SOME major accounting firms will be raising their starting salaries for accountants, in line with recommendations from a task force to increase Singapore’s supply of accounting professionals. The Accountancy Workforce Review Committee (AWRC) on Friday (May 10) launched a report detailing three recommendations to make Singapore’s accountancy sector more attractive as recruitment challenges persist.

This situation is “not unique” to Singapore, with many countries such as the United Kingdom and the United States also facing a shortage of accountants, said Second Minister for Finance and National Development Indranee Rajah at the report’s launch. This is even as demand for accountancy and related services continues to grow. Since 2018, the university intake of local accountancy students has fallen by over 10 per cent. Singapore’s accountancy sector has more than 120,000 professionals.

In its report, the AWRC identified lower starting salaries and the profession’s long and unpredictable working hours as the key challenges faced by younger accountants. Such factors have led to a decline in the overall attractiveness of accountancy, compared to sectors such as banking, technology and consulting, said the report.

In the latest graduate employment survey, the median gross monthly starting salary for accountancy graduates in 2023 was S$3,800, lower than the overall median of S$4,313 for graduates from autonomous universities.

However, in the long term, accountancy professionals’ salaries can outpace those of their peers in other sectors, noted the report.

The committee thus recommends, firstly, that employers review their compensation structures by offering higher salaries at earlier stages of an accountant’s career. This includes starting salaries. Some major accounting firms have already committed to raising their starting salaries, with details to come.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

Another challenge the AWRC highlighted in its report are the limited and lengthy pathways for diploma holders and non-accountancy graduates to become chartered accountants. In Singapore, one must attain the Singapore Chartered Accountant Qualification (SCAQ) to be recognised as a chartered accountant.

To tackle this, the task force’s second recommendation is to shorten the pathway for polytechnic graduates with accountancy backgrounds to obtain the SCAQ. This is on top of providing new routes for non-accountancy graduates to pursue careers in the sector.

Shorter pathways

From May 10, polytechnic graduates will be exempted from the taxation module in the SCAQ’s foundation programme, if they have completed an equivalent module during their studies.

This way, polytechnic graduates will need to take fewer examinations and can become chartered accountants about six months sooner.

In addition, a new accountancy career programme will be launched by Ngee Ann Polytechnic later this year to help non-accountancy graduates develop core accounting competencies.

The Accountancy Careers Launchpad programme will provide classroom and on-the-job training in accounting firms over three to four months. Participants will also receive career coaching and training allowances.

Indranee noted that some prospective accountants are less keen to pursue the SCAQ and become chartered accountants because “they perceive it to be relevant (only) for auditors”. This deprives them of the professional development opportunities offered by the Institute of Singapore Chartered Accountants, which is the Republic’s accounting industry body, she said.

The report’s third recommendation is therefore to improve the value of being a Singapore chartered accountant.

To this end, the Accounting and Corporate Regulatory Authority (Acra) has been working with the Singapore Exchange Regulation to impress upon listed companies the need to employ professionally qualified accountants, such as those with the SCAQ, in their key finance functions.

The AWRC was set up in October 2022 by the Ministry of Finance and Acra to address the manpower challenges of the accountancy sector. It has since engaged more than 300 stakeholders from the sector across 50 focus group and engagement sessions.