2014

H1 | JAN-JUN

GLOBAL TREND REPORT SPECIALIST FINANCE

A MIXED GLOBAL OUTLOOK FOR HIRING ORGANISATIONS AND CANDIDATES

• Internal Auditors are in demand in many regions

• ERP experience is valued everywhere

• In Australia there is a continuing preference for contract hires

• There is a booming market in Ireland and the UK, though not yet at pre-recession levels

• In China the market is stable

• In Hong Kong the demand for Internal Auditors is especially strong

• In Japan there is insufficient supply to meet demand for bilingual or multilingual Specialist Finance professionals

In line with our commitment to keep professionals working in Specialist Finance functions up to date with employment and recruitment trends, in May 2014 Morgan McKinley conducted an international survey of its specialist consultants in six markets. The market shows quite dramatic contrasts between regions, which can be broadly accounted for by varying rates of economic recovery and local structural issues. Candidates are advised to take the long-term view of their career progression as there will be further restructuring and change in the period ahead. Internal Audit is a good bet for ambitious Finance professionals but it will be a demanding role as organisations face up to a more regulated environment. We expect to see further improvement in the market through to the end of 2014:

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QUICK LINKS

AUSTRALIA .............................................. 2CHINA ...................................................... 3HONG KONG .........................................4IRELAND .................................................. 5JAPAN ....................................................... 7UK .............................................................. 9

While there are signs of improvement in the Specialist Finance recruitment market in Australia organisations are often still pursuing the consultancy path rather than hiring a full headcount. “They know it is less cost-effective in the long run but working through a recruitment sign-off process is too time-consuming. It is far quicker to get sign-off on consultants,” comments Matt Jacobs, Associate Director, Finance & IT at MorganMcKinley Australia. Many companies are simply not recruiting into senior level positions, preferring to rely on external consultants and auditors.

That said, we are seeing more job postings for more junior roles such as Audit Trainee and Audit Semi-Senior, as well as specialist roles such as Cash Management Manager, Corporate

Recovery Manager, Corporate Recovery Senior. Internal Audit professionals are also in demand. However, this is mainly replacement headcount. Overall, Specialist Finance teams are getting leaner.

“Many Australian companies are wrestling with the challenges of IT implementations and organisational changes as well as compliance and regulatory issues,” says Jacobs. “Businesses are constantly restructuring and candidates must take this on board when taking on a new role,” he adds. Therefore he advises candidates to identify a potential mentor or inspiring leader when considering a new position. “I see so many people fast-track their careers because they have a manager or director who believes in them and carries them up through the ranks,” he says.

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Specialist Finance teams are getting leaner.

PREFERENCE FOR CONSULTANTS

AUSTRALIA

SALARIES & BENEFITS

Salaries are likely to remain flat in Australia in 2014.

We have seen no discernible change in recent months in the Specialist Finance recruitment market in China. There is still some economic uncertainty in the country, though this should be seen in the context of relatively high growth rates compared to other parts of the world. There is still a fairly high level of demand from large international practices and in-house at large multinational enterprises, but recruitment budgets are broadly static and some companies are downsizing their Finance function or offshoring certain Specialist Finance activities.

Roles that are currently most in demand are Audit Manager, Audit Senior (with a minimum

three years’ experience in practice) and Internal Audit Manager. Chinese companies will also be looking for Specialist Finance professionals who can help them steer their way through the new regulatory environment and accounting standards, so knowledge of IFRS and GAAP is a key asset.

“Although the market is broadly stable, there are a lot of candidates getting active and looking at their options,” says Marlon Mai, Associate Director for Finance & Accounting sector in China.Those who add an MBA or equivalent, fluency in a foreign language and experience of ERP systems (particularly SAP) to their accounting qualifications will find the best opportunities.

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Candidates are getting active and looking at their options.

BROADLY STABLE AND GEARING UP FOR IFRS

SALARIES & BENEFITS

There is upward pressure on salaries in China and we expect rates to increase by 20-30% in 2014. Performance-related pay increases are only likely in Project Finance, IPO-related roles and some roles at the Big Four.

CHINA

The situation is getting better in Hong Kong though there is still a little uncertainty about the economic situation and demand is currently mainly focused on replacement rather than new headcount. There is a constantly high demand for Internal Auditors and Internal Audit Managers, a role that typically brings with it high-frequency travel. Many organisations are currently pushing through organisational changes including increased globalisation of functions and there is an ever-increasing regulatory and compliance burden to deal with.

“If you have Big Four experience in a commercial environment and want to move forward in your career in Specialist Finance, Internal Audit is a

very good option in Hong Kong, though you must be prepared to spend a lot of time travelling,” comments Jacky Cheung, Manager of our Hong Kong office.

This can be demanding and we have found that many potential Internal Audit candidates are looking for a change in direction, possibly to a role as Finance Manager or Financial Controller, often precisely because they want to spend less time in the air!

“I expect the demand for Internal Auditors will continue because controlling and compliance are major concerns for multinational companies based in Hong Kong,” concludes Cheung.

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Controlling and compliance are major concerns.

DEMAND FOR INTERNAL AUDITORS READY TO TRAVEL

HONG KONG

SALARIES & BENEFITS

We anticipate a modest rise in salary levels, probably around 5%.

Overall the Specialist Finance recruitment market has improved significantly in recent months, with demand increasing for both new and replacement permanent headcount as well as for contract and temporary hires. The general economic upswing is obviously a major factor but organisational change, IT implementations and compliance issues are also making an impact, with demand focused on the Big Four practices and other large international practices. “But we have also been pleasantly surprised by the resurgence of demand for talent in small local practices as indigenous Irish businesses are on a growth trajectory,” comments Ronan Hill, Associate Director at Morgan McKinley, Cork.

Both our Dublin and Cork offices have reported a shortage of suitably qualified locally based talent, with some organisations looking to the United Kingdom or continental Europe to fill the gap, in particular returning Irish nationals. According to Niall Hughes, Practice and Accountancy Recruiter at our Dublin office,

this is the biggest challenge in Ireland at the moment. “We are now feeling the impact of the reduction in the graduate intake from 2009 to 2011 and reduced numbers of qualified immigrants seeking employment. The problem is particularly acute for the practices as in-house roles are currently regarded as more attractive.”

The sudden increase in demand has taken us by surprise in some areas. “The demand for Accounts Payable and Payroll contract staff was all but dead 12 months ago but we have seen a significant increase lately,” comments Niamh MCarthy, Manager, our Interim & Contract Accounting & Finance recruitment consultant in Cork.

On the permanent employment side we are seeing particularly strong demand for Audit Managers, Audit Seniors, Internal Auditors, Corporate Finance specialists, Fund and Investor Services Managers, Credit Analysts and professionals who can assist with financial transformation or in risk advisory roles.

“Hiring organisations are therefore going to have difficulty securing the ideal candidate, especially for senior roles, for the foreseeable future,” says Eoin Barry, a Financial Services Recruitment Consultant focused on Fund Accounting. “We are also seeing a return of counter-offers to the market, with many candidates going to interviews when they already have other offers,” adds Ed Rossiter, Accountancy & Finance consultant at our Limerick office.

With the economy improving, we expect candidates to become more proactive but they will need to think long-term. “Try to picture what your career progression options will be not just in 12 months but in three years,” advises Ronan Hill.

“Gain experience in a larger company if possible. It may not be your ideal job but it will enable you to return to a smaller firm at a higher level of seniority in the future,” adds Niall Hughes.

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There is a resurgence of demand for talent in smaller practices.

SKILLS SHORTAGES IN MANY AREAS

IRELAND

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SALARIES & BENEFITS

Salaries are likely to remain stable overall for permanent hires with modest increases in rates for contract staff. However there will be some upward pressure on salaries in sub-disciplines where talent is in short supply, especially in practices, possibly in the 10 to 15% range.

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Hiring organisations are looking for candidates with a more rounded skill set.

In Japan there is a continuing demand for suitably qualified and experienced Specialist Finance candidates who can speak English and can therefore interact effectively with overseas offices. With many new challenges arising, such as organisational change, IT implementations, globalisation of functions and an increasing regulatory and compliance burden, the candidate supply is not keeping pace. Language is the key issue as there are few suitable candidates overseas with native-standard Japanese, which is obviously also a requirement. Those that do exist are mostly Japanese ex-pats currently working in other APAC locations or on the west coast of North America.

“Hiring organisations will often look first for candidates who are fluent in a second language,

and only then do they consider work experience and formal accountancy qualifications,” comments Brendan Walsh, Manager, Accounting and Finance at Morgan McKinley’s Tokyo office. Nevertheless, there is also more emphasis on professional qualifications in Japan than was the case in years gone by. Knowledge of ERP software, in particular SAP, is also a prized asset.

“The main drivers of recruitment are management accounting as opposed to financial accounting. Some lower skilled operational finance roles are moving overseas or have been consolidated into shared service centres. By contrast, any role involving stakeholder management is relatively secure,” comments Walsh.

Much of the demand we have seen in recent months has been from the retail and luxury goods industries, which has been rather surprising in view of Japan’s overall economic situation and the increase in sales tax on 1 April. The healthcare and life sciences sectors continue to perform strongly and are also a source of demand for Specialist Finance professionals.

“My advice to candidates is to develop a more rounded skill set. There is a growing expectation that the person coming into a job should be able to do more than the person s/he is replacing, for example by offering project management skills and the ability to handle an ERP implementation,” concludes Walsh.

STRONG DEMAND FOR BILINGUAL FINANCE PROFESSIONALS

JAPAN

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SALARIES & BENEFITS

Salary levels will remain flat for the rest of 2014. In Japan, benefits are typically weighted on individual and company performance and we don’t expect any change to this culture.

In the UK we were surprised at the sudden upsurge in demand for Specialist Finance roles but then equally surprised that this demand has been sustained. “Specialist Finance professionals are being well looked after in their present positions but also have more confidence to look at other options compared with the situation a couple of years ago,” comments Ian Palmer, Manager, Tax in Practice at Morgan McKinley. “In my role I have especially noticed an uptick in demand for Human Capital Tax, International Tax, Personal Tax and Transfer Pricing specialists, but there is more demand across the board,” he adds. The economic outlook is positive and recruitment budgets are increasing as companies tackle new projects such as IT implementations and organisational change. Demand is focused at Assistant Manager and above for in-house roles and at Manager and Senior Manager level in practice.

“As well as having formal professional qualifications, candidates who can demonstrate the ability to bring in new clients are particularly in demand within practices,” explains Palmer. Fluency in a second language and experience with ERP systems are also major assets. Hiring organisations are already finding it difficult to find talent that meets all of their requirements and may need to look abroad, typically to continental Europe, Australia and China.

Candidates may also find it difficult to adjust to the new market conditions and should take care when deciding on a new role and a new organisation. “It’s more important than ever to get an honest assessment from a consultant who has an in-depth knowledge of your discipline and has your best interests at heart,” says Palmer.

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Ability to bring in new clients a major asset. .

SUSTAINED INCREASE IN DEMAND

UNITED KINGDOM

SALARIES & BENEFITS

We will see a steady improvement in salaries in 2014 but no dramatic changes. Bonuses will keep pace.

A MORGAN McKINLEY GROUP COMPANY

GLOBAL TREND REPORT SPECIALIST FINANCE

2014