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April 30, 2008

RSM International enters Israel

RSM International has strengthened its representation in the Middle East with the addition of a new member firm in Tel Aviv, Israel. Shiff, Hazenfratz & Co becomes the network’s first and only Israeli firm.

lManaging partner Reuven Shiff, who is also the president of the Institute of Certified Public Accountants in Israel, said: “We decided to join RSM because we feel RSM’s position in the world suits our position here in Israel. We have a really strong firm and, with the international mid-tier network capabilities of RSM, we hope we can gain new clients.”

Shiff, Hazenfratz & Co has 130 staff, including seven partners. The firm provides audit, tax and advisory services, as well as a specialist economic and business consulting department, which covers all aspects of M&A services. The firm has also created a practice that provides specialised services to public sector clients.

“The International Federation of Accountants (IFAC) issued international public sector accounting standards and the Israeli government was, I believe, among the first that decided to issue financials for the state of Israel following the standards issued by IFAC,” Shiff said.

“We saw this as a great opportunity to work for the Israeli government and use the expertise that can maybe be used in other countries should they decide to implement the same standards. There are another four or five firms that do the auditing and preparing of financial statements for the ministries here in Israel because obviously it is a lot of work.”

Climbing the ladder

Shiff believes that joining RSM International could help elevate the firm’s market position. “In Israel, they rank firms by the number of employees and not by turnover because turnover is not revealed in this country,” he said.

“Obviously the Big Four are at the top, then BDO, Grant Thornton and we are roughly next… There are over 2,000 practices here in this small country of Israel, from the Big Four to the sole practitioners, so we are very pleased with our ranking. We hope that moving forward with RSM International we can be ranked in an even higher position.”

Although there is ongoing tension surrounding the Israel and Palestine peace process, Shiff believes this has had no effect on the Israeli economy, and is unlikely to have an impact on the future of RSM in the country. However, he said the firm does not collaborate with many firms in neighbouring countries.

“Amazingly enough, the economy in Israel over the past four years has been the best ever,” Shiff said. “The government budget has a surplus, inflation is very low and the gross growth was nearly around 5 percent per year in the last four years. Although we have peace with the surrounding areas such as Egypt and Jordan, we do not collaborate with any other Middle Eastern country, apart from our good relationship with Cyprus.

“Even right now with the sensitive situation of the Gaza strip and missiles striking, it does not really affect our economy. Admittedly, the situation with Lebanon two years ago may have slowed the economy for about four or five months but the economy picked straight back up again, as though nothing was happening.”

Shiff, Hazenfratz & Co aims to grow by between 15-20 percent over the next year. The firm plans to expand its international engagements and strengthen the tax department by recruiting more international tax experts. It also hopes to strengthen its market share of clients that list on various stock exchanges around the world.

“The hi-tech market in Israel is very strong and a lot of companies are trying to go onto the Nasdaq and have an IPO there. We believe that if we can offer them an alternative to the Big Four, which we definitely can, then these companies may come to us as well,” Shiff said.

Melanie White

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