Speech By Mrs Lim Hwee Hua, Minister In Prime Minister's Office And Second Minister For Finance & Transport, At The Baker Tilly International Asia Pacific Regional Conference

Mr James Castellano,
Chairman, Baker Tilly International

Mr Geoff Barnes,
President and CEO, Baker Tilly International

Ladies and Gentlemen,

1. I am delighted to join you this morning at this conference. This conference brings together over 100 practitioners in the accountancy sector. Over the next three days you will be treated to a wide range of topics that will give you a better appreciation of what the accountancy sector in Asia Pacific has to offer. To those from overseas, I welcome you to Singapore and hope you will find the time to enjoy the sights and sounds of Singapore in between.

Role of Singapore in Accounting

2. The Asia Pacific is a rapidly growing market with good potential for accountancy services. In a recent report by Datamonitor, the total Asia-Pacific market for accountancy services is worth an estimated US$30 billion, and is projected to reach US$38 billion by 2013.  This represents a healthy growth momentum in demand for accountancy-related services.

3. In the past decade, the accountancy sector has generated contributions of around S$1 billion to Singapore. This figure is expected to rise in tandem with the surge in demand for accountancy services in Singapore and the region. In Singapore, we fully recognise the importance of developing the accountancy sector, and we aspire to be a leading global accountancy services hub, working off a robust accounting regulatory framework and internationally recognised auditing standards.

4. We can also tap on Singapore's strategic location within Asia, the stable political environment and the presence of competent professionals who are conversant with international accounting and auditing standards. That we are an open economy and an international financial and business centre with about 7,000 multinational corporations having their global headquarters and regional offices here further enhances our offering as an ideal base for accountancy companies looking to set up and expand in Asia.

Developing Singapore into a Leading Centre for Accountancy Services

5. Let me share with you our efforts to develop the accountancy sector.  In December 2008, the Ministry of Finance established the Committee to Develop the Accountancy Sector, or CDAS, to conduct a comprehensive review of the Singapore accountancy sector and profession.  The committee comprises public and private sector accountancy professionals and looks into the growth and development conditions that exist in Singapore, as well as in the Asia Pacific region.

6. One key strategic thrust is to develop Singapore into a leading centre for high value-adding professional accountancy services. Two of the committee's recommendations are:

(i) First, develop Singapore into a leading Asia-Pacific Accountancy Services Centre; and

(ii) Second, liberalise the rules and regulations governing the accountancy profession.

7. To transform our accountancy sector into a modern, trusted and high value-adding hub, the committee recommends that Singapore be positioned as a global accountancy conference centre and a hub for Centres of Excellence. Additionally, the accountancy sector should also develop a wider and more international outlook, undertake more regional work, and bring in people with international expertise.

8. The committee has also recommended further liberalisation of rules and regulations governing the accountancy profession so as to ensure greater diversity in the composition of a public accountancy entity's ownership structure, while preserving the characteristics that highlight its public interest obligation. To this end, the committee is recommending changes in the following two areas:

(i) Liberalise ownership rules for public accountancy entities from the current two-thirds requirement to a simple majority of public accountants; and

(ii) Recognise international practice experience in the registration of public accountants.

9. The committee will finalise its recommendations and submit its final report to the Government later in the month. We look forward to receiving the proposals.

International Financial Reporting Standards (IFRS) Regional Policy Forum in Singapore

10. I am happy to note that Singapore will be hosting the International Financial Reporting Standards Regional Policy Forum this May.  This is a valuable platform for policy makers in this region to come together to discuss wider issues concerning the diverse roles of financial reporting and its impact on policy formulation and implementation.

11. The Forum this year will focus on how financial reporting can be made more relevant to the needs of the different stakeholders including the central banks, securities regulators and tax authorities. There will also be a sharing session on the experiences of countries in this region in converging towards IFRS. Amongst those who are invited, I am glad to share that several established organisations and countries such as the International Accounting Standards Board, the International Accounting Standards Committee Foundation, Australia, New Zealand, India, Japan, Brunei, Indonesia, Malaysia and Thailand have confirmed their attendance.

Improving the Regulatory Framework

12. Next, I would like to touch briefly on how we are improving our accountancy regulatory framework. Our existing regulatory framework continues to work towards improving audit quality that is critical to making Singapore a leading global accountancy services hub.  For instance, under the Accounting and Corporate Regulatory Authority's (ACRA) practice monitoring programme, we have completed the second review cycle for the Big-4 firms which have the highest public interest element, and the first review cycle of small and medium sized practices (SMP).

13. ACRA, in collaboration with the Institute of Certified Public Accountants of Singapore, has also been working on regulatory initiatives to help SMP practitioners, such as the development of a three-day regulatory course for those who are subject to an ACRA practice monitoring revisit.

14. These initiatives help to promote high quality audit and provide a responsive and trusted regulatory environment for businesses and public accountants.

Conclusion

15. To conclude, I would like to reiterate that we will double our efforts to develop the accountancy sector and to transform it into a leading global accountancy services hub. This vision will materialise progressively over the course of the next 10 years.

16. Finally, to all the participants, I would like to wish all of you a fruitful Asia Pacific Conference and hope that you will have an enjoyable stay in Singapore.

Thank you.