Malaysia Accounting and Business AB Malaysia February/March 2019 Accounting and Business February/March 2019 Accounting for the Future virtual A better balance Firms are taking steps to increase conference the number of female partners Catch up on ACCA’s annual virtual global conference. You can watch Personal touch the sessions on-demand and gain Emotional intelligence is the CPD units while staying ahead superpower of the digital age of the curve on issues affecting finance professionals. Free trade boost CPTPP presents opportunities – and challenges – for its members

Pay it forward Register at Cindy Hook, the go-getting CEO of Deloitte accaglobal.com/AFF2018 Asia Pacifi c, on making a difference

3934MY_Cover.indd AFF ADVERTS_full 1 page.indd 1 29/11/2018 13:59 10/01/2019 16:49 AFCA_cover02_Feb19_600.indd 1 15/01/2019 16:11 Welcome With women in Asia continuing to face challenges in career progress, this year’s International Women’s Day highlights the importance of equality as a business issue

The World Economic Forum’s (WEF) partnership and offering support for Global Gender Gap Report 2018 is a women to rise through the ranks – an sobering read that highlights just how initiative that could influence practices far countries have to go to remove the across the globe to follow suit. disparity between men and women. Our columnists consider how Asia As the WEF rightly points out, is faring in recruiting women to senior deploying around half of the world’s roles. Cesar Bacani reflects on what the total talent pool has a massive impact on WEF report tells us about the challenges the growth, competitiveness and future- for women in Asia (page 16), while Errol readiness of economies and businesses Oh considers Malaysia’s ambitious plan worldwide. At the current rate of for 30% female representation on the change, the global gender gap will top 100 companies by 2020 (page 17). take 108 years to close while economic On our cover is the inspiring Cindy gender parity is 202 years off. Find out Hook, CEO of Deloitte Asia Pacific. The which countries are the most gender- Singapore-based CEO is at the helm equal in our infographic on page 8. of Deloitte practices numbering 44,500 In this joint February/March edition, professionals across five geographies. you’ll find coverage of women’s issues She recalls the mentors who supported to coincide with International Women’s her journey and her passion for the Day (IWD) on 8 March. Rather timely, business and the people who work there. given the WEF’s comments on how A champion for gender equality, she has women contribute to the economy, this sought to encourage women to seek year’s IWD theme is #BalanceforBetter, leadership roles and puts wellbeing for in which it calls for balance to be seen all staff at the core of her management as a business issue, not just a women’s strategy. Her story starts on page 12. AB issue. Our article on page 42 looks at how professional services firms in the Colette Steckel, Asia editor UK are actively setting targets for female [email protected]

Accounting and Business About ACCA Leadership The leading monthly magazine for ACCA (the Association of Chartered President: Robert Stenhouse FCCA Deputy president: Jenny Gu FCCA finance professionals, available in seven Certified Accountants) is the global Vice president: Mark Millar FCCA different versions: China, Ireland, Malaysia, body for professional accountants. It Chief executive: Helen Brand OBE Singapore, UK, Africa and International. offers business-relevant, first-choice Member services * Magazine contacts, page 66 qualifications to people of application, ACCA office details, page 66 Available in app and pdf ability and ambition who seek a ACCA Connect: +44 (141)582 2000 * [email protected] * AB Direct: weekly news bulletin rewarding career in accountancy, finance accaglobal.com/members AB is circulated to all members in print and management. ACCA supports its Our alliance with CA ANZ and digital formats. ISSN No: 1460-406X 208,000 members and 503,000 students More about ACCA’s alliance with Chartered More at accaglobal.com/ab in 179 countries. accaglobal.com Accountants ANZ: accaglobal.com/alliance

February/March 2019 Accounting and Business 3

AP_Welcome.indd 3 10/01/2019 13:55 22 32

24 Stronger together The CPTPP could bring big rewards to participating countries

Practice

27 The view from Geraldine Ong of Reed Smith, Singapore, plus practice news 28 Helping hand Professional accountants can support clients’ mental health

Insights

32 Do the right thing New bribery legislation arrives in Malaysia 19 Robert Stenhouse 35 News in infographics News Comment Emotional intelligence is The rise of the megacity 6 News in pictures 16 Cesar Bacani the key to success 36 Show some emotion A different view of Look beyond the EQ as the superpower of Corporate recent headlines numbers on women’s the digital age 8 News roundup roles at leadership level 21 The view from 39 Time for change Chong Sook Leng A future-fit global Digest of developments 17 Errol Oh of Tokio Marine economy needs greener across the globe As more women Insurans, Malaysia, plus tax systems enter the boardroom, corporate news 42 Towards equality Interview mentoring is vital 22 Bigger picture Professional services 12 Cindy Hook 18 Manu Bhaskaran Businesses must consider firms are starting to We meet the CEO at Asia’s policymakers need their contribution to the redress the gender Deloitte Asia Pacific to contain financial risk wider community imbalance

6 24 28 36

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MY_CON_contents.indd 4 10/01/2019 17:33 44 48 58 60

44 Smart move Technical People ACCA Finance must embrace digital transformation 49 CPD Common control 58 Global reach 62 Blazing a trail IASB looks at accounting Alan de Sousa Caires, ACCA’s 50/50 gender Careers for businesses under global director of fi nance, split is just the start common control 46 CPD Happy talk BBC Media Action, on 64 The digital future 52 Technical update MIA conference Are you passionate making a difference The latest on audit, tax addresses the power about your job? and fi nancial reporting Basics of robotics process automation Management 54 IFRS 15 A look at the impact 60 CPD Screen test 66 Update 48 Give your virtual Crystal clear 56 CPD Crypto dilemma What’s on at this year’s Visualising change is the Why digital currencies meetings an Oscar- International Public key to capitalising on it are hard to classify worthy edge Sector Conference

12 62

64

‘To those who say that Asia is too diverse, isn’t the 66 diversity of our region actually a strength and not a weakness?’

February/March 2019 Accounting and Business 5

MY_CON_contents.indd 5 10/01/2019 17:23 6 Accounting and Business February/March 2019

AP_Newsinpix.indd 6 10/01/2019 13:51 Sandra Oh became the first woman of Asian descent to co-host the Golden Globes. The Korean-Canadian star of hit show Killing Eve was also the first Asian woman to win the award for Best Actress in a TV Drama in almost 40 years.

China landed a robotic spacecraft on the far side of the moon. The uncrewed Chang’e-4 probe will conduct geological analysis and is a key milestone in China’s space programme, which includes plans to build a space station.

Aquaman, the superhero movie, has become the highest-grossing film in the DC Extended Universe franchise, making US$887m by 5 January. It is directed by Malaysian-Chinese James Wan and stars Pacific Islander Jason Momoa.

Google is investing US$1bn in a New York campus, making the tech giant one of the city’s biggest occupants of office space. The development will enable Google to double its New York workforce to more than 14,000 in a decade.

February/March 2019 Accounting and Business 7

AP_Newsinpix.indd 7 10/01/2019 13:51 News in brief This edition’s stories and infographics from across the globe, as well as a look at the latest developments and issues affecting the finance profession

Change needed experience and reskilling average of 40%. At least 40% Grant Thornton US sold the A majority of senior human labour are top priorities, agreed that preparing the tax shelter, which was later resources (HR) executives according to research workforce for a future with disallowed by the Inland surveyed in mainland China published by KPMG. Among artificial intelligence is one Revenue Service (IRS), to its and Hong Kong recognise the key findings, 45% of of the biggest challenges clients William and Martha the need to transform their respondents said they have HR will face over the next Yung and the 1994 William workforces. Reshaping the a digital transformation five years. J Yung Family Trust in 2000. workforce with technology, work plan in place – slightly The Yungs settled with the improving employee higher than the global ‘Pay climate debts’ IRS in 2007. At global talks on climate change in Poland in Major shake-up Mixed picture on gender gap December, Xie Zhenhua, Big Four accountancy firms The world has closed 68% of its gender gap across four key Beijing’s chief negotiator, in the UK are facing a major pillars of economic opportunity, political empowerment, pushed back on demands shake-up under reforms educational attainment and health and survival, according to from rich nations for China proposed by the competition the World Economic Forum’s Global Gender Gap Report 2018. to accept the accounting watchdog. The Competition Iceland remains the most gender-equal country, a position it and reporting rules that and Markets Authority (CMA) has held for a decade. If current rates were to be maintained in developed countries wants to separate audit the future, the overall global gender gap will close in 61 years must follow. However, he from consulting services, in Western Europe; 70 years in South Asia; 124 years in Eastern indicated it might decide while also encouraging a Europe and Central Asia; 165 years in North America; and 171 to adopt uniform standards wider choice of auditors. Its years in East Asia and the Pacific. further down the line, the proposals to improve the Washington Post reported. audit sector for the benefit Rank % gap closed Xie noted that, while the of savers and investors alike 1. Iceland 85.8 largest single emitter of have now been put out for polluting gases, China’s GDP public consultation. Among 2. Norway 83.5 per capita remains below the reasons why the CMA 3 the world average. He later believes audit quality is 3. Sweden 82.2 criticised developed countries falling short is limited choice, 4. Finland 82.1 for not doing enough, telling with the Big Four conducting reporters that rich countries 97% of the audits of the 5. Nicaragua 80.9 should ‘pay their debts’ on biggest companies. climate change. 6. Rwanda 80.4 Pressing on 7. New Zealand 80.1 Heavy penalty Despite a challenging Grant Thornton in the US year, Chinese telco Huawei 8. Philippines 79.9 has been ordered to pay expects to become the US$100m in damages after world’s largest smartphone 9. Ireland 79.6 a US court overturned its company by 2019. Last appeal over the sale of a ‘tax year, governments in 10. Namibia 78.9 shelter’ to a Cayman Island Australia and New Zealand casino and hotel owner. joined the US in banning

8 Accounting and Business February/March 2019

AP_newsinbrief.indd 8 23/01/2019 12:20 Net gains Football finance in the UK is fascinating, not least because of the vast sums of money involved and fluctuating fortunes of the clubs on and off the field. Watch our video for pitch-perfect analysis

Ready for kick off

• Wolverhampton Wanderers CFO Rita Purewal FCCA on how Premiership promotion has benefited the club • Millwall FD Steve Exley FCCA describes uniting his passion for football with finance More information • Deloitte specialist Tim Bridge See bit.ly/AFF-foot or go to accaglobal. looks at the latest trends in com/AFF2018 to see this and other football finance sessions from our virtual conference.

Huawei from taking part has a large young population Luxury lifestyles consumption on the back of in the rollout of 5G mobile with a booming economy that Shanghai has replaced Hong lacklustre financial markets. infrastructure over national is engaging lots of overseas Kong as the most expensive security concerns. Then in organisations to trade and city in Asia in the latest Social accountability December, Huawei CFO operate in Bangladesh,’ Lifestyle Index produced The International Public Meng Wanzhou was arrested she told the country’s Daily annually by Swiss private Sector Accounting Standards in Canada, reportedly Star newspaper. ‘These bank Julius Baer. Singapore Board has reached a ‘major following a US investigation foreign organisations look comes in third, while Kuala milestone’, approving the into the company’s use for qualifications they Lumpur remains the most standard on accounting of the global banking recognise and can use as competitive city in the region. for social benefits after 16 system to skirt US sanctions a benchmark to identify According to a basket of years of discussion. During against Iran. the best candidates for luxury goods and services December’s quarterly their companies. ACCA tracked, the cost of living in meeting in Kuala Lumpur, In demand is a qualification that is Asia has surged by 3.34% the board accepted IPSAS The need for professional globally recognised and year on year. The report says 42, which outlines how accountants in Bangladesh these graduates are high in the longer term outlook governments should account ‘is already there’, Lindsay demand all over the world. remains rosy premised on for social benefits such as Degouve De Nuncques, head The students in Bangladesh structural demand from unemployment benefits and of ACCA – Middle East, said seem to understand Chinese millennials and a state pensions. Board chair on the sidelines of the recent this global trend and so more prominent female Ian Carruthers said approval CFO Conference, held by the number of students presence in the luxury marked a ‘major milestone’ the South Asia Federation of who are taking up ACCA market. It also flags a possible and ‘fills one of the key gaps Accountants. ‘The country is increasing.’ contraction in global luxury in public sector accounting

February/March 2019 Accounting and Business 9

AP_newsinbrief.indd 9 23/01/2019 12:20 literature’. He told Public (HNWI) wealth globally in 88,000 HNWIs collectively This was one of a raft of Finance International: ‘The 2017, according to the 2018 in 2017. recommendations PwC urges long journey to approval Asia-Pacific Wealth Report the government to consider is indicative of the strong released by Capgemini. With Digitised workforce in its planning for the city- and diverse views on a 12.1% growth in HNWI This year will not only see state’s 2019 Budget. recognising and measuring population and a 14.8% rise a continuous proliferation social benefits, as well as in wealth, the region is now in the use of social media New leader the rigorous due process forecast to surpass US$42 by employers to attract Cynthia Lo has succeeded necessary to develop high- trillion by 2025.The report candidates but also the rise Andrew Ross as managing quality standards.’ also finds that emerging in candidates making use of director at Baker Tilly Hong markets power that growth, their social media profiles Kong. In what is described Rising wealth led by India as the fastest and presence as part of as ‘a natural progression Asia Pacific confirmed growing region. Mature their professional branding, reflecting our succession its status as the current markets like South Korea, says Grant Torrens, business planning’, Ross will continue private wealth powerhouse, Hong Kong and Singapore director at Hays Singapore. as consultant in a senior generating 41.4% of all new also saw HNWI population He believes this is especially advisory role to the board high net worth individual growth, adding more than the case in Singapore, which and to clients. The firm says leads the way in social media the move also coincides with penetration in South-East the Baker Tilly network’s Asia. ‘With 83% of the brand refresh ‘and these two population on social media changes will be the catalyst in Singapore, it’s not unusual which will take the firm to the that this number reflects the next level’. changing dynamics between employers, employees and Revenues grow prospective employees,’ BDO has announced a Torrens said. total combined fee income of US$8.99bn for the year Tax harmony urged ended 30 September 2018, Hong Kong lags on gender balance As chair of ASEAN this representing a year-on- Hong Kong lags behind other developed markets in its year, Singapore should year growth of 10.7% in representation of women in leadership positions, research by consider proposing US$ and 8.3% at constant PwC has found. While women comprise 52% of entry-level measures to harmonise exchange rates. The global positions, the proportion falls to around 33% at the senior certain tax treatments organisation’s continued management level and declines further to 21% at board level. within the region’s nations. and accelerating growth Harjeet Baura, financial services consulting leader at PwC This will help Singapore rate is supported by relevant Hong Kong, said that leaders need to acknowledge the businesses go international business-critical acquisitions, obstacles women face. ‘Only then can organisations put in and expand their footprint such as cybersecurity place effective measures to prevent losing their female talent. in neighbouring countries, companies. Now These measures might include prioritising flexible working recommends PwC. Examples represented in 162 countries policies, providing sponsorship opportunities and addressing include harmonising the and territories, BDO saw any perceptions relating to unequal pay for women.’ withholding tax treatment consistent growth across Fiona Nott, CEO at The Women’s Foundation, which of different income streams all regions in 2018, with the supported the research, agrees. ‘We hope this survey serves so that taxpayers are not strongest revenue increase as a starting point for comprehensive, Hong Kong-specific subject to double taxation in EMEA (+17%), followed research on challenges to achieving gender parity across (to adopt a consistent by the Americas (+7.8%) and industries, and that it strengthens cross-sector collaborations definition for characterising Asia Pacific (+6.6%). AB to find innovative solutions to close these gaps.’ software payments, as royalties or service fees). Peta Tomlinson, journalist

10 Accounting and Business February/March 2019

AP_newsinbrief.indd 10 23/01/2019 12:21 AB_EthicsAd_New_Feb19.indd 1 10/01/2019 14:01 Born to run With her passion for wellbeing a key part of her management strategy, Cindy Hook is relishing her latest role as CEO of Singapore-based Deloitte Asia Pacific

s a self-confessed Bruce CV Beyond hard work and passion, Springsteen fan who has seen i Hook acknowledges that she’s also A‘The Boss’ in concert no fewer benefited from her interactions with role than 73 times, and someone who lists 2018 models, both within the office as well as at her alternative career ambition as rock CEO, Deloitte Asia Pacific her clients. ‘I’ve had many good mentors star, Cindy Hook is certainly rocking it along the way,’ she says. ‘But the people out on the accounting stage. In 2015, 2015 who really made a difference to me were she became the first woman in Australia CEO, Deloitte Australia those who sponsored me and decided to lead a Big Four professional services to give me exposure, opportunity and firm, and most recently in September 2009 connections. 2018 took on the role of CEO at Deloitte National managing partner, ‘Chaly Mah, the retired CEO of Deloitte Asia Pacific. assurance and advisory, Southeast Asia, was one such person,’ she Through all her breakthrough Deloitte Australia says. ‘He helped me to navigate Asia. The accomplishments, Hook says that she has relationships that he helped me build within never felt held back in her career. ‘I think 1998 this firm and the perspectives he gave me one of the things that helped was being Audit partner, Deloitte USA were instrumental in my being ready to take brought up in a family of all girls,’ she says. on this role.’ ‘My dad treated us all like anything’s 1986 possible and you can have whatever Joined Deloitte USA Next generation you want.’ Appreciative of the support she’s received, This attitude, coupled with a love for 1986 Hook is now excited about paying it forward tackling challenges head on, proved to be Graduated with a bachelor of and bringing up the next generation of a winning combination, as Hook steadily science in business, majoring leaders. In a recent example, as she was rose through the ranks to reach the top of in accounting, from Miami putting together her executive team for her profession. University, USA Asia, she realised that not many women Hook’s formula for success is, however, no were being shortlisted. special secret. ‘Anybody who rises to the ‘As I started bringing up names, people top of the profession works hard,’ she says. She does, however, would say ‘she’s not ready’ or ‘she doesn’t have the right believe that a passion for what you do is also essential. ‘This experience’. In the end, I decided to interview them and means knowing what you love to do and what you’re good at, I ended up picking three amazing women. As it turns out, and finding an organisation where these things are valued and they’re doing great, they’re growing immeasurably and they appreciated. I call that playing to your strengths.’ were ready for the roles.’ For Hook, even though she first got into the accounting In fact, so deep is her passion for nurturing talent profession because of an affinity for numbers and analytical that today Hook defines her career successes not by subjects, it was really her love for businesses and people, and personal accomplishments but by seeing the people in her finding a like-minded organisation in Deloitte, that helped her charge succeed. to soar in her career. ‘It’s really about the legacy that you leave behind,’ she She puts it this way: ‘I’m passionate about business, says. ‘One of the proudest moments I had recently was understanding businesses and what drives business when I stepped out of the CEO role in Australia. The board performance. And I’m also passionate about people and had to pick a successor and the firm had a strong line of helping individuals reach their potential, and that’s so much of succession candidates. I am really happy to see that the team what Deloitte is about.’ is continuing to thrive.’

12 Accounting and Business February/March 2019

AP_INTER_CindyHook.indd 12 10/01/2019 13:46 ‘The people who really made a difference to me were those who decided to give me exposure, opportunity and connections’

February/March 2019 Accounting and Business 13

AP_INTER_CindyHook.indd 13 10/01/2019 13:46 i Basics

On 1 September 2018, Deloitte Asia Pacific was formed with the coming together of Deloitte practices in Australia, China, Japan, New Zealand and South-East Asia. This move allows for greater investment and focus on Deloitte clients in the region. Together, the five geographies are expected to generate a combined investment of US$321m over the next three years. The investment will enhance Deloitte’s ability to serve global, national and private market clients by enhancing service capabilities and increasing talent resources. Deloitte she could do a lot more to advocate gender diversity and Asia Pacific, with the five geographies combined, has almost inclusiveness in the workplace. 44,500 professionals, with the potential to create a US$10bn ‘In my job, I am in a position to help people overcome their business by 2022. mental barrier, whether they are a man or a woman, or even if it’s due to their cultural background,’ she says. ‘In some ways, I think men actually have less choice than women, and As a go-getter and someone who was comfortable working the reason why I say that is that the choice for a man to be a in a male dominated workplace, it wasn’t always apparent caregiver comes with a stigma in many places.’ to Hook that not all women in the workplace were like her. Hence, today, Hook is on a mission to improve gender parity ‘I’m pretty aggressive, pretty outspoken, not timid, but not in the workplace. She says that even though much progress everyone’s that way,’ she concedes. ‘I realised somewhere has been made over the past three decades, there’s still much along the way that some women may not be as comfortable in to be done. ‘At Deloitte, women in leadership roles have these environments.’ increased around threefold, but women still only make up about 20% of our partners globally,’ she says. Champion for gender equality One of Hook’s personal passions is wellbeing. A former Her opportunity to be a champion for gender equality then marathon runner, she continues to keep fit by hiking, doing presented itself when she was appointed CEO in Australia. pilates and yoga, water skiing and mountain biking. ‘People started asking me to do interviews because I was Ever since her time as CEO of Deloitte in Australia, however, the first female CEO of a Big Four firm in Australia,’ she says, she has started to integrate her passion for wellbeing into part admitting that initially she was apprehensive about taking of her management strategy. ‘I realised that the times when on gender questions, preferring instead to focus on how I tended to be my best at work were when I felt physically, she would make a great executive. Then it struck her that mentally, emotionally and spiritually strong.’

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AP_INTER_CindyHook.indd 14 10/01/2019 13:46 This led her to think that if she could create an environment outstanding client service. And, we’re united in our values and where everybody felt well individually, they would perform our commitment to ethics and integrity,’ she says. ‘But to those better, and together that would drive the higher performance who say that Asia is too diverse, isn’t the diversity of our region of the firm. Subsequently, Hook started pushing for various actually a strength and not a weakness? You want diversity of wellbeing initiatives to be implemented at the office. One such thinking because it gives you better solutions. So let’s play to initiative, a six-week step challenge, was initially envisaged that diversity.’ for a few hundred people but ended up involving over half With her three decades of experience in audit and of the 7,000 strong Australian practice. As Hook recalls: ‘The accounting, Hook has witnessed major changes within the competitive spirit started going and the step challenge profession. On the one hand, big accountancy firms have became a wild success.’ evolved from primarily offering accounting, audit and tax services to becoming much more broad-based and multi- Rapid globalisation disciplinary in their approach to enabling businesses. It is no surprise that Hook has a fiercely competitive side to On the other hand, however, Hook gladly notes that the her. Attributing this to playing sports while growing up, she foundation on which the accounting and auditing profession reveals: ‘I thrive on challenges. In fact, I get bored when I don’t has been built for over a hundred years continue to remain have a challenge.’ true. ‘Audit is about making investors feel safe and informed The biggest challenge facing in terms of what they’re investing in Hook right now is turning and protecting the capital markets,’ Deloitte into the most integrated she says. ‘In that respect, it has not professional services firm in Asia. changed at all.’ ‘One of the biggest trends in the Even as auditors continue to world is rapid globalisation,’ Hook ‘To those who say serve this vital function in society, says. ‘Clients want you to provide that Asia is too Hook believes that the skills that are them with the breadth of capability diverse, isn’t the ingrained in them also give them an and the highest quality and advantage far and beyond the realm consistency no matter where in the diversity of our of accounting. world they are. Integration in Asia region actually a For one, Hook says that auditors is about breaking down barriers to strength and not are great at providing assurance and ensure we do that for our clients.’ a weakness?’ possess a certain level of scepticism, But with a diverse region like pragmatism and realism that has Asia, with its varying stages been finely honed through training of market maturity as well as on the job. On a personal level, this cultural differences,how will Hook enable integration? has given her the confidence to take risks along the way. ‘I think Her strategy is two-fold. First, she believes that it is necessary in order to really make the most of your career opportunities, to attract and retain human resources on the ground who you’re going to have to take some calculated risks.’ understand the local market, while at the same time bringing More than that, Hook believes that chartered accountants skills and capabilities from other markets more seamlessly to have a great foundation, because they understand how the client. For this, Deloitte needs to embrace technology. businesses operate and what drives business success. ‘Clients are demanding more efficient, more cost-effective ‘I think some people look at accountants and just think and higher quality audits,’ Hook says. ‘But to maintain that in you’re a technician but I would say auditors are much broader an increasingly digitally enabled world, you’ve got to innovate. than that,’ she says. ‘Good accountants also have great people You’ve got to use technology – artificial intelligence and skills, the ability to read and understand cultures and are able robotics, and everything at your disposal.’ to get along well with people.’ Secondly, she believes that instead of trying to overcome Looking back at the path she’s taken, Hook has no regrets: differences, Deloitte in Asia Pacific should embrace its ‘Being a certified public accountant is one of the things that diversity. To represent her campaign, she has come up with the I’m most proud of, and it’s certainly served me well over the slogan: ‘United + Unique’. past 30 years.’ AB ‘We’re united in our aspiration to be the undisputed leader in professional services. We’re united in our commitment to Rufus Tan, journalist

February/March 2019 Accounting and Business 15

AP_INTER_CindyHook.indd 15 10/01/2019 13:46 Bridging the gender gap Despite the disappointing statistics, women can be as likely as men to be promoted to the leadership ranks in the right company and the right market, concludes Cesar Bacani

Every year since 2006, the World One way is to choose a company Economic Forum has published the that has already appointed a woman annual Global Gender Gap Report. CFO or CEO and has women directors The 2018 findings were, like the on the board. These organisations tend previous editions, disappointing. ‘In to be multinationals, including the Big the workplace, women still encounter Four accountancy firms, in part because, significant obstacles in taking on I suspect, of the negative optics of managerial or senior official roles,’ not having half the world’s population write the researchers, who noted represented in their leadership. They that only 34% of managers globally also recognise that throttling the are women. talent pipeline at the senior end in This will not surprise many women in terms of gender can damage the loyalty Asia, including finance professionals. of women professionals in talent-short While the gender gap is not generally markets like Singapore and Hong Kong. noticeable at the entry levels in the Where the company operates workplace, it becomes gaping as also matters. In the World Economic professionals attempt to climb the Forum’s gender gap report, the corporate ladder. In a report published Philippines and Laos are rated as last April, the management consultant markets where ‘women and men McKinsey noted that ‘there is only one are already equally likely to attain woman in leadership positions for every managerial positions’, along with four men’ in Asia Pacific; while the Bahamas, Colombia and Jamaica. Philippines comes closest globally to The same cannot be said of China, gender parity, ‘even there, only 15% of Indonesia, Japan, Korea, Japan, board members are women’. Singapore and Thailand. Why? In a survey, McKinsey found that I agree with those who say that 45% of international executives cite the the double burden of work and ‘anytime, anywhere’ performance model family placed on women is not as the key barrier to women moving always compatible with expectations into senior roles. The second barrier that company leaders must be was the ‘double burden’ of working in geographically mobile and always the office and at home (32%). The third available. But progress can be was the absence of female role models, Choose a company made through supportive company followed by lack of pro-family public that has already and government initiatives such as policies and support (30%). appointed a mentoring and childcare facilities, I have met female finance adoption of multitasking technologies, professionals who cite these very woman CFO or CEO automation and artificial intelligence, reasons when discussing how difficult and has women and women being more proactive it is for them to become CFOs, CEOs, directors on in putting forward their abilities, board members or accounting partners. the board accomplishments and ambitions. AB Yet, for all the hindrances, some do rise to the top. Cesar Bacani is a freelance journalist.

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AP_COM_CB.indd 16 09/01/2019 17:16 Flying the flag With Malaysia’s 2020 deadline for 30% female representation for the top 100 listed companies looming, the need for mentoring has never been greater, says Errol Oh

Madeleine Albright is best known boards among Bursa Malaysia’s top 100 as the US’s first female secretary of companies by the end of 2018 and to state, having served in that capacity have 30% female participation on the from 1997 to 2001 under President boards of these 100 companies by 2020. Bill Clinton. Many people will also The first interim target has turned out remember her for this line that she says to be a low-hanging fruit. By January she has uttered a thousand times since 2018, only seven of the top 100 did not 1993: ‘There’s a special place in hell for have any female directors. Using the women who don’t help each other.’ name-and-shame tactic, the Securities In a February 2016 opinion piece Commission (SC) publicly identified that she wrote for the New York Times, the companies: together with the 30% Albright reiterated her firm belief that Club Malaysia, it talked to them about women are obliged to help one another. how they planned to recruit women ‘In a society where women often feel board members. That seemed to have pressured to tear one another down, our worked well: six have now appointed saving grace lies in our willingness to lift women directors. one another up,’ she said. Meanwhile, it is time to pay more Although such support can come attention to the second interim target. in many forms, mentoring is definitely At the end of 2017, 19.2% of board one of the most powerful ways for seats on the top 100 companies were experienced and accomplished occupied by women; by September women to assist in the professional and 2018 it was 23.2%. Hitting the 30% mark personal development of other women. by December 2020 looks doable, but it It therefore makes perfect sense that is not just about filling quotas; the full mentoring initiatives are part of efforts benefits of gender diversity cannot be to promote gender diversity. reaped if the 30% are not truly ready and Founded on the basis that it is good able to carry out their boardroom roles. for business when women make up At a 30% Club event last December, at least 30% of top management and Tan Sri Zarinah Anwar, one of the boards, the 30% Club, which began in Malaysian chapter’s founding chairs, the UK in 2010, runs a scheme that ‘offers described how the scheme provides cross-company, cross-sector mentoring The full benefits a talent pipeline: ‘We hope that to women at every layer of the career of gender diversity through the networking provided by pyramid’. This is also a feature of the cannot be reaped the mentors, we will raise the profile of organisation’s Malaysian chapter, whose if the 30% are our women mentees and expose them goals are linked to the gender diversity to opportunities to be included in the target built into the current Malaysian not truly ready selection process for board seats.’ Code of Corporate Governance. and able to If all goes well, we can look forward In addition to achieving 30% female carry out their to the day when nobody needs to talk participation on the boards of listed boardroom roles about targets for women anymore. AB companies by the end of 2022, there are also interim targets: to have no all-male Errol Oh is executive editor of The Star.

February/March 2019 Accounting and Business 17

AP_COM_EO.indd 17 09/01/2019 16:49 Stay strong With Asia facing a year of even more modest growth, policymakers must work hard to contain financial risks and maintain stable currencies, says Manu Bhaskaran

We do not expect much respite this measures that are appropriately year for the developing economies of targeting the underlying problems in the Asia after a difficult 2018. Geopolitical economy such as the tightness of credit uncertainty could prove troubling for flows to private companies. But China’s the Asian region while weaker external policymakers will have to remain vigilant demand and tightening financial and act quickly whenever confidence conditions could continue creating is hurt as the country will probably turbulence in Asian financial markets. experience a small current account The tussle between the US and China deficit this year and downward pressures is a dominating concern. In the near on its yuan could well persist. term, an interim deal can be worked Investors may have been too quick to out as both sides seem keen to avoid take solace from statements suggesting a full-blown trade war. The question is that the US Federal Reserve Bank whether this improvement in ties would could turn more dovish in its monetary be sustainable. The reality is that the policy. As mentioned above, the US differences between the two big powers economy will probably grow above its go beyond trade, with national security sustainable growth rate for most of 2019: officials in the US seeking to contain the as unemployment falls and the labour perceived ‘threat’ posed by China. market tightens even more, the Fed Key markers such as the OECD lead will have little choice but to raise rates indicator, the pipeline of new orders and and withdraw liquidity from the system. trade data all suggest that a modest The European Central Bank also limited deceleration in global demand is on its quantitative easing programme in the cards. The US should still clock in January. That means that the era of growth that is above its long-term trend super-easy global liquidity is coming to rate of around 2% even if it is unlikely an end. As interest rates rise and liquidity to sustain the high growth seen in 2018. becomes scarcer, investors will be more If capital spending picks up speed in wary of ‘riskier’ emerging markets: the the US, as we expect, the spillover into corrections seen in emerging market stronger demand for Asian exports of equities and currencies in 2018 may well intermediate goods will be helpful. The persist in the first half of 2019. other major economies that are crucial Overall, the Asian region is likely markets for Asia seem to be losing As interest rates to see modestly slower economic momentum, however, with the most rise and liquidity growth in 2019 compared to 2018. But recent data showing that the eurozone becomes scarcer, continued stresses in global financial and Japan economies are likely to slow. markets will require Asian policymakers, An important area of uncertainty investors will particularly central banks, to be rigorous for Asia will be China’s economic be more wary of in containing financial risks and keeping trajectory. The Chinese economy is ‘riskier’ emerging their currencies stable. AB losing momentum faster than expected. markets However, the authorities are becoming Manu Bhaskaran is CEO of Centennial more aggressive in putting in place Asia Advisors in Singapore.

18 Accounting and Business February/March 2019

AP_COM_MB.indd 18 08/01/2019 16:46 Three little words Emotional intelligence is as much of a must-have in the professional accountant’s skillset as technical, financial expertise, says Robert Stenhouse

This is the first president’s column I have written since the turn of the year, and the most important thing I want to do in it is ask ‘how are you?’ I have made a New Year’s resolution to improve my small talk. When we are in a rush and heavily focused on getting the job done, it is very easy to skip the pleasantries and get straight down to business. In the short term, this behaviour may seem effective, but I have come to realise that, in the longer term, it demonstrates an acute lack of emotional intelligence on my part. Asking ‘how are you?’ not only provides basic information to assess how the other person is feeling, but also enables you to benchmark your own emotional state. These are the building blocks of your emotional quotient (EQ). It is great to see the article in this month’s issue about emotional intelligence (‘Emotionally charged’, page 36), because human interaction and relationships are crucial to our profession and to our own personal development. Unfortunately, and perhaps unfairly, the had a reputation of being all about the More generally, we are always very accounting profession has traditionally numbers rather than the people. keen to know how our members and In an increasingly technology-led students feel about ACCA. I encourage future, sustainable advantage will not you to give us any feedback you can – come from competing with machines. It the easiest way is by taking part in our is more likely to come from developing regular customer satisfaction surveys. AB In an increasingly our EQ and enhancing the skills and competencies inherent in our humanity Robert Stenhouse is a director, technology-led – such as influencing, empathy and national accounting and audit, future, sustainable perspective-taking. at Deloitte in the UK. advantage will The good news, for both you and me, not come from is that EQ can be learnt. This and many More information competing with other insights are in one of our latest Read about how EQ sets us apart publications Emotional quotient in a from the robots and how it could become the human superpower of machines digital age. You can also take ACCA’s EQ the digital age, at accaglobal.com/eq. test online at bit.ly/ACCA-EQ-test.

February/March 2019 Accounting and Business 19

AP_COM_pres.indd 19 10/01/2019 16:46 -AFR_ads-JulyAug17_600dpi.indd 6 12/06/2017 14:44 The view from Chong Sook Leng FCCA, head of human resources at Tokio Marine Insurans, Malaysia, on a diverse career

I stumbled into finance by Over the past 20 years, 202 chance. There were few I’ve seen how the demands years options available for me on finance have changed when I was at school: it significantly. From keeping to close the economic gender was either the sciences or accounting records to being gap globally. commerce/accounting. After in the boardroom discussing Source: World Economic Forum completing high school, business strategies, I enrolled in ACCA and innovation and future graduated in 1992. trends impacting industries, a lot has Good for governance happened. It is very heartening when Malaysia has made the biggest gain in I recently assumed the role of heading business managers refer to finance for the latest Asian Corporate Governance up the human resources department advice and guidance on strategic issues. Association’s survey, rising three spots at Tokio Marine. Being able to make a This is when you know they find value in to fourth place behind Australia, Hong positive impact in the lives of individuals the role. Kong and Singapore. Rounding out is important to me. With the advantage the top 10 are Taiwan, Thailand, Japan, of finance knowledge, I’m able to Malaysia being in the ASEAN region India, Korea and China. The report combine this with HR to create value has much to offer. We are a region examines the difficult strategic choices for the company. It is so fulfilling to of rich culture and colourful heritage. that Asian market participants face be able to create environments where There are varied opportunities for in selecting the best way forward for individuals are able to bring their best businesses to expand into new markets reform. With competition for initial to work. in developing economies and tap into public offerings as intense as ever, it the growing middle class. notes that governments and regulators Being in a different profession from are under pressure to lower standards, when I first started as an accountant Companies are beginning to consider at the cost of long-term risks for is my biggest career achievement. As sustainability as an agenda in the investors and markets. a firm believer in continuous learning, conduct of their operations. Leading I always advocate being curious and companies are going back to the Trade war concern exploring new possibilities. drawing board questioning the impact More than half of senior executives they are making in the community surveyed in mainland China, Hong Kong in which they operate. These are all and Macau say their businesses have important deliberations as businesses been hit by trade war tariffs. When asked and companies mature and competition to describe changes during the past six intensifies in markets that have become months, 82% of those polled by Deloitte more connected virtually and socially. said the economic outlook had become It is so fulfilling to less optimistic. That marked a significant be able to create Politics and politicians are not spared change from the previous poll, where environments either, with the public demanding just 30% said their expectations had where individuals greater transparency in a world that is grown less rosy. ‘There has been a are able to bring used to being opaque. Building trust sharp shift in sentiment,’ said William by showing reliability in delivering on Chou, national managing partner of the their best to work commitments and achieving consistent Deloitte China CFO programme. good performance is key. AB

February/March 2019 Accounting and Business 21

AP_YCORP_intro.indd 21 10/01/2019 13:55 Community spirit A successful, cohesive and fulfi lled society needs a thriving and sustainable business ecosystem. A new sense of shared purpose is emerging, says Alison Sharpe

The 2008 global fi nancial crisis and ensuing economic hardship had a profound effect on society, resetting the way people view the motivations of business. In the decade since, high- profi le scandals, lapses in corporate behaviour and environmental catastrophes have damaged trust in organisations of all kinds and diverted attention away from business’s crucial role as the wealth engine of society. Today, many believe the purpose of business is making money – with little or no consideration for its wider impact, especially on the poorest in society. Despite numerous attempts to bridge the trust divide, public scepticism continues. This points to a much deeper, perhaps systemic problem: a ‘disconnect’ between what business and wider society expect of each other. To close this disconnect, what’s needed is a new ‘settlement’ between business and civil society: a shared sense of purpose that looks beyond the generation of profi ts to the underlying reasons that business exists. To capture people’s hearts and minds – and trust – organisations need to show they care about supporting people’s wellbeing and every company must not only deliver benefi ting society. fi nancial performance, but also show This sense of common purpose how it makes a positive contribution helps people make sense of to society’. how a business thinks and why it does what it does. This impact Guardians of the future was articulated strikingly by Larry Fink, Of course, progress towards this new CEO of global investment managers relationship will demand radical change. BlackRock, in an open letter in January Business will need to see itself as part of 2018. He wrote: ‘To prosper over time, an interdependent and interconnected

22 Accounting and Business February/March 2019

AP_UK_YCORP_culture.indd 22 10/01/2019 16:12 network that includes employees, and values diversity’. FRC chairman Win by society on big issues. What’s more, customers, suppliers, government Bischoff has commented: ‘To make sure employees who become passionate and more. It will have to connect with the UK moves with the times, the new about their organisation – its history, people – including those disillusioned Code considers economic and social its contribution to society – become a with business – at a deeper and more issues and will help to guide the long- powerful force driving it forwards. meaningful level. And it will need a new term success of UK businesses.’ While purpose may be relatively easy kind of leader: guardians of the future Privately owned businesses are also to articulate, it can be much harder with the courage and confi dence to in scope. The Wates principles – also to put into effect in a fast-changing make the world a better place, while effective from 1 January in the UK – are world. A brand refresh or enthusiastic engaging with society in a way that’s not designed to provide a governance communication campaign just won’t cut just transparent but authentic. framework for large private companies it. Purpose is an important statement As well as being encouraged by shifts to secure trust and confi dence and of an organisation’s desire, intent and in society, the move to embrace purpose benefi t the economy and society in core essence that people can unify is also being driven by regulators. In general. ‘Good corporate governance around. So, the journey to purpose the UK, for example, a new version of is not about box-ticking,’ says James is an evolutionary process aimed at the Financial Reporting Council’s (FRC) Wates, chairman of the Wates Group. ‘It fundamentally transforming the business. corporate governance code took effect can only be achieved if companies think To embark on this journey, a business on 1 January, calling seriously about why they exist and how must fi rst understand why it exists and for listed companies they deliver on their purpose.’ what role it plays in society. This means ‘to establish a corporate asking itself – and maybe its employees culture that is aligned with The journey to purpose – some challenging questions (see box). the company purpose, Ultimately, in developing a new sense The message is clear. Companies – business strategy, of purpose, organisations will need to public or private – need to establish promotes integrity reassess almost everything they’ve an explicit purpose that contributes to previously taken for granted. wider society as well as generating value Those that make this leap forward for shareholders. The immediate catalyst can expect to enjoy a number of is public concern, but the impact is set competitive advantages – not least to last long into the future. Now is the an enhanced reputation as a force time for business to become purpose- for good, the ability to attract, motivate driven and help create a society that and retain the best people, and more works for everyone. As businesses positive and fruitful relationships with embark on this journey, the accounting important groups. profession has a key role to play. Are As well as boosting business you ready? AB performance, these attributes will enable a business to be true to its Alison Sharpe provides consulting and own values, and mean it’s listened to strategic communications services.

Do you measure up? Businesses need to examine their purpose by asking the following questions: * Does your organisation know what it stands for in today’s context? * Does it have a coherent strategy to deliver on this commitment? * Is there clear oversight around how purpose will be delivered? * Has your organisation pinpointed which groups are affected by its activities and how it responds to their needs? * How often does your organisation engage its stakeholders around its purpose? * Does your organisation monitor the effects of delivering on its purpose?

February/March 2019 Accounting and Business 23

AP_UK_YCORP_culture.indd 23 10/01/2019 16:12 All together now With the Comprehensive and Progressive Trans-Pacific Partnership now up and running, participating countries can look forward to capitalising on the benefits

Frictions over global trade have was also ‘falling short of its objectives’ The Comprehensive and Progressive dominated headlines in recent months. and had ‘room for improvement’. Trans-Pacific Partnership (CPTPP) At the G20 meeting in Buenos Aires Yet amid rising protectionist eliminates 98% of tariffs between its late last year, world leaders vowed to tensions, a new trade deal by 11 member countries, with seven of them overhaul the World Trade Organization, countries, accounting for nearly 13.5% (Australia, Canada, Japan, Mexico, New admitting that while the multilateral of global GDP, came into force on 30 Zealand, Singapore and Vietnam) having trading system had contributed to December, marking a rare victory for already ratified the final agreed deal growth, development and innovation, it trade liberalisation. (leaving Brunei, Chile, Malaysia and Peru

24 Accounting and Business February/March 2019

AP_YCORP_CPTPP.indd 24 08/01/2019 16:43 still to do so). The agreement could the US market, tariff reductions will and Mexico, with whom the city- eventually extend to other countries proceed under the new agreement as state had no previous FTAs, and he such as Thailand, South Korea, the originally scheduled. suggests that they can now expect to Philippines and the UK. The vast majority of the reductions enjoy tariff elimination on exports of Adrian Ball, EY Asia-Pacific indirect in non-tariff barriers and investment pharmaceutical products and organic tax leader, says the CPTPP is a ‘free restrictions will go ahead as planned. chemicals into Mexico, which are trade agreement with a large potential This is important, Leather says, currently subjected to up to 6.5% and impact’. He notes that the deal is because the main benefits ‘are likely 15% duty rates respectively. estimated to provide Canadian to come through the elimination of Ho points out that companies in exporters with tariff savings worth non-tariff barriers, including rules on Singapore will also gain extended US$322m per year and New Zealand government procurement, investment market access in countries where exporters with tariff savings worth restrictions and hidden subsidies. FTAs already exist. ‘Companies in the IT, US$151m per year, for example, while it Indeed, of the 1,000-plus items that construction and consultancy sectors will is expected to boost Singapore’s GDP were in the original TPP deal, only 22 be able to bid for government tenders by 0.2% by 2035. have been taken out.’ in countries that were previously closed These 22 provisions primarily related to foreign bidders, such as Malaysia, Cost-effective and efficient to protections on intellectual property, Mexico and Vietnam,’ he says. The CPTPP also allows for regional cumulation (where, for purposes of Access into Vietnam producing goods, materials from one Meanwhile, Australian companies will CPTPP country are treated as the enjoy additional market access into same as another CPTPP country), and Vietnam, including tariff elimination on Ball points out that this is one of the ‘Despite the butane, propane, liquefied natural gas, main benefits of a regional agreement shift towards refined petroleum products, iron and versus a bilateral one. ‘This allows steel products, and automotive parts, the CPTPP to recognise input from all protectionism in and will also gain new market access CPTPP countries as originating content,’ the US, Asia is not into Japan for its sugar exports along he says. ‘In this way, companies with turning its back on with new quota access for rice and rice crossborder supply chains can become free trade’ flour exports, Ball says. more cost-effective and efficient.’ Kevin Klowden, executive director Gareth Leather, senior Asia economist of regional economic research at the at Capital Economics, says that the deal Milken Institute, believes Vietnam is one shows that ‘despite the shift towards which mainly benefited US companies, of the countries that will benefit the most protectionism in the US, Asia is not as well as clauses concerning the from the CPTPP, even without access turning its back on free trade’, adding liberalisation of Malaysia’s state-owned to the US market. ‘Because it has been that ‘by focusing on the elimination of enterprises and Brunei’s coal industry. increasingly positioning itself as the low- non-tariff barriers, it could provide a Ho Meng Kit, CEO at Singapore cost manufacturing alternative, Vietnam template for future trade deals’. Business Federation, notes that in has been very eager about getting The CPTPP started out as the addition to updating traditional investment,’ he says. The agreement, Trans-Pacific Partnership (TPP), a deal approaches to issues covered by Klowden adds, creates some certainties signed in 2016 that included the US previous free trade agreements (FTAs), for investors, exporters and importers but which never came into effect, with the CPTPP also tackles new and on how to deal with Vietnam, as well as Donald Trump withdrawing from it in emerging issues. These include the opening up a number of markets, such one of his first moves as US president, development of the digital economy and as Japan and Australia, for the country’s decrying the pact as a ‘job killer’. And the participation of small and medium- lower cost manufacturing. while there were initial concerns that the sized enterprises in international trade. remaining countries would be reluctant According to Ball, Singapore’s Tougher legal framework to agree to the same level of market companies could benefit from But the CPTPP comes with some access without the carrot of access to increased market access into Canada challenges, too. Analysts note that it

February/March 2019 Accounting and Business 25

AP_YCORP_CPTPP.indd 25 08/01/2019 16:43 says, adding that he believes that other Good for SMEs, too? countries in Asia, such as Thailand and For the first time in such a large trade deal, the Comprehensive and Progressive Indonesia, are likely to want to join the Trans-Pacific Partnership (CPTPP) includes a chapter dedicated to small and agreement in the near future. medium-sized enterprises (SME). Chapter 24 includes provisions to ensure that SMEs When it was originally envisioned, with have access to information specifically tailored for their use, through a variety of the US involved, it was a modernisation mechanisms such as websites, seminars and workshops, making it significantly easier and expansion of the North American for them to explore and navigate the CPTPP markets. Free Trade Agreement, with the idea of ‘The SME chapter establishes a committee on SME issues, made up of government connecting countries the US either had representatives from each CPTPP country, to help enhance SMEs’ participation and trade agreements with (and wanted to benefits from the agreement,’ notes Adrian Ball, EY Asia-Pacific indirect tax leader. expand on and modernise) or where Kurt Wee, president of the Association of Small and Medium Enterprises in they hadn’t previously concluded Singapore, welcomes the addition, saying that SMEs are ‘rarely aware of the essence significant agreements, such as Japan. of trade agreements and how to go about tapping into the advantages they offer’. Klowden suggests that even without the Wee notes that, under the CPTPP, SMEs will be able to better track government US, the CPTPP helps create a network procurement and participate in tenders. He adds that the trade agreement opens of trade relationships that will allow the doors to markets SMEs might not be familiar with. members to better cope with trade In November, the Singapore Business Federation organised the first in its CPTPP pressures in the region. Outreach Series, which is aimed at raising awareness of the partnership’s benefits for Ball notes that businesses should be key sectors. The inaugural session on the food processing sector was attended by aware that not all countries have yet more than 80 business participants from the industry. Similar sessions for other key ratified the CPTPP, and says companies sectors will take place in Singapore this year, while a wider CPTPP outreach seminar, interested in using the agreement for which will cover all key elements of the agreement, is planned for mid-February. exporting to these nations will need to monitor and plan carefully due to the staggering of different tariff-elimination binds members into a tougher legal standards. But I would argue that the schedules and other commitments. framework for trade, lower tariffs and end-game benefits will outweigh the ‘Bilateral agreements within the open markets. ‘There is no such thing near-term pain.’ CPTPP also offer business opportunities as a free lunch and for certain countries ‘The trade deal is beneficial to but require identification and detailed like Vietnam and Malaysia there will be everybody, but certain countries like analysis,’ Ball adds. ‘For example, a need for adjustment,’ says Deloitte Vietnam will benefit a lot more because Canadian-made motor vehicles sold China chief economist Xu Sitao. ‘They ultimately this new version of the CPTPP in Australia and Malaysia enjoy more will need to open up their service will help liberalise the economy, forcing liberal rules of origin.’ AB sector, and in the case of Vietnam the country to open up its market, they need to introduce new labour particularly in the service areas,’ Xu Sonia Kolesnikov-Jessop, journalist

‘There is no such thing as a free lunch and for certain countries like Vietnam and Malaysia there will be a need for The CPTPP will open up markets such as Vietnam’s iron and steel adjustment’ industry by eliminating tariffs.

26 Accounting and Business February/March 2019

AP_YCORP_CPTPP.indd 26 08/01/2019 16:43 The view from of global audit regulators were given Geraldine Ong ACCA, accountant, Reed Smith, new enforcement Singapore, on the impact of technology powers in 2018.

I began my career in the I am Singaporean and audit industry, if for no proud to be so. Singapore other reason than I really is a well-known business liked auditing. Being an hub and a country with high auditor means variety. It levels of security. It’s also means getting to meet a food paradise, which is Source: IFIAR different people in different one of the most interesting industries every day. things about the country and something that people who visit BoxDeloitte headline comes top After eight years in audit I decided I may not initially be aware of, but you VoluptasDeloitte Chinaeum, ipishas minctereceived ped the quis Top was ready for a new challenge. My role can’t miss it once you are here. accullorest,Employer China sintecta 2019 velest certification labor rereiciis as accountant is to bring my knowledge quosfrom the dollautetur? Top Employers Qui nam, Institute volor and experience to setting up and The main changes I have seen over the suntfor the adi 13th berit consecutive vene pro quae year. commos The managing the accounts department and past decade have been technological. quaspit,award recognises si omni lorem excellence ipsum. in the all its relevant procedures. The greatest Accounting software nowadays is Boxoutconditions crosshead: employers doluptur, create forsequamust their sense of satisfaction I have achieved so magical compared to 10 years ago. The magnipeople. bera According coribusdam to Deloitte et re nobist China la far is to see everything properly in its Singaporean government encourages doloreCEO Patrick con re Tsang, volorer building spercit aautem strong as place and working well. businesses to adopt ever more rerumcorporate volut culture volorun. is the backbone of advanced technology by providing Boxoutthe firm’s crosshead: strategy. ‘Ultimately,moditat urehend our goal I used to think that accounting was companies with incentives. isciae.is to create Gitae an magnima environment ximporr in which easy, consisting only of data entry, undenimilitour people canprem be culpa proud dolore they workprae for with accountants just concerned with My biggest career achievement estrumDeloitte,’ rerem he said. aborrup turiantion culpa numbers. But wow! How wrong I was. to date was becoming an ACCA doluptus lorem ipsum dolor sit amet. There are rules and regulations to member in 2017 and a member of All change at RSM follow. There are professional boards CA (Singapore) in 2018. Currently, BoxRSM has headline admitted Chinese firm Huapu set up to protect businesses. Business I’m doing my masters and, with VoluptasTianjian Certified eum, ipis minctePublic Accountantsped quis and the profession are in fact incredibly the backing of these qualifications, accullorest,to its global sintecta network. velest Headquartered labor rereiciis in well governed. I hope to quickly move on to a quosBeijing, dollautetur? the new member Qui nam, firm volor comprises bigger platform to demonstrate sunt1,733 adi professionals berit vene proand quae 54 partners commos my capabilities. I hope to put the quaspit,across 10 si offices omnoditat and urehendseven provinces isciae. experience and knowledge that I have Gitaecovering magnima major economicximporr undenimilit centres in I used to think that gained into good use through my work, premmainland culpa China. dolore RSM prae has estrum also adopted rerem accounting was but I also want to give back to society aborrupa new Chinese turiantion name culpa for RSMdoluptus. Hong when the opportunity arises. Ur,Kong, nihitiis to align mollaut with rerum the global atum, brand. core easy, consisting saeraeAccording cus toaut a quepress pos release, ex exerepe the only of data entry, If I weren’t an accountant, maybe I rroviduciasmove reinforces es venet RSM odit, Hong simporum Kong as with accountants would be a fashion designer. However, dolothe firm el eaquidis of choice corro for blatiosentrepreneurial, qui just concerned with having said that, I hate drawing. voluptagrowth-focused quique dit organisations, estemperum with numbers. But wow! But seriously, if I had not taken up doluptasits audit, taxet, vollamand consulting re que sus arms eum hit accountancy in my polytechnic days, autcontinuing occusaecus to provide essi omnihiciis comprehensive et lorem How wrong I was followed by ACCA, I have no idea where ipsumbusiness dolor solutions. sit amet nunc. I would be now. AB

February/March 2019 Accounting and Business 27

AP_YPRAC_intro.indd 27 10/01/2019 13:55 Making head space By encouraging mental health awareness in the workplace, finance professionals are better placed to help their SME clients, who may be particularly vulnerable

During a packed session at the World Congress of Accountants in Sydney, Australia in November, Institute of Public Accountants (IPA) CEO Professor Andrew Conway addressed an elephant in the room. How many among those present had experience with clients showing signs of mental illness, he asked? The majority raised their hands. Professor Conway’s keynote speech specifically addressed the issue of mental health in the changing role of the professional accountant. ‘Literally hundreds’ overflowed the room, and in a follow-up session the next day

28 Accounting and Business February/March 2019

AP_YPRAC_stress.indd 28 09/01/2019 17:20 delegates from around the world turned ‘We know that accountants often signs of stress and encourage clients to up for further discussion. work through times of stress with seek assistance.’ ‘I was astounded,’ Professor their clients – whether it is a time of One way to do that is through Conway says. ‘This was the first time downturn or a period of growth,’ says mental health training, which IPA that the accounting profession’s role Jane Stanton, president, CA ANZ. ‘One offers though an external consultancy, in mental health, and our right to of our members has described her Mental Health First Aid Australia. IPA start talking about it, was raised on role as sometimes being a counsellor has also restructured its educational a global scale.’ It shows that this is a for people in business, which is so curriculum to embed the notion of universal phenomenon that requires a true because accountants are walking emotional intelligence, building in some global approach.’ alongside their clients.’ psychological competencies. Professor Conway’s presentation, In response, the professional Firms big and small are taking the titled The Changing Role of the Trusted organisation launched a dedicated initiative, too, with practices embedding Adviser – Influencing Small Business, mental health programme, CA mental health support in their wellbeing was based on the results from 12 Wellbeing, in 2017, and has developed programmes to ensure that staff have a months of research by the IPA-Deakin guides to help members engage with sustainable work-life balance and in turn (University) SME Research Centre. It people experiencing mental health are able to better support their clients. included harrowing personal stories problems and financial difficulties. As Edith Lam, director and staff of accountants whose small business partner at PKF Hong Kong, points clients were stretched to the limit of out, in the past, workplace stress has their mental endurance. But Professor not been widely discussed in Asia. Conway knew that his Australian ‘Given the Chinese work values and counterparts were far from alone. culture, there’s always been a top-down ‘In many cases approach from management which Badge of honour the accountant causes staff to put in longer hours, Various studies constantly remind us ultimately leading to a stressful work how demanding corporate life can be in may be the environment,’ she says. Asia, where long working hours are worn first port of ‘Nowadays work life balance is a as a badge of honour. For instance, a call for clients really hot topic, especially in CPA firms 2015 UBS study found that Hong Kong under pressure’ like ours,’ Lam adds. Contrary to the had the longest working hours among traditional Asian office hierarchy, at PKF 71 cities studied (an average of 50.1 Hong Kong, change is being instigated hours each week per employee); 60% from the bottom up. ‘Most of our new suffered from high levels of stress; and ‘Our profession can demand a lot recruits are millennials, and they are very 49.5% said they didn’t have enough time from us, and if members experience a concerned about achieving a balance to exercise. In a 2017 survey by Robert mental health issue, we want to be part between work and life.’ Half, 56% of Singaporean CFOs cited of the solution by providing resources Measures include an open-door policy increased workloads as the main cause and support, and also, in some respects, where directors and managers remain of their workplace stress, followed by normalising it as well,’ Stanton says. easily approachable for staff. ‘We act as increased business expectations (54%). In Professor Conway agrees that industry the mentor for our junior accountants, Japan, there’s even a word – ‘karoshi’ – professionals should be equipped as where they can come and ask for to describe death attributed to overwork. ‘mental health first aiders’. guidance,’ Lam explains. ‘We ensure Of course, long days are not the ‘In many cases the accountant that staff have the chance to express preserve of finance professions. may be the first port of call for clients their concerns, and feel comfortable However, as acknowledged by Chartered under pressure,’ he says. ‘Every day explaining what they are thinking.’ Accountants Australia and New Zealand professional accountants see the Millennials themselves, 3E Accounting (CA ANZ), the nature of their work as very real pressures faced by small founders Lawrence Chai and Stephanie trusted advisers means that accountants business owners – manifesting, all Chua established their firm to avoid the are more privy than other service too often, in anxiety, stress and stress of the long working hours that their providers to the pressures clients face. depression. Our task is to look for jobs as auditors had demanded of them.

February/March 2019 Accounting and Business 29

AP_YPRAC_stress.indd 29 09/01/2019 17:20 With a young family, work-life balance was important to the couple, both Accountant, heal thyself ACCA-qualified accountants, so they In order to help their small business clients cope with stress, Hong Kong-based instilled that ethos into their business counsellor Sebastian Droesler recommends accountancy professionals first look at model. Their 50 employees across their own health. offices in Singapore and Malaysia enjoy ‘The better you are at developing self-awareness around your own emotional a range of wellness benefits, including balance and wellbeing, the easier it is to see things in others and be more flexible working hours. Chai says his staff forthcoming in having a conversation about that.’ are less stressed and more productive Begin with a 24/7 retrospection, looking not only at the hours spent at work, versus as a result, and that employee retention those spent in leisure, exercising or sleeping, but reflecting on what tasks and activities has been an unexpected bonus. energise you, and those that deplete your energy. The exercise would then progress to considering relationships with family members, colleagues, and peers. Write down Range of support thoughts as they unfold, as this gives clarity to where the pressure points are. At PwC in Hong Kong, an employee In his previous career with a leading investment bank, Droesler ‘had my share of assistance programme established in morning blues’, but self-awareness brought with it the ability to set boundaries. He’s 2011 offers a range of support, either learned not to carry a phone everywhere, to avoid incessantly checking emails and to through the 24-hour hotline or one-on- develop healthy mindfulness through yoga and meditation practice. one counselling, to proactively manage For accountants, that also means managing the emotional boundaries between staff wellness. The issues may range themselves and their clients. ‘You don’t want to be detached,’ he says. ‘The from career-related stresses or achieving challenge in juggling that professional boundary is to have a good understanding of a work-life balance to personal issues what is your role and what is not your turf.’ outside the workplace. Deloitte Hong Kong, meanwhile, works with a range of different professional Hong Kong’s human resources director. in initiatives to have a mentally fit providers as part of its framework ‘For instance, during a talk on Chinese workforce as they understand the covering ‘staff wellbeing of physical, medicine acupoints, staff were taught positive impact it has on not just mental and purpose’. The firm’s mental some simple but practical meridian employee wellbeing but also the health care also includes a professional massage techniques to cope with daily organisation’s bottom line,’ he says. psychological and counselling service health issues and to release stress.’ Effective initiatives to improve hotline under its employee assistance Counselling services are also provided mental health among finance staff programme, as well as seminars and to staff through external providers on include flexible working arrangements, monthly mental health tips. ‘Our an as-needed basis. In addition, the employee assistance programmes or professional vendors bring their expertise firm runs a mentoring programme and counselling services, as well as hiring in dealing with different needs, from work a buddy system to help new graduates temporary finance and accounting stress to family issues, personal crisis and adapt to the working environment ‘and employees to alleviate high workloads relationship issues,’ a spokesperson says. to alleviate any stress as a result of for the finance team. ‘They will provide crisis management and the change in role from a student to a ‘Companies that are proactive and intervention when there is a need.’ working professional’. dynamic in their approach to mental BDO Hong Kong also has a As a result of such measures, BDO’s health initiatives will undoubtedly see multifaceted staff wellness programme. latest internal survey shows the level of tangible results over time as employee Topics covered in its health talk series staff engagement has increased by 40%, wellbeing is crucial to business success,’ have included stress management, while the health workplace index was Johnston says. ‘With a mentally fit depression, sleep quality, weight control, also substantially enhanced by 21%. workforce, these organisations not only and stress management from the Recruitment specialist Adam Johnston, have more productive and engaged Chinese medical perspective. managing director of Robert Half Hong teams; they gain an edge in attracting ‘On top of providing useful health- Kong, China and Japan, says these firms the best financial talent and keeping related advice, speakers might lead are taking the right approach. their staff on board.’ AB participants to do exercises during ‘Business leaders in both Singapore the events,’ says Angela Wong, BDO and Hong Kong are actively investing Peta Tomlinson, journalist

30 Accounting and Business February/March 2019

AP_YPRAC_stress.indd 30 09/01/2019 17:20 Are you one of the 200,000? Download your personalised artwork at 200k.accaglobal.com No bribing matter Corporate Malaysia needs to be aware of new anti-bribery legislation, which could have far-reaching implications for commercial organisations, says Errol Oh

any businesspeople have yet to realise that individuals, while the DoJ website listed 40 enforcement Malaysia’s law on bribery involving companies and actions last year. Mpartnerships was drastically altered last year. In The Bribery Act came into force in July 2011. In the few this case, ignorance is certainly not bliss. Business owners years after that, people were wondering why no company and executives must understand the far-reaching implications had been prosecuted. That changed in February 2016, when of this development and figure out how best to respond. construction and professional services company Sweett Group And they must do so soon. Otherwise, they and their was convicted and punished for failing to prevent an act organisations risk being heavily penalised if employees and of bribery intended to secure and retain a contract with an service providers are caught giving or offering bribes. insurance company in the United Arab Emirates. This change came after Parliament passed a bill in April 2018 The UK and US experiences tell us that it takes a while to amend the Malaysian Anti-Corruption Commission (MACC) for the authorities to fully flex their prosecutorial muscles Act 2009, primarily with the insertion of Section 17A. The new over corporate bribery. In addition, when the proposed section provides that a commercial organisation commits amendments to the MACC Act were debated in the an offence if an associated person engages in corruption in legislature, the government said that the corporate liability order to obtain or retain business or an advantage for the provision would only be enforced two years after the passage organisation. To date, prosecution of bribery and corruption in of the bill. That gives the corporate sector a grace period until Malaysia has focused on individuals. April 2020. The aim of this so-called corporate liability provision, according to the government, is to nurture a corruption-free Stakes are high environment for business and commercial activities, and If it sounds like there is plenty of time for Malaysia to adjust to encourage commercial organisations to take adequate to the corporate liability provision, it is prudent to note measures to prevent corruption within their organisations. PwC that the stakes are high and there is still a lot more to be Malaysia calls it ‘the most significant change to the Malaysian done. PwC’s Global Economic Crime and Fraud Survey anti-bribery and corruption legislation in years’. 2018 suggests that bribery and corruption in Malaysia is With the introduction of Section 17A, Malaysia has on the rise, with 35% of respondents reporting that their acquired legal firepower for the anti-corruption war that organisations had experienced such incidents in the last two is similar to the US’s Foreign Corrupt Practices Act (FCPA) years, compared with 19% in 2014 and 30% in 2016. Few and the UK’s Bribery Act. Enacted in people would view this trend as 1977 to prohibit US companies from anything less than worrying. bribing foreign officials to obtain or To Dr Mark Lovatt, CEO of retain business, the FCPA is jointly A commercial consultancy firm Trident Integrity enforced by the US Securities and organisation may Solutions and an expert on Exchange Commission (SEC) and the get into legal corruption and business integrity Department of Justice (DoJ). trouble whenever systems, it is a widespread problem In the first two decades or so, somebody pays or that seems to be getting worse. there had been merely a trickle ‘Clearly, companies, regulators and of enforcement actions relating promises a bribe as enforcement bodies need to work to the FCPA. But the annual a way to benefit the harder to resolve this,’ he says. volume of cases has climbed organisation’s The introduction of the corporate markedly since the turn of the business liability provision is, of course, century. In 2018, the SEC acted a big step in that direction. For against 12 companies and two one thing, it packs a punitive

32 Accounting and Business February/March 2019

AP_I_CorporateLiability.indd 32 10/01/2019 13:44 punch. A commercial organisation convicted of an offence no longer a defence to claim ignorance,’ he says. ‘With the under Section 17A can be fined not less than 10 times the amendment in place, it is their duty to prevent the giving or gratification paid or offered, or RM1m, whichever is higher. offer of gratification in the first place, and failure to take the The alternative to that is a jail sentence of up to 20 years or a necessary measures falls on their shoulders.’ combination of the fine and imprisonment. It is useful for businesses to think of these preventive steps as a get-out-of-jail-free card. Those at the helm of Guilt by association corporations and partnerships must first fully grasp the fact But companies and partnerships cannot be thrown in the that a commercial organisation may get into legal trouble slammer, right? This brings us to another potent aspect of the whenever somebody pays or promises a bribe as a way to corporate liability provision: when an organisation commits benefit the organisation’s business. an offence, its directors and key managers are automatically Section 17A, says Lee Shih, a litigation partner at law firm considered guilty of the same crime. However, they can get off Skrine, leads to companies’ wide exposure to the corrupt acts the hook if it is proven that the offence was committed without of persons or entities associated with these organisations. their consent and that they have exercised due diligence to ‘This is the gateway through which liability is potentially prevent it. imposed on companies and their management,’ he says. Lovatt points out that this means the top decision-makers ‘These associated persons or entities are the company’s have to be proactive in preventing acts of corruption. ‘It is directors, partners, employees and those performing services

February/March 2019 Accounting and Business 33

AP_I_CorporateLiability.indd 33 10/01/2019 13:44 for or on behalf of the companies. This last category could extend to the companies’ agents, distributors, contractors and even subsidiaries.’

Onerous standard This is why Section 17A is known as the corporate liability provision. And it does not matter whether the companies had actual knowledge of the corrupt actions of these associated persons, says another lawyer, Brian Chia, a partner at Wong & Partners, a member firm of Baker McKenzie. ‘This is a very high and onerous standard, and the burden is now on the companies to show that they had in place adequate procedures designed to prevent associated persons from undertaking such corrupt practices,’ he says. In March 2018 representatives from 11 countries met in These ‘adequate procedures’ are therefore pivotal – so Santiago, Chile to sign the Comprehensive and Progressive much so that related guidelines will be issued. The good news Agreement for Trans-Pacific Partnership. The signatories are: Brunei, Chile, Australia, Canada, Singapore, New is that there is no need to reinvent the wheel: there is already Zealand, Malaysia, Japan, Mexico, Peru and Vietnam. a wealth of material on the subject that can be adapted for use in Malaysia. A prime example is the 45-page guidance published by the UK’s Ministry of Justice on procedures to Corporate liability: a global concern prevent persons associated with commercial organisations When Malaysia’s parliament was debating the bill to from bribing. Transparency International, too, has produced amend the Malaysian Anti-Corruption Commission Act, the guidance on good practice procedures for corporate anti- government noted that it had been working on the corporate bribery programmes. The SEC and DoJ have also come up with liability provision since 2012. However, the obligation to make a resource guide to the FCPA. Then there is the ISO 37001: Anti- that change had been imposed several years earlier. Bribery Managament Systems, a global standard that can help Malaysia signed the United Nations Convention against companies develop their corporate integrity framework. Corruption in December 2003 and ratified it in September However, Lee Min On, faculty member of the Malaysian 2008. Among other things, the convention calls for signatories Alliance of Corporate Directors and former director of to adopt measures to establish the liability of legal persons Coalition for Business Integrity, says it is a mistake for (and not just individuals) for their participation in corruption. companies and partnerships to do nothing while they await Here is how the UN Office on Drugs and Crime explains the the issuance of government guidelines on what constitutes rationale for that requirement: ‘Criminal prosecution has an adequate procedures. important deterrent effect on corruption. However, punishing He urges commercial organisations to start early on their only natural persons in cases that directly involve corporations development of adequate procedures by studying the might not be enough. We need to establish clearly the liability principles and best practices laid down in the guidance for of legal persons for corruption offences in order to deter the Bribery Act and the FCPA. Nevertheless, guidelines ought corporations willing to break the rules.’ to be drafted sooner rather than later so that there can be Additional impetus comes via the Comprehensive and consultation with stakeholders and sufficient time for corporate Progressive Agreement for Trans-Pacific Partnership (CPTPP), Malaysia to be ready for the enforcement of the new law. which Malaysia and 10 other countries signed in March At the same time, Lee adds, the government should 2018 (see page 24).This pact evolved from the Trans-Pacific do more to increase awareness of the corporate liability Partnership (TPP), comprising the same 11 countries plus provision, such as getting the relevant regulators, industry and the US. When the US withdrew in January 2017, less than professional bodies to work together to get the word out. a year after it was signed, the remaining members worked May 2020 seems far away to some, but it may well be that out a successor deal that suspended 22 items from the many will still be unprepared when the government begins original agreement. Like the UN convention, both free trade cracking down on bribery in corporate Malaysia. AB agreements expect legal persons to be held liable and be sanctioned for corruption offences. Errol Oh is executive editor of The Star.

34 Accounting and Business February/March 2019

AP_I_CorporateLiability.indd 34 10/01/2019 13:44 Global expansion Emerging markets are expected to dominate growth among the world’s megacities (urban centres housing 10 million or more inhabitants) over the coming decades

Trajectories of the titans Growth in population and GDP in the world’s current 33 megacities (at least 10 million inhabitants) is predicted as follows:

150% 30%

100% 20%

50% 10%

0% 0%

Cairo Delhi Lima Paris Lagos Osaka Seoul Tokyo Beijing Dhaka Manila Tehran Tianjin Wuhan Jakarta Karachi Kolkata London Bangkok Istanbul Moscow Mumbai Shenzen New York Shanghai Bangalore São Paulo Guangzhou Los Angeles Mexico City Buenos Aires Ho Chi Minh Rio de Janeiro

Real GDP growth Population growth Source: Euromonitor and Global Cities Institute, Estimated % growth 2017–30 Estimated % growth 2017–30 mapped by Visual Capitalist

Megacities in the making By 2030, the Indonesian capital of Jakarta is expected to be the biggest megacity of all, with 35.6 million inhabitants, and a further six locations (shown here) will have joined 2017’s 33-strong megacity roster.

Baghdad (Iraq) Bogota (Colombia) Chennai (India) Chicago (US) Dar es Salaam (Tanzania) Luanda (Angola)

Africa to lead the big parade Japan in reverse The four biggest cities in the world by 2100 are shown below. A falling birth rate will lead to urban shrinkage in Japan. In total, 13 African cities are expected to have overtaken Tokyo will fall from top spot by 2030 as Japan’s aging New York in population by 2100. population turns into population loss in the capital.

88.3 83.5 73.7 67.2

10.6 9.1 4.4 20.1 Osaka will be the world’s most elderly megacity, with 31% of its population aged 65 or over. Lagos, Kinshasa, Dar es Salaam, Mumbai, Nigeria DR Congo Tanzania India

Population 2010 (millions) Population 2100 (millions)

February/March 2019 Accounting and Business 35

GL_I_Graphics.indd 35 08/01/2019 16:30 Emotionally charged You may tick all the boxes in terms of traditional indicators of intelligence, but tapping in to the ‘EQ superpower’ can elevate you above others, says Dr Rob Yeung

36 Accounting and Business February/March 2019

GL_I_EQ.indd 36 14/01/2019 15:17 here is a lot of talk and many words written on the topic of emotional intelligence (EQ). But Hone your EQ Tis its supposed importance actually supported Why do so many people continue to smoke cigarettes, by real evidence? drink too much alcohol, never get off the sofa, or eat fatty Consider for a moment the skills that lead to success for and sugary foods? The reality is that they almost always partners in large professional services and management understand the factual arguments against such behaviour consulting firms such as PwC, KPMG or the Boston Consulting perfectly well but continue because of the emotional Group. (Full disclosure: I worked as a consultant for two years benefits conferred. The same is true in the workplace: at BCG). In a major study, researcher Richard Boyatzis worked colleagues may understand a factual argument but with the human resources department of one such firm to stubbornly resist because they don’t feel it’s right for them. identify the skills and behaviours that led to exceptional Emotions trump logic. performance in the firm’s senior partners. At the time, the firm In practical terms, emotional intelligence is all about had around 3,000 partners worldwide. For the sub-sample controlling and using your emotions to achieve desirable of senior partners under study, average annualised revenue outcomes, but before you can control and use emotions, per senior partner was US$2,438,000, with an average gross you must first have a good understanding of them in margin of 57%. yourself and in others. Each senior partner was scored by peers, subordinates and the office of chairman – effectively their boss – on FAR analysis cognitive intelligence skills such as their knowledge, pattern When I give training on leadership and emotional recognition and systems thinking. They were also scored on intelligence, I sometimes recommend undertaking a ‘FAR’ emotional intelligence skills such as their empathy, coaching exercise for developing an awareness and understanding and leadership. of emotions: After tracking the financial performance of the senior 1. Feelings. At several points throughout each day for partners for seven successive quarters, the researchers a week, put a name to your emotions, whether they found that several cognitive skills, such as knowledge and are positive, negative or a mix of both. It’s possible pattern recognition, were not meaningful predictors of to feel more than one emotion at once, so aim to high performance. Of the 14 skills that predicted senior name them all. For example, you may feel pride i partners’ financial performance, 13 (93%) were to do with a friend’s achievement, envy that it did not happen emotional intelligence and only one to do with cognitive, to you and worry that you are behind with your own traditional intelligence. goals. Evidence suggests that people who have a The study suggests that traditional intelligence measures large emotional vocabulary – who are more able to are necessary but insufficient for truly high performance. So distinguish between subtly different emotions – are yes, you need to pass exams, gain qualifications and continue usually more able to control them. to gather knowledge about your discipline, the competitive 2. Actions. Write down how the mix of emotions led you landscape and the world; however, all of that only gets you in to behave. For instance, did you sulk and withdraw through the door. To truly elevate yourself above those around from the situation? Did you make snide comments? you, you must hone your emotional skills. Did you belittle the other person’s achievements to make yourself feel better? Or did you simply end Defining EQ up procrastinating? The identification of the skills that comprise EQ is 3. Response. Write down what in theory would have been often credited to Yale University’s Peter Salovey and the a more adaptive, beneficial action that you should in University of New Hampshire’s John Mayer in the early hindsight have taken. 1990s. Since then, most organisational and performance You could try performing a similar exercise with clients and psychologists, including me, continue to define emotional other stakeholders. After important meetings, spend a few intelligence as the ability to recognise, understand and minutes listing the emotions that you detected in other use information about emotions in oneself and others. In people during your interaction with them. This will enable terms of developing these skills – whether in salespeople or you to develop a more nuanced understanding of other accountants, hotel managers or teachers – I break them down people’s emotions. into the following four components:

February/March 2019 Accounting and Business 37

GL_I_EQ.indd 37 14/01/2019 15:17 * Being able to recognise emotions in yourself – for instance, being aware when you are fearful, sad, irritable, Seven quotients for success embarrassed, aggressive and so on. EQ is one of following seven key quotients that ACCA’s * Being able to manage your own emotions. Sometimes research, Professional accountants – the future, has people allow their emotions to drive their behaviour – eg highlighted as important for professional accountants to when they feel angry and lash out at others, or when they develop in order to add value for employers and clients. feel sad and withdraw from others. However, people who are better able to manage their own emotions are more quickly able to calm anger or turn their own fear into hope, Technical and ethical (TEQ) for example. The skills and abilities to perform activities to a * An awareness of emotions in others. How is each defined standard while maintaining the highest standards of individual around you feeling at any particular moment integrity, independence and scepticism. in time? Is your client feeling enthusiastic or proud, anxious or frustrated? Are your colleagues bored or tired, Intelligence (IQ) interested or inspired? Emotionally intelligent people The ability to acquire and use knowledge: understand that emotions fluctuate frequently. For thinking, reasoning, solving problems and the ability instance, your client or customer may experience many to understand and analyse situations that are complex different emotions during the course of a single meeting. and ambiguous. * The ability to manage emotions in other people – for example, by guiding, calming, and inspiring or using other Creative (CQ) methods such as compassion, assertiveness and humour. The ability to use existing knowledge in a new This fourth component comprises the high-level skills of situation, make connections, explore potential outcomes being able to negotiate with opponents, coach individuals, and generate new ideas. influence customers and ultimately lead entire teams. See tips for honing these skills in the box on the previous page. Digital (DQ) The awareness and application of existing and Predicting success emerging digital technologies, capabilities, practices, Some consultants and advisers claim that emotional strategies and culture. intelligence is more important than traditional intelligence in predicting success. However, that is probably not true. Emotional (EQ) In a wide-ranging review of the published scientific evidence The ability to identify your own emotions and on emotional intelligence, researchers led by Ernest O’Boyle those of others, harness and apply them to tasks, and at Longwood University in Virginia concluded that components regulate and manage them. of emotional intelligence ‘increment cognitive ability and personality measures in the prediction of job performance’. Vision (VQ) In other words, cognitive ability (ie IQ and other measures The ability to predict future trends accurately by of what we typically think of as intelligence) predicts job extrapolating existing trends and facts, and filling the gaps performance to a certain degree. Personality measures (eg by thinking innovatively. the extent to which a person is extraverted, conscientious, and agreeable) are also separately able to predict job Experience (XQ) performance. However, adding emotional intelligence skills The ability and skills to understand customer into the mix allows us the very best prediction of who might expectations, to meet desired outcomes and to succeed and who might stagnate in their careers. create value. The implication: it helps to be smart; it helps to have a winning personality; but emotional intelligence really does make a meaningful difference, too. AB More information Read about EQ as the superpower of the digital age and Dr Rob Yeung is an organisational psychologist at leadership measure yours at accaglobal.com/eq. See this and the other quotients for success at bit.ly/ACCA-drivers. consulting firm Talentspace.

38 Accounting and Business February/March 2019

GL_I_EQ.indd 38 14/01/2019 15:17 Force for good Countries need to cut employment-destructive labour taxes and increase resource and pollution taxes to help build a sustainable global economy

ax has long been a policy tool of choice all around The report stresses the urgent need to focus taxation the world for infl uencing social and economic on resource use and pollution rather than on labour. It Tbehaviour. But can it be used to help drive a describes adapting tax systems in this way as a ‘survival sustainable global economy? of the fi ttest’ challenge: it is not the biggest or strongest This is the challenge explored in a recent ACCA report that will survive, but those that adapt in time to changing by Femke Groothuis, co-founder of the Ex’tax project – a circumstances. thinktank focused on fi scal innovations to boost the United Groothuis notes how tax systems have evolved over recent Nations’ Sustainable Development Goals (SDGs). The report, centuries – the 18th-century window tax in England and Wales Tax as a force for good: rebalancing our tax systems to support has been replaced by fossil fuel duties and progressive income a global economy fi t for the future, calls for a rebalancing of tax in the modern world. But this evolution was fi rmly rooted in tax systems, and sets out how governments must think more the industrial revolution, and as we enter the fourth industrial widely about what they should be taxing, and how those tax revolution – one driven by data and technology – so tax revenues should be put to use. systems around the world need to adapt accordingly. The headlines may be dominated by whether multinational The starting point for this discussion centres on the UN’s companies are paying their ‘fair share’ of corporate tax around 17 SDGs, described as humanity’s ‘to-do list’. Unemployment, the world, but Tax as a force for good focuses on other, less underemployment and vulnerable forms of employment are publicised taxes – in particular, labour and green taxes. It is highlighted as part of Goal 8 (decent work and economic these taxes that can directly impact the world’s social and growth), making the point that the global economy is nowhere economic challenges of unemployment and pollution. near achieving full and productive employment.

February/March 2019 Accounting and Business 39

GL_I_tax.indd 39 09/01/2019 13:20 start to fall in the next 12 years if large-scale natural and human How to green the tax base risks are not to play out irreversibly. Air pollution, mostly from Femke Groothuis suggests the tax base can be shifted away vehicles and industry, kills millions every year, while a truck load from labour and income and towards a greener regime by: of plastic waste is dumped in the oceans every minute. * Putting a price on pollution and natural resource use. The fi gures given in the report are staggering. The long- Countries can start with the low-hanging fruit – options term negative impact on the global economy caused by that suit national circumstances best. In light of the Paris carbon dioxide emissions in 2017 alone was US$16 trillion, Climate Agreement, the abolition of fossil fuel subsidies while the global welfare losses from pollution stand at US$4.6 and the creation of effective carbon pricing are the likely trillion a year, or 6.2% of global economic output. first candidates. Despite this, polluters do not pay. ‘Considering that we live * Using revenues to lower the tax burden on labour and in an era of climate change, water scarcity and geopolitical improve social protection. Careful design is required to tensions over fuels and materials, it would be wise to use ensure the needs of vulnerable groups are addressed natural resources prudently,’ the report through increased social protection or income support. points out. ‘Our tax systems, * Monitoring and adjusting. In a fast-changing world, tax however, are currently not systems will need to adapt much faster than before. aligned with the goal of sustainability, as the use of natural resources tends to be relatively tax- Groothuis argues that this creates free, or even subsidised.’ a barrier to inclusive growth. It has Green taxes are It is not as if there aren’t options been calculated that just $0.64 of growth-friendly for green taxation. The policy toolkit every dollar an employer pays in – they distort the developed by Ex’tax provides an labour costs ends up in employees’ economy less than overview of more than 100 ‘green’ pockets (the so-called labour taxes on labour tax base options that are available tax wedge). Research shows that to governments, including ways to high taxes on labour income can and income, tax air pollution (such as carbon hamper job creation and work and incur low emissions), energy, food production incentives. High payroll costs are an administrative and inputs, fossil fuels, metals and incentive for employers to minimise transaction costs minerals, traffi c, waste and water. headcount, and affect employees’ Each category is divided into decision to enter the labour force subcategories. The waste category, and the number of hours they work for example, is broken down into (the effect is particularly strong among low-income workers, electronic waste, packaging, nuclear waste, sewage, landfi ll single parents, second earners and older workers). and other types of waste. This matters, argues the report, because on average across Green taxes can be highly effective at changing behaviour the 36 member countries of the Organisation for Economic and averting environmental damage. The UK’s landfi ll tax, for Co-operation and Development (OECD), more than half of example, has been instrumental in reducing the amount of all the tax revenue comes from labour. Other countries – the waste dumped in the ground by 44% since 2000. And when emerging economies of Africa, Asia and Latin America – rely the Stockholm, Sweden, began taxing vehicles to reduce the more on sales taxes, but still raise signifi cant amounts via volume of traffi c, air-borne pollutants dropped by up to 20%, labour. Green taxes hardly get a look in. decreasing the incidence of childhood asthma by 40%. Crucially, the report argues that green taxes are growth- No alignment with sustainability friendly – they distort the economy less than taxes on labour This disparity is at the heart of the report. Many of the and income, and the administrative and transaction costs world’s greatest social and economic challenges relate to are lower than other taxes, notably income tax. Compared disadvantageous environmental mega-trends – climate with emissions trading systems and direct regulation, green disruption, pollution and consumption patterns. The report taxes provide more opportunity for recycling the revenues cites the latest Intergovernmental Panel on Climate Change by reducing other taxes to compensate in part, or even to (IPCC) analysis, which warns that global carbon emissions must overcompensate, for any welfare loss that may occur.

40 Accounting and Business February/March 2019

GL_I_tax.indd 40 09/01/2019 13:26 Green taxes fall as a percentage of GDP

5 2000 2014

4

3 % of GDP 2

1

0

US UK Italy Chile Brazil Spain Japan Turkey France Ireland Austria Poland Croatia Mexico Greece Finland Norway Canada Uganda Rwanda Sweden Belgium Slovenia Portugal Hungary Malaysia Australia Denmark Germany Argentina Philippines Ivory Coast Switzerland OECD total China (PRC) South Africa South Korea Netherlands New Zealand Czech Republic

But their use is limited. In 2014, green taxes raised 5.3% Business as catalyst of total tax revenue in OECD countries (generating revenue Business can play an important role in promoting the shift equal to 1.6% of OECD GDP) – see the graph above. Having to a greener and more sustainable tax system. The report put the case for green taxes, Groothuis sets out the steps says: ‘The private sector can become a catalyst for better that can be taken to shift the tax base towards a green tax policy by engaging proactively with governments to push for system – see box on opposite page. But she concedes that forward-looking policies to promote circular and inclusive implementing such a strategy is not easy – short political business growth.’ lifecycles do not encourage long-term strategies, while Circular business models require a shift away from the linear industries with a vested interest in maintaining the status quo take-make-waste industrial model to a carbon-neutral and are often powerful lobbyists. International coordination would regenerative approach in which products are ‘made to be also be required, and followers of the OECD’s BEPS (tax base made again’. The report cites many ways in which businesses erosion and profit-shifting) project will be well aware of just are leading through innovative models, but governments can how difficult it is to reach agreement in principle, let alone put do more to support circular business initiatives. any policies into practice. The report concludes: ‘By rethinking the design of our tax In addition, an often heard worry is that environmental taxes systems in a holistic way, taxes can become a tool supporting can aggravate income inequality, as low-income households the ambitions of an inclusive global economy that is fit for the spend a higher share of their income on energy-intensive future.’ In other words, tax can be a force for good. AB goods. In practice, though, plenty of policy options are available to alleviate the impact on specific households. Philip Smith, journalist

February/March 2019 Accounting and Business 41

GL_I_tax.indd 41 09/01/2019 13:26 A boost for balance Female partners are still a relative rarity in professional services. But UK firms are working to rectify this and could prove an example for some other parts of the world

he gender imbalance at the top of professional points’ during people’s careers. The firm is now focusing on services firms is stark. At PwC, for example, in trying to recruit more women at entry level, retain them when Tthe 2018 financial year women accounted for only they reach middle-level roles, and develop and support them 20% of the global partnership (up from 13% in 2006). to help them keep progressing. Similarly, across KPMG’s international network, only 16% ‘It’s not about fixing the women; it’s about changing the of EMEA partners (covering Europe, the Middle East and culture, structures and mindsets within the organisation – as Africa, including India) were female, although the picture well as making interventions to ensure equality of opportunity,’ was somewhat better in the Americas (22%) and Asia Rowe says. ‘While programmes and targets are important, Pacific (23%). they won’t succeed in really changing the diversity or gender Alison Temperley, former PwC tax consultant turned balance within the organisation without that focus on the management coach and leadership expert, is struck by such underlying culture – in terms of hours, the way people behave imbalances, given that far more equal numbers of men and and ways of working.’ women enter these organisations. Temperley, also author of In 2014 Deloitte UK introduced an approach called ‘agile Inside Knowledge: How Women working’. Rowe explains: ‘It’s about Can Thrive in Professional Services providing an environment where Firms, says women are drawn to people are judged on the value such businesses ‘because they are they bring and the contribution they perceived as meritocracies that ‘It’s not about make – not time spent in the office. require the skills and intellectual fixing the People can flex their hours, work power that they have excelled at women; it’s about from home or another office and previously at school and university’. changing the be trusted to do their job.’ Deloitte But something then goes wrong. also has more formal, contractual Traditional theories for low female culture, structures flexible working arrangements where partner rates include the assumption and mindsets staff can work fewer hours. In 2018 that some women leave in their 30s within the it also introduced annualised days because balancing family and work organisation’ contracts, enabling people to work life is too difficult. Female character a reduced number of days a year, traits perhaps also play a part. which can, for example, enable Temperley thinks women tend to school-term-time-only working. be more perfectionist and scared of failure than men, but less likely to attribute successes to their own capabilities or actions. Sponsorship programmes Development programmes focused on women are now the Firm action norm in many firms. Return-to-work initiatives – where women Whatever the reasons, professional services firms are taking and firms can see how well they fit together over a six-month action. Many are setting targets. In the UK, for example, PwC period – are also widespread. One area of particular current is aiming for 24% female partners by 2020 (up from 20% now); focus, however, is sponsorship. Deloitte UK runs female and Deloitte has a target of 25% by 2020 and has made a sponsorship programmes for some of its senior women, which commitment to achieve 40% by 2030 (up from 19% now). can take a variety of forms, including a one-to-one relationship Clare Rowe, culture and inclusion lead at Deloitte UK, says with a partner. ‘The partner, as their sponsor, can advocate for the firm has had ‘a real focus’ on gender since 2014, when it them, open doors and provide connections,’ Rowe says. introduced a gender balance action plan. This has seen the Sarah Churchman, UK head of diversity, inclusion and firm focus on actions designed to address potential ‘pain wellbeing at PwC, also sees sponsorship as one of three key

42 Accounting and Business February/March 2019

GL_I_women.indd 42 16/01/2019 14:33 Taking ownership Women can take steps themselves to further their career prospects. Author and coach Alison Temperley encourages women to communicate their achievements – including the financial contribution they make, not just highlighting ‘inputs’ such as their knowledge and hard work. PwC’s Sarah Churchman agrees. ‘It’s about helping people to understand what you have done,’ she says. ‘But it’s also about making your aspirations and ambitions clear. Otherwise assumptions may be made about you.’ This could manifest as ‘benevolent bias’: an assumption, for example, that a working mother won’t want to be assigned to a top engagement because of the long hours required, when that individual may have made provisions to be available. ‘It’s about having open and honest conversations,’ Churchman says.

factors that will help bring more women through to the top in These and other her firm. Sponsors are available to talented female directors initiatives applied and senior managers. ‘A sponsor is somebody who is more of internationally an advocate for these people – not just a mentor,’ Churchman do seem to says. ‘It’s about making sure women are getting access to the be having an impact. Globally, PwC’s female partner right networks as well as visibility.’ admissions across the international network increased Another key factor involves making PwC business from 23% in 2013 to 30% in 2018. And market forces may unit leaders accountable for achieving gender and be helping women’s cause, too. ethnicity targets across four grades, from manager to ‘When we are pitching for work, so many clients now want partner. The third is about fair work allocation, after analysis to see a diverse proposal team,’ says Churchman. ‘In addition, suggested that men and women were not gaining the most people from the millennial generation want much greater same access to the highest profile engagements. ‘We now flexibility in how, when and where they work. So the focus we produce quarterly reports for all our business unit leaders now have on transforming work is helpful not just for attracting so they can see, for their top 10 revenue-generating clients, younger people, but is also really helpful for women.’ AB the proportion of women and men on those engagements,’ Churchman says. Sarah Perrin, journalist

February/March 2019 Accounting and Business 43

GL_I_women.indd 43 16/01/2019 14:33 Time to transform With technology changing every aspect of business, speakers at the World Congress of Accountants were clear that fi nance teams have to embrace digital transformation

t’s no secret that just about every organisation in every to the success of any transformation, but securing capital industry is undergoing a continual process of digital expenditure to invest in a back-offi ce function such as fi nance Itransformation – but where does this leave fi nance can be a challenging exercise. ‘You’ve got to be able to sell teams? What role should these bastions of security, stability an idea, and I don’t think fi nance people are typically very and compliance play in today’s world of continual change, good at that,’ said Daniel Papallo, global planning and fi nance where the ability to innovate can make or break businesses? transformation controller at medical device company Cochlear. The short answer is that fi nance leaders must reshape their Instead of starting a business case with the mechanics own teams to help deliver the wider digital transformation that and costs of the proposal, Papallo suggested emphasising is taking place in their organisations. Finance functions must be the benefi ts of change and how these contribute to the set up to advise stakeholders on the drivers of business growth, organisation’s broader goals. ‘If you can sell that, and you can including productivity and continual performance improvement. actually make an emotional connection to the problem, then That was the view of fi nance leaders who spoke at the World that can be really powerful,’ he said. Congress of Accountants (WCOA) in Australia last November. ‘Our role in fi nance is to really enable, support and drive Show them you can do it the business to change and be successful in the long term,’ Hopkins said that demonstrating credibility had been crucial declared group CFO Janelle Hopkins, who has spent the past when she was trying to secure management approval to fi ve years masterminding the transformation of the fi nance transform Australia Post’s fi nance team. ‘We actually self- department of postal services provider Australia Post. funded some of the transformation by taking cost out of the Refl ecting on how she began the transformation process, team before we’d even delivered it,’ she said. That allowed her Hopkins said: ‘The fi rst thing I did was spend time with my to show senior leaders that her team had the ability to deliver senior leadership team, and I talked to them about the need change that would benefi t the business. for us to change and transform.’ With executive approval secured, Australia Post’s Obtaining buy-in at executive level is absolutely critical transformation occurred in stages. ‘The only differentiator between a good fi nance function and a bad one is the people and capabilities you have,’ said Hopkins, who focused on Top transformation skills the people side of the transformation fi rst. ‘I took the top 60 Curiosity and communication are two of the key attributes people within the fi nance function and said, what do we need in a fi nance team undergoing transformation, according to to do to really become a leading-edge fi nance function?’ delegates polled at the World Congress of Accountants. Hopkins and her team identifi ed several transformation- Refl ecting on the poll, Australia Post group CFO Janelle underpinning soft skills – including negotiation and Hopkins said, ‘It is about curiosity and challenge,’ adding that collaboration prowess – that were required in order to engage the right training was crucial in making sure that people were effectively with colleagues in other business units. The fi nance willing to get their point of view across. department invested accordingly in training and development, Daniel Papallo, global planning and fi nance transformation and future recruitment decisions took soft skills into account. controller at Cochlear, added: ‘Building communications skills Australia Post then focused on simplifying fi nance processes is really key – that willingness to embrace other parts of the to facilitate better decision-making. Hopkins said that taking business, build networks and align yourself to the mission the time to get these processes right was an essential part of of the business. Those are the things that are immensely allowing the business to implement tools such as automation, valuable in a fi nance team.’ To fi nd out more about the skills robotics and analytics effectively. of tomorrow’s fi nance professional including emotional Jacqueline Chan, managing director and CFO of DBS Bank intelligence, visit accaglobal.com/eq. in Hong Kong, explained how her organisation’s fi nance transformation started with a mission statement: ‘to better

44 Accounting and Business February/March 2019

GL_I_WCOAfinanceteams.indd 44 10/01/2019 16:31 assess data and provide information to stakeholders so that While the finance leaders speaking at WCOA had arrived they can make the right decisions’. at different structures and methodologies to Having identified the desired outcome, Chan adapted the transform their teams, they all shared a similar finance function’s operating model. The team was split into philosophy: digital transformation requires two parts: one focusing on traditional financial reporting using more than just investment in technology – it automation and robotics, the other focusing on analytics- requires investment in people as well. AB based performance management. Chan said the performance management part of the Andy McLean is a journalist in business was a ‘centre of excellence’ that included data Sydney, Australia. scientists, data analysts, data engineers and people who look after the platform and the architecture. These professionals worked in tandem with the financial reporting team, she said. ‘It’s important that finance does not walk alone. We need to link up with the rest of the organisation.’

February/March 2019 Accounting and Business 45

GL_I_WCOAfinanceteams.indd 45 10/01/2019 16:31 Whistle while you work Feeling passion for your job can reap benefits – provided it’s the right kind. Dr Rob Yeung offers advice on how focusing on your signature strengths can help

You have probably read about Seeking harmony managers and entrepreneurs who say Dr Rob Yeung talks about types of passion for work at bit.ly/ACCA-playlist. how passionate they are about their work. But it turns out that passion is not always positive, with studies showing feel that they ‘must’ or ‘have to’ work as that there are actually two broad types. opposed to enjoying their job. To what extent do you agree with the following three statements? Harmonious or obsessive? * ‘My work allows me to create Harmonious and obsessive passion memorable experiences.’ both exist to some degree within most * ‘My work is in harmony with the other people, but many experience one more aspects and activities in my life.’ strongly than the other. It’s also possible * ‘I often discover new things through for people to have low levels of both: my work that allow me to appreciate they may be quite disengaged from life even more.’ their work. Consider also the next three statements. The two types of passion are related To what degree do you agree with these? to different outcomes. Norwegian CPD * ‘My mood depends on me being researchers Ide Birkeland and Robert able to perform well at work.’ Buch found that harmonious passion * ‘I have an almost obsessive need to for work was correlated with life work hard.’ satisfaction. In contrast, obsessive * ‘I have a difficult time controlling my passion was negatively correlated need to work.’ with life satisfaction: these individuals The first three statements measure reported feeling less happy overall. what’s known as harmonious passion. More worryingly, the researchers When people feel harmoniously also found links to burnout: a passionate, they feel motivated to work physical and psychological syndrome hard because they enjoy it – their work is characterised by exhaustion, cynicism inherently fun or gratifying. People with and diminished work performance. very high levels of harmonious passion Unsurprisingly, people with higher may even work without pay because it’s levels of harmonious passion seemed almost a hobby for them. to be protected, while those who felt The second three statements measure more obsessively passionate had more Those who obsessive passion, which develops markers of burnout. felt more when people feel compelled to work Another study by Violet Ho and hard. That could be because they Jeffrey Pollack found links between obsessively need recognition and social plaudits passion and business success. passionate had or because they wish to feel superior Harmoniously passionate entrepreneurs more markers to others. Another common driver is were more effective at networking – of burnout because they feel they need the money they tended to receive more income to support a family or other demands in from peer referrals – than their more life. Obsessively passionate individuals obsessively passionate counterparts.

46 Accounting and Business February/March 2019

GL_CAR_Yeung_CPD.indd 46 10/01/2019 14:04 If you feel driven by higher levels of obsessive passion than you would Dr Rob’s talent clinic like, consider changing the nature I recently applied for a role and of your work. Studies suggest Q went through three rounds of that it is possible to boost interviews but was rejected. I received levels of harmonious passion feedback that I had not demonstrated by identifying and then putting suffi cient ‘ability to innovate and into use your signature strengths. solve problems’. What’s the best way to develop skills These are skills or behaviours that such as creative thinking and the ability to innovate? fulfi l two criteria: they must both There may be two separate issues here. First, do get verifi ably good results (ie A you have enough of the skill? Second, can you colleagues or customers give you successfully communicate the extent of the skill that you have? feedback that these are things you do My experience is that everybody can get better at innovation and solving well) and feel energising for you to do. problems. It’s often just a matter of making a conscious decision to do so and For example, if you receive praise for setting aside time to identify things that could be improved at work. What niggles your presentations but dislike giving or problems continually frustrate you and colleagues? What procedures could them, then this is not a signature you introduce to make things simpler, faster, cheaper or less prone to mistakes? strength because it does not invigorate From your readings and conversations with people in other businesses, what new you. Similarly, if you enjoy dealing with technologies or creative solutions would make life easier? customers but have been told that you When you identify an idea, put together a business case in order to present a well- need to work on these skills, then this argued solution to managers further up the hierarchy. If you do not feel confi dent cannot be a signature strength for you. doing so, ask for advice and perhaps make your case in collaboration with others.

Next, pursue tasks, activities and Solving problems and improving situations is a vital skill that will get you noticed CPD projects that allow you to use your within your organisation, too. signature strengths. Volunteer, The other part of the equation may concern how well you convey instances of negotiate, trade responsibilities and innovation and problem-solving to interviewers. Think about the two best examples use your ingenuity to fi nd ways to of when you delivered innovative solutions at work. For each, what was the initial exercise these important skills more problem or opportunity? What analysis did you do? Who did you involve? And frequently. Also, seek advice on how what did you as an individual do to improve the situation? Script and rehearse your best to do so from colleagues, mentors answers out loud to ensure that you can win over interviewers not only with your and confi dants. words but also your manner and personal energy. Changing the nature of your role to feel more appropriately passionate Tips for the top about your work is an ongoing process Is working in an open-plan offi ce a good idea? Two studies present a mixed picture. that will reap benefi ts over many Researchers Ethan Bernstein and Stephen Turban reported on two companies that months rather than weeks. AB transitioned to open-plan spaces: the volume of face-to-face interaction fell by approximately 70% while electronic communication increased signifi cantly. Dr Rob Yeung is an organisational Separately, Casey Lindberg asked workers in four offi ce buildings psychologist at leadership consulting to carry portable sensors. Employees using open-bench fi rm Talentspace: talentspace.co.uk. seating did more physical activity and reported lower stress than those in private offi ces or cubicles. More information It may be that open-plan offi ces affect some aspects Dr Rob tweets @robyeung. of work negatively but others positively. There is If you have a question for the talent insuffi cient research to conclude that any particular clinic, email abeditor@accaglobal. type of layout is better in every way. It is also likely com. that the nature of the work – for example, the extent Get CPD units by answering to which employees call external clients – would further questions on this article at infl uence the kind of design that might be most effective. accaglobal.com/abcpd.

February/March 2019 Accounting and Business 47

GL_CAR_Yeung_CPD.indd 47 10/01/2019 14:04 Change challenge When dealing with disruption, it helps to understand the nature of the change before prioritising how to capitalise on it, advises Tony Grundy

The Greek philosopher Heraclitus once * Bumpy incremental change. A At the nub of Ignacio’s problem is said that the only constant in life was smooth rate of change suddenly how to prioritise these disparate change change. Nowhere could that sentiment escalates, so the stickman jogging projects according to attractiveness and be more true than in today’s world of along on the flat is confronted by a implementation difficulty. This involves finance – so different from 20 years ago. mountain he can’t see over, sliding assessing project benefits versus costs Accountants are buffeted by change eventually, exhausted, to the bottom. and reviewing the difficulty over time. from many directions: increasingly * Discontinuous change. A mix Providing input to the restructuring competitive and disrupted markets, of smooth change and random, would be rated ‘highly attractive but very uncertainty/volatility, new technology, mountainous change means the difficult’. Achieving digitisation would be regulation, and the shifting demands of stickman needs help from a facilitator rated ‘highly attractive but very difficult’. the workforce, coupled with the need for who can see the bigger picture and Transforming the finance function would different skillsets. encourage him to keep going. be rated ‘medium attractive’ or, given To manage something as amorphous The following fictitious case study that progress has already been made, as change, it first has to be visualised. offers a model for how to change your ‘moderately difficult’. Crystalising it in this way allows finance running style. Ignacio is the FD of a It is helpful to plot the projects’ levels heads to be much more flexible in their medium-sized group of business services of difficulty over time on a graph. The thinking and turn it into an opportunity. companies. The group is operating vertical axis indicates attractiveness, the There is a vast amount of guidance on under a cloud of uncertainty caused horizontal axis the level of difficulty. The change management doing the rounds. by intensified competition, with profits more attractive the project goal, the But I find it useful to break change threatened by clients pushing harder on more difficult it tends to be (and vice down into four different forms: smooth, contracts. There are also rumours of a versa). Economists call it an indifference incremental, bumpy incremental and reorganisation to take out ‘surplus fat’. curve; I call it the curse of change. discontinuous. It helps to visualise these In addition, Ignacio is trying to bring But the positionings on any such in terms of a running cartoon stickman the finance department into a more graph need to be carefully thought (see the video at bit.ly/TGchange): digital world. He is midway through a through. Fail to evaluate change projects * Smooth change. The constant rate course on leadership encouraged by effectively and they will not deliver the means you can keep up the pace – the CEO, who has identified that, while anticipated benefits or will become the stickman is running comfortably Ignacio is excellent technically and good unspeakably difficult. If you understand on a treadmill. managerially, he is uncomfortable about the expected difficulty from the outset, * Incremental change. The stickman taking on a more charismatic role and you can at least plan accordingly. AB is following a rollercoaster trajectory, would benefit from better influencing which results in a high level of stress skills at board level, as the directors Tony Grundy is a strategy consultant, – and possibly distress. appear resistant to change. trainer and business school lecturer.

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GL_M_Grundy.indd 48 10/01/2019 14:05 Common control The diversity in accounting treatment for transactions involving businesses under common control is in the IASB spotlight. Adam Deller explains what’s happening

One of the items on the agenda for acquire another entity from outside GAAP, measuring net assets at historical the International Accounting Standards the P group, this would be covered cost-carrying amount. Board (IASB) is the accounting for by the acquisition method in IFRS 3, Various parties, notably securities businesses under common control. The Business Combinations, ensuring that regulators, have raised concerns about project may not be on the same scale the acquirer measured net assets at the diversity in practice in accounting

as the big new IFRS Standards, but it’s fair value. However, if entity A were for BCUCC and have asked the IASB CPD an area not currently covered, so the to acquire entity B, this transaction to provide guidance. It is a particular IASB is looking to resolve the situation. would be between businesses under concern for emerging economies, where The first issue is to establish what a common control, and there is currently BCUCC can be prevalent. Initial research business under common control is. As no prescribed accounting method. This from the IASB staff has showed that the diagram below shows, a company would also be the case if P set up a new BCUCC are typically accounted for by P currently owns 70% of entity A and entity C and transferred both A and B the predecessor method rather than the 100% of entity B. If entity A were to into it in anticipation of an initial public acquisition method. offering to sell off entity C. The major question with BCUCC that Business combinations under the IASB is looking to address relates Ownership example common control (BCUCC) are excluded to how the net assets of the transferred from the scope of IFRS 3, so entities entity should be valued at the date that must apply IAS 8, Accounting Policies, the transfer takes place. The current P Changes in Accounting Estimates and IASB position on the way forward for 70% 100% Errors, and develop an accounting the BCUCC project presents two major policy that results in useful information. alternatives for dealing with this. A B In practice, entities use the acquisition * Current value. This approach is method set out under IFRS 3, or a an extension of the acquisition predecessor method based on national method used in IFRS 3. It requires

February/March 2019 Accounting and Business 49

GL_T_DellerCPD.indd 49 15/01/2019 14:15 the net assets of the transferred used for the assets upon the transfer. with the preliminary view that the IASB entity to be recorded at fair value. It could, for example, be the carrying should not prescribe where in equity This results in a goodwill amount, amount in the fi nancial statements of to recognise any difference between shown in the difference between the transferred entity. Alternatively it consideration and transferred net the consideration and the fair value could be the carrying amount of the assets, but they also thought that the of the net assets. There are some net assets currently recognised by the least appropriate place to recognise any variations of how this could be controlling party, which would be based difference would be in share capital. applied, but the key principle is that on their fair value at acquisition, less Current guidance by accountancy the assets and liabilities would be fi rms generally suggests that BCUCC included at fair value, with goodwill can usually be accounted for using recognised, or a gain on a bargain the predecessor method or the IFRS purchase if the consideration paid is 3 acquisition method. Some guidance lower than the net assets received. While the emphasises that if the acquisition * Predecessor method. This method predecessor method is applied, it should normally transfers the net assets at their method is simpler, be applied in its entirety, as set out carrying amounts. Any difference what carrying in IFRS 3. However, if the acquisition CPD between this and the consideration method gives rise to an apparent gain is shown as a deduction in equity (if amount should be on a bargain purchase, that gain should the consideration is higher), rather used for the assets be recognised in equity as a capital than being held in goodwill. If the transferred? contribution from the shareholders. consideration is lower than the carrying amount of the net assets, Non-controlling interest it is treated as a contribution to As with all accounting changes, there equity. subsequent depreciation. is a balance to be struck between the In some ways the predecessor method Most research participants feel costs associated with the accounting is simpler to apply, as it doesn’t rely on that the carrying amounts of the and the usefulness of the information fair valuation methods and does not transferred entity should be used – one provided. The IASB believes the most involve additional costs arising from a participant argued that using carrying signifi cant impact of valuing the net fair value exercise. amounts recognised by the controlling assets in the transferred entity arises However, while the predecessor party would be a form of so-called where there is a non-controlling interest method is simpler it still brings issues push-down accounting and was not (NCI) in the ownership of the entity as to what carrying amount should be appropriate. Most participants agreed being transferred, so it is focusing its

50 February/March 2019 Accounting and Business

GL_T_DellerCPD.indd 50 15/01/2019 14:15 work on this. The impact for wholly approach could be required only applied if this threshold is not met. owned entities is not as significant, so when the equity instruments being While this would apply the cost this has not yet been examined. traded are on a public market. Such constraint and be simple, it would rely Following feedback, the IASB transactions are likely to be substantive, on an arbitrary threshold and could believes the current value approach so there is little debate that current exclude some public entities. An IASB provides the most useful information value is the most relevant measurement study of 14 stock exchanges found that for the NCI of the receiving entity, criterion. The main issue here is that setting a 20% threshold would cover although this could depend on private entities may not have to use listed companies as the minimum whether the NCI is substantive or the current value method (which public float requirement never fell non-substantive (by size or nature). provides the most useful information). below that level. If non-substantive, the benefits may However, IASB staff think that the NCI The current proposal looks at a mix of not outweigh the costs, particularly in private entities may rely on general qualitative and quantitative approaches when the NCI consists of only a few purpose financial statements less than to the NCI. This mix could involve employee stock options issued to key the NCI in public entities, as they are applying the current value method to

management personnel. often held by related parties; so, on listed entities and to private entities CPD balance, the board thinks the approach with NCI above a set threshold. Qualitative worth exploring. The project is now starting to take On balance, the IASB is proposing that Under the NCI shareholder-type shape, with the IASB focusing efforts on a current-value approach is considered option, current value would be used BCUCC with an impact on NCI. These only for some of the transactions that for transactions affecting NCI that is are likely to involve bringing in net affect NCI. Two possible approaches not held by related parties (or other assets at fair values, certainly where the – qualitative and quantitative – could employees if they don’t meet the NCI is substantial. The details are far be taken with such transactions. With definition of a related party). However, from being ironed out, but at least the the qualitative method, there are two this would not apply the cost constraint, direction is now set. AB ways to decide whether the transaction as the NCI could be very small. should be measured at current value: Adam Deller is a financial reporting * whether the equity’s instruments are Quantitative specialist and lecturer. traded in a public or private market A quantitative approach could require * whether the NCI shareholder is a the current value approach when More information related party or not. the relative size of the NCI reaches a Get CPD units by answering Under the first of the two possible quantitative threshold (such as 10% of questions on this article at accaglobal.com/abcpd. qualitative methods, a current value the entity), with a predecessor method

February/March 2019 Accounting and Business 51

GL_T_DellerCPD.indd 51 15/01/2019 14:15 Technical update A monthly roundup of the latest developments in taxation, audit, codes, standards, agreements, guidance and consultations across Asia Pacific

Hong Kong enhanced obligations of trustees can be imported into the mainland duty and custodians. free. The new rules came into force on No more preferential tax 1 January. The Hong Kong government has Prepare for IFRS 17 responded to European Union (EU) The Hong Kong Institute of Certified Changes to online sales tax concerns that its tax system unfairly Public Accountants has encouraged The Chinese government has eased benefits offshore investment funds by Hong Kong accounting practices to taxation on online imported purchases offering them profits tax exemptions. continue preparing to implement IFRS made by individuals buying foreign- The EU had identified these offshore 17, Insurance Contracts, despite the made products on international rights as a potentially harmful tax International Accounting Standards e-commerce sites. According to China’s practice. An Inland Revenue (Profits Tax Board proposing a one-year deferral State Administration of Taxation, the Exemption for Funds) (Amendment) Bill of the effective date to 2022 and purchase of 1,321 listed products worth 2018 mandates profits tax exemptions anticipated public consultation. under RMB5,000 (US$638) will not be for all investment funds operating charged import tax, but discounted in Hong Kong, regardless of their Stock Connect agreement import VAT and excise tax. If purchase structure, management and control The Hong Kong, Shanghai and price exceeds RMB5,000, all existing location, size or purpose. Shenzhen stock exchanges have agreed taxes will be charged. This compares how companies with weighted voting with a system established in 2016 when Getting tough on OTC regime rights can participate in southbound the threshold for paying full taxation The Hong Kong Securities and trading (mainland to Hong Kong) using on such imports was only RMB2,000 Futures Commission (SFC) has the Stock Connect system. Detailed (US$255). The list of products covered released consultation conclusions on rules will be drafted and released in will also grow by 63 new lines, with proposals to strengthen Hong Kong’s mid-2019. food supplements and new colour over-the-counter (OTC) derivatives cosmetics yet to be launched in China regime, so that licensed corporations Mainland China included. The new policy took effect party to non-centrally cleared OTC from 1 January. derivative transactions or conducting MoU agreed asset management must conduct risk The China Securities Regulatory Singapore mitigation. Licensed corporations Commission and Hong Kong’s SFC providing client clearing services have agreed a memorandum of Changes to ethics code for OTC derivative transactions will understanding, including a deal on The Accounting and Corporate follow segregation, portability and exchanging information about the Regulatory Authority of Singapore disclosure rules. supervision and oversight of regulated (ACRA) has issued changes to the entities they control that trade between Code of Professional Conduct and Code amendments Hong Kong and mainland China. Ethics for public accountants and The SFC has also released accounting entities over relations consultation conclusions on Origin rules eased between their staff and audit/ proposed amendments to its Code on A new agreement on trade in goods, assurance clients. The new rules Unit Trusts and Mutual Funds, saying signed between Hong Kong and took effect for financial periods from it will modify a draft new calculation mainland China’s ministry of commerce, 15 December 2018 and cover lengths of method for funds’ derivatives will ease rules of origin limiting the engagement and cooling-off periods. investments and clarify planned number of Hong Kong-made goods that ACRA is also seeking comments on

52 Accounting and Business February/March 2019

AP_T_update.indd 52 10/01/2019 16:09 proposed revisions to its requirements The way Malaysian property on filing financial statements in developments recognise revenue has changed. XBRL format.

GST self-assessment The Inland Revenue Authority of Singapore has released a goods and services tax (GST) self-assessment guidance package for GST-registered businesses reviewing sales tax exposure, during audits or when applying for a renewal of GST exemptions.

Crossborder easing? The Monetary Authority of Singapore (MAS) is consulting on a planned easing of rules controlling foreign Property development costs under IFRS companies related to Singapore The extent and timing of profit recognition has always been a difficult area of financial institutions wanting to provide judgement for property development, and IFRS 15 has been changing the way crossborder financial services in the revenue has been recognised in financial reports. Equally significant for profit is the city-state. The MAS wants an ex-post measurement of the costs to allocate against the revenue. Angus Thomson, a staff notification rather than the present ex- member at the Malaysian Accounting Standards Board, has prepared an article for ante approval system. ACCA on some questions around the cost of property development inventories and its allocation as cost of sales. In particular, it addresses how developers should Malaysia account for obligations to build affordable housing or public infrastructure as part of obtaining permission for the development as a whole. The article envisages Disclosure encouraged including any losses on the provision of affordable housing and the costs of the Malaysia’s government has released public infrastructure within the costs of the whole project, and therefore recognising guidelines outlining the operation of a them in the costs of the premium housing sales. new Special Programme for Voluntary The full article can be found at bit.ly/ACCA-prop-inv and at masb.org.my. Disclosure encouraging taxpayers to declare past insufficient tax payments. The system comes as Malaysia Guidelines revised imposing SC anti-money laundering anticipates the receipt of increased tax Securities Commission Malaysia (SC) has controls. ICO issuers and digital asset information from overseas under OECD released revised prospectus guidelines exchanges with payment functions must data-sharing agreements. and equity guidelines, increasing comply with relevant BNM laws and disclosure requirements of abridged regulations on payments and currencies. Income tax exemption prospectuses and circulars related An Income Tax (Exemption) (No.4) to proposals significantly changing Reporting changes Order 2018 has been issued by the companies’ policies, including back- Bursa Malaysia has reformed its main Malaysian government that exempts door listings and reverse takeovers. market listing requirements and insurance and takaful (Islamic insurance) securities rules controlling exchange- companies from income tax regarding Crypto clarification traded funds, telling them to report statutory income from certain The SC and Bank Negara Malaysia twice yearly rather than quarterly and shareholders’ funds. This includes (BNM) have clarified the country’s to include more useful information for life, family and general funds, plus regulation of digital currencies and unitholders in their annual reports. AB any composite insurance or takaful digital tokens. The SC will regulate business that consists of a life fund and initial coin offerings (ICO) and Malaysian Keith Nuthall and Wang Fangqing, a general fund. digital asset exchanges, including journalists

February/March 2019 Accounting and Business 53

AP_T_update.indd 53 10/01/2019 16:09 Hitting the top line The implementation of IFRS 15 has had a hugely variable impact on companies – some have been signifi cantly affected, others not at all, reports Richard Martin

The new standard for revenue management and transportation have been derecognised and recognition, IFRS 15, Revenue from sectors. The result is that what was deferred. For residential property Contracts with Customers, came into a commission cost may become developers, revenue has to be effect for accounting periods beginning a discount and so a reduction in allocated to the fi ve-year warranties January 2018. There can be few more revenue, and vice versa. The effect given as part of the ‘package’ fundamental areas to change than the of such changes has been less on and cannot just be set aside as a top-line number. the bottom-line profit than on gross provision for the estimated cost We looked at the disclosures in 18 revenue or the reported margins of of claims. companies’ fi nal annual reports before different business lines, but in some * Determine the contract price. the adoption of the new standard, and companies the impact can be just as Companies are not highlighting at their interim reports from 2018. Some significant on both. major changes in the treatment interesting changes emerged. * Identify separate performance of variable consideration. This IFRS 15 includes a fi ve-step approach. obligations in the contract. As indicates that volume discounts The reported changes under each of predicted, this change has delivered to customers or bonuses on these were as follows: the biggest impact. The greater milestones, for example, were * Identify the contracts with the unbundling required by IFRS 15 already being accounted for customer. In some cases the changes the timing of revenue cautiously. Where IFRS 15 seems to distinction between whether recognition and profit, and this has be changing treatments to a greater parties are acting as an agent in meant restating retained earnings. extent is on contract acquisition a contract or as a customer has Separating the sale of equipment costs. This was not covered by the changed. House builders have had and software upfront from the previous standard, but now such to separate the sales of new houses provision of services, maintenance costs should be spread forward in from the contracts to sell older and installation has speeded line with revenue. Some engineers houses taken in part-exchange, up revenue/profit recognition making major equipment sales, for example. This issue also affects for mobile phone contracts, for house builders and mobile phone companies in software, property example; for others, past profits companies seem previously to

The benefits in improved reporting will probably only become evident in the next periods

54 Accounting and Business February/March 2019

AP_T_IFRS15.indd 54 09/01/2019 17:25 have been expensing substantial for measuring the milestones upfront recognition of the sale commissions to intermediaries achieved. In property development, of equipment. as incurred. for some the point in time for the Much about companies’ application * Allocate the contract price to the sale is changing from exchange of of the new standard in 2018 remains different performance obligations. contracts and practical completion to to be disclosed and evaluated. The option to disregard a financing legal completion. The absence of full retrospective element when the time difference It does not seem entirely clear restatements means that the real between the receipt of cash that, even under IFRS 15, all housing impact on earnings will not fully emerge and the performance under the developments will be on the same until FY 2019 accounts are published. contract is less than 12 months model for revenue recognition; some What can be seen so far, however, has been widely taken up where may be recognising over time and would indicate that the impact of there are substantial customer others at a point in time. IFRS 15 is variable – what has changed down-payments. The requirement varies (and may be in the detail of the to identify standalone selling Transition and restatement standard), as does the extent of the prices for separate performance Companies seem evenly split between impact from one business to another, obligations was one that many those with a full retrospective and some sectors (retail and property companies found difficult to apply restatement and those opting for investment, for example) have scarcely and where a degree of judgment the modified approach. Among a been affected at all. was required. surprising number of companies, no Overall, the effect of IFRS 15 on * Recognise revenue when the final choice had been made at the profits or net assets may not be performance obligations are end of 2017; even for interim reports extensive, although the effort required fulfilled. The key criterion in 2018, for many the choice on to implement it may have been for fulfilment under IFRS 15 transition is still not clear. Users might significant, with companies trying to is that control passes to the therefore be unaware of whether understand fully the many different customer, either at a point in the previous year’s numbers are truly sorts of contracts with customers. time or over time. It is difficult to comparable or not. So has it all been worth it? The disentangle any effects from this The restatement of retained earnings benefits in improved reporting – greater from the separate performance on either transition method appears clarity and consistency, and better obligations of equipment delivery to have been relatively modest overall, disclosure – will probably only become and service. but for some, such as Rolls-Royce, it has evident in the next periods as the new More detailed effects have been been substantial. accounting standard becomes fully important – for example, the Restatements can be an increase embedded into corporate reporting. AB switch away from ‘percentage or decrease, although the telecoms of completion’ method to companies have seen consistent Richard Martin is ACCA’s head of ‘proportion of costs incurred’ method increases as a consequence of the corporate reporting.

February/March 2019 Accounting and Business 55

AP_T_IFRS15.indd 55 09/01/2019 17:25 Crypto confusion Should crypto assets be classifi ed as money, commodities, tokens or securities? Georgina Kyriakoudes explains the diffi culty in – and need for – correct categorisation

The rollercoaster ride of bitcoin coins and tokens as well as Commodities and cryptocurrencies has sparked actual cryptocurrencies, but in These are defi ned as tradable raw the interest of many investors. reality these crypto assets fulfi l materials that act as the ingredients However, while the price of different functions and should for fi nished products. Commodities cryptocurrency is certainly be categorised appropriately. By are usually thought of as physical exciting to watch, professionals categorising them as either currencies, items such as gold or cereals, but we are recognising it’s the underlying commodities or tokens, we can increasingly rely on digital materials – ie innovation – blockchain technology, start to evaluate their legal, tax and computing power, storage capacity and and the ideals it encapsulates – that accounting impact. bandwidth – to support our activities is revolutionary. and the creation of goods, and these Blockchain could democratise the Cryptocurrencies have themselves become a form of distribution of value in the same way These aim to be a digital form of money, commodity. For instance, to store the internet has democratised the meeting the attributes of a store of healthcare records on a blockchain- distribution of information. When we value, unit of account and medium based system, a platform may require think of this peer-to-peer exchange of exchange. That is not to say that ether to power its ethereum-based of value, we typically think of money, all cryptocurrencies irrefutably meet smart contracts, fi lecoin to purchase but the technology can allow any these criteria, but their main purpose digital storage, and golem for

CPD digital asset to be exchanged in a is to achieve this status. Hundreds of computer power. decentralised manner. cryptocurrencies now exist, originating The term ‘cryptocurrency’ has with bitcoin, each providing different Tokens been used as a catch-all to refer attributes – zcash, for example, offers These are used for end-user applications. to blockchain-powered native privacy guarantees. They offer consumers access to, and use

While tokens do not have the traditional aspects of a security, such as the right to vote or receive a dividend, regulators are treating them as such

56 Accounting and Business February/March 2019

AP_T_cryptocategoriesCPD.indd 56 10/01/2019 13:52 Regulatory overlap US regulators have tried to define the crypto assets under their jurisdiction, but their different interpretations merely add to the general uncertainty about how to define such assets.

Regulator Position US Securities and Although a cryptocurrency is not a security, many Exchange Commission ICOs are regulated as private placement securities Virtual currencies are ‘goods’ exchanged in a market Commodity Futures for a uniform quality and value, and fall well within the Trading Commission common definition of ‘commodity’ A developer exchanging tokens (via an ICO or Financial Crimes exchange) for ‘another type of value that substitutes Enforcement Network for currency’ is a money transmitter For federal tax purposes, virtual currency is treated as Internal Revenue Service property

of, the digital platform or product, and In the US, the Howey test is used to However, most regulators are are often called utility tokens. Steemit is define whether an asset should fall under still pondering how to define and a social media platform which rewards securities law. An asset is classed as a treat crypto assets, and their public users with steem tokens for creating and security if a person ‘makes an investment statements can be as confusing as they are helpful. This uncertainty and lack of curating content. Users vote on which of money in a common enterprise with CPD content is most valued on the basis of the expectation of profits from a third clarity is illustrated in the positions taken one steem token, one vote. Hence the party’. Some tokens present themselves on crypto-assets by the different US more contribution a user makes to the as security tokens, with limited related regulators (see box). system by curating content, the more rights such as a dividend, but many coins While there is a drive towards clarity influence they have over which content is masquerade as utility tokens simply to of regulation, a fundamental grasp highly rated. avoid regulatory burden. of crypto assets is needed to ensure The rise of initial coin offerings the substance of each type of asset (ICOs) is synonymous with crypto No single class is properly understood. Regulators tokens. ICOs allow startups to While categorising crypto assets could must act to protect citizens under their raise funds by selling their tokens vastly clarify the regulatory implications, jurisdiction without stifling innovation. even before the product has been new crypto assets don’t fit cleanly into The industry needs to be involved, developed. The theory goes that one class. Assets may even move from either through self-regulation or by purchasers will later use their tokens one category to another – for example, advising governments to publish on the platform and become part from a security token at ICO stage appropriate frameworks. Countries of the community. (See also ACCA’s to a utility token once a platform has that respond with flexibility and report, ICOs: real deal or token been launched. openness may end up the winners gesture? at bit.ly/ACCA-ICOs.) Although few countries have created in bringing about true blockchain However, in practice, purchasers are legally binding regulatory frameworks, innovation and adoption. AB often buying the token to invest in an some attempts have been made. The early-stage venture. The emergence US state of Wyoming has issued five Georgina Kyriakoudes FCCA is of sophisticated secondary markets blockchain-related bills, including co-founder of Dcentric.Solutions. for trading such tokens further implies one that excludes utility tokens as this, so while tokens do not have the commodities or securities. Lithuania has More information traditional aspects of a security, such as introduced ICO regulation, and Belarus Get CPD units by answering the right to vote or receive a dividend, has issued national accounting standards questions on this article at accaglobal.com/abcpd. regulators are treating them as such. for digital tokens.

February/March 2019 Accounting and Business 57

AP_T_cryptocategoriesCPD.indd 57 10/01/2019 13:52 Riding the waves At the heart of the donor ecosystem that sustains BBC Media Action’s broadcasts is Alan de Sousa Caires FCCA, the development charity’s global director of finance

Alan de Sousa Caires FCCA has the FinanceCV budgeting, but also for running kind of job that many accountants i the business systems. In addition, would die for. Part of his role as he ensures that BBC Media Action director of finance and business 2014 complies with the requirements of services at BBC Media Action is to help Joined BBC Media Action as deputy the Charity Commission, internal BBC drum up funding for BBC radio and director of finance. Became director of corporate regulations, external donor TV programmes that reach 200 million finance and business services in 2017 requirements, GDPR, plus local legal, people around the world a year. tax and procurement obligations in all BBC Media Action is the international 2013 the countries in which it operates. development charity arm of the Finance manager, VSO Following the safeguarding issues in broadcaster, which works with the charitable sector last year, de Sousa governments, NGOs, donors and other 2011 Caires also has to carefully oversee broadcasters across Asia, Africa and the Publishing editor and MD, safeguarding reporting. Middle East. While BBC Media Action Management Today, South Africa ‘I have had to go back over the past is legally, financially and operationally 10 years to see if there are any issues independent of the BBC, it upholds the 2009 to be dealt with, and I have put a organisation’s values and reputation. Finance manager, Chartered Insurance reporting system in place,’ he explains. De Sousa Caires has five direct Institute reports and oversees a total team Competing demands of 20 at the organisation’s London 2005 The role is demanding. Typical activities headquarters. Finance manager, Notting Hill include reviewing funding project ‘I’ve been in the not-for-profit sector Housing Trust proposals for donor organisations for 15 years,’ he says. ‘It is so much and assessing how they fit within the more complex working in international 1991 strategy, coaching staff and working development than in the commercial Finance manager, General Electric closely with the other members sector. There are so many different risks of the executive team. ‘We have a and moving parts. We have to make very supportive CEO,’ he says. He sure we are compliant in so many ways. sought out this job,’ he explains. ‘I also spends a lot of time with the IT That is why I love my job. We reach really wanted to work in international people to make the workplace more 200 million people a year through development. My wife had been efficient – an activity he describes as our programmes.’ working for Farm Africa, which was one of his passions. supporting farmers in East Africa, and However, the biggest issue, he says, VSO prelude I could see how exciting her work was. is the funding environment and the De Sousa Caires joined BBC Media Before VSO, we spent a couple of years changing demands of donors. Action in 2014 as deputy director of in South Africa where I was running my ‘Our turnover and budget last year finance, becoming director of finance father-in-law’s publishing business. After was £34m across all our country offices, and business services in 2017. Before returning to the UK, I applied to BBC and 99% of our funding is restricted,’ that he had worked for Voluntary Media Action’. he explains. ‘Though part of the BBC Service Overseas (VSO) in Papua New As the senior financial executive family, we are not funded by the TV Guinea, in a capacity building role. at the organisation, he is not only licence fee’. BCC Media Action gets ‘The time I spent in Papua New responsible for management a large percentage of its income from Guinea was one of the reasons I accounting, financial reporting and big institutions such as the UK and US

58 Accounting and Business February/March 2019

CN_P_Sousa.indd 58 07/01/2019 18:59 ‘In Nepal our programmes are distributed to remote radio stations by moped’

governments, the European Union and a drama, a magazine show or a public not knowing what to do,’ he says. ‘I the Gates Foundation, which means service announcement. did the AAT training and qualifi cation, it has to spend the money on agreed In some countries, these programmes then it was natural to go on to one of programmes. ‘For example, if Unicef is are broadcast via the BBC’s World the four main qualifi cations – I chose focusing on giving polio vaccinations Service; others go out on a local radio ACCA as it provided the broadest in Nigeria, we would bid to be a part station. ‘In Nepal our programmes range of training. Without that, I of that project. We take the money and are distributed to remote radio wouldn’t have achieved the seniority create a specifi c radio programme to stations by moped,’ he says. ‘We also or variety of roles. address the need – it’s about informing broadcast in Nepal via Facebook. ‘I value the time I still put into ACCA people so that they can decide if the We have 1.8 million “likes”, which and other networking events, meeting vaccination is right for their child.’ is incredible in a country with a people from other organisations. You They use research to consider what population of just 29 million.’ can’t underestimate the value of sharing type of programme needs to be De Sousa Caires believes his ACCA information and experience.’ AB made, in what format, and whether it Qualifi cation has proved crucial to his should be on radio or TV. It might be career progression. ‘I left school at 16 Paul Gosling, journalist

February/March 2019 Accounting and Business 59

CN_P_Sousa.indd 59 07/01/2019 18:59 Star quality Giving an Oscar-worthy performance isn’t just for actors, but making an impact in a virtual meeting requires planning and plenty of practice, says Helena Brewer

Technology has opened up a new world company jargon will be understood by close-up. Small habits, such as rubbing of virtual meetings, training sessions, everyone involved. However, if clients your ear or flicking your hair, will be webinars and job interviews, giving us or contractors are joining the meeting magnified and very distracting. If you the freedom to join in from the office, you may need to watch your language. haven’t watched yourself before, it’s a home or elsewhere. Make sure your choice of words is good idea to do so now! You may be working with a team appropriate for the audience: avoid Using notes can be difficult. Ideally spread across the globe whom quirky expressions that may require you you want to look natural and reading you rarely meet face-to-face, so it’s using up time giving an English lesson. from a screen is most likely to make you important to ensure you have the skills I once listened to an important look robotic. Be as familiar as possible needed to go live on the small screen. meeting, which started with the finance with what you need to say; if it helps, Here are some suggestions to help you. director giving a project status update to put a few bullet-point reminders on the staff and contractors around the world. edge of your screen that you can see at Check all your kit works Her cricketing metaphor confused the a glance. If you are using unfamiliar software to Latin Americans and a particularly old- deliver a presentation or run a meeting, fashioned saying had everyone under 30 Get the lighting right ensure that you make time for a trial scratching their heads. How well-lit is your room? If you run-through to help you avoid any are sitting in near darkness, all your

CPD glitches; there are free tutorials with Watch your body language audience will see is your face, which most software. In addition, you may You could well be sitting in the same will look ever so slightly sci-fi. If want to record the meeting and share chair for a while so make sure you are there’s bright sunlight shining at you, it with colleagues unable to attend; again, comfortable; good back support will may have you screwing up your eyes practise using the technology in advance. help. Also, check the position of your or creating a shadow figure behind laptop or camera in relation to where you. This can be distracting for those Handle interaction you are sitting so you are aware how watching, so you may need to close If you will be handling audience much of you can be seen. blinds and adjust the lighting. questions, decide how the attendees Movement is tricky: if you lean will interact with you. Will people forward towards the camera, the Welcome participants unmute to ask a question? If so, you audience will receive an unexpected Providing a brief introduction about need a strategy for handling those who you and the purpose of the event talk for too long! Most packages have helps settle attendees. If you have a text-based option so you can see more than 20 attending, it may not questions coming in. Looking at these be possible to allow time for them while presenting is a challenge; consider to introduce themselves. However, having a colleague review the questions Avoid quirky if it is a business meeting, a small as they arrive and identify themes. expressions that conference or an interview, it is You can also pause for questions as definitely worth knowing who else you complete a key section to confirm may require is there. Allow time for introductions participants’ understanding. you using up as simple as name, position and time giving an company. This will assist you in Choose words carefully English lesson knowing if all key stakeholders have In most situations, particularly work joined and, if not, if they have sent a meetings, the professional and in- representative instead.

60 Accounting and Business February/March 2019

AP_SS_smallscreenCPD.indd 60 10/01/2019 16:30 Ensure the sound is good Top tips for an award-winning performance This is the biggest issue when 1. Make sure you are familiar with the software you’ll be using. You don’t want to be delivering on the small screen: you fumbling on the day. need to check in with your audience 2. For Q&As, where lots of questions will be typed in, you should ideally have a and determine that they can actually colleague to help you manage the process.

hear you. When joining virtual meetings, 3. Watch your language! Avoid colloquial sayings that may confuse your global CPD there are sometimes surprisingly loud audience and waste time. background noises. 4. Check your body language. If you are sitting comfortably with the If you can control muting attendees, camera positioned correctly, you are most likely to look your best and then do so. If not, then encourage come across professionally. them to mute themselves while 5. Adjust lighting so that you don’t look like a sci-fi creature emerging from the listening. There may be times when, gloom or washed out by bright sunlight. despite all the checks, the signal just 6. Plan introductions appropriate for the size of audience and type of event. isn’t good enough. You may want everyone to introduce themselves – if so, make sure you Be prepared to redeliver key points have the time. at the end of the session. It’s also good 7. Be ready for problems with audio and make a back-up recording in case some to reassure people that a recording will participants have major problems. be made available. 8. Have a blank wall behind you if possible and, whatever happens, make sure you don’t have confidential information visible. What you are sharing? While you are focusing on the camera you may forget to check behind you. A Kelly found when on air from home, Helena Brewer is from Toastmasters clean background is best. when his toddler, older child and International, a not-for-profit If you work in an office with glass wife unexpectedly joined him. (It’s organisation that has provided screens, walls and doors, it can be worth Googling.) communication and leadership skills distracting for your audience to have By following the suggestions since 1924 through a worldwide network people walking past. Also remember above, you will improve your of clubs. to clean away any confidential performance on the small screen information that might be on a and become more comfortable More information whiteboard behind you. delivering in this way. As a result, you Get CPD units by answering Someone walking into your will undoubtedly increase your future questions on this article at accaglobal.com/abcpd. room is worse, as journalist Robert opportunities to star! AB

February/March 2019 Accounting and Business 61

AP_SS_smallscreenCPD.indd 61 10/01/2019 16:30 The battle for balance ACCA’s proud record in achieving 50/50 gender balance across the membership doesn’t mean we should rest on our laurels, says Helen Brand

progress up to the next tier – executive level – than their male counterparts. We believe that it’s every organisation’s responsibility to support diversity, and to review the way they support and open up opportunities to women – and all under- represented groups. The accounting profession is committed to improving the workplace experience and progression prospects for women. We need to When it comes to split, and our Council and keep working together on promoting and celebrating executive team are also a true, concerted effort to difference, ACCA has balanced in terms of men acknowledge long-standing a distinguished history. and women. issues, rectify them, and The theme for International Opportunity and diversity But there is still work to bring about change that Women’s Day (IWD) this are two of ACCA’s five be done. A recent report creates balance. year is #BalanceforBetter. core values, and we were commissioned by ACCA IWD 2019 provides a It is a call to action to drive established specifically to from King’s College London chance for us to celebrate gender balance across open up the profession to and the ESRC (Economic the achievements of a the world as just one people of all backgrounds, and Social Research woman who worked tirelessly aspect of ensuring diverse based solely on their ability. Council) compared the to achieve balance in the representation at all levels We’ve always been an career trajectories of UK world of accounting – Ethel of business and society. inclusive professional body, men and women in finance Ayres Purdie, ACCA’s first proud of our and accounting. It found female member. reach and that, while the career paths One century on since she difference. of men and women in the became an ACCA member, Ethel Ayres Looking back, sector initially progress in we share an overview of her Purdie pursued it’s amazing near-parallel, the careers life (see box opposite) by a vigorous to see how far of women decelerated in Professor Stephen Walker middle management, due of Edinburgh University campaign against we’ve come. ACCA is in a primarily to limited peer Business School. A full the unfair strong position sponsorship and a lack of account can be found in the treatment of when it comes high-profile projects or journal Critical Perspectives married women in to balance – our opportunities in comparison on Accounting. AB the tax system membership to men. It’s at this stage that has a 50/50 women take an average Helen Brand is chief gender of seven years longer to executive of ACCA.

62 Accounting and Business February/March 2019

INT_UK_A_womensday.indd 62 16/01/2019 15:37 A statue of suffragette Emmeline Pankhurst was unveiled in Manchester last December to mark the centenary of the first UK general election that women could vote in.

Ethel Ayres Purdie, flouter of convention This year is the 100th anniversary of Ethel Ayres Purdie’s Association of Accountants, which had a more progressive election as an associate to the London Association of admissions policy. Accountants, a founding organisation of ACCA. She became Purdie became the leading provider of income tax advice the first woman to be admitted to an accountancy body in to women, eventually operating as the Women Taxpayers’ the UK. She spent most of her working life pursuing women’s Agency. She pursued a vigorous campaign against the unfair equality. Where she saw gender inequality she resisted, treatment of married women in the tax system. She was a campaigned and fought for the reform of public policy. leading figure in the Women’s Tax Resistance League, which Born in Islington, London, in 1874, Purdie worked as argued that if women did not have the vote, they should not a 16-year-old as a clerk at the Post Office. Here she was have to pay tax. involved in a campaign to return deferred pay to female civil Purdie argued that women winning the vote was a key servants who had been forced to leave the service due to step in redressing wider gender inequalities, and that the marriage bar, the rule that required women to give up economic, social and political emancipation was essential their jobs once they got married. to the progress of women. She believed that the success of Soon after her own marriage in 1897 and giving birth to women in business and the professions depended on access two sons, she defied conventions by taking accountancy to capital, which should be supplied through co-operative exams and launching a career as an accountant. ventures such as the formation of women’s banks – financed, The chartered accountancy bodies did not admit owned and managed by women. women at that time, and the Privy Council, the body that Purdie died in 1923 but remains an inspirational figure to heard applications for royal charters of incorporation, all who seek to forge gender balance and challenge bias. turned down her request to become a chartered accountant as an individual. She eventually joined the London Stephen Walker, Edinburgh University Business School

February/March 2019 Accounting and Business 63

INT_UK_A_womensday.indd 63 16/01/2019 15:37 The digital future Delegates at the recent MIA conference were urged to prepare for the transformation of the finance function through the disruptive power of robotic process automation

Disruptive technology Organisations seeking smarter technologies,’ far adopted RPA. Adoption is playing a critical role a competitive advantage Brand said. ‘ACCA is is also more significant in in transforming finance have adjusted their committed as part of its finance functions in larger capability at the heart of strategic priorities to future research programme economies, with 74% in businesses. Technology deliver digitisation across to explore these exciting the US and 61% in the UK is helping companies the business to enable developments such as saying that they had RPA shape future strategy, greater speed to market machine learning and activity compared with, manage performance, drive and data driven insights. And artificial intelligence.’ for example, 38% in Hong innovation, support more for CFOs, that is a call to Brand also highlighted Kong. In Malaysia, there effective risk management arms for finance automation. a recent research report, appears to be growing and make better decisions. Automating routine, Embracing robotic interest in the use of robotics Speaking to delegates transactional and repetitive automation during the in the finance function as at a plenary session work naturally frees up evolution of finance, 49% of those surveyed say during MIA’s International finance professionals to add produced by ACCA, its they have implemented Accountants Conference value. That is where robotics strategic alliance partner, or are trialling RPA. ‘So 2018 in October, ACCA or RPA (robotics process Chartered Accountants across the world there chief executive Helen Brand automation) comes in. Australia and New Zealand, is plenty of runway left noted that ‘the one thing ‘But perhaps the greater and KPMG in Australia. for robotics adoption,’ above anything else that is prize is how finance teams The report indicates Brand said. needed by the business is start to combine robotics that it is mainly larger speed of execution’. with other emerging organisations that have so Lessons learned However, the path to RPA Helen Brand told adoption will not necessarily delegates that the way be smooth sailing as organisations combine ACCA’s research revealed a robotics with other number of challenges and emerging technologies lessons learned from the will be crucial. first implementers. There may be initial concerns from employees about the impact of technology on finance roles, and robots will not improve processes that are already broken. Hence, it is critically important that the talent challenges and upskilling required by RPA are managed properly. ‘Automation is definitely not a new agenda – especially for the finance

64 Accounting and Business February/March 2019

MY_A_robotics.indd 64 10/01/2019 14:13 function,’ Brand noted. then that’s the wrong to look into the processes meetings and even a slogan- ‘The profession is very used platform,’ he said, adding to make sure that it is lean, writing competition.’ to technology adoption. that RPA adoption was and undertake a review An audience member Where, for example, about efficiency rather than to cut down on all the asked how a CFO obtains would professional cutting staff. Companies, unnecessary processes and assurances that data accountants be he said, have got to go in steps,’ he said. ‘Otherwise, generated by robots used in without spreadsheets?’ with the right mindset of we are not automating decision-making has integrity Alan Hatfield, ACCA’s investing in RPA to allow something which is effective and is reliable. executive director – strategy the freeing up of employees as the complexity will still Drawing on KPMG’s and development, who from low-level work so they be inside.’ experience when advising moderated the subsequent can focus on innovation Ng added that on implementation of panel discussion, said and higher-value activities. understanding what RPA RPA, Gan said there must the top three challenges This, coupled with the is really about is vital in be checkpoints within the to RPA implementation right change management ensuring a successful process itself to make sure were employee resistance, in deploying disruptive implementation. ‘It’s the human team checks and combining with other actually a validates information. ‘We technologies and poor IT software, and not cannot fully rely on the bot; legacy systems. a robot walking that’s the caution that we put When it comes to around,’ he in,’ Gan said. adopting RPAs, there must said, dispelling Despite some scare be involvement across ‘If your idea a popular stories of companies misconception. the business and it should to implement reducing headcount due not be considered as just to automation, speakers an IT project, explained RPAs is to reduce Test runs noted that RPA and cognitive panelist Alvin Gan, staff, then that’s There is also technologies can actually KPMG Malaysia executive the wrong a need for spark new jobs and enhance director and head of IT platform’ understanding human skills and expertise. enabled transformation. the costs of Inevitably, the types of jobs KPMG is already starting implementing will likely change as we see to implement RPA in its RPA, Ng noted. more and more middle- financial services space. technologies like RPA, will ‘In the first few years, income routine jobs being ‘What we are trying to in turn lead to a reinvention operating expenditure will replaced by automation. automate is the business. of the workforce, offering increase as you have to go The challenge for companies Involvement of business new ways to deploy talent in through a lot of training and is to integrate and make and finance is key to making order to remain relevant in test runs,’ he said. the most of both kinds of sure that automation does the marketplace. He said another key labour. In other words, the well,’ Gan said, adding that The key challenge for many consideration is the need human factor and touch it is vital to arm the CFO organisations is deciding for staff engagement. are always going to be with greater insight so that which finance processes are Ownership of the RPA present and considered, the business can make the suitable for RPA adoption. project is also very no matter how advanced right decisions. For Ray Ng, senior manager important and getting the automation becomes. at Averis, activities or right person to start it are Citing the recent case of All about efficiency processes that are rules- among the challenges Ibrahim Diallo, who was fired Gan noted that one of the based, have high volume to overcome. ‘For us to by a machine in Los Angeles, questions often asked is transactions and structured implement it, we actually Gan asked: ‘Can we fully rely whether RPA adoption will data are those that can took about six months on a machine? The answer lead to a reduction in staff. be automated. to promote RPA within is no’. AB ‘If your idea to implement ‘Going beyond these, I the organisation through RPAs is to reduce staff, think companies will have various activities, townhall MK Lee, journalist

February/March 2019 Accounting and Business 65

MY_A_robotics.indd 65 10/01/2019 14:13 AB Malaysia Edition IPSC in Prague February/March 2019 Volume 22 Issue 2 Is the public sector financially sustainable? Find out at ACCA’s Asia editor Colette Steckel International Public Sector Conference in the Czech capital city Editor-in-chief Jo Malvern

Digital editor Jamie Ambler

Video manager Jon Gilmore

Sub-editors Lesley Bolton, Dean Gurden, Peter Kernan, Jenny Mill, Eleni Perry, Vivienne Riddoch, Rhian Stephens

Design manager Jackie Dollar

Designers Bob Cree, Suhanna Khan, Robert Mills

Production manager Anthony Kay

Advertising Daniel Farrell [email protected] +44 (0)20 7902 1221

Head of ACCA Media (interim) Prague will host the ninth edition of ACCA’s International Peter Williams [email protected] Public Sector Conference this February. Director of brand and corporate reputation (interim) Chris Quick Public sector finance The conference will Standards (EPSAS), transfer professionals from all over host the launch of ACCA’s pricing and international Printing Times Printers the world will assemble Bridging the Global taxation, and talent Pictures Getty

in Prague in late February Infrastructure Gap report, management in the public ACCA Malaysia for ACCA’s sustainability- examining financially sector finance profession. ACCA Malaysia Sdn Bhd (473007P) themed International Public sustainable methods of Stephen Heathcote, Suite 15.1, Level 15 Centrepoint North Tower Sector Conference. Key funding infrastructure. ACCA’s executive director Mid Valley City issues will be addressed by a Other sessions will cover – markets, says: ‘The public Lingkaran Syed Putra 59200 Kuala Lumpur host of big-hitter speakers, the following topics: sector is facing intense 1 800 88 5051 [email protected] including the auditor- * financial reporting, challenges – from increasing generals of Jamaica, Nigeria, public financial scrutiny on spending, to Accounting and Business is published Pakistan and Tanzania. management and the constrained funding, to by ACCA. All views expressed are those Czech deputy minister implementation of delivering high-quality of the contributors. of finance Tomas Vyhanek international standards services in an increasingly The Council of ACCA and the publishers do not guarantee the accuracy will deliver the keynote * the role of accountants in digital world. This is a of statements by contributors or speech, on public sector tackling fraud, corruption timely event to assess best advertisers, or accept responsibility for any statement that they may express sustainability. Other speakers and organised crime practice and learn from in this publication. The publication of an advertisement does not imply will include Maame Yaa * case studies of how an interconnected global endorsement by ACCA of a product Tiwaa Addo-Danquah, digital innovation can network of public sector or service. deputy police commissioner transform the sector finance professionals Copyright ACCA 2019 Accounting and Business. No part of in the Ghana Police Service; * the role of supreme audit and policymakers.’ this publication may be reproduced, John Manzoni, chief institutions in delivering The conference will be stored or distributed without the express written permission of ACCA. executive of the UK Civil sustainability in the sector. held at the Prague Marriott Accounting and Business is published by Service; and Thomas Müller- Breakout sessions will offer a Hotel on Thursday 28 Certified Accountant (Publications) Ltd, a Marqués Berger, chair of choice of themes and deep February and Friday 1 March. subsidiary of ACCA. Accountancy Europe’s public dives, including European Register for the event at ACCA, The Adelphi, 1–11 John Adam Street, London, WC2N 6AU, UK. sector panel. Public Sector Accounting bit.ly/ACCA-IPSC-2019. AB

66 Accounting and Business February/March 2019

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