Singapore Government

The CDAS Final Report: Executive Summary

In its final report (submitted in April 2010), the Committee to Develop the Accountancy Sector (CDAS) unveiled an exciting vision to transform Singapore into a leading global accountancy hub for the Asia-Pacific region by 2020.

  1. The Asia-Pacific region is widely reported as the fastest-growing region for the international accountancy networks. Singapore, located in the heart of the Asia-Pacific region, is suitably poised to ride on the possibilities of the dynamic economic growth for the region.

Riding on Growth Possibilities in Asia-Pacific

  1. The total Asia-Pacific accountancy market reached US$ 30.8 billion in 2008 and is forecasted to reach US$ 38.3 billion by 2013. The major contributors to the Asia-Pacific accountancy market are Australia, China and India; Singapore contributed 2.8%[1]. In Australia, the US$ 9.2 billion accountancy market formed almost 1% of its GDP. Singapore’s US$ 862.4 million formed 0.47% of its GDP, and has great potential to grow.
  2. The emerging economies in China, India and ASEAN (in particular, Vietnam and Indonesia) are beckoning as new markets for promising investment destinations and developing accountancy sector. At the same time, economic expansion has fuelled strong demand across the region and this has led to significant investment in recent years from the global accountancy networks, particularly in China and India.
  3. Market revenues in the Asia-Pacific region have increased healthily during the past five years, from US$ 23.7 billion in 2004 to US$ 30.8 billion in 2008, at a compound annual growth rate of 6.7%. This will encourage new entrants [2].
  4. Overall, competition in the Asia-Pacific market is assessed as moderate to strong. Buyers of accountancy services can vary in size but include many medium and large businesses, which strengthens buyer power considerably. The Big Four[2] firms have a significant presence in the Asia-Pacific region. There are also many smaller-sized professional entities, which are drivers of the competition in the Asia-Pacific accountancy market. Competing for major clients is difficult except for the largest accountancy entities, which can offer an appropriate range of expertise[2].

As Singapore Becomes the Leading Global-Asia Financial and Business Hub

  1. The Singapore Government and the Economic Strategies Committee had recently unveiled the economic blueprint for the Singapore economy. This included the plans for Singapore to become the leading Global-Asia Financial and Business Hub, leveraging on its existing and strong reputation of having a pro-business and trusted regulatory environment.
  2. The Singapore accountancy sector and profession are primed to take part in the major transformation in our economic environment that promises exciting growth prospects over the next 10 years.

Transforming Singapore into a Leading Global Accountancy Hub

  1. CDAS’ vision is to transform the Singapore accountancy sector into a leading global accountancy hub for the Asia-Pacific region by 2020.
  2. The accountancy sector in London, with its long established tradition that enjoyed an international reputation for leadership and expertise, can be viewed as a leading light for the Singapore’s sector. As Singapore aspires to be a leading global accountancy hub for the Asia Pacific region, it should seek to double the sector’s existing GDP contribution from the current level of 0.4% to about 1% over the next 10 years. This would be similar to that of the current contribution of the accountancy sector in the UK as well as other developed jurisdictions like Australia.
  3. The growth of the accountancy market should be achieved through developing a stronger international outlook for the sector, both in terms of service provision and professional development. The contribution from the sector’s services export should thus be doubled from the current level of 22% to 50% over the next 10 years. There is great potential for the public accountancy entities based in Singapore to expand their work through growing existing and new regional markets and in providing high value-adding specialised niche services. The profession and sector’s capability and productivity should also be strengthened, through expanding the talent base and enhancing the flow of high quality accountancy professionals in Singapore. A key outcome in this area would include having greater diversity in the profile and academic background of the talent base.
  4. The professional development environment in the Singapore sector will also benefit greatly from the vibrancy generated from the intensification of the presence of the various internationally recognised professional bodies in Singapore. Indeed, these international players will be co-partners with the Institute of Certified Public Accountants of Singapore, the local universities and the Singapore-based public accountancy and corporate entities, in building up the thought leadership, research and development capabilities in accountancy services for the Singapore accountancy sector. Regulatory agencies like the Accounting and Corporate Regulatory Authority (ACRA), and the sector’s continued focus to uphold and build on the “trusted and high integrity” factor of the Singapore’s international branding, will continue to ensure the Singapore accountancy profession’s strong adherence to ethics. It is through concerted efforts from all stakeholders that the accountancy profession can continue to offer trusted and high value-adding expertise.

The CDAS’ Recommendations

  1. The CDAS’ recommendations, broadly classified under three key strategic thrusts, are:

    Strategic Thrust 1: Leading Global Centre for Accountancy Talent, Education, Thought Leadership and Professional Development

    To deepen expertise in the accountancy sector, Singapore should:
    1. develop a globally-recognised, Singapore-branded, post-university professional accountancy qualification;
    2. develop a centre of excellence in business valuation, internal audit and risk management and tax;
    3. set up a CFO Institute for the professional development of Chief Financial Officers; and
    4. set up an Accountancy Services Research Centre (ASRC).
  2. Strategic Thrust 2: Leading Centre for High Value-adding Professional Accountancy Services

    To promote the regionalisation of accountancy services and to move the services provided from the Singapore-based public accountancy entities up the value chain, Singapore should:
    1. develop into a leading centre for high value-adding accountancy services for businesses in the Asia-Pacific region;
    2. liberalise ownership rules for public accountancy entities;
    3. level up the expertise and upgrade the capability of small-and-medium sized practices; and
    4. review the current audit exemption threshold and licensing framework for the audit of public interest entities.
  3. Strategic Thrust 3: Strong Accountancy Sector’s Infrastructure and Institutions

    This is a call for concerted action from all the relevant stakeholders who can, and should, make a difference in turning the Singapore accountancy vision into a reality. This entails:
    1. the transformation of the Institute of Certified Public Accountants of Singapore (ICPAS) into a professional accountancy body with a global membership, outlook and standing;
    2. the establishment of an Accountancy Sector Development Fund (ASDF); and
    3. the establishment of a Singapore Accountancy Council (SAC).

Read CDAS’ 1st recommendation.
Download the complete CDAS final report.

[1] Source: Datamonitor (2009). Accountancy in Asia-Pacific: Industry Profile.
[2] The Big Four refers to PricewaterhouseCoopers, KPMG International, Deloitte Touche Tohmatsu and Ernst & Young International.

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