Timid recovery and signs of renewed growth: MGI members in Peru and Argentina comment
The Peruvian economy has struggled in the last few years – the pandemic hit hard. It is beginning to bounce back but recovery is still fragile. In Argentina, after years of grappling with recession and runaway inflation, the country's new government is implementing bold and transformative reforms.
In a recent edition, MGI Worldwide members in Peru and Argentina took time out to speak with the International Accounting Bulletin, sharing their views on the accounting industry in their respective markets.
Regulatory progress in Peru
Maintaining high standards of quality across the accounting industry is at the forefront of the local industry. Peru’s accounting regulations have progressed significantly in recent years, driven by the country’s efforts to join the OECD and adopt high regulatory standards.
Angel Saco, partner at MGI member firm MGI Ramirez Saco, comments:
Angel Saco
"The Ministry of Economy and Finance, through the Accounting Standards Council (CNC), has actively implemented global best practices. This amendments to the law requiring private sector companies to adopt International Financial Reporting Standards (IFRS). The CNC continues to update the IFRS framework and improve financial reporting quality, approving standards like the IFRS for SMEs and the Peruvian Financial Reporting Standard for Microenterprises, which will be effective in 2025. Additionally, since 2023, the CNC has coordinated with supervisory bodies to implement Sustainability IFRS, enhancing transparency for investors with a focus on sustainability.”
Technology and mergers
Technology is reshaping Peru’s accounting landscape and Angel anticipates significant changes, stating:
"The digitalisation of accounting and tax services, as well as the implementation of artificial intelligence, are expected to drive significant changes in the industry."
He also highlights a trend of consolidation among accountancy firms, driven by resource needs and succession planning challenges poinint out that "smaller firms are merging with larger ones to maintain market viability."
Despite challenges, firms remain optimistic, investing in technology and pursuing mergers to enhance capabilities. According to Angel, these efforts position Peru's accounting industry for growth in a competitive and evolving environment.
Economic reforms in Argentina
Argentina’s transition to a pro-market government is driving significant economic reforms, fostering optimism after years of instability. Inflation control, tax incentives, and deregulation are reshaping the business environment, with positive outcomes anticipated across industries. The government’s ambitious fiscal objective of zero deficit and initiatives like the RIGI (Incentive Regime for Large Investments) are central to economic recovery.
Consulting and outsourcing demand
The reforms have boosted consulting and outsourcing services, particularly for foreign-owned companies unfamiliar with Argentina’s complexities. Businesses are increasingly relying on advisory firms to navigate the changing tax and regulatory landscape.
According to Rafael Faillace, partner at MGI Jebsen & Co., the demand for consulting, tax advisory, and legal services is growing rapidly:
Rafael Faillace
“Our expectations for the next 12 months are highly positive. We anticipate solid and consistent growth in new projects and clients, as a result of the improvement in the Argentine economy.”
Challenges in the accounting sector
Fee negotiation, high inflation, and talent retention remain key challenges for accounting firms. The new government is still modifying tax regulations, and has talked about a comprehensive tax reform, aimed at simplifying the current system alongside the deregulation already underway.
MGI Worldwide member Ignacio Rodríguez Spuch, partner at Casal, Vecchi, Rodriguez Spuch y Asoc. SRL comments:
Ignacio Rodríguez Spuch
“For accountants, this means that training efforts must be redoubled, but clients must rely even more on their accounting advisors to be able to adapt to this environment of profound changes.”
Argentina’s austerity measures and reforms have created social and political tensions, yet the outlook is optimistic. A shift from a populist to a liberal economic model marks a significant cultural transformation. Many Argentinians see this change as a step toward a more prosperous and stable future.
To read the full article in the October edition of the IAB, members can click HERE (login to the MGI Worldwide member portal will be required).
Top rankings
In the 2024 IAB rankings, we were delighted to see our member firms ranking so highly against the other top accounting associations!
In Argentina our member firms ranked an amazing 6th for fee income, and 13th for staff data. Our member firms in Peru ranked 7th for fee income, and 8th for staff data.
MGI Worldwide would like to congratulate all our member firms in Argentina and Peru who were responsible for helping achieve these fantastic results.
For more information
Visit the MGI Ramirez Saco website or firm profile page
Visit the Casal, Vecchi, Rodriguez Spuch y Asoc. SRL website or firm profile page.
Visit the MGI Jebsen & Co. website or firm profile page
MGI Worldwide, is a top 20 ranked global accounting network and association with over 8,800 professionals, accountants and tax experts in some 440 locations in alomost 100 countries around the world.