NEW YORK & MONTVALE, N.J.--(BUSINESS WIRE)--Business confidence and economic outlook improved drastically for small and medium-sized enterprises (SMEs) in the twelve months to mid-2014, according to findings from the ACCA (the Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants) in their second Global SME Performance Review. To view the full report visit: http://www.imanet.org/PDFs/Public/ACCA/Back_in_the_Game.pdf.
The report, titled “Back in the Game,” shows that a range of business challenges, particularly those relating to cash flow, have eased for SMEs in the second review period, with SMEs in the Middle East and Western Europe leading the way. Additionally, capacity building across regions has resumed in earnest, led by the Americas and the Middle East. Despite widespread improvement, the report noted mounting business challenges for SMEs in some regions, including Central and Eastern Europe and South Asia.
“Western Europe and the Middle East are taking the lead in the economic recovery, showing a significant decrease in external pressure and a 13 percentage point increase in capacity building,” said Charlotte Chung, ACCA senior policy advisor. “However, Central and Eastern Europe and South Asia still struggle to see an increase in capacity building. The former is likely to reflect the ongoing concern over Ukraine and the impact of sanctions imposed on Russia by the U.S. and E.U.”
Government Policy and the Investment Environment
Ratings of government policy by SMEs have continued to improve; ratings from the U.K. reached positive territory for the first time in this latest review. Spurred by greater confidence in the sustainability of fiscal policy, SMEs are increasing hiring and investment. In particular, SMEs are starting to rebuild the capacity of their finance functions, with larger SMEs focused on building human capital, and micro and small businesses focused on professionalization.
The investment environment also improved for SMEs globally, driven primarily by a greater availability of capital and profitable opportunities. Micro and small businesses have benefited the most as the banking sector’s ongoing recovery has finally unlocked the flow of credit to them. Among ACCA and IMA’s major markets, SMEs in the UAE, the UK and Ireland saw the greatest improvement, while those in China and Malaysia continued to experience shortage of growth capital.
While SMEs were hit hardest by the economic downturn, they have historically shown greater resilience, compared to their large corporate counterparts. SMEs are seizing new opportunities for economic growth by embracing innovation, entering new markets and building strong supplier relationships. ACCA/IMA’s first Global SME Performance Review identified mid-market businesses as a distinct group which greatly contributed to economic growth, and the second review has reinforced the two bodies’ conviction.
According to Raef Lawson, Ph.D., CMA, CPA, IMA vice president of research, “Mid-market businesses are the most ambitious and ready for growth.”
“This group was the most likely to create new jobs during the 2013/14 period and reported the largest increase in job creation, more so than large corporations,” Lawson said. “They also reported the largest net investment in staff development and greatest emphasis on job creation, highlighting a difference in resource prioritization and allocation between mid-market business and micro, small and medium businesses.”
The ACCA and IMA joint website, roleofcfo.com, is a resource for finance leaders which contains ACCA and IMA reports, research and insights.
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We support our 162,000 members and 428,000 students in 173 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of 91 offices and centres and more than 8,500 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
About IMA® (Institute of Management Accountants)
IMA®, the association of accountants and financial professionals in business, is one of the largest and most respected associations focused exclusively on advancing the management accounting profession. Globally, IMA supports the profession through research, the CMA® (Certified Management Accountant) program, continuing education, networking, and advocacy of the highest ethical business practices. IMA has a global network of more than 70,000 members in 140 countries and 300 professional and student chapters. Headquartered in Montvale, N.J., USA, IMA provides localized services through its four global regions: The Americas, Asia/Pacific, Europe and Middle East/Africa. For more information about IMA, please visit www.imanet.org