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“Shanghai in those days was where the
main business was, but because of the
lack of basic state infrastructure, all
the companies were incorporated and
registered in Hong Kong.”
he 1960s were an excit-
ing time to be in Hong
Kong, but not always
in a good way. The
British colony lurched
from financial boom to
bust. Banks were set up then sank swiftly.
Property prices see-sawed. China endured
the convulsions of the Cultural Revolution,
while elsewhere in Asia, war and rebellion
The city’s accounting profession, in its
own quiet way, was also in a period of chaos
w ith a mad mixture of qualifications, stan-
dards and oversight.
If Hong Kong was to make the kind of
progress towards a global financial hub that
many accounting visionaries foresaw, there
would have to be dramatic changes. The
changes that unfolded led to the formation,
40 years ago, of the Hong Kong Society of
Accountants, the august body that we now
know as the Hong Kong Institute of CPAs.
Over the next four decades, the interna-
tional standards of reporting, auditing and
governance that the Society – and then the
Institute – developed played a pivotal role
in Hong Kong’s success story. It made the
city one of the most efficient, respected and
trusted business environments in the world.
In short, it transformed the city from a colo-
nial harbour town into the financial giant we
At the dawn of the 20th century, the future
didn’t look all too promising for Hong Kong.
Shanghai, after all, offered a more educated
population, a more convenient location and
relatively little government interference fol-
lowing the decline of imperial power.
By the 1910s, Shanghai had become a sig-
nificantly more important trading port than
Hong Kong. With the transfer of British naval
power to Singapore, Hong Kong risked be-
coming a backwater, with small-scale manu-
facturing of piece goods.
Still, most of the multinationals in Shang-
hai’s International Settlement were incorpo-
rated in Hong Kong and the colony’s accoun-
tants did their books. “Shanghai in those
days was where the main business was, but
because of the lack of basic state infrastruc-
ture, all the companies were incorporated
and registered in Hong Kong,” recalls Peter
H.Y. Wong, the son of Peter Wong senior, who
cofounded the accounting firm Wong, Tan &
Co. in Shanghai in 1928. (Wong junior later
went on to become a president of the Hong
Kong Society of Accountants.)
The Institute of Chartered Accountants
in England and Wales had been established
in London in 1880 and some of its members
were – like most accountants in Hong Kong
then – hired by businesses. Butterfield &
Swire, a trading house or hong with bases
in Shanghai and Hong Kong, employed one
ICAEW member, Arthur Lowe, in 1898.
Lowe, foreseeing the importance of Hong
Kong in commerce and the role that accoun-
tants would play in its success, resigned to es-
tablish his own accounting practice in 1902.
He became Hong Kong ’s first professionally
qualified, full-time practising accountant.
The 1920s and 1930s saw the rise of the
Hong Kong manufacturing industry – and
a shift from handmade to machine-made
products – benefiting from the decline in
European manufacturing and tariff breaks
within the British Empire.
Hong Kong started assuming a more re-
gionally prominent role in the 1940s, after
the Japanese invasion and World War II.
Western and Chinese companies abandoned
Shanghai as the Communists gained the up-
per hand during China’s civil conflict.
“ The whole firm moved down to Hong
Kong starting in ’46 when he saw very clearly
that the Communists were moving in and un-
der their system there was no room for pro-
fessional accountants,” recalls Wong, refer-
ring to his father and his firm.
Indeed, as Paul Gillis, now a visiting
scholar at the Guanghua School of Manage-
ment at Peking University, noted: “The Com-
munists [had] fully nationalized the econo-
my by 1962 and abolished auditing by public
accountants. The profession did not exist in
China for the next 18 years.”
Industrialization in Hong Kong accelerat-
ed from the 1940s onwards, with the inflow
of refugees, entrepreneurs and capital flee-
ing the civil war on the Mainland.
When the 1960s arrived, as Asia-Pacific
economies developed and Western compa-
nies sought to expand beyond mature mar-
kets in Europe and North America, Hong
Kong found itself poised to become the re-
gional base for financial ser vices. The terri-
tory had a British legal system, as well as a
histor y as an entrepôt that had already built
up ser v ice sectors such as shipping, logistics
Throughout the decades that Hong Kong
was burgeoning, it was only natural that
companies would require bookkeepers, ac-
countants and auditors to make sure ever y-
thing was adding up.
To ser ve the multinational corporations
and institutions that came to set up in Hong
Kong, an accounting sector started to de-
velop in the city from the turn of the 20th
centur y. Lowe’s firm – which became Lowe
Bingham & Matthews – and leading inter-
national accounting firms such as Peat, Mar-
wick, Mitchell & Co., offered auditing and
accounting services that generally followed
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