Insights

Finance & Accountancy

FINANCE MARKET COMMENTARY, Q3 2018

• Article by BRUIN Financial

FINANCE MARKET COMMENTARY, Q3 2018

MARKET OVERVIEW

Q3 was punctuated by peaks & troughs with a month  long hiatus in  August from both a client and candidate perspective, but with July & September very busy either side.

Work / life balance and clear opportunities for advancement were the top areas of focus for candidates, with the result that firms who were unable to articulate clearly their internal policies and strategies lost out to those where the narrative was more clear.

True to form, September had a high volume of firms seeking to take advantage of the Newly Qualified ACA / ACCA / CIMA market and this was matched with a large number of Newly Qualified candidates coming to market – the main challenge was managing expectations on both sides around the reality of recruiting a Top 6 ACA into a Reporting role for example, whilst being consultative to candidates around the barriers to entry into Front Office / FP&A type positions and setting realistic salary expectations to all parties.

A large number of roles have been growth hires, with a focus on UK based staff with a Pan-European mandate, eg Fund Oversight roles requiring Lux GAAP skills in a Post-BREXIT landscape.  This will continue to be a key focus and presents a challenge to the market as there is a shortage of candidates who have deep and proven knowledge of European reporting polices / standards as historically they have been managed “in country”.

In the contract space, our banking clients created a strong demand for newly qualified ACAs, for a wide range of roles. However, we experienced an extremely scarce number of newly qualified candidates interested in contract opportunities as the security of the permanent market seemed an important factor to be considered in the current climate.  Our buy side clients hired a number of Contractors, with roles varying from Accounts Payable Analysts and Junior Accountants up to senior Financial Control and Programme Accounting candidates. The Contract FP&A space was generally dominated by project related assignments within both existing initiatives and newly implemented programmes.

As firms aim to remain competitive and optimise their operations for the near future, we found an increase in the demand for Brexit related projects in both Asset Management and Banking, particularly within the Finance Change and Tax spheres.

 

ROLE PROFILES

Q3 of 2018 saw a wide range and diverse mix of role profiles which is often the case during the summer months. It is common over this period to see a priority on roles that have dragged into the summer period that are now more business critical to recruit, as opposed to a rise in the number of new vacancies being released. Due to the high number of decision makers being away over the summer, non critical, growth led hiring is often delayed to the start of the fourth quarter. Furthermore, we saw the continued trend on the push for newly qualified Accountants from an Audit background. This is a very buoyant candidate pool as it is the same time that candidates on the ACA scheme qualifying and entering the market for the first time.

One area that has been busy throughout 2018 is firms looking for qualified Product Controllers. Across the third quarter we actually had a reduction in the number of roles in this area. This could be due to the previous push on outsourcing the Product Control function to low cost areas coming into effect, and the roles no longer sitting in London which has reduced the volatility in the market.

An area that was busy over the quarter was the sub £60k market. We saw firms looking for part or newly qualified accountants were hiring in a number of areas including; Fund Accounting, FP&A and Accounts Assistants. There has also been an increased push in the Fund Accounting space to bring in junior candidates as opposed to replacing leavers with ‘likes for like’. As a result, we see replacement roles at the more senior end of Fund Accounting with oversight of internal and external contributors. Furthermore, due to desire to bring in candidates with strong oversight experience, we have found that clients have been most impressed with candidates who have worked both in the industry and from a Third Party Administrator.

This trend has been apparent in the FP&A space. We have seen a significant increase in the number of firms that are looking to bring in part qualified accountants and offering full study support and remuneration of previous fees paid in order to attract the quality candidates who would be reluctant to leave due to the prohibitive costs incurred by repaying exam and course fees.

One pleasant trend during the third quarter of 2018 has been the increase in Senior Roles. This is a typically quiet market at the senior end of Accountancy and Finance, however we did see multiple roles at Director and Head Of level which moved quickly over the latter months of Q3.

In the contract space, our Banking clients particularly sought Newly Qualified ACA candidates for Legal Entity Control, Product Control and Regulatory Reporting roles. As the number of candidates in the market was limited, the majority of our clients became flexible, thus having considered a scope of candidates without a Big 4 background.  In Product Control, senior contract roles continued to become increasingly more specialized and clients strictly demanded specific product knowledge and experience.  Business Analysts within the Finance Change and Regulatory Reporting projects space were highly sought after, especially for candidates with extensive software knowledge and technical skills and wide experience in a specific area.

Within the Asset Management space there has been an influx in the demand for Fund Accountants and Fund Accounting Oversight roles, with many firms demanding specialized knowledge of certain structures, especially Unit Trusts, UCITS and OEICs. Buy side clients prioritised extensive knowledge of a certain area or a particular fund, thus considering  strong candidates with different backgrounds and solid experience at similar firms.

Overall, the demand for contractors has been evenly spread across buy side and sell side institutions.  We observed that banking clients had a strong preference for candidates holding formal Accounting qualifications regardless of their level of experience, whereas asset management firms tended to be more flexible with requests varying in accordance to individual areas of expertise and are happy to look at candidates that are qualified by experience.

 

Audit

Our Audit team have had a steady job flow all year round and this quarter has been no exception. Within Investment Banking this is less down to growth and more as a result of ring fencing and a great deal of positions being moved out of London. However within Asset and Wealth management a significant number of positions have become available in central Europe and especially Luxembourg. This is a huge area of growth and will certainly be a market that BRUIN looks to build and utilise.

From a London perspective the majority of profiles we have been working on with some success had been mid- senior level roles (AVP-VP) within Banking and Capital Markets, however the challenges we have seen is with the depth of candidate pool.  At this level the quality of candidates actively seeking new roles has decreased dramatically and much more of the candidate generation is down to head hunting top talent.

On the contract side, there was consistent demand towards the end of the quarter, particularly for specialist auditors for the front and middle office functions. As the audit season is approaching, we are expecting an upturn in demand this final quarter as the majority of our clients look to prepare in advance for the New Year requirements.

With a 16% increase in new positions from Q2, we predict that this positive flow of roles will continue through to the New Year.

 

PREDICTIONS

The net result of the change in operating models across Banking & Asset Management has been an increase in opportunities being taken on for locations such as Luxembourg, Dublin & Paris, this will continue to be an important area for firms to be recruiting into and BRUIN are demonstrating success in both relocating talent as well as successful recruitment from local firms in another jurisdiction.

Q4 often has an early peak in terms of movement as firms seek to secure the headcount required for 2019 to meet business needs, additionally the candidate focus shifts to protecting their bonus reward for work done in 2018 so the salary uplift / bonus commitments a new firm can offer becomes a significant factor in the difference between offers being accepted or rejected as we approach the end of the year.

The first part of Q4 will likely be a busy one as firms look to fill their vacancies before Christmas, ready for the year end closure. The contract market is likely to remain buoyant due to clients being reluctant in making long term plans and commitments; therefore, we are expecting to see a firm influx of contract roles in Q4. We foresee the same level of demand for ACAs to be very strong with the candidate pool likely to increase as part-qualified accountants qualify from their exams.