Career focus: specialising in IFRS
The reasons different people decide to pursue a career in finance vary enormously. Perhaps you were good at maths at school, perhaps there is an accountancy gene in the family, or maybe you didn’t get on to the drama course you really wanted to do and someone persuaded you that having a professional qualification under your belt like ACCA was a sensible back up plan?
For some, though, their interest in accountancy stems from the fact that it is, in essence, the one discipline on which the world depends and is so interwoven into the very fabric of the global economy, impacting everyone from huge multinationals to sole traders. After all, money really does make the world go round.
For these individuals, specialising in accounting standards is an exciting and dynamic career, where the decisions that are made and the way in which the standards are applied, have a real impact on real people and also help shape the accountancy profession itself.
Accounting standards are essentially about disclosure and, in many respects, are at the heart of market efficiency. The basic purpose of accounting standards is to allow the provision of financial information within a financial statement that reflects a true and fair view of the business affairs of an organisation. This enables investors, analysts and creditors to make informed decisions about the allocation of resources.
An International Financial Reporting Standard (IFRS) is a standard set by the International Accounting Standards Board. It has replaced the older term International Accounting Standard. IFRSs are compulsory for listed companies in the EU and have been adopted by many other national accounting standards bodies.
In the US, the Financial Accounting Standards Board is working towards converging US GAAP (generally accepted accounting principles) with IFRSs under the Joint Conceptual Framework project, while Japanese accounting standards have been extensively revised to bring them into line with IFRSs. So if you decide to specialise in this highly challenging area, what type of work can you expect to be doing?
Alex Hagger, former manager of finance and accounting at Badenoch & Clark, explains: ‘An IFRS specialist can expect the nature of their work to be fairly technical. The type of work includes financial accounting, preparation of statutory accounts, accounting work that might underpin mergers and acquisitions or an IPO, for example.’
Demand for IFRS experts is high, says Hagger. ‘It has been consistent for the past 18 months,’ he says.
‘While IFRS skills are desirable, and strong results in the appropriate ACCA papers are important, we’re seeing a greater demand for accountants who can demonstrate a wider skill base. Commercial skills are becoming increasingly important. Employers are looking for accountants who can work in fast changing and dynamic environments, who have good communication skills and who can show a demonstrable impact to an organisation’s bottom line.’
This article was first published in Student Accountant