Globalisation and technological advances in telecommunications have posed new challenges for global auditing companies.
“The nature of business has changed and it is a lot more globalised now, which means that the banking industry and the transfer of capital are also becoming more globalised,” Tham Sai Choy, chairman of KPMG in Asia-Pacific, said yesterday.
Globalisation requires auditors to gain a better understanding of the financial regulations of other countries, as many of their clients begin to expand abroad. Faster communications mean that clients’ needs and the way they get their information have been transformed.
New behaviours have prompted banks, regulators, companies and auditors alike to adjust how they do their business.
Each country has a unique approach to regulators and auditors have to provide accurate information so that their clients can make the best decision.
Auditors need to be accurate and reliable.
“The duty of auditing and accounting jobs is to shed light for its customers by making sure that they get the right information,” he said.
Each country’s regulations are unique because each country has different problems, so one country should not adopt another country’s regulations entirely because one size does not fit all.
Globalisation has also pushed the growing trend and need for international accounting standards but despite the international effort in the past decade, there are still differences in standards especially between the United States’ Generally Accepted Accounting Principles and Europe’s International Standards on Auditing.
“Not that much has changed in 10 years but a lot of effort has been made to archive international accounting standards. However, there is still a lot more to be done,” he said.
Technology has also changed client’s behaviour.
“Technological advances mean that access to information has changed. People nowadays need real time information and auditors should have the ability to process them in a way that can enhance financial reporting,” he said.
Auditing is becoming more predictive since people have the ability to find out what their revenue will be before they decide to sell. That means clients need more support from auditing to have better control before they make any crucial business decision.
Another challenge for global auditors, especially those in Asia-Pacific, is the shortage of skilled workers because of the increased of competition in the labour market due to globalisation.