Have there been any significant regulatory developments in Ghana over the last 12 months?

The accounting environment in Ghana has not seen significant regulatory developments over the last 12 months. Governmental fiscal pronouncements and some tax legislations enacted are aimed at consolidating laws subject to administration by the Ghana Revenue Authority with implications for accounting, effective April, 2023.

In December 2022, the Government of Ghana announced a Domestic Debt Exchange Programme (GDDEP) consistent with negotiations with the International Monetary Fund (IMF) for the restoration and sustenance of the macroeconomic stability. The GDDEP offers registered local bondholders to exchange their eligible domestic bonds for new ones with some conditionality though investments in treasury bills and small investor holdings are exempt.

How would you describe the health of the accounting industry in Ghana in terms of customer demand, fee pressure, and staff recruitment and retention?

Demand for accounting services is dictated by regulation, group policy and investor needs. The regulatory legislations compelling businesses to prepare accounts include:

• Companies Act, 2019 (Act 992);
• Income Tax Act, 2015 (Act 896) as amended;
• Securities Industry Act, 2016 (Act 929) as amended;
• Banks and Specialised Deposit-Taking Institutions Act 2016 (Act 930) etc.

Owner-managed businesses in Ghana perceive accounting as “necessary evil” and, therefore, relegate its importance. Section 127 of Act 992, compels businesses to comply with the requirement of keeping accounting records and preparing accounts. Businesses including the accounting practice in Ghana which were affected by Covid-19 and the Russia-Ukraine war took adhoc measures to manage personnel movement and high cost of living which dipped business performance hence demand for Accounting services.

Ghana is undergoing domestic and external debt restructuring as part of the conditions to secure an IMF support. A revitalised interest in the Ghanaian economy would, expectedly, create new businesses for the accounting industry to leverage on.

Fee profiles are competitive among the “big” firms with international affiliations. Most Accounting firms in Ghana are inadequately resourced with the desired personnel because of inability to pay competitive remuneration. The lack of guaranteed fee has created an environment for businesses in Ghana to offer low fees for accounting services. The Practice Society of ICAG made local recommendations to the Regulator on the minimum Service Fee for the public practice of accountancy based on risks affecting fee pricing such as unrealistic price undercutting by Practitioners and unfair dictation of audit fees by clients.

Guaranteed chargeable fee are needed to:

• maintain and improve the standard and quality of audit;
• set commensurate remuneration;
• level the playing field for Practitioners to prevent “low-balling”.

Fees chargeable are based on such criteria as volume, risks, estimated man-hours, caliber of assigned staff and firm status rather than the fortunes of the client.

Partly and newly qualified accountants abound for recruitment. However, accounting firms are conceived as a training field for young Accountants who invariably are underpaid creating high iteration rates.

Are there any services areas where demand has grown over the last 12 months?

Growth in demand exists in the services sector driven by education, health and ICT service industries.

Has there been any significant consolidation or merger activity in the accounting profession?

Consolidation or Merger is alien to Ghanaian accounting firms, the basic reason being loss of control and loyalty. No known merger activity has occurred in the profession since the land mark one of Price Waterhouse and Coopers & Lybrand in 1998.

What are your expectations for the next 12 months - are there any potentially significant developments in the pipeline?

In spite of the decline in the Ghanaian economy, the next 12 months fall into an election year which will be characterized by increased government expenditure with rippling effects on the general economic activities of local institutions. Accounting firms will leverage on this to improve revenues.