From Industry to Academia: Dr. Zhongwen FAN
From tax consultant to researcher
Accounting is generally considered to be the bedrock of the modern financial markets. Through studying different financial statements from different firms, one could develop a keen sense of the inner workings of the capital market. As a young man with a curious soul, Dr. Fan decides to observe the world through the lenses of accounting.
Graduating with flying colors, Dr. Fan’s relentless effort had rewarded him offers from every one of the Big4 accounting firms. Eventually choosing to become a tax consultant, Dr. Fan has explored the private sector for a year and a half. Working for the Big4 has opened up the door to the new world for Dr. Fan. During his tenure, Dr. Fan had come across financial statements from hundreds of companies. Studying them is like running inside a kaleidoscope. Their different organizational structures, business models, and financial performances have piled up into a formidable array of knowledge to be explored. The process of being intellectually stimulated by questions the world has to offer, Dr. Fan is encouraged to become an accounting scholar in order to seek truth from facts.
How to excel in undergrad and postgrad
While many believe that the skills required to excel in undergraduate courses are entirely irrelevant to postgraduate research, Dr. Fan believes that the gist to succeed in both curriculums is the same. To stay hungry, stay foolish has always been the iron law to succeed in studies. One will never improve if staying content with knowledge spoon-fed by teachers. It is equally important for students from both curriculums to hone their accounting expertise and stay tuned for financial news. While entry-level posts focus mostly on your accounting expertise, managerial roles in the accounting industry will require employees to exercise judgment and act according to the latest development in the business world. It is, therefore, crucial to read financial news from multiple sources in order to broaden your horizons. Moreover, as it is common for different authors to take different stances on the same issue, analyzing their differences would be the perfect opportunity for undergraduates to intellectually stimulate themselves.
In addition, as managers in the accounting industry are responsible for a lot of business persuasion, Dr. Fan also recommends students to develop and polish their communication and organizational skills at an early age. The rich and diverse out-school activities offer by student societies are the best whetstones the university could offer.
Postgraduates, on the other hand, should pay relatively more attention to develop their understanding of economic theories and advance their statistical knowledge in order to produce credible and systematic research work. Reading financial news is still important, as new business phenomena are easily the best research topics to work on. Since research is hard and failure is often, Dr. Fan recommends postgraduates to set reasonable goals and stay positive during the process. Dr. Fan believes that his unrelenting interests in accounting have given him the courage to face his failures squarely in order to troubleshoot and improve.
Writing skills are also very important to a postgraduate, as the readability of your research papers is a critical factor considered by journal editors when deciding which paper should be published. In the case of Dr. Fan, he alleged that his verbal reasoning skills are developed during his preparations for GMAT exams. Dr. Fan believes that doing aptitude tests allows one to systematically enhance their skills in numerical reasoning, verbal reasoning, and logic in tandem. Therefore, even if you are uninterested in developing a career in the private sector, you should not shy away from opportunities to holistically develop yourself.
The value of internships
Having internships with prestigious accounting firms could glamorously embroider your CV. Although tasks assigned to interns are usually mundane and maybe insignificant, Dr. Fan hopes that students could be more thoughtful and look for opportunities that could stimulate their personal growth. For example, students could immerse themselves in the company’s perspective when dealing with tasks that involve monetary interests. To be able to feel the pressure could encourage students to be more cautious and serious.
Dr. Fan also believes that internships provide students the opportunity to develop a proper and professional working attitude. Dr. Fan recommends students to do more background research before working on your assigned tasks. Being better informed on the subject matter would definitely give you an edge in out-performing others and build up your reputation in the long run. Applying this mindset in your studies could encourage one to seek knowledge beyond the undergraduate curriculum and develop a more solid foundation than your peers. As accounting is the bedrock of the financial world, mastering it grants one an edge to master any advance financial knowledge.
Blockchain technology as a hot research topic
The blockchain technology is a buzzword in recent years, renowned for its competence in producing highly transparent and highly credible transaction records. Researching its actual effect on the market has, therefore, become a hot topic among researchers.
Dr. Fan has recently conducted research on whether the introduction of blockchain could add value to shareholders. Using an event study in the US, by analyzing the impacts caused by a regulation that enables firms to record stock transactions with blockchain, Dr. Fan observes that the market reacts positively to the technology. Dr. Fan posits that the blockchain technology shines brightly in the fields of increasing the accuracy of proxy voting during shareholder meetings.
Before the introduction of blockchain, voting often entails a lot of problems and errors due to the complicated voting system and non-simultaneous update in the information. However, utilizing blockchain in the voting process enables users to receive perfect information on the voting process and the voting results. As data uploaded are copied to users at the same time, it is nigh-impossible for individuals to manipulate and fabricate the records.
Blockchain has not only solved the fundamental problem in bookkeeping, but it also gives an alternative to the market to decentralize itself if necessary. However, Dr. Fan believes that the degree of decentralization varies in different sections. Bitcoin, for example, is a financial product existed due to the mistrust of the authority figures in the banking industry. Its market is totally decentralized and although buyers are anonymous, the on-going transactions are transparent to all thanks to blockchain technology. However, to the extent the market demands privacy protection in transactions, buyers would still prefer to trade through traditional intermediary agencies and willingly be monitored by authority figures.
The future of the accounting industry
As the introduction of AI has taken up a lot of traditional accounting duties, accountants must evolve from compliance workers to strategic consultants. When asked how students could better prepare themselves for these roles, Dr. Fan begins by introducing us to the three ways accountants are important to the market.
First, accountants are responsible for making external financial reporting of firms. This task is crucial as it is the window to draw external investors. In order to effectively perform this task, students must develop a better understanding of the accounting standards, laws, and regulations in different regions. Students should also work hard on their numerical reasoning skills and data analytical skills in order to produce better accounting estimates and minimize the information asymmetry between firms and investors.
Second, accountants are also consultants. Accountants’ responsibilities in analyzing financial statements and make recommendations based on the statistics are often being looked over. While it is a task that requires years of practical experience in order to have decision-makers entrusted you with the task, students could start developing their business acumen by paying attention to the latest business phenomena.
The third and the most important duty of an accountant is to performing internal control. Effective accounting control is critical to the operational capacity and efficiency of a company. It reduces accounting errors and ensures that the firm’s performances are reflected accurately. To perform this task, Dr. Fan advises students to skills in programming and data analytics, as so to improve the data management of firms by ensuring that the data generation process is error-free.
Before joining HKU, Dr. Fan had taught in the US. Although it is believed that local students are much quieter compare with US students, he believes that being thoughtful could still be a good trait for learning. However, he would still try his best to encourage students to actively participate in class, as discussions are the best ways to induce knowledge exchange.
Moreover, Dr. Fan also hopes that students could be more far-sighted instead of narrowly pursuing a high GPA. The purpose of tertiary education is to develop skills in critical thinking and in the long term, make the world a better place. Solely focusing on exams and assignments would bring nothing new to the world. It is only through perpetual thinking and learning, the world could improve. Dr. Fan hopes students could be more aware of their surroundings and try to apply theories they have learned to better understand these phenomena. Preferably, try to amend the present with new ideas.
As a novice scholar equipped with practical experience in the industry, Dr. Fan is looking forward to conducting research on down-to-earth topics such as blockchain and accounting and finance. In the future, when he has developed a more thorough understanding of accounting, he may consider engaging in cross-faculty research collaborations to dive deep in the ocean of knowledge.