Source: Business-Standard.com
When Control Solutions, one of USA’s biggest accounting firms dealing with Sarbanes-Oxley (SOX) accounting compliance procedures, wanted to recruit accountants for its expanding practice, it looked at Enabilizer, a New Delhi-based accounting outsourcing firm. That look has led to the two signing a joint venture agreement that allows Control Solutions to outsource its SOX work to the Indian JV.
And, it was not the only global firm to look to Indian accountants for help, Rain, a mid-sized South African accounting firm has also chosen to hire for two years, six experienced senior staff from its network partner in India, the Mumbai-based accounting firm Chokshi and Chokshi.
Facing an annual attrition rate of nearly 50%, Rain and Control Solutions are among the growing breed of accounting firms that are beginning to look India wards for outsourcing their work, both on-shore and off-shore. The reason, just when accounting regulations are becoming more stringent in USA and Europe, there is a looming global shortage of accounting professionals.
Akshay Bhalla, CEO of Enabilizer estimates as much as 60% of the F1 visas to USA in the next few years would be cornered by the financial & accounting (F&A) segment, especially as the quantum of on-shore work goes up. James Mendelsohn, CEO of MSI, a global network on accounting firms that boasts of 250-members, adds: “In the US, the number of students going into accounting fell drastically in the wake of the Enron collapse.”
However, at the same time the regulatory framework under the Sarbanes-Oxley legislation became more stringent. Most firms, especially mid-sized ones have few options left, than to on-shore much of their SOX work, as it cannot be taken out of the US.
And, of course, there is the labour and cost arbitrage. Tholons, a Bangalore-based IT consultancy firm estimates that in the financial and accounting services off-shoring of common transactional processes yields a 20-25% cost reduction, while off-shoring key high-end processes, such as SOX related work, could lead to cost reductions of 35-40%.
John Micklethwaite, the editor of The Economist, who is visiting India and chaired the two-day business round table with the Indian government is an authority on globalisation, and has written two books on the subject i.e. A Future Perfect: The Challenge and Hidden Promise of Globalisation and Globalisation and Making Sense of an Integrating World.
Coming to India after a gap of 8-years, yet, having followed the country closely, Micklethwaite smiles as he says: “I would be lying, if I said that the change strikes you when you land. But, in terms of impressions, it’s just the people – the Indian business people you now come across in London and the sort of deals they are doing. Or, the number of British and American business people you see here, including 20-people from The Economist.”
The Economist’s marketing team is in India to drive up the magazine’s circulation, which makes you pop the question, ‘Why?’ “You look at the changes in India. All those are changes that we approve of and also if you look around the world at things that propelled The Economist forward, it is the opening up of the markets,” he says, adding The Economist is sort of a user’s guide for globalisation and “it’s also a big beneficiary from it”.
To quote Micklethwaite, the interest in India is huge, as: “When we put India on the cover in Europe or America, it sells extremely well. One of our highest selling issues was one with India on the cover. Now, you can’t not have an India strategy,” he says referring to companies abroad.
A major proponent of globalisation, Micklethwaite does recognise some of its negative impacts. “Yes, it is kind of cruel and an uneven process. There, obviously, are people who lose out. We have stories about cotton farmers committing suicide, because cotton prices in India had gone against them. Overall, it is an enormous force for good. When you look at the damage done by globalisation it’s nothing compared with the damage done by lack of it,” he says.
Right or wrong, however, globalisation has helped to put India on the map. People worldwide are realising that the smugness and the tendency to underestimate and run down India, always knocking it to off its feet, has not only toughened the Indians, but also pushed them to hone their business smarts. That combined with their reverence for education that runs deep through India’s ancient and of today cultural traditions, has the Indians knocking the world to its feet.
Not a new picture, but history has it, many came from across the world to sit at the feet of the learned men of India eager to partake of what they had to teach, and then there were those that came to marvel at the glory that was India, only to write home about it i.e. Hieun Tsang, the Chinese chronicler who travelled extensively in India during the 7th A.D., as did his countryman Fa Hien. Then, we have the accounts of Greeks who accompanied Alexander on his world conquest and reached India e.g. Nearchus Onesicritus and his Greek ambassadors like Megasthenes (Indica), Deimachus, and Dionysius. Among, later Greek authors to write about India, we have Strabo, Justin, Arrian, Plutarch, Ptolemy, Pliny etc. This is borne out by the testaments of important Greek scientists and philosophers of that period e.g. Pythagoras, the Greek mathematician and philosopher who lived in the 6th B.C. and was familiar with the Upanishads, who even learnt his basic geometry from the Sulva Sutras of India. The famous Pythagoras theorem is, actually, a re-statement of a result already known and recorded by earlier Indian mathematicians, notably Aryabhatta many centuries before Pythagoras stumbled upon it.
Later, Herodotus (father of Greek history) was to write that the Indians were the greatest nation of the age, there was Ctesias, and Megasthenes, who travelled extensively through India in the 4th B.C. left extensive accounts that paint India in a highly favourable light. And, even Arab historian Alberuni went into raptures at the India of his day, just as the British, the Dutch, the French, the Portuguese and the Germans did as they exclaimed and squabbled over their rich pickings they so greedily plundered from the sub-continents, even as they were enthralled by the rich culture and architectural splendours of India.
And, so begins the modern day plunder of India, a plunder of its brains and hard work, globalisation at its best and at its worst, when it forces Indian farmers to take their lives due to WTO diktats enforced by money-hungry Western powers! However, Indians will combat that in their own way, just as they forced the British to QUIT INDIA!