Red Tape Holding Accountants Back

Over half of Australian Finance Managers say bureaucracy or ëred tapeí is slowing down their ability to comply with accounting standards and regulations, according to Robert Half Internationalís latest International Workplace Survey.

Over 40% of those surveyed say that the issue affecting their business is not the complex new compliance procedures introduced by the government, but rather the additional paper work and heavy administrative regulations that result from these procedures.

This additional workload is being blamed for the sluggish levels of innovation and development in the Finance sector. Rather than being able to use their skills to help their organisations grow, finance departments are swamped with the sheer weight of compliance work they are now expected to undertake.

ìAdditional procedures and paper work resulting from new regulations are obviously holding our more commercially focused accountants back, and leading to a paperwork-heavy working life. This will naturally inhibit time available to contribute to the strategic development of the company.î said Nigel Barcham, Managing Director, Robert Half International ANZ

ìThese changes have implications for the reputation of the finance sector, externally as well as within the internal framework of a company. It is important that this issue is addressed before it results in a diminished interest in the industry at a graduate level. This would be a massive concern at a time when Australia is already experiencing a skills shortage in the finance sector.î Nigel continued

One possible solution to this issue is for firms to split the functions of the finance department and begin employing finance staff who specialise in either compliance or innovation and development. This would allow departments to maximize and channel individual skills and ambitions, while addressing the struggle that faces companies attempting to reconcile these two almost ëdiametrically opposedí skill sets.

ìIncreased compliance is here to stay and we may even need to consider changing the way that we train graduates when they enter the sector. The question of whether we continue to train people to do both tasks, or create specialist functions within a department is one that must be considered.î Nigel commented

Australian Finance Managers are not alone in their concern about the limiting effects of ëred tapeí. A convincing 94% of Finance Managers surveyed globally agreed that Governments should simplify procedures and administration to encourage entrepreneurship amongst young people.

Interestingly, Australian companies appear to be less concerned by bureaucracy than companies in neighbouring New Zealand where over 70% of companies are finding the workload created by new regulation is affecting productivity levels.