SAICA Strategy

SAICA Vision

Executive Summary

Further, to the strategy formulation, we review the implementation and control aspects of strategy through monthly Plan, Do, Review sessions with the Management Committee.

Collaboration with Member Constituencies

We are currently reviewing the terms of reference of the National Commerce and Industry committee and the National Small Practices Committee. The purpose of the review is to ensure that these committees take ownership of and drive the strategic direction of SAICA service delivery to their respective constituencies. Our longer term objective is to do the same for the large practices forum, the public sector forum and our international member groupings.

We have established a number of committees and working groups directed at active collaboration with members. Given that our small practice constituency face huge issues currently, we have created advisory groups comprising of these members. These groups include the following:

• Small Practice Strategy Committee
• Small Practice Advisory Forum (SPAF)

The Small Practice Strategy Committee is a consultative forum comprised of influential practitioners from around the country. The role of the committee is to identify issues facing the small practice environment in the medium, short and long term and to help craft solutions to the issues that they face. A first sitting of this group was held at the end of January, with Brand Promotion and Communication being two of the key next steps identified. The session was well received and provided valuable insight into the future of small practices. A communication to all practitioners was issued the day thereafter explaining the process and soliciting involvement from members as the process of consultation unfolds.

The SPAF will complement the Small Practice Strategy Committee in crafting alternate training models for the training and qualification of prospective CAS.

We will complement these forums with regular road-shows aimed at a broader audience over the course of the year.

We will drive the same approach in ensuring adequate consultation with members in Commerce and Industry, academia, government, large practice and absentee members. These interactions will be staggered over the year with the initial focus on the small and medium practice environment.

Issues

The strategy review with the SAICA Strategy Committee identified seven big-ticket issues which will drive much of our activity over the course of this year. The issues/propositions identified are:

• Definition and delivery of value propositions per segment
• Transformation and skills shortage
• Brand promotion
• Education and training model review
• Stakeholder relationships
• Funding
• People

We will briefly cover the background, issues and strategy for the year in relation to each of these areas.

Transformation and skills shortage

• Shortage of accounting skills at all levels
• Shortage of trainee accountants
• No real growth in pipeline of students, coupled with inadequate throughput pass percentage rates
• Adequacy of the transformation of the base of students presenting themselves for the QE.

Our strategy for this year builds on the successes of the transformation initiatives of the past and seeks to enhance those through added initiatives. Our strategy is focused on:

• Growth in numbers of members through our schools, undergraduate, postgraduate, QE and learnership programmes
• Growth in size through a focus on the provision of a broader range of accounting skills into the economy, initially through the launch of the AAT programme
• Growth in significance by focusing on the consolidation of the South African CA programme in Southern Africa.

Targets

Success in the current year will be represented through the following measures:

Growth:

• Shift in population demographics and increase in numbers of candidates presenting themselves for QE (Part 1) and passing.

Size:

• Successful role out of AAT programme and getting people who have been successful to join the body
• AAT to become financially viable i.e. generate sufficient income to deliver value to all stakeholders.

Significance:

• To have a Southern African Institute of Chartered Accountants with members in SA, Namibia, Swaziland and Zimbabwe
• To have at least 150 new students (annually) enrolled through UNISA in these countries to become CAs.

Education and training model (and conversion)

The professional development model currently being used within SAICA manages to consistently produce the best quality Chartered Accountants globally. The demand for South Africa CAs locally and internationally is testament to the long-standing quality of the designation. The model does, however, face some challenges:

• The financial management specialisation has not proven to be a success with aspirant CAs
• The education model currently in use is yet to be aligned to a yet to be defined competency framework for an entry level CA (entry level into the market)
• The TOPP training route has not attracted a critical mass of trainees and training offices
• The TIPP training route, with its focus on audit training, will potentially see a significant decline in training offices should the Companies Bill remove the audit requirement for limited interest companies
• The impact of the Companies Bill could filter through to trainees as the market attempts to understand the role of a future CA.

Strategic Imperatives

Our efforts for this year will be focused on the development of the following:

• A competency framework
• A revised training model aligned to the competency framework which allows for alternate training models for aspirant CAs
• Simplification of the administration involved in the management of training contracts as well as the recording of CPD for qualified members
• The conclusion of research into the accounting skills shortage in the country. This will help inform the competency framework for the CA as well as any other level of accountant identified in the process.

Targets

• Competency framework presented to the Board for approval in the fourth quarter of this year
• Revised training models presented to the Board for approval for implementation effective 01 January 2009
• Skills research finalised by 31 May 2008
• Administration review approved by the Board during May 2008 for implementation in 2009.

Funding

Strategic Imperatives

The plan is to build capacity for SAICA in this regard. A fundraising consultant has been found to assist SAICA develop this capacity.

Our efforts for this year will be focused on:

• Writing proposals for specific sector donors locally and internationally
• Formulating a funding strategy for SAICA
• Training in proposal writing
• Creating capacity internally to consolidate the function of both sponsorships and funding.

We are also focused on understanding the flow of costs and the extent of subsidisation of various activities by fees and other revenue. This will assist in better managing the allocation of resources to specific member constituencies. We are currently engaged with an Activity-Based Costing exercise which will outline that detail. The results of this exercise will also be used to inform our future funding strategy as it relates to membership fees. A continued inflationary increase in fees is not a sustainable business model and will need to be capped at a point in time.

The development of a funding strategy is also critical in outlining the approach to be used by SAICA in further developing its technology and people infrastructure. This will invariably be an expensive and drawn out process that will reap results over a minimum of a three year period. Working on a payback period of three to five years will challenge the break-even budgeting philosophy that has been the norm at the Institute over the years.

SAICA activities are currently funded 60 percent from membership fees and 40 percent other revenue. The SAICA annual budget is also based on the break-even principle, since we are a non-profit making organisation. This however does not cater for the mandate of growing and transforming the profession. This means that SAICA has had to find alternative sources of funding for transformation and growth (which includes Thuthuka) initiatives. The success of these initiatives is largely dependent on the organisation’s ability to source funding which in the past was predominately from government and the accounting firms. The inability to source funding for projects such as the schools project in all provinces has put SAICA at a risk of being unable to delivery on its strategic objective of growth.