Habits are the key cornerstones to uber success. Goal setting, visualisation, money management and having an investor mentality are some of the most powerful habits of the wealthiest people in the world. Most of these people made their money through successful business growth. Implement new empowering habits into your life for 2017 and achieve your business goals. View the following infographic to find out more. Infographic Courtesy of Addicted2success.com Farrelly Dawe White offer businesses the right advice. Advice that will drive you to achieve your business objectives and reach your full professional potential. Talk to us now. #2017

Guest blog by Alan Tracey Choosing your strategic partner in finance is a significant step that can add immense value to your practice capacity to service existing and future clients to a higher level. The drive for faster, quicker and better advice is better enabled when you already have your team in place. How can an Accountant help me grow my practice? When Clients attend to you with a problem they want resolved, having access to all of the resources is one of the immediate benefits they expect. The majority of legal problems or challenges that a business faces have significant financial implications, including taxation. Having a trusted firm of accountants as a Strategic Partner will ensure that you add more capacity to provide added value for your Clients more effectively. The most common issues requiring input from accountants will include: What are the Taxation implications? The majority of property Sales or Disposals, including succession will have implications for property taxes. Some of the more ‘interesting’ cases will have complications in relation to VAT or provide opportunities for careful planning on corporate and financial structures that minimise exposure for existing/future owners. The critical issue here is that the best tax advice is gained prior to the transaction, rather than after the event. Is there a better corporate structure that will minimise future costs? Solicitors are usually very conversant with opportunities that exist for better structures that maximise future benefits for Clients, particularly in relation to trusts and such vehicles. However, complications in entities can often result in an excess of costs of administration and compliance that significantly erode the benefits. Best use of the old tailors’ adage of ‘measure twice, cut once’ comes to mind. The tax authorities do not like complicated structures that are unnecessary and appreciate solutions that are more elegant, transparent and easier to understand and explain. What is the projected cost? Whether it is a family dispute or restructuring, a senior staff dismissal or a major corporate acquisition or disposal, projections of future earnings or distributions can have a very significant impact on the outcome of discussions and negotiations. When you have immediate access to accountants that are experienced in this area, matters flow quicker and simpler. What makes a good accountancy partner for a Legal Firm? Mutual respect and trust are crucial with an understanding of how the other party operates. Prompt response and feedback: open lines of communication. This includes full access to key people who will be available to have an open and honest discussion on possible areas of business or conflict, before engagement takes place. Frequently, a simple phone call or email can provide confirmation or assurance to the Solicitor that their proposed approach is robust and correct and does not require the services of a fellow professional. The best advice is often: ‘do not proceed’. Accountants who can work to support the legal team inconspicuously to the Client or otherwise as required. Equally, accountants who will take on a brief, deal directly with the Client and keep the Solicitor informed of the key steps and issues as they close out An accountancy practice that has the experience and capacity to provide the full range of services including Taxation, Accounting & Financial, Business Advisory, Corporate Compliance, Receivership & Insolvency and Forensic Accounting whether for Private or Corporate Clients An understanding and agreement on the basis of charges and Fees; all in the ultimate interest of Clients without a detrimental effect for either the Legal or Accounting practices. Better alliances make for better business. Consider your alliance with an accountancy practice to be an essential extension to your legal team, someone that can and will access where major decisions with finance and taxation elements are going to be made. There is a tremendous value to be gained from an added objective and independent view of the major financial decisions that impact your Clients. Strategic alliances are a smart way to extend your capacity to provide exceptional services for your Clients. For More Information Click Here To Visit Our Audit & Assurance Services Page Farrelly Dawe White meets all of the criteria outlined and has extensive experience working with legal firms. Consider having an introductory conversation to extend your client offering and grow your legal firm. #2017

The Chinese economy is in a period of flux: what emerges will have profound significance for global business. If one word aptly describes informed reaction to recent Chinese economic data, it is probably ‘confused’. The powerhouse economy that enjoyed three decades of extraordinary growth has entered a period of flux, but what that means for both China and the world remains unclear. Figures released at the end of July neatly encapsulate the dilemma for economists wanting black and white answers to a tricky conundrum. Two key measures of factory output painted an entirely conflicting picture, with large state-owned businesses appearing to underperform while smaller private companies enjoyed notable success. What is clear is that the era of stratospheric investment-led growth is over. The Chinese economy grew by an average of 10% annually between 1980 and 2011. Predictions for 2016 top out at 6.7%. A HARD LANDING? The key question is, where does China go from here? Is the economy heading for a ‘hard landing’, potentially tilting the world back into recession, or will efforts at modernisation bear fruit? “The problem now is that exports are reducing, but domestic consumption is not yet a force to push the economy forwards,” says Yong Sun, managing partner of UHY’s Chinese member firm, Zhonghua Certified Public Accountants LLP. “That means investment is still a very important part of the economy, but it is not sustainable. At the moment the government wants to sustain growth at 6.5% or 7%, so it has no choice but to invest.” Most economists agree that state investment – spectacularly successful in the past – will have to play a smaller part in the Chinese economy in the future. “In recent years there has been no real problem for the Chinese economy,” adds Yong Sun. “But now there is a question of direction.” In what direction China travels, and how quickly it moves, is a question of global significance. Stephen S. Roach, former chairman of Morgan Stanley Asia and a senior fellow at Yale University’s Jackson Institute of Global Affairs, has calculated that, despite its slowing expansion, China remains the single largest contributor to world economic growth. If forecasts prove correct and its economy grows by 6.7% in 2016, China will contribute 1.2 percentage points of a predicted global GDP growth of 3.1%, or 39% of the total. By comparison the US will account for just 0.3 percentage points. CHINA’S CHOICE With those figures in mind, it is easy to see why Roach believes the widely feared economic hard landing for China would have a “devastating global impact”. But there is another possibility, and a more likely one in his view. He writes: “The world stands to benefit greatly if the components of China’s GDP continue to shift from manufacturing-led exports and investment to services and household consumption.” A report by the McKinsey Global Institute, entitled China’s Choice: Capturing the USD 5 Trillion Productivity Opportunity, attempts to put a figure on what a successful rebalancing of the Chinese economy might mean. Shifting to a productivity-led economy could generate up to USD 5.6 trillion of additional GDP by 2030, the report claims. Such a shift “will not be easy” and will involve some hard decisions on the part of the Chinese state. One concern is that the government, worried by rising unemployment and focused on unsustainable growth targets, is rowing back on commitments to speed up the transition from an investment-led to a consumer-driven economy. A CHANGING ECONOMY But despite central inertia, there are encouraging signs from the Chinese private sector. Recent research by UHY revealed that 1,609,700 new businesses were formed in China in 2014, nearly double the number created in 2010. It is not yet known what effect economic slowdown has had on new business creation in the last 18 months, but Yong Sun says that Zhonghua is continuing to see a positive shift in its client base. “We can see the economy slowly changing from heavy industry to service industries, and we are also seeing more clients in high tech sectors, internet businesses and other innovation sectors. Previously, most clients would be large, state-owned businesses. Now we deal with many SMEs, and the newly established companies we work with are growing very quickly.” These kinds of businesses are crucial to a successful rebalancing of the Chinese economy, the McKinsey report states. Sustainable jobs in innovative industries, along with increased efficiency and more widespread digitisation, will help to grow the Chinese middle class and, at the same time, serve it more successfully. At the moment, says Yong Sun, middle class consumers tend to buy cheaper goods from abroad rather than supporting domestic markets. NEW OPPORTUNITIES, NEW RESPONSIBILITIES Another important element of China’s restructuring will be “deepening global connections”, says McKinsey, and China is continuing to reach out to the world. Again, state investment remains a major driver. Chinese state-run companies are winning major infrastructure contracts around the world, perhaps most successfully in Africa. Then there is the much vaunted One Belt, One Road initiative, a potentially massive infrastructure programme to develop trade routes in Asia and beyond. But China is also continuing to open up its internal markets to foreign investment, even if it is not yet doing so quickly or completely enough to realise the most optimistic predictions in the McKinsey report. In fact, China is not just more open, it is also becoming a safer and more sophisticated destination for foreign companies. “Ten years ago and more, foreign companies saw a huge market, but mainly cheap labour and cheap land,” says Yong Sun. “China is no longer cheaper, so companies who come here are usually focused on serving the Chinese market or they already have clients in China who they want to serve better.” With new opportunities come new responsibilities. New labour laws, tax regulations and transfer pricing policies make China a more complex proposition for foreign companies than it was a few years ago. In return, they have access to a vast and growing middle class (an estimated 116 million households), an increasingly skilled labour force and better protection for their intellectual property. As UHY’s member firm in China, Zhonghua helps companies negotiate the country’s more complex tax and labour laws, and can advise on the best investment vehicles for particular businesses. Its expertise also helps a growing number of private Chinese companies looking to expand into global markets. GLOBAL NETWORK, LOCAL KNOWLEDGE In both areas, Zhonghua is able to enlist the services of UHY’s extensive international network. UHY has offices in over 320 major business centres in the world, as well as a number of dedicated China desks that focus on helping Chinese firms move into new markets and foreign companies establish a presence in China. Member firms offering China-specific services through their China desks include, among others, UHY Haines Norton in Australia, UHY Lee Seng Chan & Co in Singapore, UHY LLP in the US, and UHY Hacker Young in the UK. Cross-border collaboration between member firms, combined with appropriate local knowledge and expertise, are key parts of UHY’s service offering. When United Initiators, a chemical company headquartered in Germany and with operations in China, the US and elsewhere, wanted a global accountancy solution, it turned to UHY LLP, Michigan in the US. By doing so, it automatically tapped into the expertise of German member firm, UHY Deutschland AG, as well as Zhonghua Certified Public Accountants LLP in China, and a number of others. Melanie Chen, partner at UHY Advisors in New York, is head of the firm’s China desk. She believes that facilitating business between China and the rest of the world requires that kind of cooperation, along with specialised experience. “I am sure many Chinese natives in the UHY network have similar backgrounds and experiences to mine,” she says. “Often we have not only completed college educations in both countries, but also have significant working experience in both countries. We know very well about the differences in business cultures, regulations, GAAP requirements and business operations. We are able to bridge those differences with our experience and knowledge.” “We support many Chinese companies entering the market in Singapore and across South East Asia, working in close collaboration with our UHY colleagues across the globe,” says Kelvin Lee, partner at UHY Lee Seng Chan & Co, Singapore, and its resident China expert. The firm has recently helped a large Chinese retailer of baby and children’s products prepare to expand overseas, assisting with financial management, tax planning, branding and strategy, and is continuing to explore further collaboration opportunities with Zhonghua. MOVING ABROAD Melanie Chen believes that clients will seek out advice even more regularly in the coming years, as the Chinese economy matures and Chinese companies seek competitive advantage outside the country’s borders. “China is like Japan and Korea in the ‘70s and ‘80s, with companies that need to go beyond their domestic market to acquire new technology, brands and markets, to sustain development and growth,” she says. “I believe that in the next few years we will see more Chinese companies making investments all over the world.” Yong Sun of Zhonghua also sees opportunities as Chinese businesses spread their wings. He believes many will take their first steps into foreign markets through mergers and acquisitions, while others will require training and consultancy services from firms like Zhonghua, working with the international expertise of the UHY network. UHY member firm UHY Haines Norton in Sydney, in collaboration with UHY in Malaysia, is currently assisting with the listing of a large Chinese chicken production company on the Australian Stock Exchange (ASX). Mark Nicholaeff, a director at UHY Haines Norton Corporate Finance Pty Ltd, says: “We are currently getting a large number of enquiries from Chinese companies seeking investment opportunities in Australia. Our firm alone is in talks with more than six Chinese companies wishing to list on the ASX and many more seeking to invest in Australia, particularly in the mining and agricultural sectors.” And those opportunities will most likely increase, as China continues to drive global economic growth and reach out to the world. The kind of innovation and efficiency improvements that come from open markets at home and expansion abroad will be essential for the future health of the Chinese economy. Government priorities can slow or speed the process, but the direction of travel appears set. For more information about UHY’s capabilities, email the UHY executive office, info@uhy.com , or visit www.uhy.com . #2016

Cybercrime poses a growing threat to global business, and protection depends on awareness, collective responsibility and behavioural changes as much as technology. Ask people about Cybercrimes and they may reference big-name disasters which have grabbed headlines and whose fallout has been felt across the world. Like the attack on US retail giants Target and Home Depot which led to the theft of millions of customer card details; or the gang that used ‘Lurk’ malware to orchestrate the theft of RUB 1.7bn (USD 25m) from banks in Russia; UK mobile and broadband provider TalkTalk’s loss of 100,000 customers after a data breach compromised customers’ personal information; or the attack on Japan’s pension service which exposed a million names, ID numbers and addresses; the thousands of malicious URLs created to mimic online banking services in the run-up to Brazil’s Summer Olympics in Rio 2016. Sony, Yahoo, Mattel, Amazon, Ryanair, eBay, numerous major banks – the list is growing. Such attacks have put cybercrime in the global spotlight. But while thefts from big business or governments garner media attention, most cybercrime is more routine. “Some attacks are targeted,” says Stephen Gates, of global cyber security consultant NSFOCUS. “But most are arbitrary, such as hackers building web robot armies that scan the internet looking for vulnerable systems.” SMALL IS VULNERABLE It is not all big business either – all companies are at risk, and the most vulnerable are the small to medium enterprises (SMEs). “Small, private companies are probably more exposed than large public ones,” says Olga Petrukhina, head of legal practice, UHY Prostor Ltd, Ukraine. “They do not have the expertise and tools in-house to combat the problem. For some, a cyber breach could cause them to go out of business, not only through potential financial loss but also through damage to their reputation and the subsequent fall in confidence.” The existential threat that cybercrime represents to SMEs is an argument for more strategic and rigorous protection. Professional services companies, with their imperatives for quality and client accountability, have an opportunity to lead the way in this, while highlighting a crucial fact about cybercrime. “It is a strategic business issue, not just an IT issue,” says Olga. “Service offerings that provide proactive advice and insight are becoming more essential, for example risk assessments, training and awareness, plus incident and breach response management.” READINESS IS KEY Many firms have cybersecurity expertise, but the ones that combat attacks most effectively are those with a cultural readiness and framework in place. This may take many forms, but at its heart is a recognition that responsibility begins at the top. “Boards that choose to ignore cybersecurity do so at their peril,” says the US Securities and Exchange Commission (SEC) commissioner Luis A. Aguilar. A framework developed by the National Institute of Standards and Technology (NIST) – a US federal technology agency that works with industry to develop and apply technology, measurements and standards – works to five key principles underlying the overall approach: identify, protect, detect, respond and recover. Firms should ask themselves: ‘Is there a cybersecurity plan?’ ‘Has accountability for cybersecurity been assigned to a senior executive?’ ‘Have employees been trained on cyber risks they need to be alert to?’ If the answers to these questions are yes, they are taking the issue seriously, but need to continuously apply and evaluate the measures to stay effective. Knowledge of the main types of attack is vital for SMEs. For professional services, two key threats are ransomware and business email compromise. The first is a malicious encryption of files where perpetrators demand ransom for decryption. It can be triggered internally – a single misconfiguration, improper file permission setting or uneducated employee is all it takes to deploy it. Business email compromise is a type of phishing where an email impersonating someone with authority sends a request to an employee, tricking them into making a transaction. In April 2016, the US Federal Bureau of Investigation (FBI) warned of a dramatic increase in business email compromise. David Hartley, who runs the technology advisory service for UHY member firm UHY Advisors, St Louis, US, says staff can be a company’s weakest link or its first line of defence. He says, “In our client base, criminals are increasingly focused on exploiting the human element of cybersecurity through tactics like phishing, spear-phishing and social engineering. “It used to be that we could count on our technology to protect us through firewalls, antivirus protection and so on. Now criminals are trying to trick the humans using the technology rather than exploiting the technology itself.” For UHY member firms responsible for storing and handling their own sensitive data and that of clients, people are a crucial asset against cybercrime. David says, “The importance of protecting our clients will be reinforced through monthly training that all UHY employees in the US will be required to complete.” GLOBAL THREAT Cybercrime is clearly an issue that can strike any firm at any time, though SMEs are most vulnerable – but are there also global hotspots? Research from security company Mandiant suggests that Asian organisations are 80% more likely to be targeted by hackers than other parts of the world. The reason is that the median time between a security breach and its discovery in Asia is 520 days, the study claims, or three times the global average. Hackers target Asian companies not because they offer the best returns, but because they present fewer obstacles to lucrative data. The US tends to top lists showing the wider financial costs of cybercrime, with European countries and China, Brazil, Russia, Japan and India high in the rankings, but no country is immune. Last year the UN estimated that cybercrime affects more than 431 million adult victims globally and has grown into a lucrative transnational business, with returns that may exceed three trillion US dollars a year. “In India we have seen an increase of over 300% over the past few years,” says Sunil Hansraj, joint managing partner of UHY member firm Chandabhoy & Jassoobhoy, Mumbai, India. “We hear almost daily reports on ATM frauds, web payment portal frauds and corporate server hacking. At our firm, important client-related data is normally maintained directly by partners in a secured storage set up normally as encrypted/password protected data with restricted access.” BACK DOORS TO DATA The increasingly global and interconnected nature of business has only widened cybercrime’s impact. To an increasingly sophisticated subsector of cybercriminals, often with links to organised crime, SMEs are not only vulnerable in themselves but also represent a potential backdoor into the larger organisations they supply and service. “Sometimes, small companies are more prone to hacking attempts, especially if they are part of a supply chain for a larger organisation,” says Bogdan Botezatu of Bitdefender, a global security company based in Romania. “Attackers will often target a smaller contractor of a large organisation, in order to escalate its privileges and try breaching the larger business.” When smaller companies are digitally connected to larger ones, the results can be ruinous. The Target attackers bypassed the retailer’s frontline security and accessed its network via one of its air conditioning contractors. While it is true that cybercrime is a large and growing threat, businesses can manage their exposure and most are only as vulnerable as they allow themselves to be. “Cyberattacks, malware and system vulnerabilities have been mystified beyond all reasonable analysis,” says Ian Trump, global security lead at cloud service provider LOGICnow. “In fact, the most effective IT strategies against all unknown and known threats are generally the same. Patch and update the operating system, patch and update third-party applications, restrict administrative access and use malware defences.” PROTECTING OUR NETWORK Cybersecurity initiatives take place across the UHY network. Colin Jones, partner at UK member firm UHY Hacker Young, London, UK, believes simple strategies for reinforcing security messages make a huge difference. A written information security code is regularly reinforced by training, along with the recognition that cybersecurity is a company-wide responsibility rather than just an IT issue. “Clients have an expectation that given the size of our global network, and as a professional services organisation dealing with confidential client information, our member firms will have robust cyber security measures in place,” he says. Information and training is being matched by investment in state-of-the-art security technology. A report by Oxford University’s Saïd Business School concluded that Mexico’s financial sector is becoming increasingly attractive to cybercriminals. “One critical change has been upgrading our firm’s infrastructure with an emphasis on enhancing information security,” says Oscar Gutierrez, managing partner of UHY Glassman Esquivel y Cía. S.C., Mexico. “So, we acquired perimeter security and specialised filtering equipment for incoming and outgoing connections.” UHY Mexico also offers clients a physical connection, via an implant at their offices, to the firm’s secure network. “This way they can protect and manage all their information on our servers without compromising their security,” says Oscar. Companies are becoming more demanding in evaluating the cybersecurity readiness of their business partners. They may seek additional assurance in a service auditor report or even sending in their own auditors to review the company’s cybersecurity programmes. UHY Advisors in the US offers cybersecurity audits for its enterprise customers, testing client networks against recognised benchmarks. For middle market customers, the firm performs cybersecurity risk assessments and can help establish a cybersecurity programme. Marcello Reis, partner at UHY Moreira, Brazil, says cybersecurity services for clients are a vital part of the firm’s offering. “As well as our own measures to protect data, we have a team of specialists in information security audit and advisory, and we are accredited by the Brazilian Internal Revenue Services (Receita Federal), which also controls and regulates all international trade. We provide advice to large and medium-sized multinationals in Brazil in order for them to get access to a special customs regime that speeds up the import and export processes, while tightening IT security.” RISK AND REWARD Cybercrime offers both threats and opportunities – some estimates put global cybersecurity spend at USD 170 billion by 2020. As awareness of cybercrime grows, companies who can offer cybersecurity services will always enjoy a significant competitive advantage. “No business is free from risk, whatever its size. We need to be in a strong positon to deal with the issues and threats involved with cybersecurity and advise clients on best practice,” says Colin Jones. #2016

No one doubts we are in the grip of the third great age of innovation: the time of technology. but while the agricultural and industrial revolutions brought lasting and sometimes radical social change, technology is different. The rate of advancement we are experiencing is like nothing that has gone before, and it has the power to transform the lives of everyone on the planet. This brings an unprecedented level of optimism for solving global ills – but equally raises unique concerns. Artificial intelligence (AI) and a future that is approaching at breakneck speed were among several technology topics discussed at UHY’s Annual Conference in Ho Chi Minh City, Vietnam, in October 2016. UHY Global spoke to prominent AI and tech presenters at the event. AT THE LEADING EDGE Dr Long H. Vu is an IBM Research Staff Member in the Department of Exploratory Stream Analytics at the IBM T. J. Watson Research Center, New York. He spoke about current developments in AI and in particular the projects coming out of IBM Watson, the computer giant’s own technology platform that uses natural language processing and machine learning to reveal insights from large amounts of unstructured data. “We all know that computers are used to analyse large amounts of structured data, but 80% of the data available to us every day is actually unstructured in nature, and has up until now not been fully explored or understood by computers,” says Dr Vu. “This means as human beings we are trying to absorb multiple sources and types of data, such as spoken words, text, emails, photographs, social messaging, CCTV, audiovisual, documents, reports – all natural forms of communication – without much help. And every industry is now producing more and more new data, at an alarming rate. IBM Watson is a system that can process and categorise all of this material in huge volumes and at great speed. In terms of statistical analysis, it can use a whole universe of data, not just a sample. We call it a cognitive system – once it has understood its data, it can analyse and produce results in a reasoned way; it can weigh up and select the best answers. It is a thinking machine.” There are dozens of underlying open technologies that contribute to this artificial intelligence: text and language translation (IBM Watson currently provides full support for six languages with many more under development), tone analysers, visual recognition, image tagging, relationship extraction, facial recognition, and many more. But of equal significance to AI is machine learning, which never stops. Dr Vu explains that this is how a system develops expertise. “Like a person, Watson gets better and better over time. The more data it is fed, the more ‘reason’ it can apply and the more behaviour patterns and nuance it can learn. The result is exceptionally robust output, be it statistical or semantic insight, or even real-time conversation with a person, through a user interface like Nao.” RISE OF THE ROBOTS Built by global robotic specialists SoftBank Robotics, Nao is a humanoid robot which, powered by IBM Watson, can move, listen and understand human language, speak and interact with human beings and change his movement and behaviour, depending on the conversation context. For many people, Nao – and similar robot-like interfaces – bring to life the populist future where robots walk, talk and do the housework. For Dr Vu, they are one type of interface that humans may use to access AI systems; and the dystopian vision of robots taking control is far from where cognitive systems are headed. “In some sense, AI technology is no different to other scientific advances – nuclear, say, or genetics – where discovery comes with certain ethical dimensions. But the reality is that machines do not replicate our deepest human abilities. In our application of knowledge we may call on unique collaborations of empathy, creativity, humour, common sense, instinct and vision. We have morals, imagination, compassion. We can dream, we can abstract and we can generalise. What robots – or cognitive systems – actually give us is the ability to amplify our brainpower, not replace it. The benefits far outweigh the risks.” To illustrate his point, Dr Vu cites several applications that IBM has already developed for use in a range of industries. In healthcare, for example, Watson’s Oncology Advisor exemplifies the new partnerships that will be made possible between people and computers. “We trained Watson to develop diagnostic expertise in breast and colon cancers, by enabling the processing of over 15,000 hours of oncology expertise, six million articles, 20,000 clinical trial outputs and over one and a half million patient records. The application now supports real oncology consultants in real hospitals.” Similar developments are underway in genomics and diabetes. THE FUTURE IS BRIGHT Watson is also set to revolutionise other data-heavy sectors, including telecommunications, oil & gas, education and professional services – where automated analysis and insight from large volumes of financial or case data, for example, may free the professional from mechanical tasks and, as Dr Vu describes it, “enable deeper added-value advisory relationships.” This is good news for accountants like UHY who already strive to promote this kind of advisory culture. It is an exciting time for computer science specialists. Dr Vu believes that IBM Watson – and other cognitive platforms – will continue to grow and deliver applications that benefit individuals, businesses and the planet. “There are many talented people out there – professionals, specialists, entrepreneurs – looking for ways to meet our 21st century challenges,” he says. “It is good to be involved in providing them with some means to find answers.” Dr Long H. Vu holds a Ph.D. in Computer Science and has published 25 journal articles and conference research papers. He was the recipient of the prestigious Mark Weiser Best Paper Award in 2011, given by the IEEE International Conference on Pervasive Computing and Communications. He has also filed four US patents. To find out more about IBM’s AI platform, visit www.ibm.com/watson . Read the UHY Global Issue 3 ‘Greet The Future – Harnessing Tech For Better Service’ BE PREPARED FOR A TECHNOLOGY TSUNAMI According to scientists, futurologists and science fiction writers, we are on an exponential technology curve which, they predict, will shortly consume us in a tidal wave of disruption and change. And there is enough evidence to suggest they are right. It does seem more probable than possible that the technological revolution will change the way we live forever. Technology that at first empowered people has already started to replace them in areas of high volume low skilled work. Smart factories deploying robotic process automation are transforming manufacturing and logistics. Driverless cars – inconceivable to mainstream thinking a few years ago – are now on our roads. Drones are set to disrupt conventional distribution. DNA is mapped. The first wave to break was the internet, from which a new order emerged – technology start-ups that are today’s new household names: YouTube, Netflix, eBay, PayPal, Wikipedia, Skype, TripAdvisor, Flickr, Spotify, Facebook. They brought innovation and disruption to the old ways and many corporate giants were caught sleeping, to their eventual cost. Now, we have the Internet of Things, where connectivity infrastructures – mobile, satellite, the cloud – are enabling connectedness with few limitations. At the same time, many see the current decade as the time of robotics and artificial intelligence. The exponential trends are hard to deny. According to entrepreneur and technology practitioner Juan Martinez-Barea, all companies and industries will become high-tech ones. “Technology will be present for everyone,” he says, “the only question is which technology? Business managers must ask themselves: what technology is going to disrupt my industry?“ The auto industry is one which typifies the rate of change brought about by technology advancement. “In ten years the car industry will be very different,” says Juan. “It is likely that all new cars will be electric, and autonomous (driverless) vehicles will be commonplace. New competitors will own the customer relationship – not the automakers, but companies like Apple, Google or Microsoft. The ownership model will change and car transport as a service could become ubiquitous. And none of this prediction relies on anything that is not already either under development or in commercial use. “We have a tsunami coming,” he says. But Juan remains optimistic that it will be a force for good. “Every sector has dozens, if not hundreds, of entrepreneurs working hard at solving problems using different technologies. This swarm of start-ups is the most powerful force on earth.” His own bioinformatics start-up is focused on developing and commercialising a universal test for early detection of cancer, aiming to saving millions of lives. “We have been working on this for four years,” he says. “Will we make it? I don’t know. I hope so. But I am sure that by 2020, someone will.” Juan Martinez-Barea has worked with more than a thousand start-ups, has advised and coached hundreds of entrepreneurs, and has helped to launch more than 100 high-tech new ventures. Find out more at www.juanmartinezbarea.com . #2016

Innovation in technology opens up new and better ways for accountancy and professional services firms to help businesses. But how can those clients make the most of the benefits on offer? “When accountancy firms make technology work for them, they help clients more strategically, more quickly and at a lower cost,” says Olivier Boutellis-Taft, CEO of the Federation of European Accountants. As his organisation prepares to issue a paper on how cloud computing can help professional accountants better serve their SME clients, they are certainly not alone in recognising that technology has the power not just to streamline existing tasks, but to gather and analyse data in a way that transforms business decision-making. Lee Bryant, co-founder of Postshift and Shiftbase, works with leading professional services firms and bodies on technology adoption. He sees a future in which firms will operate their own platforms with many self-service tasks, but in which accountants will have an enhanced role as advisors and consultants. “These platforms will cover collaboration, communication, project and relationship management, but later expand to include real-time data analysis and hosting of accounts information, and will perhaps also make available artificial intelligence or smart tech that can help find hidden patterns in client data,” says Lee. Technology, of course, already enables member firms in the UHY network to stay closer together, sharing expertise and breaking down borders, especially for those businesses with multinational interests. WELCOME TO THE CLOUD Innovation always aims to enhance and expand the range of services, provide real-time reporting and make communication seamless. To that end, there has been a rapid increase in cloud accounting and it is something that features highly in UHY’s five-year 2020 Vision strategy. Delivered over the Internet and securely accessible from any web browser, wherever the user happens to be, cloud-based services can substantially cut overheads and IT costs compared to investment in servers and software that needs constant updating. Many firms now use a blend of ‘traditional’ IT and cloud. In a study by the IBM Center for Applied Insights1, using the cloud in the IT mix was found to help firms reduce expenses by shifting from fixed costs to the ’pay-as-you-go’ cloud delivery model. As well as being scalable and flexible enough to support dynamic needs, adopting a hybrid approach means organisations can selectively combine the use of the cloud with parts of their traditional IT infrastructure, thereby best meeting their needs in terms of functionality, speed, resilience, security and regulatory requirements. Michael McCoughtrey, managing partner, UHY Haines Norton in Sydney, Australia, has seen the benefits that cloud computing can offer. “For accounting and professional services, access to accounts and documents is made simpler. Businesses can provide and see information more quickly and we can respond at lightning speed,” says Michael. “Problems are more visible and can be solved without the delay that might make things harder to tackle. Internal fraud, for example, can be spotted promptly. Businesses also benefit from spending less time on low-value tasks and more time on value-creating opportunities.” Having launched its cloud-based service at the end of August 2016, the UHY Hacker Young group in the UK point to the benefits smaller clients gain from being able to provide the firm with a real-time view of their accounts. “One example where we have improved productivity for clients is in enabling the use of mobile and tablet devices,” says managing partner Laurence Sacker. “Clients can simply photograph an invoice, upload it into the cloud to software like Receipt Bank or Basecone, and then have this automatically posted directly into their ledgers using OCR technology.” Syful Islam, managing partner, UHY Syful Shamsul Alam & Co in Dhaka, Bangladesh, is also a fan of data analytics tools and the power they give to dig deeper into clients’ data, both financial and non-financial, to find the elements that have an impact on profitable growth. “During audits, we can test complete sets of data, rather than just testing samples,” he says. “These tools aid in risk assessment by identifying anomalies and trends, and point auditors toward items they need to investigate further. A firm’s data can also be compared to industry data.” TIME AND COST SAVINGS Many small and medium-sized businesses simply do not have the time to manage and assemble the information needed to report and measure the performance of their business. The improved workflow enabled by cloud computing and shared applications not only leads to timely information, but also faster and more informed decision-making. In Norway, where UHY member firm RevisorGruppen has offered electronic filing and cloud-based services since 2014, the cost benefits to clients have been tangible. “We have been able to show businesses the comparison between ‘traditional’ accounting handled externally and a cloud-based system, where many basic tasks are handled in-house but value-creation services are provided by the accountancy firm,” says Kirsti Armann, CEO, RevisorGruppen. “It has been important, though, for us to work closely with clients as the systems are set up and they start their first transactions to ensure people are comfortable and competent with the processes.” TRUSTED ADVISORS Although cloud accounting should never be a way of devolving responsibility, it creates a new way for professional services firms and clients to work together. As the emphasis on client self-service increases, the role of accountancy and professional services firms is evolving. The accountant becomes a trusted advisor, acting as consultant at the planning and adoption stage, then adding value through analysis and strategic guidance. “We have helped customers achieve updated and more effective accounting systems,” says Kirsti Armann. “It has certainly been easier for businesses to make changes when led by someone they trust, rather than having to search and set up solutions on their own.” In Argentina, Roberto Macho, managing partner of UHY Macho & Asociados and UHY Board Director, is firm in his belief that clients need to adapt and adopt. “Anyone who pulls away from technology will ultimately be expelled from the market for lack of competitiveness,” he says. “We know that some clients face IT barriers, which is why it is now so important for us to help them with the technological options – whether it is advising and implementing a full-blown enterprise system or enabling standalone services.” His firm has worked closely with multinational clients to integrate processes and reporting seamlessly across borders. “For three firms, we have provided the technology that allows them to have their admin office in one country and operate in six or seven others. It has reduced back office costs by 60% on average,” says Roberto. Syful Islam recognises that many clients need support that goes beyond traditional accounting and into the realm of business automation. “Considering the challenges of today’s business environment, high efficiency and productivity are critical,” he says. “Clients often need help with strategies to automate processes that keep costs under control. It is a question of integrating applications, restructuring labour resources and using applications such as human resource information systems, computerised accounting and payroll software, supply chain management and fixed asset management tracking.” READY FOR THE CLOUD? Because failing to plan is planning to fail, documenting existing on-premises software and internal work processes is key. Areas where businesses lose the most productivity or have the greatest problems with technology should then become the first areas to move to more efficient cloud applications. Clients who are still heavily dependent on paper-based systems and their own server-based accounting packages can be daunted by the prospect of converting to cloud software. However, this should not preclude the use of new data analytics tools. Businesses often have separate centres or silos of data around the organisation, which are typically managed with spreadsheets. The risk of embedded errors can be high and productivity held back. “In these instances,” says Laurence Sacker, “we recommend clients move to new data analytics packages that can later accommodate automated data feeds from cloud applications. They get the immediate benefit of aggregating the dispersed web of spreadsheets into an integrated whole.” Clients can also position themselves to take advantage of new technology through having a local champion, dedicated to sharing the benefits and providing a link between the business and external advisors such as accountants. TECHNOLOGY FUTURES Despite undoubted productivity gains through workflow improvement and cloud accounting, data use remains an issue, with many firms still spending a lot of time extracting or downloading data from various sources and re-inputting it elsewhere to upload in another application. The solution could come in the form of application programming interfaces (APIs), which allow different software and databases to communicate with each other effectively. In the European Union, a new directive on payment systems requires banks to develop open APIs and let third-party developers link into their systems by 2017. The result could be that bank statements will automatically upload each day for instant reconciliation. While Syful Islam already sees his clients benefiting from faster communication, enhanced reporting and reduced cost, he believes the next generation of technology can offer firms even more. “International auditing standards require meticulous attention. In Bangladesh, we are looking at audit applications that will allow us to extract data, identify exceptions and unusual transactions, and generate reports. For clients, that will mean the reassurance of continuous monitoring, fraud detection and tracking of key performance indicators.” Lee Bryant agrees that moving away from spreadsheets and non-integrated models is essential if businesses are to take advantage of the more advanced data analytics capabilities of accountancy and professional services firms: “Until clients have some kind of consistent data storage for financial information, it is very hard to use the big data capabilities that the larger firms are building out.” As technology changes, the role of accountancy and professional services is changing too. Ultimately it is the clients who will benefit, as the firm they trusted to look after their books becomes a business management advisor, helping them build a picture of their business needs and steering towards the technological advances that will lead to greater efficiency and profitability. For more on the impact of technology and its relationship with professional service providers, check out our interview with IBM Watson’s Dr Long H. Vu, who talks about the future of artificial intelligence in the profession (this issue, page 8), and our feature on cybersecurity (this issue, page 10). For more information about UHY’s capabilities, email the UHY executive office, info@uhy.com , or visit www.uhy.com . 1 IBM report: Growing Up Hybrid. Accelerating Digital Transformation. www.ibm.com/ibmcai . #2016

From 1 January 2017 the National Minimum Wage will increase to €9.25 per hour. The changes in National Minimum Wage are represented in the table below. [table id=13 /] For the purposes of the Act, the following payments are regarded as wages: normal basic pay, as well as any overtime shift allowances or other similar payments any fee, bonus or commission any holiday, sick or maternity pay any other return or payment for work (whether made under the contract of employment or otherwise), any sum payable to an employee in lieu of notice of termination of employment. The following payments are not regarded as wages: any payment of expenses incurred by the employee in carrying out his/her employment any payment by way of a pension, allowance or gratuity in connection with the death, retirement or resignation of the employee or as compensation for loss of office any payment referable to the employee’s redundancy any payment to the employee otherwise than in his/her capacity as an employee any payment in kind or benefit in kind. For further information or assistance with processing your payroll, please call Niall on +353 42 933 9955 or email niallclarke@fdw.ie . #2016

Special Assignment Relief Programme (SARP) The new Special Assignment Relief Programme (SARP) was introduced in 2012 to assist Irish companies and multinational companies in attracting key talent to Ireland. The relief was initially introduced for tax years 2012, 2013 and 2014. In the Finance Act 2014 under Section 15 the relief was extended to include individuals assigned to work in the State during any of the tax years 2015, 2016 and 2017. In Budget 2017 it was further extended by 3 years to 2020. SARP provides for income tax relief on a proportion of income earned by an individual who is assigned by his or her relevant employer to work in the State. What are the qualifying conditions for SARP? In order to avail of the relief, the individual must meet the following conditions: Relevant income exceeding €75,000 per annum Relevant income for the purposes of SARP is defined as the individual’s total earned income from that employment, excluding the following payments; Reimbursement of expenses subject to Revenue guidelines Bonus payments, contractual or otherwise Share options or any other share based remuneration Notional value of BIK (benefit-in-kind) Restrictive covenant payments Termination payments Be a full-time employee of a company tax resident in a country with which Ireland has a Double Taxation Agreement (or information exchange agreement) for 6 months* immediately prior to arrival, it does not apply to organisational “new hires”. The assignment must be for a minimum of 12 months The individual must become tax resident in Ireland and not due to pay tax in another country The individual must not have been tax resident in Ireland for the five tax years immediately preceding the year of arrival. How the scheme works? The relief operates by allowing a 30% deduction from employment income in excess of €75,000. The relief may be claimed real time through the PAYE system or alternatively after the year end via a tax return (Form 11). The formula used to calculate the specified amount is as follows: (A – B) x 30% Where A is the amount of the individuals income which is subject to tax in the State after deduction of a qualifying pension contribution to a Revenue approved occupational, personal, PRSA or overseas scheme, and is no longer subject to a maximum threshold.** B is €75,000 Example A qualifying individual earns a base salary of €250,000 together with a company car (BIK) of €10,000 and makes contributions of €20,000 into a Revenue approved scheme. Solution [table id=10 /] The overall value of the relief is the specified amount calculated at the individual’s marginal tax rate, in this case: €49,500 x 40% = €19,800 Note: Relief is from income tax only – PRSI*** and USC are not relieved under SARP What other benefits are available under SARP? Where an individual qualifies for this relief, they may also benefit from the following payments free of tax: One “home leave” trip per year for the individual and their family. School fees up to €5,000 per child, per annum (primary or post-primary education) What are the reporting requirements? Employee: Form 11 self-assessment tax return (by 31st October each year) Employer: SARP(1a) application form (within 30 days of the individual’s arrival) SARP employer return (by 15th February each year) *Previously 12 months prior to 1st January 2015 ** Previously a threshold of €500,000 applied prior to 1st January 2015 *** Where an individual holds a Form E101, Form A1 or a Certificate of Coverage issued from another country, no PRSI is payable in Ireland. Click here to find out more about UHY FDW’s Executive Payroll Service #2016

Income taxes fall for high earners by 9 percentage points – faster than European average GDP growth outperforms global average over last 30 years Ireland’s high net worths are among those who have benefitted the most from global reductions in income taxes over the past two decades, according to a new study by UHY, the international accounting and consultancy network. The research reveals that the effective income tax rate for Ireland’s high earners with a salary of USD 1million has fallen at a faster rate (down 8.6 percentage points – from 47.5% in 1996 to just 38.9% today) than the global average (down 5.6 percentage points from 41.4% to 35.8%) in the last twenty years. Income tax cuts in Ireland have also been more substantial than in most other European economies, which have seen average reductions of 8 percentage points since 1996 – from 49% to 41%. This puts it within the top half of the fastest income tax cutting countries in UHY’s study. UHY studied tax data in 26 countries across its international network, capturing the effective income tax rate for higher and lower income workers*. UHY notes that each working citizen in Ireland is entitled to a personal tax credit of €1,650, and an employee tax credit of €1,650. This study does not include social insurance or other taxes impacting people’s net income. Ireland’s workers on lower incomes – those earning USD30,000 – also benefitted from significant tax reductions. They have seen their tax rates fall 25 percentage points, from 33% twenty years ago to 8% today. Russia has seen the biggest cuts of any major economy for higher earners, who have seen their income tax rate fall by nearly two-thirds (from 35% to 13%). The UK imposed the biggest increases of any major economy in the study (see table below) – one of the few countries to do so. British workers earning USD1million saw their tax bills rise by 4 percentage points over the period, from 39% to 43%. Comments Alan Farrelly, Partner at UHY Farrelly Daw White Limited: “Many governments around the world have tried hard to ease the tax burden on take home pay in the past twenty years – and Ireland has been leading the way.” “By making bold cuts to income tax rates, policymakers have sought to bolster consumer spending power, improve their country’s attractiveness to an increasingly internationally-mobile workforce and boost economic growth.” He adds: “It’s an approach which has contributed to Ireland’s robust GDP performance in recent decades.” “While this study did not take account of social security and other taxes such as USC impacting individuals’ net income, the reduction in USC rates in consecutive budgets and the 2016 decrease in the higher rate of income tax from 41% to 40% are positive steps in increasing the net income of individuals that we would encourage the Government to continue going forward.” UHY’s data also reveals the extent of global economies’ GDP growth in the last thirty years, since the UHY network was founded in 1986. Their figures show that Ireland’s GDP has grown by 278% in the past thirty years, outstripping the global average of 135% GDP growth (see third table below). The European average was 74%. Income tax rates for higher earners (USD 1 million) [table id=9 responsive=scroll responsive_breakpoint=device /] Income tax rates for lower earners (USD30,000) [table id=7 responsive=scroll responsive_breakpoint=device /] Change in Gross Domestic Product (GDP) since the UHY network was founded in 1986 [table id=8 responsive=scroll responsive_breakpoint=device /] GDP data from the United States Department of Agriculture. Fill in your email to your right and download the full study now. #2016

Application to Court for an Order Extending Time to File an Annual Return Following the commencement of the 2014 Companies Act on 1 June 2015, a company which has missed, or knows that it will miss the deadline for filing its annual return with the CRO, may make an application to the District Court for an Order to extend the time for delivery of its annual return. The Application can eliminate the need for a company to pay late filing penalties and also allows the company to retain their Audit Exemption which is otherwise lost for 2 years. The company must put the Registrar of Companies on notice that it is applying to the court and must deliver the applicable Court Forms to the CRO at least 21 days before the Court hearing. The CRO will issue a Letter of Acknowledgement which the Applicant must provide to the Court. Under section 343 of the 2014 Act, applications for an extension of time to file an Annual Return may be made to the District Court (or to the High Court). The Court may, if it is satisfied that it would be just to do so, make an Order extending the time in which the annual return of the company, may be delivered to the Registrar of Companies. An application to the Court can only be made in respect of an annual return which has not already been delivered to the CRO. Only one Order may be made in respect of a particular year. The Order may, at the discretion of the Court, be granted to include multiple years for which returns are outstanding. The extension of time to file an Annual Return does not alter the Annual Return Date (ARD) of the company. If the company delivers the annual return for the year in question to the CRO within the extended time period specified by the Court, the annual return will have been delivered on time and company will not have to pay late filing penalties or lose its audit exemption (if applicable). In other words, the annual return will be treated by the CRO as having been delivered on time and the consequences of late filing will not apply to that annual return. How does the process work? The company cannot represent itself so it must have the appropriate legal representation in Court. The main steps of the procedure can be summarised as follows: An application for a Court date must be made to the District Court in which the company’s registered office is situated. A copy of the above notice of application and a copy of the Affidavit must be served on the CRO. The application and a declaration of service to the Registrar are then filed with the Court no later than four days before the date fixed for the hearing. Upon completion of the hearing, if the Order is granted it should be filed at the CRO (usually within 28 days) and the B1, accounts and standard filing fee should be delivered to the CRO no later than the date to which the extension has been granted. Frequently Asked Questions? [accordions id=”2930″] Please contact Richard Windrum, in our Corporate Compliance team, who would be happy to assist you further. richardwindrum@fdw.ie +353 42 933 9955 #2016

Blockchain Technology will eliminate the need for centralised institutions like banks or governments to facilitate trade, evolving age-old models of commerce and finance into something far more interesting: a distributed, transparent, autonomous system for exchanging value. What is Blockchain and how will Blockchain Technology impact us? Bettina Warburg, a blockchain researcher, entrepreneur and educator spoke at the TED summit this year, answering key questions you may have. Watch the clip below to find out more… #2016

Reward your employees with up to €500 tax free under the “Small Benefit Exemption Scheme” Are you looking to reward your employees with a bonus this Christmas? Did you know under the existing Benefit-in-Kind arrangement, an employer can provide an employee with a single “non-cash” benefit up to €500 without it being subject to PAYE, USC and PRSI. “This is effectively a saving to an employer of up to €700 ” Conditions: The treatment does not apply to cash payments, which are taxable in full. No more than one such benefit given to an employee in a tax year will qualify for such treatment. If more than one benefit is given in a tax year only the first benefit will qualify under the Small Benefit Exemption Scheme, even if it is less than €500. The maximum value for this benefit is €500 (up from €250 since 22nd October 2015). Where a benefit exceeds €500 in value the full value of the benefit is to be subjected to PAYE, USC and PRSI. The benefit cannot form part of a “salary sacrifice” scheme. For more information about this please feel free to contact me using the details to your right. #2016