Small and medium-sized practices (SMPs) in the accountancy sector play a vital role in supporting Singapore’s economic growth by providing every business, including small and medium-sized enterprises (SMEs), with robust foundational financial, accounting and business services. Much like other companies across industries, accountancy SMPs need to leverage digital technology to enhance their effectiveness, including to transform their operations, maximise value to their clients, and open up new advisory revenue opportunities.
SMPs received a boost in their digitalisation efforts with the recent launch of the Accountancy Industry Digital Plan (IDP) and the signing of a Memorandum of Understanding (MOU) between the Institute of Singapore Chartered Accountants (ISCA) and Singapore Polytechnic (SP), aimed at improving their digital readiness for the future.
The new Accountancy IDP was unveiled by Indranee Rajah, Minister in the Prime Minister’s Office and Second Minister for Finance and Education, at an event organised by ISCA, Singapore Accountancy Commission (SAC) and Info-communications Media Development Authority (IMDA) on 22 August 2019. “A plan developed from the ground up in consultation with the industry, the IDP will enable practices here to evolve their skills and make use of technology at a time of great disruption,” said Ms Indranee, at the launch. “I would like to encourage the profession to see the opportunities in change and make technology work for you. This is not a journey you need to make alone… the government will support you on this.”
Developed by SAC, ISCA and IMDA, IDP will enable SMPs, which make up 98% of the about 700 accountancy entities in Singapore, to be better prepared for a digital economy. IDP supports earlier efforts such as the Industry Transformation Map and Accountancy Sector Roadmap; it is also part of IMDA’s SMEs Go Digital programme and will enable SMPs in the sector to better identify and harness digital technologies, based on their stage of digital readiness. IDP will focus on three strategies:
a) enhancing digital skills and knowledge;
b) promoting the adoption of technology, and
c) fostering accounting technology and business model innovations.
IDP comprises a Digital Roadmap to provide guidance to SMPs on the digital solutions to adopt and employee training to undergo, at each stage of digital development. In order to support the digital development of SMPs, two other initiatives were announced at the launch event.
a) Accounting Technology & Innovation Centre (AccTech Centre), to develop new accountancy technologies and business models, and
b) SMP Centre, a one-stop portal with information to support SMPs on their digitalisation journey.
SUITABLE FOR ALL STAGES OF TRANSFORMATION
IDP is designed to be relevant throughout this journey of change for SMPs at various stages of digitalisation. No matter how “digital” one is, IDP has suggestions for solutions and training courses that can make a difference. The Digital Roadmap identifies three stages of digital development for an SMP:
Stage 1 Getting ready for the digital economy
SMPs that are just embarking on their digital transformation will look to ways to increase productivity. Digital solutions will help streamline operations and optimise resources. For example, audit management tools can enable SMPs to enhance audit quality and facilitate compliance; they also help manage engagements more efficiently. Other tools here include cloud accounting, which improves the accessibility of real-time information, and data analytics that can enhance risk management.
Document management, know-your-customer (KYC) screening, practice management and taxation management round off the list of tools available for SMPs to kickstart their digital journey.
Stage 2 Growing in the digital economy
For those that have already started their digital transformation, new digital tools can help to connect them to new businesses and create a throughput of data to generate business insights. Here, data analytics can be used for advisory services, by transforming financial information into storyboards and financial insights into communication tools to help customers make better decisions.
Separately, new e-payment capabilities will make use of e-invoicing standards and streamline previously paper-based processes. In addition, an integrated e-platform that connects through application programming interfaces will make it seamless for SMPs to transact with government agencies and other enterprises.
Stage 3 Leaping ahead
For an SMP that has gone past stages 1 and 2, the road ahead is one that involves innovative services and business intelligence. Here, artificial intelligence (AI) can be used for both audit and accountancy to improve audit risk assessment and boost efficiency and accuracy for accounting practices.
Across all the three stages, there is a need for robotic process automation (RPA) and capabilities such as cybersecurity. These are the “hygiene” factors that form the foundation for any transformation effort.
IDP supports earlier efforts such as the Industry Transformation Map and Accountancy Sector Roadmap; it is also part of IMDA’s SMEs Go Digital programme and will enable SMPs in the sector to better identify and harness digital technologies, based on their stage of digital readiness.
GETTING THE RIGHT SKILLS
IDP features a training roadmap aimed at equipping the sector’s human resources with new capabilities and the necessary mindset to embark on the digital journey. At each stage of the SMPs’ digital readiness, there are digital skills that their employees can acquire to prepare them for the digital economy. The training is broken down into two broad segments, for basic and advanced skills. Tech basics provide general knowledge and understanding of tech trends and their impact, and promote a mindset change; more advanced skills are available for professionals who require deeper knowledge and skills in the similar areas. The training roadmap features three stages, as follows:
Tech basics include learning about innovative design thinking and RPA, and how they impact the industry. More advanced accountancy professionals seeking higher proficiency digital skills should learn data analysis for audit and investigation, and hands-on protection officer training, for example.
Skill sets include a practical understanding of fintech and other disruptive technologies such as the Internet of Things and cloud computing. More advanced skills taught here will involve using analytics for organisational performance and visual dashboards to present the analysis.
Skill sets at this level include big data and machine learning for finance. Accountancy professionals will also learn about AI and its impact on the industry. More advanced individuals can try their hand at harnessing AI with Python programming.
PREPARING FOR A DIGITAL FUTURE
While tools are important, the human element remains essential in understanding and using them. Without the right talent to make use of these emerging technologies and tools, the transformation of the sector would not be successful. To this end, the ISCA-SP MOU, signed at the IDP launch event, aims to enhance the digital capabilities of local SMPs in two main areas:
- Developing certification courses in RPA that are customised for local SMPs, and
- Supporting SMPs in the adoption of audit software to automate and streamline their audit workflow.
The collaboration will involve 80 students from SP’s Diploma in Accountancy programme, who will use RPA and audit software to help SMPs streamline their audit workflow and provide technology solutions.
DEVELOPING NEW TECHNOLOGIES
Established by SAC and the Singapore Institute of Technology (SIT), the AccTech Centre is a resource centre that facilitates collaboration and catalyses technology and business innovations in the accountancy sector. It will help SMPs to innovate business processes, business models, service delivery, and products. Through the centre, SMPs can work with academics, technology partners and government agencies to experiment and prototype innovative ideas. It will also provide networking opportunities with thought leaders and technology partners. Participants can benefit from workshops and symposia on advanced accounting technologies, as well as attend training and attain certification through SIT to upgrade their technology skill sets.
GET STARTED TODAY
One challenge many SMPs face is the constant grind of the regular business cycle. With the assistance offered by IDP, there is now fresh impetus to jump onboard as soon as possible.
SMPs which are unsure of where to start can look to a one-stop shop in the form of the SMP Centre. Established by ISCA and supported by SAC, it includes an online self-assessment toolkit to assess an SMP’s digital readiness and identifies pre-approved digital solutions alongside curated training required at each stage of digital development through the digital and training roadmap. In addition, the SMP Centre provides information on available funding support and also the AccTech Centre.
Find out more about SMP Centre here.
Find out more about the Accountancy IDP here.
Watch the video here.
This article was written by Info-communications Media Development Authority, Institute of Singapore Chartered Accountants and Singapore Accountancy Commission.