Thousands of accountants are converging in Hong Kong for their five-yearly global congress, in the hope of salvaging a professional reputation in tatters.
The 16th World Congress of Accountants has drawn attendees from 100 countries, all well aware that the past year of scandal upon scandal resulting from poor oversight of company accounts has been a disaster for them. The result of the outcry over the fiddling of figures at Enron, WorldCom and Qwest, not to mention the restating of numbers from countless others, could be the end of the self-regulation the industry has prized.
“(The experiences of the past year) means we have to change the processes in which we are working,” said Rene Ricol, newly appointed president of the International Federation of Accountants (IFAC).
“To put in place stronger internal controls inside companies, and also put in place external control for the firms.”
The problem for the accountancy business, experts say, is that the reforms it badly needs are certain to make corporate performances look even worse than they do already. But David Tweedie, head of the International Accounting Standards Board (IASB) and thus Europe's top regulator of the trade, said that was unavoidable if trust was to be restored.
“My own view is no surprises, full transparency” in company figures, he told Reuters news agency.
“That's the answer to it, and accounting doesn't give that as yet.”
Among other things, stock options, pension schemes and off-balance sheet liabilities – the factor that brought Enron crashing to earth – are still too opaque for investors to grasp, he said. Predictably, many companies – particularly US high-tech ones – oppose expensing stock options, for instance.
“Most of the things we do will not increase profits, it will reduce them and will show companies having more debt,” he said.
“But that's the fact.”
The congress was opened on Tuesday by Chinese Prime Minister Zhu Rongji, who said he had no illusions about the standard of accountancy in his own country.
“As you know I seldom write inscriptions because my handwriting is not impressive,” he said, referring to the Chinese tradition of leaders leaving examples of traditional calligraphy when they visit an organisation.
“But I wrote four words for the three accounting schools in China: Make No False Accounts.”
Although Mr Zhu steered clear of specifics, it can hardly have escaped the attention of his audience that China has had more than its share of accounting nightmares in recent months. As well as the now-routine insider dealing charges levelled at brokerages, a large proportion of China's stock market listed companies rarely publish quarterly or even half-year figures which have been properly audited.
Some barely publish figures at all.