In a recent survey conducted by the Malta Institute of Management amongst 74 companies it resulted that most companies do not make a distinction between Auditors, Management Accountants and Financial Accountants.
The survey aimed at understanding the role of Management accountants in companies particularly in SMEs. The respondents stated that Accountants are used by all the businesses in question but for different services, most commonly auditing. Management accountants were only used by 65% of the respondents but are definitely seen by 95% to be a help to business persons in decision making. However, when one analysed what kind of services they utilise it resulted that only 38 percent related services pertaining to the profession of the management accountant.
It was also noted that had companies need not audit their accounts, the services of an accountant would still be used by 92% of the companies and were ranked somewhat important and higher.
In the case of small companies, most companies think that they are not able to afford a management accountant due to cost and since they are exempt from an audit by the Companies Act.. In spite of exemption from the Companies Act there is no exemption from the Income Tax Act, an anomaly highlighted by many. The underlying factor when dealing with small companies would be if it was even worth it to request the services of a management accountant due to costs. Although small businesses look to save money and therefore the majority would think they would not be able to afford such a professional, how long would it take for the business to complete certain tasks and would it be a good use of resources? It has been proved that “most small businesses can’t afford to have a full-time accountant on staff, and while some owners may have solid working knowledge of the day-to-day bookkeeping or accounting needs of their businesses, many rely on the expertise of a designated accountant only during tax season. Once tax season is over, many of those same small business owners will likely go back to managing their books on their own.” – Jennifer Wanawa.
The Accountancy profession in Malta has to give a different dimension to its profession. The survey result is a clear indication that businesses value the work of an accountant but do not understand how the accountant can help more. The lack of knowledge of the services of Accountants is concerning. Indeed, it is even more concerning that only 65% would try the services of a management accountant free of charge and 35% would not. This tied with the fact that there is no real understanding is even more concerning.