Big firms take long view on Ukraine’s economic potential
15 October 2008, 22:49Urmas Kaarlep came to Ukraine this year to serve as a senior partner at the local offices of PricewaterhouseCoopers, where he will head assurance. He comes to Ukraine after 15 years with PricewaterhouseCoopers in his native Estonia. In this Kyiv Post interview, Kaarlep discussed early views on the Ukrainian market, and compared it to Estonia.
KP: What is your view of the Ukrainian accounting and auditing market?
UK: It is definitely growing for two reasons. For one, the economy and business in general are developing quickly. Secondly, Ukrainian businesses are becoming much more sophisticated.
The audit market will grow 30 percent per year for some time to come. Once the world recovers from the current credit crunch, more domestic companies will need services from the Big Four accounting and auditing companies.
KP: What’s the overall business volume for this market now?
UK: The current estimate for assurance alone, is about $100 million and growing fast. Of this, the Big Four controls some 60 percent.
KP: You’ve previously worked in another post-Soviet country, Estonia, before coming to Kyiv. How does the Ukrainian market compare?
UK: The one difference is that Estonia is a European Union member state. It is also much smaller, which makes transition easier.
From the other side, if you’re thinking about the accounting or audit business, there are only a few big companies in Estonia. There are definitely more prospects for business in Ukraine.
KP: Many local audit companies complain there is a lack of qualified staff. Do you experience this problem, too?
UK: Yes, there is a resource constraint and this is a priority issue for us.
KP: So, how do you deal with it?
UK: When we hire a recent university graduate, we invest extensively in training, like getting them certified with the Association of Certified and Corporate Accountants.
Such training programs are a top priority for us, and a main motivator for our young professionals.
KP: Do you have significant staff turnover?
UK: I wouldn’t say it is too extensive. Compared to other companies, yes, ours is higher, but I wouldn’t say it is a big problem for us. We train and develop young professionals well and most of them stay with us.
KP: Are Ukrainian universities providing enough qualified graduates?
UK: There are many smart and well-educated university graduates and young professionals in Ukraine. They are hungry to learn more and get their ACCA qualification. We know that well. We recruit about 100 graduates each year.
KP: Who are your main clients?
UK: We are pretty strong in the banking sector. It makes a pretty big part of our business. We are also very strong in the insurance and real estate sectors. Both are hot right now.
KP: What changes do you expect on the horizon of the Ukrainian audit and accounting market? How is it going to develop?
UK: Of course, Ukraine’s market will continue to grow, and domestic companies will be searching for partners and investors from abroad. The number of Ukrainian companies that want to go international and list their shares on exchanges through initial public offerings will grow. The demand for the best accounting services will grow with it.