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To steer their companies through the current financial crisis, Hong Kong’s CPAs use a combination of short- and long-term strategies to steer their companies through this financial crisis.

In a study conducted by the Kong Kong Institute of Certified Public Accountants, respondents -- CPAs working as chief financial officers or other C-level officers of some of Hong Kong’s most important companies -- says they are responding to the crisis through short-term moves such as reducing headcount, calling in debt and accounts receivable, and controlling margins; and long-term programs such as raising funds from equity markets, diversifying the business, and forecasting conservatively.

All respondents agree that keeping their companies liquid was a core strategy for getting through the turmoil.

“Hong Kong CPAs helm some of the city’s leading corporations and have a view from the top – they’re responsible for and privy to business decisions made at the most senior levels,” says Winnie C.W. Cheung, chief executive of the Institute. “They’ve learned a lot through the past couple of years and plan to apply those lessons now the recession has ended.”

The study concludes that the lessons of the financial crisis include the need for constant cost reduction, the need to know more about derivatives before investing, the ability to accurately predict the pace of asset realisation, the necessity of diversified revenue streams, and caution in planning.

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