Audit firms seek quality professionals

by Yulia Golub, Kyiv Post, Staff Writer
Jul 02 2008, 20:28

© Courtesy photo Alexei Kredisov, Ernst & Young managing partner, says that Ukraine has yet to meet its foreign direct investment potential and “in this regard, we are preparing ourselves for future years of high growth in Ukraine.”

Finding and retaining qualified, experienced and reliable personnel is the most difficult challenge that accounting and audit companies operating in Ukraine face. On the other hand, some companies find it challenging to maintain the highest quality standards in a fast growing market.

“The most difficult challenges for Ukrainian accounting companies are providing high quality auditing services and increasing of their responsibility to the client,” said Tatyana Bernatovych, president of audit firm APiK.

International companies operating in Ukraine recruit approximately 100 graduates from Ukrainian universities each year. Once recruited, companies invest a significant amount to help the new hires obtain internationally recognized qualifications, for example the Association of Chartered Certified Accountants (ACCA) or Certified Public Accountant (CPA).

 “All our senior people have such qualifications, this is at the core of our business, and key to providing our clients with service of the highest quality,” said Quentin O’Toole, partner­in­charge of audit services for Deloitte in Ukraine and Belarus. Most international companies operating in Ukraine have their own schools and different types of in­house training programs.

“The entry level of employees into our audit department is such that we send them through intensive training courses. These courses are both internal, including international, and externally conducted training by outside trainers,” said Alexei Kredisov, managing partner of Ernst & Young Ukraine.

The main problem with Ukrainian education in accounting for audit companies is the lack of practical experience. “Although the theoretical background is not bad, the sometimes weird legal situation and bureaucracy requires quite a lot of practical experience, which one cannot obtain at the university,” said Thomas Otten, general director of Ukraine Consulting.

Regardless of Ukraine’s poor education level and lack of practical experience, there is still a strong demand for young Ukrainian graduates. Ernst & Young, which has been successfully operating in Ukraine since 1991, boasts 500 employees, the majority of which are young, talented and professional Ukrainians.

PricewaterhouseCoopers has the most ACCA associates of any organization in Ukraine. “We are committed to recruiting and training our people. Part of our training program is the ACCA affiliation,” said Jock Nunan, assurance services partner at PricewaterhouseCoopers in Ukraine.

“We also have many Certified Public Accountants (CPA) and Chartered Financial Analysts (CFA) in our office, all of which have been recruited from Ukrainian universities.”

But there is good news for talented Ukrainian professionals, if you are a qualified professional (ACCA, CPA or CFA), you will be head­hunted. Professionals with knowledge of foreign languages will always be head­hunted as long as the shortage persists. According to Kredisov, they are in high demand in Ukraine and each year companies lose about 15­-20 people out of every 100 people who started the year. “This is high, but not unusual turnover for our industry internationally and, especially, in emerging economies,” Kredisov noted.

Most companies are proud of their alumni as they take top positions with Ukrainian and international companies. After years of experience outside of the profession, some companies’ former employees decide to return back and normally companies welcome them. In order to stay in touch with the alumni, Kredisov said, "Ernst & Young" launched the EY Alumni section on our website and had our first alumni party last year.

Because the Ukrainian government and president announced their priorities to lead Ukraine into the World Trade Organization (WTO), Ukraine needs to confirm its status as a market economy country, until then most companies will find it difficult to work here. “In my mind the biggest problem is the non­existent legal certainty, which you can see as well as contradictory norms, especially within taxation related to law,” said Otten. On the other hand, the chances of doing business in Ukraine are so big that it is worthwhile to accept these obstacles, he said, adding that chances for accounting services are so big because these obstacles require a thorough accounting and good consultation.

In order for Ukrainian companies to attract capital, loans, long­term and international investors, they need to become transparent. The desire for transparency in Ukrainian companies with the aim of complying with international business practices causes an ever higher demand for accounting and audit services, insiders said.

“As a part of our client acceptance we may not accept non­transparent companies,” said Vladimir Vakht, a chartered, certified accountant at Deloitte in Ukraine. Although Ukraine enjoyed a significant increase in foreign direct investments (FDI) during the last two to three years, it is a common belief that the investment climate in Ukraine still requires further improvement, and the potential of the country in terms of FDI attraction is far from being achieved. “We have yet to see further acceleration of FDI, especially in light of events like EURO 2012,” Kredisov said. “In this regard, we are preparing ourselves for future years of high growth in Ukraine.”

Another challenge that accounting and audit companies have to face is working with state authorities. The recent conflict between the Main Control and Revision Office of Ukraine (GolovKRU) and Ernst & Young, regarding the latter’s valuation of the Pridneprovska Railways, is a case in point. In the valuation, the firm undervalued two items, out of 400,000, GolovKRU asked the State Property Fund in Ukraine to review Ernst & Young’s operating license.

“Our experience with central authorities is not as bad as we expected initially, the exception being the Central Tax Administration, as we do not always get clear answers to certain questions. But here again this is often caused by the contradictory laws that prevent them from providing clear statements,” said Otten.

With future improvements in the investment climate in Ukraine, further transparency and sophistication of Ukrainian companies, most of the companies plan ambitious growth of their businesses of up to 40 to 50 percent, they said. “Our business grew approximately 50 percent over the last several years, and we are planning for several more high­growth years ahead of us,” Kredisov said. “The expected recovery of international financial markets from the current credit crunch should also help over the next 12 to 18 months.”

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