BA, which earlier this week announced annual profits up pounds 55m to pounds 640m, is one of many airlines that has moved passenger revenue accounting centres (which account for ticket income) to the Third World to bring down labour costs. Several US airlines have data entry work done either in the Dominican Republic or in Mexico, and Singapore Airlines has contracted out its revenue centre to a state-owned enterprise in China.
"Many of our competitors have already transferred activities overseas, where costs are significantly lower than at home," says Bob Ayling, BA's chief executive. "We cannot continue to compete effectively on this basis without facing up to the need for change."
The company will move 500 jobs to India - on 10 per cent of the pay of comparable workers in Britain - while phasing out about 600 jobs through greater automation. This will save about pounds 9m a year; it is part of an overall re-engineering of BA to make it a "virtual corporation" that outsources more operations, requires internal departments to be market-tested against outside tenders, and transfers some functions to lower-waged countries.
John Claret, deputy secretary of the Chartered Institute of Management Accountants, says that accountants in the UK should not feel threatened. "It is largely transaction processing and report generation. People have been centralising and decentralising this forever. It has been mostly within one country because we did not have the technology we have today.
"It doesn't matter where your transaction processing takes place, as it is largely de-skilled, so it is done automatically by machine and needs technicians and clerical workers to look after it. The qualified accountant has been the manager or creator of the system, rather than making the entries. When you discuss what accountants have been becoming in recent years, they are now part of the management team, and they will continue to be where the management team is."
The Institute of Chartered Accountants takes a less sanguine view. In its consultation document, Added value professionals, chartered accountants in 2005, the ICA predicts: "Some companies will even find it attractive to outsource entire departments, such as management accounting, to low- cost regions."
David Stewart, former partner at Coopers & Lybrand, was chairman of the committee that produced the ICA report. He says that all elements of the accountant's role may transfer to low-wage regions within the next few years. "A lot of people are trying it out at the moment ... Things are moving more quickly than people realise."
The ICA believes that two clear trends are discernible. One is for more automation, reducing not only the number of clerical jobs, but also the numbers of accountants in work. Another trend is for the world's economy to move east, taking with it jobs formerly done in Europe - though it believes that London will continue to be a leading global financial centre. The report adds that if accountants are to have jobs in the next decade they must concentrate on adding value in their work, and be willing to move around the world.
But a more global accounting profession needs international acceptance of qualifications, and a single accounting standard. Liesel Knorr, technical director of the International Accounting Standards Committee, says that progress is fast on both fronts. In practice, accountants with qualifications in one country can already work elsewhere. Acceptance of a single accounting standard is within sight. "We are working to our programme," says Ms Knorr.
By April next year the IASC will have drawn up a single international accounting standard for company accounts that will be acceptable to all the world's stock exchanges and regulators. The code should be in place within a further two years.
Some major British-based multinationals are rumoured to be closely watching BA's transformation. The strong international competition in the airline industry, together with its naturally global character, has made it more willing than other sectors to transfer jobs from the First to the Third World, but others are following.
India has become one of the world's leading computer software production centres. The Caribbean is the base for computer data inputting for some of the United States' financial services industry, which has followed the example of the airline corporations. Many of the world's top IT corporations are considering major investment in Malaysia as a centre for a range of manufacturing and service activities.
Analysts have warned for some years that jobs in some of the professions could follow data processing work in going east. Now it is accountants' jobs that may be on the line - in more ways than onen
Paul Gosling is the author of 'Financial Services in the Digital Age', published by Bowerdean.