and accountancy ecosystem – including higher education institutions, the business community, the public sector, standard-setters and regulators, governments and policy makers.
Alta Prinsloo, Chief Executive Officer, PAFA says: ‘If the accountancy profession is to be fit-for- future, it must be digital, contribute to socio-economic development and play a key role in building ethical and sustainable business. To facilitate this, more and better collaboration is an imperative – and that starts with national PAOs. PAFA stands ready to facilitate collaboration among PAOs and stakeholders to respond to the calls to action encapsulated in the report.’
Jamil Ampomah, director of ACCA Africa, adds: ‘Respondents’ views about ESG are certainly a wakeup call. Hurdles need to be overcome as accountancy professionals have a unique opportunity to lead ESG adoption in their organisations, in their own countries, right across Africa and globally. One of the strong recommendations in the report is for the profession to skill up here – the tools and qualifications are available to do this, so the opportunity is waiting to be grasped.’
Mary Iwelumo, Partner, PwC Nigeria and Strategy Lead for PwC West Market noted further: ‘We were startled by the finding that accountants generally did not expect ESG to have a meaningful impact on the profession and professionals over the next decade. At PwC, we had hoped that knowledge that ESG is a business imperative would be universal, especially among professionals that have a seat and voice at the table of business leadership. This disquieting discovery must, therefore, galvanise all of us to a collaboration that will build an education system that will equip accountants to anticipate the future, and prepare for and thrive in it.
Top ten statistics from the report show that:
- When it comes to global accounting standards,81% of respondents say International Financial Reporting Standards (IFRS) have been adopted across Africa.
- 71% of accountants expect that digital transformation of accounting functions would be the profession’s biggest game changer over the next decade.
- 64% have seen professional accountants become CEOs or Directors in their organisations.
- 53% say stricter regulatory and statutory compliance will have an impact on the profession.
- Almost half – 49% – of respondents believe that the accountancy professional contributes to strategic direction and development of business insights in the upper echelons of organisations.
- AccountantsinAfricaaremostoptimisticabouttheimplementationofenvironmentally friendly policies and investment in infrastructure – each at 30%.
- 45%indicatethatmostseniorprofessionalsintheirorganisationsareinvolvedinthetraditional roles of organising, controlling, processing, and reporting on financial related transactions.
- 47% say another significant trend is predictive accounting software such as forecasting and data analytics tools
- 10.47% say changes in tax policy is an important future trend.