The Role of Accountancy in National Development

INTRODUCTION
Ghana as a nation has come far, from a dependent nation to an independent nation. We have had
our challenges and we have had our milestones. An outstanding trait of Ghanaians undeniably is
our solidarity. Rather than be downhearted and flustered about certain events, we find humour in
the worst of things. However, hardly do we find issues pertaining to the shortage of jobs in the
country amusing. Nonetheless, assertions have been made that business-related jobs are one of
the most sought after jobs in Ghana. Such notions carry along little evidence as such. Mr Joseph
Odartey Blankson, President of the Institute of Chartered Accountants, Ghana (ICAG) during the
19
th
graduation and admission ceremony in 2012 categorically stated that high quality
sustainable accounting was an important part of every developing and emerging economy since
the accountancy profession could be a protection against fraud and corruption.
This commentary makes perfect sense in all directions since indicators related to the financial
health of the economy are distinguished as critical success factors underpinning Ghanas
survival. This explains why more people are drawn to national debates on matters concerning
SME growth, depreciation of the national currency, inflation matters, oil and gas revenue
management, corruption; rather than disease control maternal mortality, illiteracy rate, gender
inequality and other social concerns. The balance continues to be tilted towards monetary issues
rather than social concerns; the ideology with many is that monetary stability has in its workings
to solve social instability.
As is evident, finance is so fundamental to the well-being of the Ghanaian economy which
clearly implicates that accounting and finance professionals have a dramatic role to play in not
just economic growth, but sustainable economic growth. What in deed is the role of accountancy
in Ghanas development? This essay explores past and current role of accountancy in national
development, and based on current issues makes projections on what clearly accountancy will
bring to the Ghanaian economy
PAST AND CONTEMPORARY ROLE OF ACCOUNTANCY
The early years of the accountancy profession was centred on mostly bookkeeping recording
the financial effects of transactions making reports to management. This primitive function
helped in deepening the stewardship role of business professionals and beyond. An entrepreneur
could thus have enough confidence of receiving accurate records pertaining to daily transactions
without having to be around the business premises.
Beyond basic bookkeeping, accountancy has currently evolved into numerous sub-divisions
which include tax accounting, management accounting, financial accounting and others; in both
public and private practice. It now goes beyond the original act of recording past events into
predicting future trends and making sound financial decisions for major stakeholders. The
establishment of the Institute of Chartered Accountants (Ghana) by an Act of parliament, Act
170, in 1963 also progressed accountancy into an organized profession in Ghana.
Access to this information not only helps management in knowing how to plan forward but it is
also an insignia to investors, the government and shareholder groups about how to proceed.
Management accounting- an aspect of accountancy has been a beneficial tool for management in
planning and control.
One may argue that as accountancy in its origins was to provide historic information thus the
activity had no impact whatsoever on economic development. But let us bring the facts to bare.


little or no significant influence on initial development policy choice. Indeed, accounting
provides ex post information about the results of particular policies that governments pursue.
Another critical role of accounting is that of attestation, which involves the accountant providing
the much-needed assurance that people in trusted positions are conducting their affairs honestly
and in accordance with accepted policies. The attestation role of accounting is critical because of
the overwhelming perception in the conservative tradition that advancement in economic
development will inevitably require the separation of capital and management. Management, as
stewards, are required to act in the interests of the owners of capital and the accountant fills the
role of ensuring that this is not compromised.
Enron collapse in the .Corporate management also rely heavily on the analytical expertise of the
accountant for effective decision making in uncertain contexts. Such decisions include costing
and pricing of products, planning corporate activities, and (re)formulating strategies in
competitive industries. At the national level, the accountant contributes in providing national
income data and highlighting the trends in the various components (Enthoven, 1973).
Much of the data that goes into national income accounting is usually collated from the accounts
of the individual economic entities in the country. Further, accounting plays a key role in the
national annual budgeting process.
Accounting regulation and the information generated by accounting systems are deliberately
skewed towards fulfilling the needs of the dominant stakeholders (mainly the providers of
capital). The reformist tradition challenges the status quo and argues that accounting reports
should provide the necessary information for all stakeholders, including employees,
management, social and environmental activist etc. integrated reporting performance
measurement is one of the key issues in the quest for advancement in socio-economic living
conditions. This helps national leaders to determine whether certain development oriented
policies are achieving the desired outcomes or should be abandoned.


Accountancy is also at the heart of corporate governance practices as established by the
Sarbanes-Oxley Act (2002). Corporate Governance was established to prevent corporate failures.
Although the provisions in the act vary from country to country, voluntarily or by law the
guidelines remain the same.

How did this help in national development? Fiduciary relationships were promoted. This relates
to the responsibility to look after someone else's money in a correct way. Management would
have had no confidence in other executives if they werent assured that accurate accountability
would be made. Employment is provided in this instance, both to the Executives and to the
functional staff who have jobs by virtue of management confidence in expanding.
Monitoring (fraud, corruption, embezzlement, misappropriation, pilfering)

Widening government tax net. Mgt a accounting help. Corporate governance and risk mgt

Budgeting, decision making techniques, foreign exchange
3.4 Future Role of accountants
Integrated reporting (al gore quote), technology systems security (case study of target), SME
IFRS (GAX)
What more is expected of accountants in future? I believe that accountants must be well
prepared, intelligent and up to date with new developments. Here, I make three projections.
The first outlook is the emergence of the concept of Integrated Reporting (IR). It has been
defined by ACCA.org as a concise communication about how an organizations strategy,
governance, performance and prospects lead to the creation of value over the short, medium and
long term. The primary purpose of an integrated report is to explain to providers of financial
capital how an organization creates value over time. An integrated report benefits all
stakeholders interested in a company's ability to create value, although it is not directly aimed at
all stakeholders. This report is creating the next generation of annual reports because it involves
an assessment of an organization and its prospects.
Accountancy can also made roadways in technology. Technology systems security (case study of
target), can be incorporated into accountancy. The CIA triad of systems security can be expanded
to include accountability. Of course, this has been subjected to a lot of debate, since it does not
fit well into the core concept. (Donn Parker, 2002). But examining it from a different angle and
seeing the incidence of Target shows how reasonable this incorporation will be. Systems security
involves securing information that is vital to business, such as employee records, financial data
and operational information. This implies how important securing this information is. Ghana has
little, if any advancement in this area. Huge sums of money, time and resources can be lost if
measures are not put in place now, to secure these data and have accountants seen as heroes.
(Why was the CFO blamed for the break-in in Target rather than the Chief Security Officer?)
Another area evolving in Ghana is the promotion of small scale enterprises (SMEs). Accounting
is already playing a role in this sector. However, it seems the standard on SME accounting is
being ignored. IFRS. With the establishment of Ghana Automated Exchange (GAX), SME
promotion in Ghana is going to be the focus and talk of the town. Accountancy can play a
major role in this development by applying the standard on SME accounting.

3.3Perceived role of accountants (questionnaires)
Currently, the accounting profession is making headways in national development. Accounting
can hardly be mentioned without talking of finance.
From the perspective of an accountant to be
Recommendations
Change peoples perception to realize we have a bigger impact to play in national development. It
is only by doing that before we can fully contribute to national development and not just by a
margin. The idea is not to advertise to only business professionals but to greatly influence non-
business professionalfs who we are. Having them as a friend. Because they have it in them to
influence the future generation to be accountants and give us de needed support to perform our
function
Conclusion
Unsolicited





A concise communication about how an organizations strategy, governance, performance and
prospects lead to the creation of value over the short, medium and long term. It means
representing a companys performance
In many ways good financial management is the foundation on which effective international
development is built. Therefore volunteers with finance skills are in high demand. Qualified
accountants have the training and experience to build the confidence of local finance staff
Conclusion is to say what ica can do promote the accountancy profession look at ACCA article
on innovative first on mobile
Industry Trends
Computers are the biggest agents of change in accounting. They are making almost every area
more efficient and accurate. They provide templates and standard forms for transactions and
records, and organize the data better. Increasing access to a companys data allow accountants to
have quick access to the information they need to do their job effectively, and new accounting
software makes the work more efficient and enjoyable by eliminating a lot of manual work. They
also resolve problems of geography through the World Wide Web. Thus, the modern accountant
needs to be well-versed with computer programs and using the internet. Many accountants even
specialize in writing programs or troubleshooting existing programs. Some accountants are even
involved in technical aspects like developing or implementing technological systems and
maintaining networks.
Personal financial advisors are gaining popularity as more clients need reliable, honest,
competent individuals or firms. Personal financial officers provide services in preparing taxes,
personal budgets, and retirement plans. They also can help clients develop investment portfolios,
effectively utilize assets, and provide advice on recognizing and minimizing risks. However,
regulations prevent accountants from both providing these services and preparing financial
statements for the same client.


The exact role of accounting has, however, been questioned in very recent times,
prompting this critical reflection.

But Wallace (1990) noted that the
exact role of accounting in socio-economic development is yet to be clarified (see also
Susela, 1999).
Yet the concept of
development is an umbrella one whose meaning, scope and understanding vary according
to the theoretical lens that guides the individual researchers or policymakers thinking
(see Rahaman, 1997). Attempts to address and simplify this problematic concept have
resulted in the existence of diverse classifications of development theories which has
compounded the problem and have led some to conclude that, at the practical level, the
concept of development is in serious crisis (see Haque, 1999).

Accountings role is one of accumulating the necessary data, analysing and
interpreting these data and reporting the resulting information to corporate management,
heads of government institutions and other stakeholders for rational economic decisionmaking.


Accounting is a socially constructed craft whose role in national socio-economic
development depends upon how it is perceived and utilised.

We conclude that accounting has a multiplicity of roles in national socio-economic
development and seeking to understand the exact role of accounting requires an
appreciation of the context-specific nature of not only accountings functioning and roles
but also development itself. It is impossible to find a single set of roles for accounting
that will reflect all development paradigms. Accountings roles in Third World socioeconomic
development therefore vary from one development tradition to another.