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April 30, 2008

Region round-up

Region round-up

Asia-Pacific

• PricewaterhouseCoopers China and Hong Kong (PwC) has admitted 57 new partners – 42 in mainland China and 15 in Hong Kong. The firm now has close to 330 partners. It said the new partners represent a significant step in its localisation strategy and is a measure of its success in attracting local talent. PwC employs more than 8,000 people in China and Hong Kong and expects this number to top 10,000 by 2010.

• Internal controls at companies listed in mainland China are not meeting the level of compliance required by regulators, according to a Deloitte China survey. The survey found that while 74 percent of the companies surveyed were fully aware of the regulatory requirements for internal controls, which have followed an overhaul of regulations and guidelines for listed companies in recent years, just 20 percent said their existing internal control systems fully meet the requirements.

• The Hong Kong Institute of Certified Public Accountants (HKICPA) has lost a case brought against it by the accountancy functional constituency legislative representative over its decision not to distribute newsletters and other materials to certain members. The council had decided not to distribute the materials to those members who did not request them. A judicial review was brought to the Court of First Instance over the matter and the court has now handed down its verdict. HKICPA president Mark Fong said: “The council, the governing body of the [HKICPA], will review the decision, assess the implications and consider the way forward. Council is obviously disappointed in the decision.”

• The Australian National Institute of Accountants (NIA) and the Chinese Institute of Certified Public Accountants (CICPA) are negotiating arrangements to simplify the process for their members to hold dual membership. The expectation is that members of one organisation will receive credit towards membership of the other organisation. NIA deputy chief executive Andrew Conway said the Australian institute is “extremely optimistic” about reaching an agreement with the CICPA on mutual exemption.

Deloitte Australia has questioned whether a new standard business reporting programme recently unveiled by the Australian Government will offer any reduction in the amount of reporting required for small businesses. Deloitte tax partner David Pring said the new voluntary programme, which allows businesses to use their own accounting software to complete reports such as business activity statements, might improve efficiency. However, he warned: “Business would like to see a reduction in the amount of reporting and regulation.”

KPMG Australia has named Peter Nash as its new national managing partner for audit. Nash, who was the inaugural head of the firm’s people, performance and culture programme, takes over from Geoff Wilson, who will be chief executive in 2008. Doug Bartley replaces Michael Andrew who has become national chairman. James Allt-Graham, the current head of KPMG’s business performance services, will take on the additional responsibility of national managing partner for people, performance and culture.

• Malaysia is to set up a Public Companies Accounting Oversight Board in a bid to strengthen corporate governance in the nation’s capital markets. The pledge was delivered by Malaysian Prime Minister Abdullah Ahmad Badawi at his recent budget speech. He explained: “This board will be responsible for monitoring auditors of public companies to ensure that the quality and reliability of audited financial statements is enhanced.” Badawi also revealed that Malaysia’s Code of Corporate Governance is under review.

Africa, Middle East, South Asia

• The development of accounting expertise in some African countries is in danger of being compromised because local accounting institutes cannot compete effectively with international bodies, a University of Nigeria professor has warned. In a report published by the Institute of Chartered Accountants of Scotland (ICAS), Chibuike Uche said local professional accounting institutes in countries such as Nigeria, Ghana and Sierra Leone struggle to compete with international accountancy bodies in indigenous markets for training and education. ICAS executive director for technical policy David Wood said indigenous accounting bodies need to develop in ways that are locally and internationally relevant and “ensure that their qualifications are not marginalised by those of international accounting bodies”.

• The Institute of Chartered Accountants of India has formed what it called a “high powered committee” to examine the leakage of a question paper from its common proficiency test held last month. The committee consists of three government nominees and six fellow chartered accountants.

• Independent accountancy and business conglomerate Talal Abu-Ghazaleh & Co International (TAGI) has signed a strategic alliance agreement with independent professional services firm SMS Latinoamérica. According to TAGI, the agreement stipulates that both firms may “use their respective networks where practicable and to their mutual benefit for any business referrals in the areas of accounting, assurance and advisory services related to certified public accountant activities in the Middle East and Central and South America”. SMS Latinoamérica has member firms in Central and South America while TAGI has widespread coverage across the Middle East.

• The Institute of Chartered Accountants in England & Wales (ICAEW) has signed an agreement with the Institute of Chartered Accountants of Pakistan (ICAP) that aims to provide global opportunities and strengthen ties between the institutes. ICAP members will now be able to undertake advanced level tuition, which will allow them to become members of the ICAEW. The agreement will also enable sharing of experience and the exchange of best practice across many disciplines on behalf of the respective memberships. ICAP currently has 3,800 members.

Moores Rowland South Africa has joined Mazars. Since 1 September 2007, the firm, which has 320 professionals, has been operating under the name Mazars Moores Rowland.

Europe • The European Financial Reporting Advisory Group (EFRAG) has extended the comment period for its draft proposal addressing the International Accounting Standards Board’s exposure draft on IFRS for SMEs to 24 September 2007. EFRAG said the extension is due to “the length and complexity” of the draft.

• The regulatory arm of the Institute of Chartered Accountants in Ireland has ordered one of the institute’s members to be severely reprimanded, fined €10,000 ($13,500) and pay costs of €10,000. The disciplinary tribunal found that Kevin O’Donovan from O’Donovan & Partners Chartered Accountants breached his duty to co-operate with the tribunal; breached his duty to act in a professional role when he was in receipt of a loan from a client contrary to the institute’s ethical guide; and facilitated the making of accounting entries in the records of a named party, which would have the effect of misleading anyone who sought to establish the true provenance of certain funds.

Grant Thornton UK has created a cross-discipline financial services group, which will replace the firm’s financial markets group and the financial services practice of RSM Robson Rhodes. The group will be led by Ian Gorham and will comprise 13 partners and a further 150 professionals. Gorham said: “Increasing our strategic offering in the marketplace has been a key driver for us over the past 12 to 18 months and the creation of this new team has helped us achieve this goal.” The financial services group represents approximately £22 million ($44.4 million) of the firm’s total revenue. The merger of Grant Thornton with Robson Rhodes created a firm with fee income of approximately £387 million.

• Former global practice leader and manager at Arthur Andersen, Richard Boulton, has been named head of the financial and accounting services (FAS) group at LECG. Boulton is a London-based expert in forensic accounting who joined the global expert services firm in 2002. LECG’s FAS group accounts for approximately half of its consulting revenues.

Mazars Ireland has marked its first step into Northern Ireland by establishing a Belfast practice. The Mazars Northern Ireland office will be led by Roger Alexander, who joins the firm from RSM Robson Rhodes where he was the director of public private partnerships (PPP). Alexander will lead Mazars Ireland’s construction and property finance, and consultancy team across the island, offering a specific focus on PPP partnerships. The firm’s managing partner, Joe Carr, said: “Northern Ireland is an economy on the cusp of significant growth and Mazars is well positioned to take advantage of this with our Northern Ireland presence.”

PricewaterhouseCoopers UK (PwC) has appointed Mike Bailey to lead its indirect tax practice. Bailey has been with the firm since 1993 and led its value added tax (VAT) team in Wales and the west of the country before recently moving to London. He said: “We have a strong indirect tax practice in terms of our experience and the breadth of skills that our people possess.”

North America, Latin America

• The SBLR Group, a Canadian member firm of Enterprise Network Worldwide, has merged with Freedman Gould effective this month. The combined firm will operate under the SBLR name. With six partners and 35 professionals, SBLR specialises in accounting, business consulting and strategic tax planning services to small and mid-sized businesses in the greater Toronto area. “This expansion strengthens SBLR’s position as one of Toronto’s leading, full-service chartered accountant firms catering to privately-owned growth enterprises,” SBLR managing partner Cary Selby commented.

• US firm Kahn, Litwin, Renza & Co (KLR), which belongs to The Leading Edge Alliance, has created a learning programme designed to “foster professional development and technical skills”. According to the firm, the KLR University has been established to help the team comply with current laws and regulations, provide practical knowledge to heighten skills and effectiveness, and meet individual training and professional development needs. Thirty-six courses are being offered, including regulation updates and communication techniques. Session leaders include local college and university professors, alliance partners and in-house senior level staff. Managing director Alan Litwin said: “We believe programmes like KLR University and work-life balance initiatives are essential in retaining and hiring the best and brightest talent in our industry.” KLR is based on Rhode Island and has 110 staff.

CPAmerica member firm Brickley DeLong has announced the promotion of a new partner – Patrick Mutchler. He has been with the Michigan firm since 1990 and is experienced in tax and accounting.

Grant Thornton US has expanded into the San Diego market with a new office in Del Mar. The firm has aggressive expansion plans for the office. It has been opened with 24 professional staff and there are plans for that number to rise to 35 by the end of the year and 100 by 2009. The partner-in-charge of the new office, Don Williams, said: “Grant Thornton will give [San Diego] businesses a new choice – one that combines local, national and international resources of the largest accounting  firms with intensive partner and executive-level involvement and a strategic focus on growing private and public companies.” Grant Thornton now has 52 offices. The new office is part of the firm’s strategic growth plan for the Southern California region.

KPMG US has launched a programme to provide leadership training and financial support to minority undergraduate business students. Fifty students are part of the first group to go through the initiative, which aims to increase the number of business leaders in the profession and also in other parts of the business world. KPMG national managing partner for campus recruiting Manny Fernandez said: “While the students selected for the programme are all academically strong, the future diversity leaders’ programme takes their learning a step further, providing these students with some of the extra skills, knowledge and business perspective they need to become the business leaders of tomorrow.”

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