eFinancialCareers

A panel of headhunters gives its assessment of typical London pay packages: Base: £ 65,000. Bonus: 25%

A few weeks ago, newspapers gleefully revealed that under Chancellor Gordon Brown, Britain’s tax code has doubled in size to over 7,000 pages of dull, closely set text: in eight years Brown – the accountant's friend - has added as much complexity to the tax system as his predecessors managed in 200.

Although the world of accounting regulations may not have evolved quite as fast, much has changed and is continuing to change: all those hedge funds, derivatives and other financial instruments need rules and people to ensure the rules are followed properly, particularly given the growing internationalisation of financial markets. As a result, prospects for regulatory accountants have been looking pretty good.

“Over the past two years, there has been an increase in demand for regulatory accountants, as a result of SOX and Basel II. Most investment banks are actively looking for candidates with good regulatory experience,” says Noel Marshall of Finance Professionals.

Steve Leeson, Manager of Morgan McKinley’s senior finance division, goes further:

“At present, almost without fail, every one of the leading investment banks are looking to recruit into their regulatory reporting teams,” he says. Leeson adds that demand is being driven by the wider need for experienced controllers and the growth in regulatory based projects including Basel II, with regulatory accountants in the UK usually making their reports to the Bank of England or the FSA on a regular basis.

“The regulatory team also analyses capital adequacy. They are responsible for ensuring that the business’s depositors and counter-parties are protected from the firm's on- and off-balance sheet risk,” he says.

So aside from knowing your SOX from a fox and generally being fully au fait with ongoing changes in the regulatory world, what sort of person becomes a regulatory accountant? Basically someone with a good accounting qualification, a close attention to detail and good communications skills, as the role requires dealing with the front, middle and back office.

For this, Leeson suggests you would start on a base of around £45,000 rising with three to four years' experience to around £60,000-£75,000. Marshall says an individual with around four years' experience would be sitting on a base of £55,000-£70,000 with a bonus of between 20%-30%. Having specific knowledge is worthwhile: those with a proper understanding of the regulations underlying Basel II can expect to be paid a premium whilst detailed knowledge of SOX – as underwritten in the 2002 Sarbanes Oxley Act - can also expect higher remuneration, despite the compliance deadline having been put back a year.

Perhaps the biggest benefit of becoming a regulatory accountant, is the flexibility it can give. Monitoring activity within all parts of a financial institution gives you an understanding not just of the products it trades but of the way it operates; this could hold you in good stead should you wish to become something other than a regulatory accountant.

“In a regulatory accounting role, individuals can gain a valuable overview of the whole organisation and with a big internal and external client population, it can be a good fast track entry point into the world of financial services,” points out Steve Leeson.

Figures and commentary by Morgan McKinley, Robert Walters and Finance Professionals.