SAICA is keenly aware of the skills shortage in the financial services industry, and of the negative effect this shortage has on accountability and service delivery in the public sector. In response, SAICA has put its money where its mouth is, collaborating with government across a wide set of projects, all aimed at improving the public sector’s ability to plan and account for its expenditure, and so to improve levels of governance, accountability and service delivery.
Furthermore, in South Africa, we are short of about 5000 CAs(SA).
By 2018 it’s predicted that 10 000 new positions will be opening up in financial services every year.
Of the 35 000 members of the South African Institute of Chartered Accountants (SAICA), less than 2700 of these are African or Coloured men or women.
If South Africa is to achieve true transformation and growth, drastic change is required.
A vehicle through which this drastic change can be achieved is the Thuthuka Bursary Fund (TBF). This programme is fast-tracking the transformation of the South African accounting industry.
The Thuthuka programme was launched in 2002 and the Thuthuka Bursary Fund was launched in 2005, with the objective of aligning the demographic representation of the profession to accurately reflect South Africa’s demographics.
Thuthuka Bursary Fund
“Together with many other professions, the profession of chartered accountancy is critical to the economic, social and cultural development of the country,” says Minister of Higher Education and Training (DHET), Blade Nzimande: “It has the potential to play a broader leadership role in skills development in the country.”
He says: “The Thuthuka project is an important initiative that serves as a strategic lever for the transformation agenda of the accounting and auditing professions.”
The TBF facilitates the journey of disadvantaged African and Coloured students hoping to qualify as CAs(SA), thereby contributing to transformation and growth within this sector.
SAICA’s Professional Development, Transformation & Growth Senior Executive Chantyl Mulder notes: “We want to build a brand-new team of responsible leaders who are successful and add value to society. The new generation of leaders should be significant rather than merely successful. They should be leaders who make a meaningful impact on society.”
“SAICA experienced a lot of wins during 2012,” says Mulder: “Particularly with respect to transformation and growth, through the Thuthuka Bursary Fund.”
The SAICA strategy has a two-pronged approach: expanding the number of SAICA-accredited universities, while also increasing the number of qualified African and Coloured graduates from those universities.
University of Limpopo (UL)
UL’s 2011 SAICA-accreditation has meant that for the first time, students living in Limpopo no longer had to travel to Johannesburg to study chartered accountancy.
Director of School and Nedbank chair in Accountancy at the University of Limpopo, Professor Cosmo Ambe says: “We had 207 first-year students enrol for the BScAcc course in 2012, 162 second-year students, 93 third-year students, and 87 fourth-year students. The average pass rate for first-years was 88%, and 93% of second-year students passed the first semester examinations (third and fourth-year students are still writing their year-end exams).”
The National Skills Fund (NSF) directly funded the UL programme, with about R25 million supporting 452 students. This funding was generated with the assistance of Thuthuka.
University of Zululand (UniZulu)
In partnership with Bankseta, University of Cape Town (UCT) and SAICA, Government has invested R64 million into UniZulu to ensure that the university receives SAICA accreditation over the next four years.
Bankseta CEO Max Makhubalo says: “Reaching communities like Empangeni in KZN helps us to pervasively build a case for skills development in the communities that really need empowering.”
“Through this project, 400 learners will gain access to a high-quality undergraduate degree programme with international recognition,” says Mulder.
UniZulu Vice-Chancellor Professor Fikile Mazibuko says: “Our students will now compete with confidence – not only acquiring a world-class qualification, but benefiting from mentorship opportunities and contributing to the development of their profession.”
Walter Sisulu University (WSU)
Also through the NSF, the DHET is investing R84 million into WSU to ensure that it receives SAICA re-accreditation during the next four years.
The DHET, UCT and SAICA partnership will give 425 previously disadvantaged students access to a world-class undergraduate degree previously unavailable to them.
A WSU Administrator, Professor Lourens van Staden says: “SAICA accreditation will mean our students can be accepted by other universities without the need for bridging courses. We need more accountants, particularly black accountants. Nonetheless, we are proud of the fact that 70% of Black CAs(SA) hail from the Eastern Cape!”
Full-service student support
The TBF Programme does more than just cover student fees. SAICA recognises that university can be overwhelming, especially for students arriving from severely under-resourced schools. Thus, a Thuthuka bursary covers tuition, books, meals, mentoring, residence fees, and even provides the students with an allowance. All students in the programme are housed in the same residence, giving them access to a built-in support group, with senior students even providing mentorship to younger students. The project has already borne fruit. To date 95 students have passed part 1 and part 2 of the qualifying examinations, thus being a step closer to qualifying as a CA(SA), with only the training requirements left to be completed. Of these 95 students, 16 have registered as CAs(SA), 29 are regarded as prospects and the remainder are left with only training obligations to complete. There are currently about 1 500 students in the programme.
The Thuthuka programme is also transforming the financial services landscape in terms of the quality of graduates being produced. In 2011, 81% of the TBF students writing the Qualifying Examination (QE1) to become chartered accountants passed and 60% passed the QE2 – a result which has these ‘disadvantaged’ Thuthuka students outperforming their more ‘advantaged’ colleagues. Currently, 50% of those eligible to write the CA(SA) qualifying exams are African or Coloured, compared to just 1% a decade ago.
“If success is measured in terms of tertiary education results, as indeed it should be, then Thuthuka has not only met but surpassed our expectations,” says Chantyl Mulder.
Working with government for change
Thuthuka is a response to the government’s call for private enterprise to work in partnership with the public sector to improve service delivery. As Auditor-General Terence Nombembe puts it: “The proven success of private-public sector collaborations such as Thuthuka shows us that we can address the skills crisis in government. It should take between five and 10 years to establish a sustainable skills base – after that, we just need to keep replenishing the skills.”
Demonstrating government’s commitment to this approach, TBF’s fundraising is supplemented by Rand-for-Rand state input. For every Rand donated by the public or private sector, the National Financial Aid Scheme matches the contribution. At present, the initiative costs R42 million per annum, and the TBF’s aim is to have sufficient funding to see all its current students through to the completion of their studies.
Transforming the basics
SAICA also understands that the challenges facing many South African students go beyond the mere financial. Very few of our schools are producing enough skilled maths students, and some of our universities under-perform in the training of financial services graduates. To this end, SAICA is investing in promoting and enabling core maths at schools, and continuing with its drive to improve BCom standards at all universities.
DHET is so impressed with the strides SAICA has made in universities, that it intends to implement similar programmes for public sector employees. One of the weaknesses bedevilling colleges of Further Education and Training (FET) is a lack of qualified chief financial officers (CFOs). Government, with the help of SAICA, has instituted a programme to supplement existing skills and processes, and to ensure that this intervention results in a sustainable long-term result. Auditor-General Terence Nombembe has stated his intention to use Thuthuka to transform the public sector. “It’s a no-brainer,” he says. “It’s the formula that could address the skills gap and restore the health of public sector finances.”
Action and attitude the key
SAICA is, in effect, the standard bearer and the gatekeeper of accountancy in South Africa. The institute is responsible for setting the standards in ethics and best business practice, and for informing regulation and legislation. Its commitment to excellence in these fields has won the approval of accountancy institutes across the globe, and the 2011/2012 World Economic Forum Competitiveness Report once again ranks South Africa as number one in the world for strength of auditing and reporting standards.
However, SAICA is also committed to sustaining the supply of CAs(SA), and to equipping public-sector leaders with the skills to effect efficient service delivery. Rather than hand-wringing and blame-shifting, the institute has opted to confront the problems facing our transforming economy head-on, in partnership with government, by committing personnel and resources to a strategy aimed at making world-class financial management a South African reality within the next decade.
The year 2012 was the fourth year in which Thuthuka CTA graduates were allocated to SAICA-accredited donors for training, with 100 candidates allocated to 27 donors. In total Thuthuka has allocated 317 candidates as trainees since 2009.
Of the bursaries awarded in 2012, 55% are female and 45% are male; 89% of students are black and 11% are coloured. Thuthuka had a total of 804 candidates on its programme in 2012 – 54% are female and 46% are male; 88% candidates are black and 12% are coloured.
Although Thuthuka has been relatively successful in attracting funds during its short life, it is clear that more funding can only mean more success. To date, over 2 000 students have become a part of the Thuthuka legacy, the full impact of which will soon be seen in the growing number of African and coloured CAs(SA), and hopefully in the way that our public and private sectors are run. ❐
Author: Yuven Gounden