The Independent Regulatory Board for Auditors (IRBA) has warned that a looming financial-skills shortage could severely undermine South Africa’s 6% growth ambitions.
Kariem Hoosain, CEO of the IRBA, says that, similar to the much-talked about shortage of medical and engineering skills, the financial needs of South Africa’s economy are rapidly outstripping supply.
“The implications are worrying when you consider just how many facets of the economy rely on dependable and timely financial information to make decisions.
“Businesses all rely on having a good grasp of the numbers, banks and other lending institutions base financing decisions on financial information and, of course, investors use it as the foundation of analysis before committing hard money.
“Foreign investors also place reliance on financial information to make assessments on whether to invest or not. Good reporting and reliable information is as important to a country as sound infrastructure and good communications.
“It helps to attract investment and it’s exactly these kinds of foreign direct investment flows we need to ensure our country’s growth rate reaches the target of 6%.
“The CEOs of major auditing firms in South Africa have recently also indicated that they are struggling to recruit sufficient and appropriately qualified trainees to meet the growing needs. The shortage could be as much as 30% of the required numbers.”
Hoosain says that part of the IRBA’s mandate is to widen the access to professional bodies that can apply for accreditation by the IRBA.
“In terms of the Auditing Profession Act, the IRBA must prescribe requirements for the accreditation of professional bodies and we are encouraging other professional bodies to apply to us. This will certainly help with increasing the access to professional financial qualifications. However, any positive impact from this will only be felt in a few years’ time.”
Hoosain notes that, in recent years, not enough attention has been focused on improving financial skills and that this will hamper growth and investment, just as much as a shortage of engineers and other specialised skills.
“The relevant stakeholders, including the professional bodies and ourselves, will have to come up with creative solutions to deal with this challenge. Hopefully [the] government is also becoming increasingly aware of the shortage and will take steps to help address the situation.
“We also need to spread the message that the accounting and auditing professions are very rewarding and with these skills in demand, salaries are likely to be buoyant for years to come. The opportunities to practice are varied and include both the public and the private sectors.
“The working environment is exceptionally challenging because finance professionals must be able to keep abreast of constant change in the social, political, technological and economic environment, both locally and internationally.” — I-Net Bridge