The digital revolution has changed the business world. Accounting is no exception, and it is natural to wonder what digital development means for the profession. Today, we are pleased to speak to San Rithy, who will share his opinions on how digital transformation will impact accountants in Cambodia to give you an idea of what your future might look like if you choose to be an accountant in the digital age.
Rithy is the Managing Director in charge of Acclime Cambodia. His role is to help clients transform their businesses (small and medium-sized enterprises) into corporate ones, focusing on corporate governance, business management and financial management by leveraging financial technology (FinTech).
“There was no professional accounting body in Cambodia until 2002, when the promulgation of the Law on Corporate Accounts, Their Audit and the Accounting Profession 2002 resulted in the creation of two accounting institutions: The National Accounting Council (NAC) and the Kampuchea Institute of Certified Public Accountants and Auditors (KICPAA).
KICPAA, or the Institute, is the only one independent and non-profit institution in the Accounting and Auditing profession in Cambodia which was established by the 2002 Law on Corporate Accounts, Their Audits, and the Accounting Profession and subsequently the 2016 Law on Accounting and Auditing of the Kingdom of Cambodia. The Institute was established to protect the profession’s public interest and interest; govern its members through professional capacity development; enhance compliance with standards, professional codes of conduct, rules and regulations; and develop and manage professional accounting education programmes.
On the other hand, NAC, which is now replaced by the Accounting and Auditing Regulator (ACAR), is a regulator of the Royal Government of Cambodia, governing, strengthening and promoting the development of the accounting and auditing profession in Cambodia as well as promoting law enforcement and implementation of Cambodian accounting and auditing standards.
Since the replacement of NAC, ACAR is actively promoting the obligation and importance of accounting roles to both accountants and businesses to prepare themselves for the economy’s future growth, particularly in line with Cambodia Digital Economy and Society Policy Framework 2021-2035 set out by Royal Government of Cambodia.
Likewise, in January 2022, an Instruction 002 on the Submission of Annual Financial Statements to the Accounting and Auditing Regulator (ACAR). ACAR announced that they would enforce the law requiring all enterprises in Cambodia to lodge annual accounts with the body. The instruction is applicable for the 2021 year, and the accounts must be lodged by 15th April 2022 (which was initially extended to 15 June 2022 and now further extended to 30th Jun 2022 except NGO which has to be extended to 30th August 2022).
Further, all enterprises must keep accounting records and prepare financial statements in accordance with the applicable standards and laws. ACAR will be undertaking inspection visits and intend to fine enterprises noncompliant with the law.
As a developing nation, Cambodia lacks accounting professionals who are competently capable of preparing financial statements in compliance with regulations and standards, particularly CIFRS for SMEs. Cambodia needs young professionals who are highly skilled to improve the overall productivity of the economy.”
“Digital transformation in Cambodia is not new but at its very beginning. As published in Cambodia Digital Economy and Society Policy Framework 2021-2035, Digital transformation in Cambodia is about adopting, capturing and maximising the benefits of advances in information and communication technology and digital technology to increase productivity and economic efficiency.
Digital transformation involves the integration of digital technologies and business processes. Therefore, digital transformation has a tangible impact on accounting information systems and the accounting profession, from memorising, classifying, and summarising to analysing and discussing financial statements, establishing the system, and ensuring the effective continuity of the system.
Accountants in business are the back-office staff who support operational functions in accordance with each business model. Their jobs are to produce timely and reliable financial statements in compliance with regulations and standards. Their scope of work includes forming proper documentation, record-keeping and reconciliation, and reporting. A lot of paperwork has been manually prepared to ensure the internal control systems are in place from both operational and financial perspectives.
This transformation is considered necessary for the accounting profession to constantly renew and improve itself in parallel with developments in the digital era. In addition, the emergence of digital systems and faster and safer operations carried out by accountants in these systems make it necessary to change the social image of the profession. In the process of digitisation, the transformation of the accounting profession by redesigning it will keep the profession up to date to meet the challenges of the digital age. Therefore, accounting practitioners must continue their work by feeling more responsible for thinking, redesigning, and analysing to shape the profession’s future.”
“As mentioned earlier, the Law on Corporate Accounts, Their Audit and the Accounting Profession was promulgated in 2002. Since then, Cambodia has made reasonable progress in reforming accounting and auditing arrangements to meet the needs of a mixed market economy, particularly in this digital era. Given the scale of this task, it is not surprising that the accounting industry today has remained several gaps and challenges that may be categorised as follows:
It is well-known that the working environment and work models affect employees’ motivation, productivity and job satisfaction. Staff can learn fast and thrive in an advanced working environment.”
“Our COO, Ms Debby Davidson, once said:
“A founding principle of Acclime is the long-term alignment of all our stakeholders. Creating a diverse and inclusive workforce is key to ensuring that Acclime remains an employer of choice”.
Likewise, to gain the “employer of choice”, we have practised three principles below:
From day one, our employees understand the goal setting to become a manager in 3-5 years through the annual performance review “APR”, which evaluates yearly. From year to year, they have to assess whether they are productive and produce the expected results as agreed by their direct supervisor during the goal-setting process. They gain expertise through on-the-job training and a must-join program with CAC Centre, which provides professional training and development to our staff.
Compared to the same tier, we are not only providing salary benefits but also incentives and bonuses to our staff according to our company year-end performance.
Acclime will not use a “timesheet” to monitor the performance of our professional staff, said Mr Martin Crawford, our Group CEO. This is a very friendly and effective practice for the current generation. Acclime understands and listens to the core needs of staff who work “independently” to grow more but “interdependently” to produce better results.”
We would like to express a profound thank you to San Rithy for sharing with us his valuable experience. We hope his opinions will provide a clear path forward for those pursuing a career in accounting.