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Nationalisation, political instability and the Asian financial crisis have plagued the development of Myanmar's economy. David Hayes speaks to Morison International firm Win Htut Aung & Associates about the state of the country's accounting profession
Foreign investment policy has had a major impact on Myanmar's economy during the past decade. Regulation favouring the growth of local businesses has resulted in many foreign trading companies closing their offices, operating instead through local agents. This has changed the type of accountant services private clients require.
Overseas protests by non-government organisations (NGOs) over the detention of Nobel Prize-winning democracy advocate Aung San Suu Kyi, plus foreign trade sanctions imposed by the US government, have forced a number of foreign companies to pull out of Myanmar and stop trading with the country altogether. This has reduced the size of the lucrative foreign client accounting market, which appears unlikely to rebound until the government adopts more open foreign trade policies once again.
Win Htut Aung & Associates, a member firm of Morison International, is one of Myanmar's few private accounting firms. Combined, these firms employ between 50 and 75 of the country's estimated 300 qualified certified public accountants (CPAs). Most small accounting firms are run by CPA sole practitioners. Other practising CPAs have salaried employment and part-time private practice work.
Foreign accounting firms are allowed to set up office in Myanmar but foreign accountants are not allowed to practise, according to the firm's managing partner, Win Htut Aung. He says PricewaterhouseCoopers, KPMG and Ernst & Young previously had offices in Myanmar but decided to pull out because of overseas NGO pro-democracy protests against the country's government. Local counterpart accountant practices now do Big Four referral work. These practices are Myanmar's biggest and employ about 50 accountants each.
Win Htut Aung & Associates employs 15 qualified accountants including seven CPAs. Occupying office premises in the country's largest city, Yangon, the practice has 22 staff in total and will take on a new batch of four to six trainees this year. Audit accounts for 53 percent of the firm's work, while business set-up and secretarial work represents another 30 percent. Tax work is about 15 percent.
Aung tells IAB that local clients now dominate the current market, in contrast to previous...