Written by: Lachlan Colquhoun - Acuity Magazine, October/November Issue, pg 83-84.
In his 18 years as a partner with PwC in the Hawkes Bay region of New Zealand, there was one thing which continued to frustrate Giles Pearson FCA.
Over and over again he saw clients take on accountants who, although they might have impressive enough CVs, lacked the technical skills they needed to do their jobs effectively.
"Someone might have looked great on paper, but when they had to apply technical knowledge their skills didn't match up with how they represented themselves in the CVs," says Pearson.
The impact of this was waste, both in terms of time and money. Clients were forced to reach out to engage specialist skills for jobs their own accountants could not perform, forcing time delays and additional expense.
"Research will tell you that the cost of this reworking is 143% of the salary of the person who didn't perform," says Pearson. This puts the average cost of recovering from a bad hire at A$183,000 for an accountant, and A$100,000 for a bookkeeper.
Pearson's frustration, however, led to an idea which - since he left PwC - he is now able to pursue full-time.
Teaming up with Steve Evans, whose background is in human resources with a particular expertise in psychometric testing, Pearson has launched accountests.com, an online testing business which offers downloadable competency testing across a range of accounting disciplines.
In 40 multiple choice questions, tests are designed to be completed in 30 minutes, Accountests offers six tests across areas such as cost accounting, management accounting, bookkeeping and chartered accountancy.
After a soft launch several years ago, Pearson and Evans are now pursuing Accountests on a full-time basis, designing tests which can help in the recruitment of accountants in both New Zealand and Australia.
Already, Accountests are up to around 1000 tests taken, with the majority so far done in New
The subject matter and questions are tailored to the Australian or New Zealand regulatory and tax environments, and the tests are "professionally agnostic" in that they are relevant to accountants across a range of different qualifications.
Does it beat good judgement?
"We advocate that employers use our tests alongside the existing recruiting process," says Evans. "The idea is that once an applicant does a structured interview and the employer does a reference check, then doing one of our tests on top of that can give some extra insight on whether the person's skills are as good as their CV says.
"There is no Googling this stuff. Either you know it or you don't and it is very hard for people to fudge or cheat."
The Australasian market for accounting skills, says Pearson, is"pretty tight". "Often when you advertise a vacancy the reality is that you are struggling to get a pool of good candidates," he says.
"So if you strike a candidate who scores well in the test and everything else they have done stacks up, then it tells you this person is marketable and it allows employers to get on the front foot and get a deal done quickly to get the person onboard.
"On the other side, if the candidate performs poorly in the test, that might be why they are moving on from their current employer, and the truth is that you are often better to employ nobody than somebody who doesn't have the skills to do the job."
Recruiters and employers set their own conditions for the tests, and Evans says many are using effective ways of ensuring the integrity of the tests and to verify they have been
"One way is to retest the person, with another test in the same category, while other people will use a Skype call with a candidate for testing," he says.
Pearson drove the development of the test contents and says they have been deliberately set at a high level.
"We want to test the ceiling on where people are, and most people tell us that it does that quite well," he said. "We don't get many people saying it was easy."
Feedback from the recruitment side of the equation has been positive so far, although Pearson
acknowledges it could be slow to build momentum.
"Accountants are difficult people to get to change the way they do things," he says. "In the industry, accountants are the ones who understand the pain of employing the wrong person - but they are rarely the ones doing the recruiting."