An association of legally independent accounting firms GMN International General Meeting – New Delhi, India 28 and 29 October 2015 _____________________________________________________________ Attendees Australia Ian Cooper Joe Ciccia Stephen Wight Canada Jeffrey Dessau Ben Detsky Cyprus Michael Larkos Panayiotis Kolokotronis Denmark Søren Larsen D R of Congo Joyeux Bahidika Dubai Rohit Ghai Rajeev Kulkarni France Alexandre Vallette India Ashish Ghosh Sanjay Khanna Rohit Kohli Deepak Saxena Nisar Mecca Rachna Agarwal Ireland Declan Merry Kenya Andrew Bulemi Andrew Mbaya Lebanon Elia Krayem Jihad Khalifeh Mauritius Kamal Hawabhay Mexico Manuel Duran Barbaray Peru Eduardo Espinoza Patricia Espinoza Philippines Corazon Enriquez Felicidad Abad Singapore Robin Chia South Africa Herman Van Der Merwe Jannie Griesel Ignus Kempen Spain José Esteve Enric Paredes Sri Lanka Aubrey Saverimuttu United Kingdom Graeme Blair United States Steve Handler Mike Wilford Vietnam Thuong Nguyen International Executive Malcolm Bolton Page 1 of 16
Transcript
An association of legally independent accounting firms
GMN International General Meeting – New Delhi, India
Attendees Australia Ian Cooper Joe Ciccia Stephen Wight Canada Jeffrey Dessau Ben Detsky Cyprus Michael Larkos Panayiotis Kolokotronis Denmark Søren Larsen D R of Congo Joyeux Bahidika Dubai Rohit Ghai Rajeev Kulkarni France Alexandre Vallette India Ashish Ghosh Sanjay Khanna Rohit Kohli Deepak Saxena Nisar Mecca Rachna Agarwal Ireland Declan Merry Kenya Andrew Bulemi
Andrew Mbaya Lebanon Elia Krayem Jihad Khalifeh Mauritius Kamal Hawabhay Mexico Manuel Duran Barbaray Peru Eduardo Espinoza
Patricia Espinoza Philippines Corazon Enriquez Felicidad Abad Singapore Robin Chia South Africa Herman Van Der Merwe
Jannie Griesel Ignus Kempen Spain José Esteve Enric Paredes Sri Lanka Aubrey Saverimuttu United Kingdom Graeme Blair United States Steve Handler Mike Wilford Vietnam Thuong Nguyen International Executive Malcolm Bolton
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Wednesday, 28 October 2015 Day 1 – Meeting starts 09.00
1. Welcome and Greetings Michael Larkos welcomed everyone to the 38th annual GMN International meeting. He thanked Ghosh Khanna & Co. for hosting the conference. He mentioned that the conference started 3 days ago with the Asia Pacific regional meeting, followed by the IEC meeting and then the social day. He hoped that all attendees would benefit and gain from the conference, especially from the new activities which have been included to add value. Mrs Meenakshi Lekhi, who was to welcome the attendees to New Delhi, had been delayed in traffic and was expected to arrive soon.
2. Report from Chair Michael Larkos said how delighted he was to be in New Delhi as he completes his two-year term as Chairman. Being Chairman has been an interesting time, which takes much effort and energy. Referring to GMN he mentioned that it is an association in the top 25 with combined members’ revenues of $200M and more than 2,500 employees. The new Chairman is Ignus Kempen who is set to continue the work started some time ago with more successes, improvements and growing GMN. Michael gave a special thanks to hosts Ashish, Sanjay, Rohit and Deepak. He thanked the members for attending in spite of the long journeys for many. He was pleased to see old and new faces from 22 countries with more than 40 attendees. Michael gave a special mention to welcome new member firms Yale & Partners in Toronto, Canada, Korn Audit in Moscow, Russia, DIJ Audit in Belgrade, Serbia and the newly merged firm AnViet Auditing in Vietnam. He warmly welcomed new member attendees Jeff Dessau and Ben Detsky of Yale & Partners and Thuong Nguyen of AnViet Auditing. He continued that being Chairman has been a challenging time with much to do considering the needs of members and the association. However, he was glad to say that the effort he put in was less than the value he got out. In the last two years he has experienced the differences of leading an association distinct from those of leading a firm. He thanked the members for the opportunity he was given to be Chairman and invited members to come forward to participate; to be proactive and not reactive. Michael reminded attendees that much had been achieved in the last 12 months for the new GMN that was conceived by the strategic review. GMN has a solid, robust structure with protection for office holders; it has come a long way since it was founded. The transition took two terms of chairmanship of Cameron Johnstone and Mike Wilford to design and architect what GMN is today. Everything has been implemented and the association is ready to reap benefits. Continuing he referred to the vastly improved website that saw the launch of a members’ section at the beginning of the year to which some members have signed up and Michael encouraged all to do so.
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Michael pointed out that to add more value to members will take more resources, not people, but finances. Additional funding needs to come by having more members. The regions have the responsibility to support and contribute to GMN. Improved recruitment will provide an increase in the number of members, which in turn will provide more finances. Last year GMN had 68 member firms and during the year 5 new members joined and 4 left, meaning GMN now has 69 members. The growth was not as good as the previous year, but reminded everyone that members do not leave because they are unhappy, but because they merge or are acquired. GMN needs to improve its image and strengthen its profile so that in such situations GMN is not the underdog and retains the merged entity as a member. Michael commented that the International Office, comprising of the International Executive and International Coordinator, is a part-time contract, but provides full-time effort. He thanked the International Office for their contribution. He then reminded members that they need to help the International Office to achieve their tasks. The International Office make few requests, but when they do they are important. As an illustration, the Annual Declaration is needed to be completed and submitted on-time. The information is used for budgets, regional fees, external surveys and the accountancy press, e.g. IAB. Without up-to-date information GMN can fall behind and so Michael urged members that when the Annual Declaration is requested their submission should be prompt. On conferences Michael referred to the change of conference format in Las Vegas which saw the reintroduction of breakout sessions and the introduction of a professional external speaker. Turning to finances Michael reported a surplus for the year of $13,000 against a budgeted deficit of $14,000, so an unexpected turnaround which was not achieved by growth or cost savings, but costs not spent. The budget for the coming year includes costs to improve GMN’s image and to continue the recruitment effort. In closing, Michael gave thanks to MC members Ignus Kempen as Vice Chairman and Ashish Ghosh as 3rd MC member, soon to be Vice Chairman. He welcomed Graeme Bursack as the newly appointed 3rd MC member. He thanked Malcolm Bolton as International Executive and added that without his assistance and guidance the MC could not have achieved what they have. Lastly he thanked Wendy Aboucham, International Coordinator, for ensuring that all runs smoothly.
3. New member presentations New members – Yale & Partners LLP, Toronto, Canada Jeffrey Dessau, partner of Y&P, presented that the firm was founded in 1953 and today continues the tradition of focusing on every client as the most important. Y&P is a full-service firm comprising of six partners, ranging in age from 30 to 53, who serve a diverse client base. For detailed information refer to the presentation slides.
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Welcome to New Delhi Sanjay Khanna introduced Mrs Meenakshi Lekhi, Member of Parliament representing New Delhi, to the meeting saying it was a privilege to welcome such an honoured MP who is always willing to attend social occasions. There followed a lighting-of-the-lamp ceremony which Sanjay explained was a customary ritual at all auspicious functions in India. Mrs Lekhi welcomed everyone to New Delhi and continued by providing an overview of India. She highlighted that India’s economy is growing at a rate of 7.5% and is expected to surpass China. A current fiscal deficit is contained and the country is undergoing a redistribution of resources. The government of India has done many great initiatives that compare well with any emerging economies. India is the largest democracy in the world which has a cost; fairness in all dealing has a cost. As a principle it is believed that equitable growth is the only way for sustainable growth. Talking of the economy Mrs Lekhi referred to the IT and Financial Services sectors where she informed that India is able to provide a service and a solution. The country has huge manpower and skill. She reiterated that the government has done wonders. To develop skills there is now an Industry Training Institute with modern syllabuses. There is green technology and green energy of solar and wind power providing power to the grids and smart grids. To close she emphasised that India is a peaceful nation that does not invade other countries, there are no coups. Finishing, Mrs Lekhi wished everyone a pleasant stay in Delhi, a place where she considers herself a local guardian of the area. Michael thanked Mrs Lekhi for an inspiring address and, as a token of appreciation, presented her with a gift. Before returning to new member presentations Michael commented that he was inspired by the confidence India has about their nation. New member presentations, continued New members – An Viet Auditing Co. Ltd, Vietnam Thuong Nguyen, partner of Anviet, presented information on the firm which included details of the recent merger between An phu Auditing Co Ltd (original GMN member) and Viet Anh Auditing Co Ltd to form An Viet Auditing Co Ltd. The merged firm, ranked in the top 15 professional firms in Vietnam, comprises of 11 partners, 15 managers and 125 staff. For detailed information on Anviet refer to the presentation slides.
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New members – Europe Søren Larsen reported that the European region had gained two members in the year. The new member firms are: DIJ Audit, Serbia Korn Audit, Moscow, Russia Søren went on to give an overview of the new member firms in Serbia and Russia. For detailed information on DIJ Audit and Korn Audit refer to the presentation slides. New members – A J Verna SRL, Bolivia A J Verna were unable to attend the conference and a presentation, on their behalf, was given by Patty Espinoza. For detailed information refer to the presentation slides. New members – International Taxation Consultancy Mike Wilford gave a presentation on behalf of Tim Phillips, who was unable to attend the conference. Mike mentioned that Tim, Regional President of the North American region since 2006, had retired as a partner of Coulter & Justus (until recently a GMN member) and set up an independent practice, International Taxation Consultancy. Tim’s practice has been admitted to membership. Tim has 29 years of public accounting experience, including 16 years with the IRS. International Taxation Consultancy is knowledgeable on inbound and outbound USA tax and US taxation of international operations and transactions. For further information, refer to the GMN E-Brief dated 29 July 2015.
4. Conference Host Firm – Ghosh Khanna & Co. Sanjay Khanna, on behalf of the host firm, opened with how it is important to attend conferences to meet people. The members need to create opportunities and work together for the benefit of all; work on these opportunities. Sanjay continued by providing background information on GKC, a mature firm established for 35 years that has since seen much change in India and is proud to provide work opportunities to people. GKC has 9 partners and directors, 30 professionals and 190 employees, a head office in New Delhi and 6 branches in major locations in India.
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Sanjay followed with a video presentation, “India Moving Ahead”, which reported that India, often referred to as an economic powerhouse, has sustained rapid growth over 2 decades. The challenge is to provide energy, momentum and a single commitment to growth to create jobs for its young population. Measures have been taken to cut down red tape and make the system efficient with technology. To provide an impetus to India becoming a manufacturing nation, industrial corridors and smart cities, using next generation technology, are being developed. For further information, refer to the presentation slides and the video, “India Moving Ahead”.
5. Regional Reports Africa, report by Jannie Griesel Jannie summarised:
The region is represented in the five principal regions in Africa
Regional conferences are well attended and discuss strategic goals, new technical and topical issues relevant to every practice
The concept of having a pan African alliance of African firms by creating an auditing and consulting entity is on hold for now
Growth is expected by recruiting new members and retaining existing. There were no questions from attendees. For further information, refer to the Africa President’s report. Asia Pacific, report by Ashish Ghosh Ashish summarised:
Ashish’s term as Regional President has come to an end and Joe Ciccia has been appointed as Regional President for a two-year term
The AP conference, held immediately before the international conference, was attended by 18 members
Members had been lost during the year due to mergers or a change of strategy by the departing firm
Ashish requested that members pass on any leads they may have for recruiting potential new members. There were no questions from attendees. For further information, refer to the AP Regional Report.
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Europe, report by Alexandre Vallette Alexandre summarised:
The regional conference and technical meetings had been well attended
With sadness he reminded of the sudden death of our Czech member, Ladislav Aubrecht
During the year two new members joined, as referred to earlier in the meeting, and there had been no losses
The region is hopeful to soon recruit a member in Sweden
The region has incorporated in the UK and is registering for VAT
The next regional conference is to be held in Koblenz, Germany in June 2016. There were no questions from the attendees. For further information, refer to the Europe report. North America, report by Mike Wilford Mike summarised:
The region had held a successful conference in Los Angeles during July
A new member, Yale & Partners reported earlier in the meeting, has joined
The primary issue for the region is the recruitment of new members. There is to be a rethink on strategy but it remains an ongoing challenge
The next regional conference is to be held in Toronto, Canada and all are invited There were no questions from the attendees. For further information, refer to the NA Regional Annual report. South America, report by Eduardo Espinoza Eduardo summarised:
He had been newly appointed to the regional executive and the IEC
The region had held a successful and well attendee conference in Quito, Ecuador
Various topics had been discussed including quality control, auditing software and referrals
All are invited to the next regional meeting to be held in Lima, Peru. There were no questions from the attendees. For further information, refer to the South America report.
6. Introduction of Mr T S Vishwanath Ashish Ghosh welcomed Mr Vishwanath to the meeting, someone he had known for 40 years. As background Ashish continued that Mr Vishwanath, among many other distinguished
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achievements, was a former President of the Institute of Chartered Accountants in India and former President of the South Asian Federation of Accountants. His address will discuss how accounting associations can benefit from changes happening globally.
7. Keynote Speaker – Mr T S Vishwanath, “Accountancy in Tandem with Global Outlook”
Mr Vishwanath opened with how delighted he was to have been invited to attend the meeting. He remarked that India is on the rise, a bright spot in a sluggish global economy. With a sense of nostalgia be recalled his luncheon meeting in London with Mr Norman Nash, a founding member of GMN. Moving onto the topic of his address he said it is an expansive subject. He opined that any profession evolves to the needs of society and must change to society’s needs to remain relevant. As the profession increases globally, so public scrutiny increases, and the profession will be challenged more and more as the expectation gap widens. He referred to the high-profile corporate scandals and failures which had been attributed to the profession; the auditor is always the first to be subject to scrutiny. He offered that the profession must anticipate the growing needs and challenges that are going to confront it. And, in contrast, he commented that the profession is a highly specialised focused based service, whereas business is a driver for profit. He expanded his discussion on the global economy by considering, in detail, the effect of quantitative easing, the slow down of China effect, the rising of the Indian economy, the stagnation of the EU economy and the global reserve currency. He suggested that the services sector has enormous clout and immense potential, if it can organise itself in a robust and lean manner. The global profession needs knowledge beyond accountancy, needing to understand economies and trends to be able to advise on treasury operations. He continued that the economic trends point to a shift of core economic activity towards Asia and then, possibly, to Africa. The current India/Africa summit being held in Delhi shows the significance of Africa. The players in advanced economies would compete for opportunities, compete for growth. The accountancy profession cannot be oblivious to these economic developments as the new economic areas of the Asian and African regions would generate significant opportunities. He returned to the corporate governance and accountancy issues that rocked the developed world that has led to codes, standards and observances in the global model that has meant a clamour for greater public accountability and oversight as never before. One set of high quality standards and a relook at current practices will become vital to facilitate inter-firm and inter-global comparisons. He introduced that technology means that international activity no longer needs a bricks and mortar presence. A good idea can launch a small start-up that can lead to the big league quickly. The accountancy profession world-wide is exposed to new areas for providing
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professional services such as risk assessment, cyber risk/protection, strategic planning, treasury management and compliance with laws in various jurisdictions. He expressed the view that there needs to be a restoration of public confidence and oversight; self-regulation is no longer acceptable. The profession needs to address the concerns of the public. This may lead to a demand for a global body of the profession. So in the context of all this unfolding what should networks and associations be doing? Mr Vishwanath believed they should bring themselves together with a strong governance structure, have a mechanism to deal with conflicts of interest issues, leverage the skills of firms by using the best talent to provide a holistic service, provide swift retribution for poor performers and put in place a quality control process to review firms. To close he said the accountancy profession will grow and thrive, but only with integrity.
8. Introduction to breakout session Michael Larkos provided an introduction to the breakout session. He noted that ‘breakout session guidelines’ had been circulated prior to the conference which included full details on how the session will operate. Further he mentioned that Group 4 had been given a detailed brief in advance to facilitate their discussion. Additionally, breakout teams for each topic, together with team leaders, had been pre-assigned. Michael informed that the topics were: Group 1 – Making technology work for your firm Group 2 – Successful marketing techniques for accountants Group 3 – How to create business opportunities within GMN Group 4 – How to make a staff transfer programme work for GMN Michael requested that each team is prompt with their timings as set out in the guidelines and summarise their key findings in the PowerPoint template provided prior to the conference.
9. Breakout session and discussion in groups The four groups gathered in their respective teams to discuss their topics.
10. Breakout session report back and questions Group 1 – Making technology work for your firm On behalf of group 1 Rohit Ghai gave a report back to the meeting. Rohit summarised the groups key findings under: The paradigm shift; Client acquisition;
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Staff acquisition; Banking and financials; Client servicing. For fuller information refer to the report back presentation slides. Ignus Kempen requested that it would be helpful if the group could provide details of software used. Michael Larkos added the importance of browser restriction sites in the workplace, e.g. social media sites, which can be done on a computer-by-computer basis. Group 2 – Successful marketing techniques for accountants On behalf of group 2 Graeme Blair gave a report back to the meeting. Graeme summarised the group’s key findings under: Inherent conditions; Most effective methods, to include referrals, advertising, targets, networks and marketing to existing clients; Firm marketing organisation. For fuller information refer to the report back presentation slides. Group 3 – How to create business opportunities within GMN On behalf of group 3 Declan Merry gave a report back to the meeting. Declan summarised the group’s key findings under: Clients and identifying opportunities; Marketing via the international office; Marketing by member firms; Referral rules and guidance; Conferences; Other. For fuller information refer to the report back presentation slides. Group 4 - How to make a staff transfer programme work for GMN On behalf of group 4 Joe Ciccia and Steve Handler gave a report back to the meeting. The group’s key findings were summarised under: Advantages and disadvantages of a programme; Reasons for transfer;
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Communication and feedback; Costs and starting a fund. They added that if there is a transfer there should be a video produced for presentation at regional and international conferences. For fuller information refer to the report back presentation slides. Day 1 – Meeting closed at 17.35
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Thursday, 29 October 2015 Day 2 – Meeting starts 09.05 Michael Larkos welcomed the attendees to day 2 of the conference.
11. Introduction to Mr Gautam Mukerjee Ashish Ghosh introduced Gautam Mukerjee. Gautam has been an entrepreneur since 1983 and shortly thereafter began teaching Entrepreneurship, Leadership and Corporate Strategy.
12. and 13. Workshop: “How to Reach your True Potential”
Gautam Mukerjee delivered a half-day interactive workshop designed to help each attendee
to open a door and pursue the journey to understand what is their true potential.
The workshop developed a theme built on the work of others who have studied and authored
on this concept.
Gautam outlined the operating tools and then led into considering identity, skills and
acquiring wisdom. He expanded into emotional intelligence, consciousness and how to create
inner positivity before finally focusing on how to reach your true potential.
Each attendee received a personal copy of the Workbook, “How to Reach your True Potential”
which includes an interpersonal orientation assessment.
This session was condensed from a three day workshop entitled “Transformational
Leadership” which is designed to initiate the process of uncovering that intelligence which is
an innate part of our being and express itself through our intuition.
14. Presentation: “The Mauritius International Financial Centre as a hub for global and
Indian corporates to do business/invest in Africa”
Kamal Hawabhay declared that Mauritius is a great place to do business and is the financial
centre of choice. The presentation touched upon the realities and factors to consider when
doing business in Africa, why use Mauritius as a base or gateway and what Mauritius
International Financial Centre can be used for.
Due to the limited time available, Kamal made an abbreviated presentation based on a much
larger presentation of 41 slides.
For fuller information refer to the presentation slides.
15. Presentation and group discussion: “TED video – The workforce crisis of 2030 – and
how to start solving it now”
A short video clip was shown that reviewed the global workforce crisis that, in many countries,
is at its turning point now and, for virtually all others, will become a huge problem by 2030.
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It revealed that the crisis will be made worse as high-skilled workers will be in even shorter
supply. The significant gap between the supply and demand for labour, especially skilled
labour, will bring challenges for governments and companies alike in respect of education,
qualification and upskilling.
It considered whether technology can solve the problem by boosting productivity and
replacing jobs. The conclusion was that technology will replace some jobs, but at the same
time will create new jobs and new skills and so the skills mismatch will become more acute.
It was suggested that businesses need to put in place a people strategy needs that considers,
how to forecast labour supply and demand, how to attract the best people, a plan to educate
and upskill and how to retain the best people.
A brief discussion followed which mentioned that in accountancy the shortage of staff already
exists and is a problem in many countries. It was suggested that as an additional service line,
to create a new revenue stream, firms could advise clients on efficiency to tackle the looming
problem.
For full details refer to the video that is available online at www.ted.com.
16. Address from incoming Chairman, Ignus Kempen
Ignus opened by referring to the success of the conference; he had made new friends,
rekindled relationships, generated business opportunities and learnt from the various
discussions and presentations – conferences are getting better.
He gave thanks to Ashish Ghosh as host and organiser, to Malcolm Bolton and Wendy
Aboucham for the support they provide as the international office and lastly, to Michael
Larkos for his dedicated long hours to the good cause of GMN.
He emphasised that be hoped to fulfil members’ expectations during his term as chairman.
Ignus went on to explain his first interaction with GMN some 16 years ago when he was asked,
as a junior accountant, to pick up a GMN member at an airport. Since that time, he informed,
that he has held office as African Regional President, third member on the management
committee, international vice chairman and now International Chairman.
He remarked that he was already looking forward to the 2016 London conference and how
he would like to see joint regional conferences, perhaps one in every three years, and in this
regard the Asia Pacific and African regions were already in discussions.
He continued that he had listened to members and taken notes of their comments and will
follow up on the points that have been raised.
He reminded that recruitment is key and how he would like to see membership grow from 69
today to 75 in 2016 and 90 by 2020. GMN is about “partnering for success” – to achieve for
Graeme Blair, partner of host firm Goodman Jones, presented information on the 2016 conference to be held in London. The 2016 conference outline is proposed as: Saturday, 15 October: IEC meeting full day Sunday, 16 October: Social day for members and spouses/companions Monday, 17 October: Conference day 1 and gala dinner Tuesday, 18 October: Conference day 2 The social day will be a guided sightseeing tour of London, lunch at the Nelson followed by a visit to Greenwich to include the Cutty Sark. The conference will be held at the centrally located Radison Blu Portman in Portman Square. Conference registration will be online and expected to open in the new year. For fuller details refer to the presentation slides and the promotional video clip of London.
18. Management Accounts 2015
Ignus Kempen presented the approved 2015 management accounts and summarised as
follows:
US$ Income from members 160,000 Total costs -147,000
Surplus 13,000
Accumulated surplus at 30 September 2015 84,000
19. Budget 2016
Ignus Kempen presented the approved 2016 budget and summarised as follows:
US$ Income from members 159,000 Total costs -169,000
Budgeted deficit -10,000
20. Group discussion: “GMN International – Questions to the Management Committee”
Ignus Kempen summarised the outcomes from the IEC meeting:
2015 accounts approved, referred to earlier
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2016 budget approved, referred to earlier
Table of Rates approved for 2017 with no change to bands or rates
Table of Rates 2017, recommendation of the IEC that the cap of 0.13% is increased to
0.15%. This recommendation requires members’ approval and will be put to an electronic
vote in accordance with procedures set out in the byelaws
Michael Larkos stands down as International Chairman to be replaced by Ignus Kempen at
the close of the conference
Ashish Ghosh elected as Vice Chairman
Graeme Bursack (European region) appointed as third member of the Management
Committee.
International Conference 2017 to be held in Mauritius
21. Introduction to Comply Global
Malcolm Bolton highlighted that the management committee and international office are
always looking for extending benefits to members. For this reason, the ComplyGlobal team
had been invited to attend the conference to give a live demonstration of their software which
is to streamline compliance management. The product is extremely flexible and can be
tailored to any jurisdiction. It can be used by individual firms to manage their own compliance
or used to manage compliance of clients, which could be an additional revenue stream for
firms. The ComplyGlobal team had also invited attendees to a cocktail gathering which
follows immediately after the demonstration which will provide members with an opportunity
to talk to the ComplyGlobal team on a one-to-one basis.
