“Today is the tomorrow you were worried about yesterday. Now you know why,” quipped Peter Wyman PwC’s global leader of public policy and regulation at the CCH conference this week.
In what the conference organisers billed as a swansong in his distinguished career as a driving force within the world’s largest accountancy firm and its oldest professional body, the former ICAEW president speculated on the future of accountancy by looking back at the changes that had happened since he was an articled clerk 40 years ago.
“Frankly self-regulation is over. And it’s not been replaced by something that is without its problems,” he said. “Forty years ago we lived in a world of self regulation, but that wasn’t such a bad thing. People setting rules had some understanding – it was all about substance. Today it’s around form and the rules are set by people who can’t understand what drives the professional mind. The rules are set by civil servants who have never been in practice.”
The forces affecting accountancy are the same as those that are shaping the global economy, he said: globalisation, industrial consolidation and technology. New systems, for example, will pave the way for organisations to report their performance in real time, and create an infrastructure that will let accountants outsource more and more of their compliance work to lower cost countries, he predicted.
“Regulation has not globalised and that’s still a problem. It’s national and set by quite a lot of people without breadth. Starting with Sarbanes Oxley, it’s running out of control. Regulation is duplicative. We’ve got to move to a world of proper mutual recognition, so if you are regulated by one location that will be recognised by other countries. It may be different, but will be accepted. Until that happens we’ll have massive duplicative, non-productive regulation.”
According to Wyman, “most people I talk to think auditors have had a good financial crisis”. With few significant problems around financial reporting, there haven’t been any problems with audit. Yet investors, politicians and regulators in Whitehall and Brussels continue to ask why auditors didn't warn of the impending crisis before it happened.
“They’re now saying that maybe there isn’t the right set of obligations,” he noted.
“We’re in the political spotlight. Forty years ago, as portrayed in the Monty Python sketch, accountants were perceived as boring. I now realise that boring is good.”