OFFSHORING may seem like yesterday's news and part of a globalisation narrative that has since lost its sheen. But in recent years, particularly since the COVID-19 pandemic, offshoring has experienced a fresh wave of popularity as accountancy and audit firms in the developed world experience a recruitment crisis.
Accountancy firms in the UK and elsewhere have turned to offshore centres or opened their own offices overseas to help provide the skilled staff they need to service clients in their home jurisdictions.
Vipul Sheth, a UK accountant and former KPMG tax manager, is the founder of AdvanceTrack, an offshore service provider with four locations in India employing around 500 people, mostly focused on providing outsourced services to small and medium-sized UK firms. "We have never been so busy," he says.
The story of accountancy firms seeking offshore workers was recently writ large when BDO in the US announced it would open centres in India and South Africa, doubling the size of its overseas workforce to 5,000, mostly because of a fall in the number of graduates at home.
Small firm opportunity
BDO is not alone in this. All the Big Four firms have offshore locations, while a throng of service providers have sprouted to offer smaller firms their opportunity to make use of skilled and willing accountants overseas.
This was once all about the costs: qualified staff in places like India work for comparatively lower wages, saving firms money. There are efficiency savings too. Offshore staff are more likely to take on easier, more routine tasks, leaving staff at home to focus on value-added services, such as advice and consultancy.
But there are other factors now at play. Accountancy firms may be struggling to maintain their staff numbers and new recruits because of the retirement of baby boomers and a global uptick in demand for accountants. Advances in technology may have convinced some candidates that accountancy and audit are on the cusp of being taken over by machines.
Some of the reasons may also be cultural and born of experience from the pandemic, which prompted many people to question their career and life choices. Sheth says the growth of other industries, including finance and IT, has drawn young people away from accountancy. So, too, has a perception that accountancy offers a lifestyle that is too demanding and with too many risks, especially at senior levels. "They don't want the lifestyle," he says, "and they don't necessarily want the partnership."
Scandal may have played a part too. At the end of December 2021, Kevin Ellis, senior partner and chair of PwC, warned that criticism of the profession, following a raft of scandals and tightened regulation, was deterring recruits.
According to Antonis Diolas, head of audit and assurance at ACCA, work-life balance, well-being, and the time it takes to train may be all playing a role, depending on the jurisdiction. "This is indeed a noticeable trend globally," he says. "However, the reasons driving that movement could be different in each country and/or region, as well as between firms of different sizes."
What the experts appear to agree on is that the discontent with accountancy and audit witnessed in some jurisdictions has so far failed to emerge in locations traditionally linked to offshoring. According to Diolas, audit and accountancy careers have maintained their lustre in many places, despite a loss of popularity elsewhere.
"Audit remains an attractive career choice in some countries," says Diolas. "For example, in less developed economies opportunities for moving from public practice to industry are limited; hence, people choose or remain in the audit profession."
In South Africa, ACCA members now have a route to become registered auditors following accreditation by the country's Independent Regulatory Board for Auditors. "This is likely to drive talent into the market, which would be great for the South African economy," says Diolas, "and it could also address the attractiveness of careers in the audit profession to a certain extent."
The issue is global. Ed Hayes is founder of Tipu Resourcing, which helps firms across New Zealand and Australia outsource work to India, particularly tax return and accounts. He says firms struggle to employ local accountants. This has seen many turn to offshore centres, which is good news for people in those locations. "What we're doing is opening a new world of opportunity to a previously staid occupation in India," Hayes says.
Others see offshoring as a key route to jobs with strong links to prestigious organisations. Silver Levene, a London-based firm with a strong presence serving the media industry and legal professionals, has opened an office in Mauritius employing 45 people that undertake work for clients in all the firm's service lines, including audit.
The staff all qualified with ACCA before they joined and because of 'secure lines' it is, says Silver Levene partner Mark Gold, like having them in "the room next door".
He adds, "We are totally in control. They are our employees and we can look after them," adds Gold. "For us it works really well. And it's good for staff in Mauritius who have the prestige of working for a British firm."
Elsewhere, the opportunity and attraction may be not only well-paid work but also the qualification itself. According to Sheth, offshore centres are booming and will develop people professionally. He hopes to become an ACCA training centre at some point in the future, while at the moment his managers help employees to plan their own independent studies.
"The opportunities are immense. We're doing five times the work we were doing five years ago," he says. "It's good for us to recruit smart men and women who want to do something with their life."
Author: Gavin Hinks, journalist
Source: ACCA Accounting and business magazine