To Edmund Wong FCPA (practising), there has never been a more crucial or complex time to be the Accountancy functional constituency’s representative in the Legislative Council (LegCo). From the regulatory reform of the profession to the growing opportunities in the Greater Bay Area (GBA), Wong is looking forward to advocating on these issues on behalf of accountants. “Through this role, I’ll be able to help my fellow accountants and serve as a key communication channel between the government, the Hong Kong Institute of CPAs, and the profession,” says Wong. “And with these new powers come new responsibilities.”
Wong, who will hold his new role as a LegCo member for the next four years, will be balancing his new responsibilities along with his full-time job of managing his father’s firm, Patrick Wong C.P.A. Limited, as Practising Director, as well as his roles in various Institute committees. These roles, Wong says, have proven indispensable in understanding the issues faced by members.
His desire to find better solutions prompted him to run as a candidate in the recent LegCo election, held on 19 December 2021. Wong secured a total of 3,175 votes – nearly 40 percent of all total votes – to win a seat to represent the Accountancy functional constituency, which is one of 30 functional constituency seats in LegCo. As of 2021, the Accountancy functional constituency is composed of more than 27,000 CPAs. Wong considers the victory as the highlight of his career so far, and an opportunity for him to make a tangible impact on the profession.
A major task
Top of Wong’s list of priorities is to help the profession navigate the upcoming regulatory reform, which will see the regulatory and disciplinary powers of the Institute being handed over to the Financial Reporting Council (FRC) later this year. “This reform is, without a doubt, a major concern among members,” he says. “With most CPAs used to the existing practice reviews from the Institute, this change will take some getting used to, which is causing a bit of worry.” Wong notes that he will be closely monitoring subsidiary legislations and by-laws regarding the reform that will be submitted to LegCo’s Panel on Financial Affairs, which is a panel tasked with scrutinizing government policies and issues of public concern relating to financial matters.
Despite the transfer of powers, Wong believes that the Institute will still play a key role in the profession and can now focus on strengthening its role in the functions it is retaining. “The Institute will remain in charge of roles such as standard setting, member services, and education and training. In other jurisdictions, such roles may be shared by other member bodies and authorities – but in Hong Kong, the Institute is in charge of all these roles,” he elaborates. “In short, the Institute wouldn’t be wearing two hats anymore. Because the Institute is a member body as well as a regulator, it has been advising practitioners to refer to a specific accounting standard or the code of ethics when it came to technical enquiries instead of providing clearer guidelines. After the reform, it will be able to focus on the welfare of members more.”
“As a representative of the accounting profession, it’s important that I maintain a close dialogue with different bodies. This way, all opinions can be heard.”
For almost a decade, Wong has played an active role at the Institute. He is currently Chairman of the Small and Medium Practices Committee and Deputy Chairman of the Greater Bay Area Committee. He has also served as a member of the Professional Development Committee and as deputy chairman of the Young Members Committee. He is also a Past President of the Society of Chinese Accountants and Auditors. His experience working with different members of the profession since he graduated has provided him with valuable insight into the various difficulties that they face on a daily basis, such as the issue of long working hours, as well as challenges which include the impact of COVID-19-related restrictions on the audit profession. “I’ve been in several meetings with the Institute to see if there’s any unfinished business to be carried forward from previous councillors. As a representative of the accounting profession, it’s important that I maintain a close dialogue with different bodies. This way, all opinions can be heard,” he says. “This has been greatly helpful in my role as a LegCo member so far.”
In light of the upcoming reform, Wong notes that many members, especially those in small and medium practices (SMPs), are worried about potential fee increases. “One concern I’ve heard from members is that because the FRC has taken on new roles, they might not have the adequate funding; they’re concerned that fees, such as registration fees imposed by the FRC, will be too high, which will be a burden to their practice,” he explains. Wong, who has joined LegCo’s Finance Committee, Panel on Commerce and Industry, Panel on Economic Development, Panel on Financial Affairs, and Panel on Security, says he has voiced this issue during a LegCo Finance Committee meeting held last month. “I’ve already raised this concern to the Financial Secretary. I hope that in their upcoming budget, they’ll be able to allocate additional funds to the FRC in order to reduce the burden for accountants.”
Wong will also be working closely with the Chairman of the FRC and the Institute. “I’ve been meeting with the FRC and the Institute’s leadership team to talk about the regulatory reform and our members’ concerns,” he notes. “I hope to be a voice for the profession during this whole process. This will be a major task this year.”
Edmund Wong FCPA (practising), Practising Director at Patrick Wong C.P.A. Limited, is the representative of the Legislative Council’s Accountancy functional constituency.
Putting the profession first
Wong also plans on using his new role to deal with the issue of attracting and retaining talent in the profession, particularly young people, and address deep-seated issues. “Many accountants are leaving their jobs because of long working hours and, often times, a salary that doesn’t meet their expectations. I believe that an accountant’s salary has to be proportionate to the amount of work they put in. It’s quite a serious problem,” he says, highlighting that addressing the problem will also help to enhance the reputation of accountants and how they are viewed in society.
Wong notes that he is intent on working closely with the FRC to find solutions. “It is an issue that I have voiced to the FRC. They aren’t only taking on a regulatory and disciplinary role; they’re looking to promote the healthy growth of the profession. The FRC understands that young accountants are key to the future of the profession and share the same views on the issue of long working hours – this will be on our agenda for the next four years.”
He notes that challenges such as the COVID-19 pandemic have pushed some firms to adjust their fees in order to retain clients, which, in turn, has affected staff remuneration. “Some firms might offer a comparatively low audit fee in order to stay competitive,” he says. Wong cautions that though firms are able to retain clients, the change in pay for staff may deter accountants, especially fresh graduates, from staying with firms for longer periods. He believes this problem will persist for some time. To cope, he advises firms to ensure audits are performed to the highest level for clients. This, Wong adds, will help them avoid any disciplinary measures and resultant fees, maintain credibility, and retain clients as well as staff. “If fees rise to a reasonable level, salaries would also rise, and this will, in turn, attract more young talent to the profession,” he says.
Having spent most of his career running and managing an SMP, Wong knows the challenges smaller firms face when it comes to staying ahead of developments in the profession. “SMPs simply lack the resources,” he says, referring to technical or specialist partners who provide help and advisory services to clients. “Technical support is important; accounting standards, auditing standards, tax laws and company ordinances are always changing, and SMPs experience a hard time keeping up with these developments.”
With his first-hand experience, Wong is determined to proactively voice the concerns of SMPs to the government, the FRC, and the Institute. “I feel obligated to listen to the concerns of fellow SMPs and explain them to the relevant authorities. I’ll be able to better serve SMPs in this aspect in my term.”
Long-term benefits
Despite the current wave of COVID-19 infections causing disruption across Hong Kong, Wong places trust in the city’s resilience, and says it still holds one prime advantage – its close proximity to Mainland China, which he adds, is key to the city’s economy. He is also hoping for quarantine-free cross-border travel between Hong Kong and Mainland China to take place as soon as the current outbreak is brought under control. “Even if we are unable to open up the border completely, the Hong Kong government should open its border with Mainland China or at least the GBA. We are positioned very well to maintain a good level of competitiveness once the border opens,” he says.
Wong says he has been communicating with the government to explore whether it is possible for accountants to be exempted from quarantine upon their return to Hong Kong. “With Hong Kong’s proximity to Mainland China, many accountants are required to travel across the border to discharge their duties and carry out engagements in person. Due to COVID-related lockdowns and quarantines, many accountants are unable to perform their duties in Mainland China.”
Indeed, with the vast opportunities for work and collaboration in the GBA alone, Wong has long been pushing for both practising and non-practising accountants to be able to easily work across the border. “For the past 20 years, we’ve been looking at whether CPAs in Hong Kong can join CPA firms in Mainland China and if non-practising CPAs can work in non-assurance services or consultancy services there,” Wong says. He notes how challenges include Mainland residency requirements and passing CPA examinations that are in Chinese can prove difficult for CPAs in Hong Kong, where accounting syllabuses and examinations are currently in English. “I understand that this is not an easy task, but I’m determined to accomplish this within the next four years.”
“For the past 20 years, we’ve been looking at whether CPAs in Hong Kong can join CPA firms in Mainland China and if non-practising CPAs can work in non-assurance services or consultancy services there.”
There may be obstacles to overcome in the area of tax, Wong notes, such as the implementation of the Organization for Economic Co-operation and Development’s tax framework, base erosion and profit shifting (BEPS) 2.0, which will introduce a global minimum tax on multinational enterprises (MNEs) in Hong Kong.
BEPS 2.0, according to a statement issued by the Hong Kong government in October 2021, will mainly ensure MNE groups meet the new conditions and is unlikely to affect small and medium enterprises (SMEs). Wong believes that the requirements may affect SMEs, due to the reliance on SMEs by large corporations. “For example, many SMEs work for multinational corporations (MNCs) as suppliers. And without investments or with less investments from MNCs, those SMEs will likely feel an impact,” he says. According to statistics from the Hong Kong government’s Trade and Industry Department, SMEs constitute more than 98 percent of business establishments in Hong Kong.
Some MNCs, Wong adds, might be less willing to invest in Hong Kong because of the impact of BEPS 2.0 on the city. “This may have an impact on Hong Kong’s economy and on employment as well,” he says. However, Wong notes that until the requirements come into effect in 2023, it is still too early to draw conclusions, and that Hong Kong will continue to attract both large- and medium-sized, and small companies with its low tax rate, among other benefits, even after the implementation. “Hong Kong, with its stable legal system, is also positioned well for investors to benefit from both Mainland China and the Asia-Pacific region. This will always be a key advantage.”
Striking a balance
Wong regards balancing his role as LegCo member and his other roles as the biggest challenge he has faced in his career so far. “It’s a big step going from an accountant – one who has spent the last 15 years in the profession – to being a legislative councillor,” he says. “For the past two months, I’ve had to work in both my own office and in my LegCo office each day. As a functional constituency representative of the accounting profession, I need to maintain my role in the profession in order to understand the difficulties of fellow accountants. I’m always trying to find ways to strike a better balance.”
However, he embraces this challenge and is deeply committed to helping the profession navigate challenges during the next four years – and for the rest of his working life. “Our profession deserves better,” Wong says. “I’ve been speaking with many accountants over the past two months regarding some of the difficulties they have been facing – and helping them solve their problems makes me passionate about supporting the profession.”
Wong has played an active role in the Institute. He is currently Chairman of the Small and Medium Practices Committee and Deputy Chairman of the Greater Bay Area Committee.
“I’ve been speaking with many accountants over the past two months regarding some of the difficulties they have been facing – and helping them solve their problems makes me passionate about supporting the profession.”
Wong’s many responsibilities leave him with little spare time. “Since being elected, I believe there are no ‘official’ working hours for me now,” he laughs. “Whenever help is needed, I want to be there. I have different people calling me on a daily basis to voice their concerns or opinions. I’m busy, but I enjoy helping people.”
Wong’s passion for helping society is also evident in his personal life. When he finds time on the weekends, he volunteers for the Hong Kong government’s Auxiliary Medical Service, and has been doing so since he was a secondary school student. “I joined at the age of 16. My main duties include providing first aid and ambulance services for public events. We stand at the front line and help those in need,” he says, noting how he volunteered to be medical personnel during the Standard Chartered Hong Kong Marathon in October 2021. “When I’m on the front line in my roles, I feel I am helping society at large.”
In the months and years ahead, Wong hopes to lay the right groundwork for young accountants to succeed, and for each one to feel the same sense of joy and satisfaction that he has felt as an accountant since the start of his career. “With my new role, I now serve Hong Kong as a whole,” he says. “And I want to do my best in helping the profession attract more young accountants, and letting them know that it is indeed a fulfilling career. I plan on doing whatever I can to improve the profession for the next generation.”
As the newly elected representative of the Legislative Council’s Accountancy functional constituency, Edmund Wong FCPA (practising) will be focused on guiding the profession through the upcoming regulatory reform; communicating the concerns of young members and small and medium practices to the government, Financial Reporting Council and the Institute; and identifying more opportunities for both practising and non-practising members to work in the Mainland.
