The Role of Chartered Accountants in Shaping Bangladesh's Economic Future
Since its establishment in 1973, the Institute of Chartered Accountants of Bangladesh (ICAB) has played a crucial role in the country's economic development. As Bangladesh aims to become a trillion-dollar economy by 2041, the demand for Chartered Accountants is expected to increase significantly. ICAB needs to adapt to the changing economic landscape by increasing the number of Chartered Accountants, updating the syllabus to include emerging technologies, and disseminating knowledge on complex accounting rules. These actions will help ensure financial transparency, corporate governance, and economic success in the future.
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Smart Bangladesh: Chartered Accountants Role in the Journey Chartered Accountants in Business Perspective Md. Abdul Kader Joaddar FCA MD & CFO, SCB 22 May 2021
Brief Background Since establishment in 1973, ICAB had been the trusted Partner in Progress of Bangladesh over last 50 years Bangladesh has made tremendous progress, GDP grown from $8bn in 1973 to $460bn in 2022. ICAB also have grown its member to around 2,300. ICAB actively participated in various policy formulations, writing various laws, and also contributed towards economic success of Country ensuring financial transparency, corporate governance. Implementation of DVS is a key milestone. This journey was not easy, but was made possible by some of the legendary figures of the profession through dedication, hard works and in some cases personal sacrifices. As we celebrate 50th Anniversary of ICAB, we also look 50 years ahead, as the country embarks on achieving a Trillion dollars plus economy enabled by Smart Bangladesh by 2041 ICAB and its members are also preparing to embark on this very different journey, and this seminar is part of that preparation.
How the Economic Landscape would be like New Industry MAC Population 2022: 12m 2030:34m, grow 3 times. Larger than size of Malaysia. To become the 9th largest consumer market. GDP IT & Outsourcing Light Engineering & assembly Agro processing and FMCG Fin. Services, MFS, Insurance 2022: $460bn. 2041:$1.1trln(@4.7%) 2.4 times $2.3 trln (@9%) 5 times $2.8trln (@10%) 6 times Expected Landscape Change Sustainability at the center To improve resilience Secure low cost capital Reduces risk with better credit rating Innovation to remain relevant Continuous innovation would be the key to success as well as to remain relevant Digitization, Automation Block chain, Intelligence, Automation, Machine Learning, Big data, Data Analytics IOT, Artificial Process Robotic Risk Management Cybersecurity Foreign Direct Investments Financial transparency Corporate Governance Ease of doing business Smart Bangladesh Smart Government - Paperless Smart Citizens Tech & Vocatl. Edu Smart economy - Digitized Smart Society Cashless economy Key Enablers Capital Markets Policy Reforms FinTech and Startup Fintech and Startup ecosystem needs to be supported to help economy Improved governance Supplier of long-term funding Engage private partners early Consistency and law
Role of ICAB in Changing Economic Landscape SL No. Economic Landscape Impact / Need Actions to be taken $2.3/ $2.8 trln GDP 5/ 6 times of current 9th Largest Consumer market New Industries The size, depth and breadth corporates and other new local and foreign companies would be more Demand for Chartered Accountants would increase many fold. Currently ICAB has ~2,300 members against demand of ~12,000 1. Increase no. of chartered Accountants Increase awareness Attract more and more brilliant students Simplify education / examination process Reduce costs for studying CA Offer higher allowances to students Further simplify entry criteria for CMA, ACCA etc. for them to pursue CA Formulate a realistic longer-term plan to increase number of CAs. 2. Digitization, Automation, Innovation, sustainability Current CA syllabus, CPD Topics may not be future ready and needs revamp CA syllabus, CPD Topics needs revamp to provide basic / working level understanding on Block chain, IOT, Artificial Intelligence, Robotic Process Automation, Machine Learning, Big data, Data Analytics, Sustainability. 3. Knowledge based economy New and complex accounting, taxation rules needs to be understood. Disseminate knowledge with business community on the development of various accounting guidance e.g., intellectual property rights, Tech based assets / business etc.
Role of ICAB in Changing Economic Landscape (contd) SL No. Economic Landscape Impact / Need Actions to be taken DVS is already a success. We have use this to improve quality. Increase capacity building of members through training on new techniques under automated environment and also work faster. Full compliance with IASs/ IFRSs, ISAs. Formulate a longer-term plan 4. Foreign Direct Investment Improved: Financial transparency / credibility Corporate Governance Ease of doing business indices (24.2/ 140th) Also, increased capacity of ICAB ICAB to engage with regulators to modernize: Companies Act 1994 Income tax, VAT Act Help automate and digitize Tax, VAT and Customs processes Formulation of Laws on Intellectual property rights etc. 5. Policy Reforms to align with growth strategy Participation of Private Sector early in the process 6 Fast changing ecosystem Dynamic and consistent team with flexible plan would be the key. ICAB Management to be upskilled and be primarily responsible to develop and deliver the ICAB s forward looking long-term vision with Council s support.
Role of Professional Accountants in Business (PAIB) In the fast changing eco system, influenced by digitization, extensive use of Big Data, prevalence of FinTech, PAIBs have to be well prepared to cope with the change to remain relevant SL No. Economic Landscape Actions to be taken 1. Continuously look to Learn, Unlearn and Relearn Learning is going to be continuous, in the following areas: Development in the Digital space: APIs, Robotic Process Automations (RPA), Artificial Intelligence. Data: Big data, Data analytics, data based decision making, Predictive and Prescriptive analytics etc. FinTech: Cloud, Internet of Things (IoT), Blockchain, Metaverse. 2 Hiring resources with future fit skills Preference should be given to candidates with knowledge on tech and RPA, AIs, Data Analytics etc. 3 Be ready to shift focus 90% of the works that we currently do will be replaced through automation, AI. We have to learn how to use data analytics to derive insights, patterns and make forward looking decisions. 4 Careful where you invest CFOs should take into account of expected / predicted change in future before capital investment decisions. Investment in Physical branch may not be future fit in a digitized and cashless economy. 5 Invest in Technology Finance professionals should always look for ways and means to automate processes and invest in technologies that would deliver scale and modular. 6 Keep a close eye on the Development in Fintech Space Watch out for development in Fintech space to understand the implications of their development, also find a way to leverage their development for businesses. 7 You don t necessarily have to build / own everything Look for perfect partner and use them as an escalator / lift instead of walking. There are so many startup / tech companies out there who may be a perfect match.
Key Messages Economy would grow 5/6 times enabled by Smart Bangladesh where Digitization, automation and innovation would be at the center. No. of CAs need to grow to meet increased demands We have to focus on capacity building, learn new things, improve quality, as well as ensure financial transparency and credibility. We have to work hand in hand with government agencies supporting in the areas of policy formulations, revising various Acts / laws. ICAB to develop a long-term execution plan to meet the increased demand. While I believe the role of Chartered Accountants would not change much, but surely the way we do, the speed at which we do, the tools that we use, and the areas that we currently focus would surely change significantly, and for that we have to start preparing ourselves now.
