Dr. Amarendra Kumar, a Fellow Member of Institute of Cost & Management Accountants of India (CMA) and currently a Finance Advisor in DXC Technology, Bangalore, was elected as President of Indian Society of Management Accountants (ISMA) this year. He is also in mentor board of Young Entrepreneurs Network-India. Autar Nehru in an email interview, asked him about the impact of Covid19 pandemic impact on finance and accountancy profession and how the it will emerge in a post-covid world
Belated congrats for being chosen as the President of Indian Society of Management Accountants. What will be your tenure and responsibilities here?
I appreciate the editorial team of Curriculum Magazine, Education21.in taking the time in interviewing and also congratulating me for my recent responsibility given as the President of Indian Society of Management Accountants ( ISMA ). I agreed to take over the Honorary role of President of ISMA with a long-term vision because I love my profession and want to contribute best practices in cost & management accounting. Having a long corporate experience now is the time for me to give back to our management accounting community. As a senior professional I realize the need for qualitative contributions in management accounting for development of the CMA profession.
Like many professions, accountancy has been hit by the lockdowns and closures, do you have data or estimates about the impact on the professionals in our country? What about institutional support?
The unparalleled challenges arising out of COVID-19 pandemichave surely impacted the professionals. Data from the Centre for Monitoring Indian Economy (CMIE) showed that the loss of salaried jobs during these three months totalled 8.6 million, while the cumulative loss of salaried jobs since the pandemic started last year was 12.6 million. India had 85.9 million salaried jobs in 2019-20. This has come down to 73.3 million in April this year. The ongoing second wave of the pandemic (April and May 2021), India is witnessing a decline in the economic activity owing to the localised lockdowns that is mostly affecting jobs in some sectors especially in the retail, hospitality, aviation and construction industry. However, we have also seen a lot of positive job movement in India’s healthcare, Pharma, EdTech and IT sector since last year. Like every profession, accountancy will emerge from COVID-19 changed. COVID-19 accelerated change and forced us to reconsider the role of professional accountants. We heard from our Institutional stakeholders about the transformation of organizations, the agility of business, and the resilience of professional accountants managing through unanticipated change.
Coming to the pandemic situation which has in fact worsened and impacted our economy, how do you see the economy doing and when can we expect signs of recovery?
For every month of current localised lockdowns, the output loss would now be about Rs 1.25 trillion versus Rs 75,000 crore as per the restrictions seen in mid-Apr’21. Economists slashed GDP rates for the foreseeable future due to the obvious impact of the lockdown, which is expected to be lower to 9.9 per cent, from 11 per cent earlier forecast. Reserve Bank of India’s recent consumer confidence survey which showed a deterioration in perceptions of the economic situation and expectations of decreased spending on non-essential items. Although most economists indicate that the impact of the second wave on the economy will not be as harsh as last year, there are several risks that can derail the economy. India should choose the path of increasing investment during the pandemic, and so it can create lots of jobs, and then the demand will pick up and to see economic recovery faster on the way. Important requirement for India’s economy is to recover from the havoc of the pandemic. Vaccination is the only way that can bring India out of the impending economic crisis. As countries vaccinate more, behavioural changes in the form of increased people’s mobility are expected.
The economic impact in the long run will depend on the recovery mode. For a strong recovery, a positive average growth rate of 2% per year can be assumed. For a moderate recovery, a positive average growth rate of 1% per year can be assumed. For a weak recovery, a positive average growth rate of 0.50% per year can be assumed.
Finance or accountancy has seen as an evergreen profession, what are the opportunities like online work that the pandemic has created for the finance people? Are there job opportunities abroad as well?
There is no second thought about it !! Finance or Accountancy has seen as an evergreen profession, with a consistent demand for skilled accountants across different domains. During this pandemic the role of professional accountants has gone beyond being a business partner to crisis manager. A genuine level of trust has developed between employers or clients and their accountants, with the latter helping businesses get back on their feet. Therefore, post-pandemic, employers and clients will continue to seek out the expertise of trusted advice.
Covid-19 triggered the world’s most massive remote work experiment, and the impact is here to stay. Some of the world’s largest companies have chosen to have their employees work from home even after the pandemic is finished. The pandemic forced most companies to shift toward a work-from-home environment and use of cloud technology for working online from anywhere;the use of technology has increased the job opportunity for Indian Accountants to secure a position in another country. Professional Accounting Institutes of India have begun to address the growing needs of accountants in international matters , helping their members to become conversant in global business practices and strategies so they may better advise their clients in these areas; and also provide services in the international arena such as cross-border tax planning, multinational company mergers, joint ventures, etc
In terms of careers and future in accountancy, what will you tell those who aspire to get into the field of accountancy?
As President of ISMA, I’m attuned to the latest trends in the accounting and finance profession and the evolution of the Finance professional’s role in the 21st century. With great pay, opportunities for growth, and the chance to help businesses grow into the next decade and beyond, accounting is a great career path to pursue. Intelligent technology is shaping the future of accounting careers by impacting the types of jobs that will become available in coming times. As advanced systems handle repetitive work, humans will deal with more of the analysis, becoming the crucial link between data and clients. Technology will continue to impact the role of the accountant and the demand for accountants in the future. Accountants today must show up as true strategic partners, problem solvers, and change agents. To remain relevant, accountants can’t just produce numbers; they are being called to tell the larger story behind the numbers and help solve societal needs in the process.
ICAI-CMA must be on a path of integrating newer career paths and knowledge, can you briefly elaborate on this this?
With its increased focus on financial planning & analysis, cost control and decision support, Profession of Cost and Management Accountant (CMA) is growing with the aspiration to move from “counter of wealth” to “creator of wealth and influencer of strategy.” The CMA Designation requires continuous professional development as a reskilling requirement to equip themselves with the economic and technological changes. Given that professional development is “always critical in the Finance Career where knowledge demands are constantly evolving” this ensures CMA lives up to their designation. Having these requirements in place challenges CMAs to keep up with the sector-specific specialisation, ability to adapt recent management accounting practices and digitalisation that they need to advance to reach the next level in organisation.
Your plans and message to student community
Ironically, and unfortunately, the COVID-19 pandemic has created stress full experience. It’s unlikely to be forgotten, and if viewed with a growth mindset—the belief that one’s skills and qualities can be cultivated through effort and perseverance—it can be life-changing. The Accounting profession is highly dynamic and requires persistent value addition in education delivery and curriculum. We all are aware that professional Accounting courses require hard work, dedication, and commitment. It is our endeavour to ensure that the future Accountants acquire unmatched proficiency in the accounting domain and are well prepared for future professional lives. Finally, I advise students to create a love of learning and a resilience that is essential for great accomplishment. Such a mindset will serve well in the future, far beyond the timeline of a temporary pandemic.