The Pandemiconomic Impact: Insights from ACCA finance professionals
Sri Lankaâ€™s tech industry is resilient in the face of the worst ever global recession caused by the COVID-19 pandemic, says ACCA Member Jehan Perinpanayagam, who is the CEO at finance and accounting services provider Infomate, a subsidiary of listed John Keells Holdings Plc.
Sri Lankaâ€™s export earnings from IT reached approximately $900 million in 2019. This amounts to a 6% growth rate from a year earlier, according to the annual report of the Central Bank of Sri Lanka. This growth is significant with the islandâ€™s total exports managing to grow less than 0.5%.
Sri Lankaâ€™s tech industry (including BPOs and KPOs) employs 80,000 people. It is targeting $5 billion in exports by 2022 creating 200,000 new jobs in the process. However, the pall over the global economy in the next two years until a cure for COVID-19 is discovered could upset those plans. But Perinpanayagam is optimistic.
â€œWe donâ€™t have enough information to forecast the impact of this pandemic on the economy or the tech industry. However, I believe the IT sector will remain resilient and indeed there may be some new opportunities,â€ Perinpanayagam says.
The pandemic has disrupted industries world over, but the response from Sri Lankaâ€™s tech and BPO industry in shifting quickly to business continuity mode, and the proactiveness of the industry has been commendable, he says. â€œThere are companies here in tech experiencing export growth. We have seen a myriad of new innovative apps, new platforms developedâ€.
In the domestic market, while lockdowns have disrupted economic activity across the island, tech companies continue to service their clients and see demand for technology solutions including in completely new areas.
â€œWe see our colleagues in the tech industry roll out innovative additional services. These include mobile apps which helps the government to monitor and contain pandemic risks and remote consultation with doctorsâ€.
â€œThe experience of my organisation, Infomate, has been very encouraging. For instance, despite the lockdown, we ensured a smooth closure and year-end for our parent company JKH with our team showing tremendous commitment.Indeed,it is noteworthy that pre-COVID timelines were met. We supported several businesses in the group to seamlessly transition to remote working as well,â€ Perinpanayagam says.
He says Infomateâ€™s overseas clients are appreciative of the companyâ€™s ability to provide uninterrupted services. â€œOur clients are very appreciative and impressed with our ability to maintain uninterrupted services and in some cases provide additional services and higher service levelsâ€.
â€œIn the domestic market, we do see a fall in business, but we are quickly pivoting to industries that can ride this storm such as retail and essential services. Many retail firms are now taking e-commerce seriously and we provide them with the necessary technological platformsâ€.
Maintaining efficient internal controls, accounting and payment functions is critical more than ever before and this is where tech becomes important. â€œWe are pleased that we can support our valued clients with a stable back office during this challenging period. Our clients do not have to worry about any functions relating to back-office processes, human resource management, payments and controls,â€ he says.
Not long ago, the accounting profession fretted over technologyâ€™s rapid upheavals, the disruption of traditional business models and losing jobs to robots. Professional bodies such as ACCA Global had been at the forefront of busting those myths about technology.
The COVID-19 pandemic, and the global economic crisis it has spawned, is demonstrating the value of technology strategically harnessed by finance professionals. The ongoing crisis validates ACCA Globalâ€™s conviction about assimilating technology into the accounting profession.
For several years, Perinpanayagam has advocated the use of automation so Sri Lankan businesses can devote more resources and attention to higher-end functions and create value. Technology will enable finance staff to focus on analysis and insights, and exercise better judgement around financial options, even more important today to survive this unprecedented economic crisis, and perhaps, discover new opportunities.
If the pandemic has a silver lining it is that Sri Lanka is taking giant strides towards a digital economy, Perinpanayagam says.
Sri Lankan tech and BPO companies have been able to transition to remote working fairly seamlessly with tech teams putting in additional hours than normal to the satisfaction of most of their clients worldwide. In the domestic market, there is a visible leap towards a digital economy with more businesses adopting online transaction platforms and e-invoicing, he says.
â€œI do see growth in transaction volumes in some industries due to technology and this is a trend that will continue long after the pandemic ends,â€ Perinpanayagam says.