Global - FLYING COLOURS CENTRAL AMERICA POISED FOR VIBRANT FUTURE - UHY Auditores & Consultores, SA
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
global
ISSUE 11
FLYING
COLOURS
CENTRAL AMERICA
POISED FOR
VIBRANT FUTURE
BACK IN THE GAME
FOOTBALL’S ROAD TO RECOVERY
GETTING THERE The network
OVERHAUL FOR GLOBAL SUPPLY CHAIN
for doing
HOME, HOTDESK OR HYBRID business
THE FUTURE FOR POST-COVID WORK HABITS
2 UHY GLOBAL May 2021 WORD OF WELCOME
IN THIS ISSUE
3
BEAUTIFUL GAME
16
NEW WORLD OF
WORD OF
Is football poised to
return to normal?
AGILE BUSINESS
Changing habits
WELCOME
4
that will outlast Welcome to issue 11 of UHY One of the biggest symptoms
the pandemic Global, our twice-yearly magazine of managing the virus has been
for international businesses. This a new nationalism including
‘JUST IN TIME’ TO
is the second ‘lockdown’ issue, the closing of borders and
‘NOT ENOUGH’
meaning that at the current contrasting strategies to deal
Covid lessons for
time, the Covid-19 pandemic with the threat. In our feature
global supply chain
is still throwing a dark shadow Global Trade Reset, we examine
19
across our world. A year on from the perfect storm for business of
the outbreak, travel and social global disruption under Covid-19
freedoms remain restricted in with added Brexit, and a new
GAME ON
many countries, industries and US administration keen to undo
Historic team
jobs continue to suffer, and so many of the policies developed
8
weathers storms
many people continue to lose by the previous administration.
their lives. On behalf of UHY
International, I extend our sincere I expect to see the resumption
BEATING
sympathies to everyone blighted of many cultural activities lost
THE ODDS
by this dreadful disease. to us over the last 12 months.
Strength in numbers
When viral transmission falls, it
for Central America
20
While nothing is certain in the will be a joy to once again visit
world, I am taking heart from the theatre or watch a game of
GLOBAL TRADE
the huge progress being made soccer. Our regular All Around
RESET
to develop, test, produce and The World page, opposite, kicks
Can the world
deliver the vaccines we desperately off this edition of UHY Global,
need. A substantial proportion of with a look at how the ‘beautiful
12
economy build
back better?
our most vulnerable populations game’ is already making a cautious
will be offered immunisation comeback. Also in this issue, fans
VOYAGE OF as 2021 moves forward. I am can read about KS Cracovia, a
DISCOVERY also profoundly hopeful that sporting institution in Poland, and
Profile of Antonis the amazing resilience we have a client of our Polish member firm.
Kassapis seen in all of our communities,
personal and professional, will These are optimistic stories for
14
GLOBAL NEWS
23 help return us to a more normal
life – with some new perspectives.
a year that promises to put the
worst behind us. I hope you enjoy
reading them. If you would like
SERVING CLIENTS,
Stories from SERVING Inevitably, many of our features in to dig deeper and browse our
around the world COMMUNITIES this issue of UHY Global consider expanded digital edition of UHY
Celebrating our the impacts of Covid-19 on a Global, you can find it online, here:
inspirational people range of economic and geopolitical www.uhy.com/publications.
activity. For businesses reliant
on international supply chains, Dennis Petri
the pandemic has asked some Chairman, UHY International
very tough questions of their
15
INSPIRATION AND
resilience. In our article: From
‘just in time’ to ‘not enough’,
we look at how pre-pandemic
INNOVATION
production and distribution
Staying competitive
models fell short, and what lessons
under duress
have been learned, a year on.
ALL AROUND THE WORLD UHY GLOBAL May 2021 3
WINNING BACK
THE CROWDS
COULD TWO MAJOR INTERNATIONAL FOOTBALL
TOURNAMENTS IN THE SUMMER OF 2021 SIGNAL
A RETURN TO BUSINESS AS NORMAL?
iStock.com/Barcin
Will 2021 mark a return to normal for the was, but unsustainable in the longer term. People want to be associated with success,
beautiful game? Two major international Football clubs are grateful for the support whether they are college students or
competitions are scheduled to go ahead, of business where they have it. MKS potential investors into an area.”
delayed from 2020 because of the Covid Cracovia, a club in Poland’s top division
pandemic. Euro 2020 (as it is still called) is and a client of Polish member firm UHY Successful sports teams not only bring
being played across 12 European countries ECA Group, is owned by international direct wealth to a city or region, but
this summer, culminating in the final at capital group and global software also contribute economically in terms
Wembley Stadium in London. On the other developer Comarch S.A. (see client story, of city visibility, tourism and investment.
side of the Atlantic, the Copa America is page 19). The organisation’s other activities That is even more true for host cities
also underway in June and July 2021. offer some level of financial protection for of major international tournaments,
the team. which are boosted by infrastructure
The arrival of effective vaccines has raised spending before an event, fan spending
hopes that the matches will take place in during it, and an intense media focus on
LONG-TERM CHALLENGES
stadiums teeming with cheering fans, but local amenities, history and tourism.
UEFA – European football’s governing body In a report for the World Football Summit,
– has made no secret of the fact that it is which focuses on the business side of the
HOPING FOR THE BEST
planning for several different scenarios. game, industry experts suggested that
many of the challenges created by the While football’s governing bodies are
virus will still be felt in 2024, as the sport keen to stage major tournaments in the
struggles with limited attendances, reduced summer, doing so without spectators – or
sponsorship and a fall in merchandising with only a limited number – will be a
There is a feelgood and licensing revenues. Smaller clubs that major blow for host cities. Elliott says that
rely on nurturing young talent before is especially true when cities have invested
factor that raises selling it to larger competitors may also in infrastructure in the expectation of
recouping the outlay from the economic
an area’s economy suffer from a decline in transfer fees.
activity of thousands of visiting supporters.
when a football Elliott Buss, a partner at UK member firm
UHY Hacker Young in Newport, Wales, “These cities will have been spending in
team is doing well. and head of UHY’s national sports group, expectation of full hotels, packed bars
says the wider economy of an area is and restaurants, as well as fan spending
significantly affected when football fans in and around grounds,” he adds. “The
go missing. “It is the pubs and bars in city lack of fans won’t matter so much in
centres and around the ground (when London or Rome, which will have spent
As the pandemic swept across the world
they are open), the caterers, the security very little, if anything, on additional
in spring 2020, many professional clubs
firms... all these rely on an influx of infrastructure, but remember that cities
were left with plummeting income and no
football fans from the local area and also like Bucharest in Romania and Baku in
choice but to continue paying the wages
away fans from other regions,” he says. Azerbaijan are due to host matches too.”
of players and staff while maintaining
stadiums and training facilities. For the moment, the football industry
“There is a kind of feelgood factor that
raises an entire area’s economy when a is hanging on and hoping for the best.
Since then, football has returned, first
football team is doing well,” says Elliott. Everyone involved in the economics of
behind closed doors and more recently in
“So when a team gets promoted to the the game is hoping that the rivers of
front of limited numbers of fans in some
top tier, you see a boost in applications to revenue from modern top-level football
regions. The situation is better than it
the local university from foreign students. will soon flow freely once again. n
4 UHY GLOBAL May 2021 FROM ‘JUST IN TIME’ TO ‘NOT ENOUGH’ CORONAVIRUS AND GLOBAL SUPPLY CHAINS
FEATURE – GLOBAL SUPPLY CHAINS UHY GLOBAL May 2021 5
A t the start of the pandemic, manufacturers and retailers
struggled to source the parts and products they needed as
the global supply chain ground to a halt. A year later, what lessons
have been learned?
When coronavirus spread rapidly around Around the world, businesses were hit
the world in the early months of 2020, from both sides. As markets shrunk,
the effects on global supply chains were companies had to fight for every new
immediate and obvious. Health services piece of business, only to see efforts
quickly ran short of personal protective to fulfil hard-won orders hamstrung
equipment (PPE). Supermarket shelves by malfunctioning supply chains.
emptied of staple foods such as rice
and pasta as consumers rushed to stock
up on store cupboard essentials.
While these shortages made headlines
The pandemic
around the world, behind the scenes
manufacturers faced their own supply has provided an
chain challenges. When China went opportunity to
into lockdown early in the pandemic,
many businesses struggled to source redefine best practice
the equipment and components they in warehousing
needed. As the crisis spread across
the globe, supply chains crumbled. and logistics and
Morito Saito, vice president and director at
create stronger
UHY FAS Ltd, Japan, says that in the early supply chains
months of the pandemic procurement was
a major headache for small and medium-
that are better
sized businesses in particular. “These able to withstand
businesses could not source the quantity of
parts they needed, and they did not know
global shocks.
when logistics would recover and parts
would be available again, causing great
uncertainty. In addition, they did not have
the diversified network that could step in
and immediately arrange replacements.” BACK TO NORMAL?
In Brazil, too, manufacturers suffered The situation a year later is much
as Chinese workshops shut up shop. improved, at least on the supply side.
Carlos Bernardo Gonçalves, corporate Despite many northern hemisphere
finance partner at UHY Bendoraytes & nations having endured a winter wave
Cia – Auditores Independentes, Brazil, of Covid-19, PPE shortages are not a
talks of a perfect storm created by a pressing concern and supermarkets remain
scarcity of supply and the exchange well stocked. Manufacturers in many
rate depreciation of the Brazilian real countries might be struggling, but that
at a time of global uncertainty. is more from a dearth of customers than
a scarcity of parts and components.
“We also had some cases of clients who
suffered from the lack of components So, is the supply chain crisis over? Is it back
and raw materials, especially in areas to ‘business as usual’ for manufacturers
such as clothing and electronics and retailers who have in recent
manufacturing, which had China as years favoured lean and ‘just in time’
their largest supplier,” he adds. procurement policies? The pre-Covid supply
iStock.com/Kosal Hor chain was focused on rapid delivery and
6 UHY GLOBAL May 2021
reducing the costs involved in stockpiling valuable companies are those that are best is underpinned by this as well as by
parts and products, but priorities may be at cutting costs. Lutfey Siddiqi, a visiting the fragility of links which emerged
shifting. Many experts say it is time for a professor in practice at London School of during the crisis.”
re-evaluation of our reliance on the kind of Economics’ foreign policy think tank LSE
complex international supply chains that IDEAS, believes that the ‘de-globalisation’
struggled in the face of a global crisis. associated with the pandemic “has
challenged the value of hyper-efficient,
According to these voices, Covid should super-optimised supply chains... cost Manufacturers
act as a wakeup call for the global
procurement sector. They argue that the
cutting is no longer an unequivocal and retailers are
indicator of returns; it may actually signal
pandemic has provided an opportunity increased risk and reduced resilience.” realising that
to redefine best practice in warehousing
and logistics and create stronger supply In other words, lean and complex
relying on a single
chains that are better able to withstand supply chains may make companies less supplier for a
global shocks. They argue that resilience attractive to investors in future, because
should replace cost as the primary criteria they are inherently vulnerable. But how
vital component or
of a functioning procurement strategy. to make supply chains more resilient? popular product
Using digital tools and AI to model the
That is partly because the Covid pandemic represents a huge
effects of various shocks and diversify
is by no means over, and partly because supply accordingly is one potential business risk.
global supply chains were stretched to solution. Insisting that suppliers implement
breaking point even before Covid-19. disaster recovery planning is another.
Global warming is leading to more of
the extreme weather events – floods, One idea that has gained considerable
fires, hurricanes – that make ‘just in time’ support since the start of the pandemic Is onshoring realistic? Many national
delivery harder to guarantee. Then there is the ‘onshoring’ of supply chains, governments think revitalised local supply
are geopolitical threats, most recently which simply means sourcing more chains can help post-Covid economic
highlighted by the US-China trade war. parts and materials closer to home. recovery. The PPE crisis at the start of the
Research completed before the pandemic This reduces the risks associated with pandemic highlighted the risks of relying
found that companies already expected shipping goods thousands of miles and on distant producers for vital materials,
disruption to production lines for one or gives national governments the power and at the same time showed that it was
two months every three to four years. to step in and support producers of vital possible to create new domestic supply
As the researchers noted, “the fact is materials who may be struggling. chains almost overnight. Alan Farrelly, UHY
that the world has more shocks.” Board member and managing director
British economist and author Paul Ormerod
of UHY Farrelly Dawe White Limited,
believes the pandemic has made the idea
RISKY COST CUTTING Ireland, says local production of PPE was
of domestic procurement more attractive.
Modern supply chains were created for quickly accelerated as the country’s over-
“The crisis has obviously led to geopolitical
cost and efficiency, not for resilience. reliance on China became clear. “The fact
connections being reconsidered in a pretty
But even stock markets may be starting that Ireland needed to acquire 15 years
fundamental way,” he says. “The concept
to re-evaluate the idea that the most of average annual supply from China
of bringing manufacturing back (to the UK)
FEATURE – GLOBAL SUPPLY CHAINS UHY GLOBAL May 2021 7
iStock.com/JESP62
during the first half of 2020 showed the of new factories and equipment, in Sectors that are now considered of
need to become more self-sufficient,” reality local production will struggle to national importance – the production of
he says. “In the race for supply, quality compete with Chinese imports on price. basic medical supplies being one – may
was compromised, and the fact that Nevertheless, there is evidence that benefit from public investment and other
alternatives have now been sourced more Japanese businesses are aware of the stimulus measures to encourage self-
locally could be the way of the future, for need to diversify their supplier base. sufficiency. In other areas, “companies
PPE and other vital products or materials. will start to consider the risk of global
In a short space of time Ireland had to “Some domestic manufacturers have pandemics and other shocks in supply
create a new industry, and that will allow begun to move their supply chains chain decision-making, tending to
the country to become more self-sufficient from China to Thailand, as well as geographically diversify suppliers even
should the need arise in future.” Vietnam and Indonesia, and are further if margins are reduced,” he says.
In the Netherlands, too, there are hints strengthening their local procurement
that businesses in some sectors are trying and production systems,” Morito says. Carlos adds that, for business to
to source parts and components closer But he adds that many Southeast Asian become more resilient in the long
to home. “I have heard from Dutch countries have some way to go before term, investors and stock markets
companies in the high-end electronics they can match China’s advanced will have to reward organisations for
industry (dominated by low volume and manufacturing capabilities, and that strengthening supply chains without
high complexity) that are looking for China will remain the preferred supplier punishing them for increased costs. But
opportunities to make supply chains more of a wide range of industrial materials change is clearly needed, and the early
resilient through more regional sourcing,” and components in the short term. signs are positive. Manufacturers and
says Paul Mencke, partner at Govers retailers are realising that relying on a
Accountants/Consultants, Netherlands. single supplier on the other side of the
world for a vital component or popular
In that case, ‘regional’ sourcing would product represents a huge business risk.
likely mean the EU, though Paul’s own Many national Supply chain shocks are likely to become
experience is instructive. The pandemic more common. One positive outcome
struck just as the Eindhoven office governments think of Covid-19 would be the widespread
was having the glass roof in its atrium revitalised local re-evaluation of what constitutes best
replaced, forcing a long delay as the practice in supply chain management. n
Italian supplier stopped work for an
supply chains can
extended period of lockdown. help post-Covid For more information about UHY’s
capabilities, email the UHY executive office,
economic recovery. info@uhy.com or visit www.uhy.com
AN EVOLVING STORY
While shortening supply chains may
increase resilience to some extent, no
supply chain is invulnerable. There are
other issues with local procurement.
In Brazil, Carlos Bernardo Gonçalves
Morito Saito says that, while Japanese
agrees that supply chain management is
authorities promote domestic
changing thanks to the pandemic, but
procurement by subsidising the purchase
through evolution rather than revolution.
8 UHY GLOBAL May 2021 BEATING THE ODDS CENTRAL AMERICA LOOKS FORWARD TO A BRIGHTER FUTURE
FEATURE –- ???
BEATING THE ODDS UHY GLOBAL May 2021 9
F ew regions have struggled harder than Central America to forge
economic and political viability and unity in a globalising world.
How is a joined-up approach to trade benefiting traditional and
modern businesses – and how far will recent success in these areas
make sure they can bounce back from the challenges of Covid-19?
Like the earthquakes and volcanoes challenges. Sustainable recovery and
which define the region’s geology, new opportunities will only happen
the eight nations of Central America with bold emergency measures and
define its future. Belize, Costa Rica, these must work hand in hand with
Dominican Republic, El Salvador, a longer-term vision. We are here to
Guatemala, Honduras, Nicaragua and support our clients to make these
Panama are set to drive the region’s new measures work for them.”
growth and prosperity. They have fought
hard, first for their independence and “Everything we do collectively now could
latterly for their reintegration into a affect our national development over
more cohesive whole. 2021 marks the next decade, and beyond,” he says.
30 years since the Organización de
Estados Centroamericanos (ODECA) set
a new treaty of cooperation in motion,
supported, since 1993, by the Central
American Integration System (SICA) Everything we do
which is observed internationally by
eleven regional advisors, including the US
collectively now could
and Canada. SICA’s four main pillars of affect our national
support revolve around political, socio-
cultural, economical and sustainable development over
management of natural resources and the next decade,
their ongoing commitment has always
been to achieve ‘peace, freedom, and beyond.
democracy and development’.
STRONGER IN RECOVERY
Armed with support from SICA and
Foreign investment and technical
other organisations, together with
assistance are key to new economic
clear engagement from regional UHY
success. The US, currently Central
member firms, clients and governments
America’s most important trade and
in individual jurisdictions, everyone is
investment partner, must target
working hard to adapt to global and intra-
investments aimed at generating
regional opportunities as well as dealing
new employment opportunities and
with difficult public health and political
supporting sectors, essential for growth
challenges. The will to thrive as a nation
and regional integration. As with other
is beyond question – indeed, there’s a
countries hit by the pandemic, Central
general optimism that the region will be
America has experienced weakened
stronger in recovery than ever before.
fiscal positions and strained public
“According to Omar Pérez, managing resources. Multilateral development
partner, UHY Auditores y Consultares banks and international financial
SA, in Honduras: “All our UHY member institutions must play a major role in
firms across this region agree that financing Central American economies.
a positive, far-reaching response
POST-COVID PLAN
to the crisis must look further than
firefighting the immediate post-Covid The region’s major income relies on
impact with all its economic and health agricultural exports such as coffee,
iStock.com/Mabelin Santos
10 UHY GLOBAL May 2021
iStock.com/Marco Vasquez
bananas and pineapples. Tourism is opportunities are out there to trigger community in helping the region to
also fundamental to Central America’s success but now Central America promote growth and investment.
sustainability – and this has collapsed in must find ways to capitalise on them
the wake of Covid’s travel restrictions. by creating an economic reactivation INVEST IN CHANGE
plan for a post Covid-19 world. In recent years US companies have
The impact on both industries been looking to grow their nearshore
has been devastating but UHY The AALAC identifies three key areas trade into Central America – attracted
member firms across the region are of opportunity, confirming the region’s by the region’s competitive wages,
positive about building back. unique potential to be an integral part growing young working population
of a robust and sustainable recovery. and preferential trade access. The
In short, these potential building understanding is that by diversifying
blocks for long-lasting change are supply chains and relocating, US
the demographic bonus of a large businesses will be better protected against
An economic working-age population, nearshoring of future global disruptions. The advantages
multinational firms to Central America
reactivation plan and a renewed appetite for regional
for Central America if this happens,
is that the region will be in a strong
needs to create an economic integration. AALAC delivers position to become the first US choice
constructive, results-oriented solutions to for nearshoring and foreign investment
incentive for individual inform how the public and private sectors – both of which are critical for boosting
jurisdictions to can advance hemispheric prosperity and job creation and creating competitively
position the region as a core partner priced supply chain resilience.
attract nearshoring in the transatlantic community. Longstanding foreign investment
business opportunities. The challenges are clear. An economic
relies on newly revitalised cooperation
between leaders from the public and
reactivation plan needs to create an
private sectors so that together they can
incentive for individual jurisdictions
create workable solutions to address the
to attract nearshoring business
region’s historic barriers to growth.
The Adrienne Arsht Latin American opportunities – and AALAC’s support
Center (AALAC) points to strong regional must be harnessed by both public and The region’s second-largest trading
benefits, such as dedicated economic private sectors working together to partner is Central America itself.
zones and tax advantages – designed train and empower low-income youth. Intraregional trade between Honduras,
to improve ease of doing business. The There is also a role for the international El Salvador, Guatemala, Costa Rica andFEATURE– BEATING THE ODDS UHY GLOBAL May 2021 11
Nicaragua accounts for 27% of total AN INTEGRATION RESTART their place as a market that offers
exports and 13% of total imports – a Better understanding and expertise theeconomies of scale that will
status quo that will continue to flourish in business technology is central for lead to new market opportunities,
as each nation’s understanding of achieving sustainable development – full enhanced regional competitiveness and
the power of togetherness grows. economic integration has stalled partly dynamic job creation programmes.
because of longstanding technical and
It is imperative that governments “Our offer as UHY member firms in
practical hurdles. A sophisticated uptake
seize Central America’s demographic Central America is to build our reputation
of technology across the nations will
bonus of a thriving workforce and on consistent excellence and responsive
encourage growth and unity. Political
build initiatives that encourage young advisors. Our ability to work across our
leaders must put any tensions aside and
people not to move away from home. region’s national borders is unparalleled
prioritise an integration agenda with
and one which we are very proud of,”
technology as its beating heart. This
says René Pérez, founding partner of UHY
will comprehensively boost advances
Peréz & Co in Guatemala. “These are
in the implementation in policy, fiscal
unique times though and we will not rest
and monetary coordination, tax
A priority for harmonisation, the adoption of common
until we have done everything we can to
support our clients through the pandemic
Central American standards and financial sector integration.
crisis and on to much better times.”n
nations is to achieve If the countries of Central America
For more information about UHY’s
act as one now, they will take
structural change capabilities, email the UHY executive
office, info@uhy.com, or visit
for sustainable www.uhy.com.
development.
Central American nations must invest in
policies, new sectors and industries that
will reduce educational and economic
disparities, improve training for work
in a changing economic landscape,
create new jobs and attract more
women to the labour market. The Inter-
America Development Bank indicates
that these measures could result in a
33% increase in GDP per capita.
An immediate priority for all Central
American nations is to achieve structural
change for sustainable development.
Employment opportunities must be
protected and company closures avoided.
UHY member firms work closely with
clients to strengthen the liquidity of their
businesses and to guide them towards
operating under a ‘new normal’.
“We are introducing new service lines
such as forensic auditing and payroll
administration and we are working
with associated consultants in some
specialised areas,” says Arabellis Calderón,
managing partner, UHY Calderon
Gonzalez & Asociados, Dominican
Republic. “All our staff understand the
importance of excellent service and we
are learning to develop new options
and new thinking whenever we can.” iStock.com/Edfuentesg12 UHY GLOBAL May 2021
iStock.com/Freeartist
VOYAGE OF
DISCOVERY
A n idyllic childhood shattered by war made Antonis Kassapis a
refugee. The experience gave him tenacity and adaptability,
even allowing him to flourish in a profession he vowed he would
never be part of. The career I said
“We have a saying in Cyprus – Antonis later took a combined degree I would never follow
‘Whatever you hate and don’t in architecture and computer science was accountancy!
want, you see it all over you’. This and after graduating had the option
happened with my career.” Despite to continue in computers or study
his admission that accountancy was to become an architect. “To study
neither his first or even last choice of I needed a job to support myself.
career, there is no denying the success Cyprus was not yet an EU member
it down. In my six years as manager of
Antonis Kassapis has made of it. so I needed a work permit.”
the offshore business team I had gained
Growing up in the village of Kormakitis TAKING OPPORTUNITY specialist expertise and many contacts.
on the northern shore of Cyprus in I decided to start my own firm.”
One profession for which it was easier
the 1950s, the director and managing to get a permit was accountancy. “I GOING IT ALONE
partner of UHY Antonis Kassapis got a job as a trainee accountant and
Limited had other dreams. “My father Antonis set up in a rented office in
qualified in 1984. After the trauma of
was a teacher, we had plenty of books summer 1991 with a team of five. “One
losing my home in Cyprus I felt settled
to read and I imagined myself as client brought another and we became
and was at last earning a salary.”
many things – a painter or sculptor, a ‘one stop shop’ for international
singer, boxer, footballer, architect, The accountancy profession was on businesses wishing to use Cyprus.
civil engineer and more. The career the rise in Cyprus, and Greek speaking Besides accounting, tax and audit we
I stated categorically I would never accountants were in demand. In offered everything our international
follow was that of accountant!” 1984 Antonis was offered two jobs, clients needed for setting up in Cyprus.”
one managing a team working with
The childhood idyll ended dramatically in The UK was in recession when Antonis
offshore companies. “I started my job
1974 when Antonis had to flee from the left, but things were different in Cyprus.
in Nicosia in March 1985 and stayed
invading Turkish army, leaving his parents “I saw companies with profits, prospects
six years. I was one of the first in
at home. “My village was the nearest and hope. With my firm I always had a
Cyprus to specialise in international
point to Turkey so we felt the urgency. feeling that this could not last for ever,
business and I found it fascinating.”
I ended up a refugee in the UK where but 20 years later we had 50 staff and
I had an older brother at Birmingham Opportunity came knocking when more work than we could handle. But
University. Having just finished school, Antonis was 35 and spurred a huge the economy started shaking in the
I went to college to do A Levels.” decision – he was offered a lucrative role second decade of the 21st century.”
with a Middle East company. “I turnedPERSONAL PROFILE UHY GLOBAL May 2021 13
Amid the Greek debt and large bad THE JOY OF FAMILY
loans the two largest local banks By 1993 Antonis had embarked on
collapsed. Unlike Greece there was no another venture – a family. “I married
bail-out for Cyprus. “My country was Rona, a lawyer, the following year we
the first item in the international news had a son, Yiannis. Our second son,
for months. Not in a good way.” Marios, was born in 1995. We separated
in 2017 after our sons (pictured right
with Antonis) had left to study in
London, where they now work.”
We became a Today, the firm continues to flourish, and
engages strongly with the UHY network
one stop shop which they joined in 1992. “UHY has
for international been an important part of my career
and life. I have seen it grow from a small
businesses wishing friendly group to a global network, and
attending meetings helped me think
to use Cyprus. about how to improve my firm. Over the Lockdown gave our
years UHY has referred some good clients
to us and helped some of mine to grow firm space to do
internationally. I enjoyed my relationship
with UHY people I met over the years.
things we never had
ADAPTING FOR SUCCESS time for previously.”
The Covid-19 pandemic proved a
Confidence eventually returned, and
challenge and an opportunity for
today Cyprus has a thriving services
Antonis’s business. “The UHY network
sector, strategically important at the
support has been invaluable. There
crossroads of Europe, north Africa and
have been many positives amid the MR BEAN AND LIVERPOOL
the Middle East. “It has natural and legal
gloom – Covid forced us to strengthen
advantages which make it attractive That may involve his favourite pastimes –
our IT systems and online working
to international business and high net reading, his allotment and travel.
skills. Lockdown gave us space to do
worth individuals,” says Antonis. “At 40, I took up skiing and speedboat,
things we never had time for previously.
which I found exciting. I love films and
Antonis’s business navigated the Again, it’s adaptability that counts.”
TV, particularly crazy comedies like
crisis years well and he realised his Mr Bean, Monty Python and Borat.”
Among other priorities Antonis is
superpower was adaptability. “You have
focusing on succession planning which
to be able to change fast to cope with His other great love is football –
he hopes will enable the firm to continue
circumstances and take opportunities. he and his sons support ‘the best
smoothly after him. “I’m looking forward
My relationships with clients were vital. club in the world’, Liverpool FC.
to an active retirement, doing new things
As well as providing good service I was “We are happy when they win and
and relaxing with friends and family.”
friends with many and they referred miserable when they lose!”
me to their associates. This was the
Asked about his inspirations in life
main way my firm grew at that time.”
Antonis does not hesitate. “My parents
gave me the desire to succeed in a
Antonis and his team
fair and workmanlike way and are
my inspiration. My father Elias died
in 2020 and is buried in his beloved
Kormakitis where my mum Ioanna
still lives. Finding myself a refugee
from Cyprus in England, I had to solve
problems for myself as I had learned
to. My 40-year career has brought me
personal satisfaction, financial comfort
and skills to cope with life situations.
Despite its reputation, accountancy
has never been boring for me.”n
To find out more about UHY
Antonis Kassapis Ltd visit
www.uhy.com.cy or email
antonis.kassapis@cosmoserve.com14 UHY GLOBAL May 2021 GLOBAL NEWS
NEW LEADER FOR WORLD TRADE BODY
Economist and international development alongside overseeing a USD 81 billion
expert Dr Ngozi Okonjo-Iweala has operational portfolio in Africa, South
taken office as the first female and Asia, Europe and Central Asia.
first African Director General of the
World Trade Organization (WTO). Speaking on her selection as Director
General, Dr Okonjo-Iweala highlighted
Dr Okonjo-Iweala twice served as the importance of a collective response
Nigeria’s Finance Minister and was to rebuilding the global economy. “A
responsible for reforms enhancing the strong WTO is vital if we are to recover
transparency of government accounts fully and rapidly from the devastation
and strengthening institutions against wrought by the Covid-19 pandemic,”
corruption. She also had a 25-year she said. “Our organisation faces a
career with the World Bank, where great many challenges but working
she rose to become managing director together we can collectively make the
from 2007-2011 and spearheaded WTO stronger, more agile and better
initiatives to assist low-income countries, adapted to the realities of today.”
ARM’S LENGTH NEW ERA FOR UK AND EU
GUIDANCE Following the endorsement of the
largest ever bilateral trade agreement
contracts. EU stock trading in the
UK has ceased and moved to within
The Organisation for Economic Cooperation
on 30 December 2020, the UK has the single market. A memorandum
and Development (OECD) has published
completed its separation from the of understanding around the
guidance to help address practical
European Union (EU), with new regulation of financial markets is
challenges relating to transfer pricing rules
arrangements now in force for trade, expected soon and discussions
raised by the coronavirus pandemic.
travel, immigration and security. are ongoing. The treaty will be
Developed and approved by the 137 subject to review every five years.
Under the post-Brexit trade and
members of the Inclusive Framework on
cooperation treaty, UK businesses will
Base Erosion and Profit Shifting (BEPS), the
be able to trade products with the EU
guidance seeks to provide clarity on applying
on a tariff-free and quota-free basis,
the arm’s length principle (ALP) during
although customs declarations, border
periods impacted by Covid-19. Four key
checks and special licences for some
areas have been identified where additional
products have been introduced. Non-
limitations and practical challenges are most
tariff barriers for medical, chemical
significant: comparability analysis, losses
and other products have been
and the allocation of Covid-specific costs,
reduced, and UK and EU businesses
government assistance programmes, and
will have continued access to bid for
advanced pricing agreements (APAs). iStock.com/Charlie AJA
each other’s government procurement
For further information, visit www.
oecd.org/tax/transfer-pricing/guidance-
on-the-transfer-pricing-implications-
of-the-covid-19-pandemic.htm
AUDIT QUALITY UPDATE
The International Auditing and providers. They also look to increase
Assurance Standards Board (IAASB) audit firm leadership responsibilities
has issued revised standards aimed and accountability, increase focus
at strengthening and modernising on flows of communication and
audit quality management. strengthen the monitoring of quality
management systems and the
Recognising the need for proactive
effective remediation of deficiencies.
and adaptable quality management,
the new standards introduce a The standards are effective from
risk-based approach focused on 15 December 2022, replacing
achieving quality objectives and the the current IAASB standards on
impacts of technology, networks quality control and audit.
Shutterstock.com/360b
and the use of external serviceCOGS AND WHEELS UHY GLOBAL May 2021 15
iStock.com/Fresh Splash
INSPIRATION AND
“The rapid deployment of relevant
technologies to provide clients with
uninterrupted service, has been
INNOVATION
impressive,” he says. “It feels like our
members have squeezed years of learning
into just a few months. By sharing
this on calls and through our regular
H ow does a global accountancy network stay
competitive under duress? The answers lie in
knowledge share, relationships and communications.
communications, ideas, experience and
recommendations have effectively rolled
out through the network very quickly.”
While it is expected of most businesses to multinational clients working with our PEOPLE FIRST
stay competitive and evolve to meet the members in different countries. While we The wellbeing of over 8,500 professionals
changing needs of their market, the global see this in normal times as a competitive worldwide has also been a priority for firms,
pandemic is proving to be a disruptor of the strength, it has now proved to be a major and the network. To ensure support – both
highest order, forcing leaders to re-evaluate factor in surviving the pandemic.” technical and personal – is always available,
existing models and plan more carefully for UHY member firms have been scrupulous
the future. From supply chain resilience to Through regular video calls between the
in assessing the new working environments
employee wellbeing, company architectures UHY Board and member firms across the
and meeting the needs of their people. With
are being redefined at a rapid pace. world, and by taking its usual regional and
such a changing mix of Covid restrictions
global conferences online, the network
and guidelines across the 100 plus countries
For global accountancy and consulting has been able to maintain the momentum
in which UHY operates, a plethora of
networks like UHY, comprised of of cooperation and communication
measures and solutions has emerged.
independent member firms, there are between UHY colleagues. While on-screen
Leadership, teamwork and personal
additional challenges. Each member will relationship-building will never replace
resilience were all issues studied and
manage its own domestic and international face-to-face networking, Rhys recognises
debated during the Annual Meeting online
client base, meeting needs, ensuring that there have been unforeseen benefits.
in 2020, and member firms have been quick
continuity of service and identifying and
“Our online conferences had a wider to share their concerns and find solutions
implementing necessary change. The
audience, with more participants working with their colleagues across the network.
risks of insufficient change, not adapting
quickly enough or simply being unsure of at an operational level within their firms.
“Keeping staff safe, effective and motivated
how to move forwards, are clear. Network They have provided an additional value
through lockdowns has been of paramount
management must in these circumstances to discussions and knowledge sharing,
importance for the UHY Board and the
fulfil its role of catalyst, facilitator and and further strengthened the practical
membership of this network,” says Rhys.
motivator, on top of its quality control and working relationships between firms.”
“Technology has played a massive part,
member support obligations – no small task. the key enabler, but I have to credit the
AGILITY AND IMAGINATION innovation, imagination and endeavour
WORKING TOGETHER As member firms shared their Covid-19 of our colleagues around the world, to
According to UHY International’s chief journeys throughout 2020, valuable insights find ways through. There has always
executive officer Rhys Madoc, the emerged. Not least, the importance of been an almost familial culture within
network’s longstanding culture of close maintaining proactive communications and between UHY member firms. The
collaboration and relationship-building with clients, providing trusted advice to pandemic has challenged people like never
between firms has been a key factor in help steer businesses through the maze of before, but I am proud of the practical
coming through 2020 relatively unscathed. government support schemes – and with and emotionally supportive responses I
an eye to the future, helping clients to have seen from our firms, which perfectly
“Working together has been a foundation establish resilient, more agile infrastructures. exemplify this close-knit network.”
stone of the way UHY operates, right from
the network’s inception nearly 35 years Top of the list for Rhys has been the As 2021 moves forward with a Covid-
ago,” says Rhys. “It provides consistency, speed at which member firms have experienced network of member firms,
quality and joined-up personal service to adapted to remote working. and with mass vaccinations a reality,
recovery and growth beckons for UHY. n16 UHY GLOBAL May 2021 PERSPECTIVES
A NEW WORLD OF
AGILE BUSINESS
STICKING PLASTER SOLUTIONS ADOPTED IN 2020
ARE MORPHING INTO NEW WAYS OF WORKING
THAT WILL OUTLAST THE PANDEMIC. UHY EXPERTS
DISCUSS THE WAYS BUSINESS HAS BEEN CHANGED
FOREVER BY COVID-19.
iStock.com/Fresh SplashPERSPECTIVES UHY GLOBAL May 2021 17
I
n January the chief executive of Unilever told a conference
that a significant part of the firm’s 150,000-strong global
workforce would never go back to the office full time.
“It’s essential to make sure business
clients have secure remote access
to essential systems from any
internet connection including
His words made headlines. Here was “If there is too much remote encrypted connectivity to employees,
further proof that the adoption of remote supervision, employees feel distrusted, suppliers and invoices,” he says.
work, an emergency measure when resulting in possible compromise on
Covid-19 swept across the world in 2020, work ethics. If it is too little, work BIG CHANGE AHEAD
was no longer seen as a temporary fix. and productivity could slacken.” If remote and hybrid working models
Alan Jope’s comments showed that for do become the norm after Covid, the
Unilever, there would be no going back. Still, remote work is likely to continue
consequences will be significant. Hybrid’s
Instead, the company would join a growing for many employees as part of a hybrid
appeal goes beyond its flexible working
list of businesses determined to offer a model, when they spend some of the
benefits for staff. Businesses are eyeing
hybrid working model (in which employees working week in the office and some at
potential savings in equipment costs,
split the working week between the office home. Employees want it – in a recent
bills for utilities (power and lighting)
and home) after the pandemic ends. UK survey, 73% of knowledge workers
and even reduced office space.
said they favoured a hybrid arrangement
In that way – and in many others – the after the pandemic, meaning companies A well planned hybrid work programme
pandemic has changed business for that refuse to offer it could face a could mean companies having to physically
good. Emergency measures that were recruitment and retention problem. host less than 65% of their workforce
adopted overnight when Covid first at any one time. That fact is leading to
struck are morphing into permanent the reimagining of offices as digitally
solutions that will outlive lockdowns and advanced, fluid spaces for meetings,
social distancing. The pandemic-fuelled Remote supervision is hotdesking and team bonding, with
transformation of business goes beyond
remote working to include the reimagining untrodden ground for most of the day-to-day work carried out
elsewhere. Research by Cisco Systems
of office space, the accelerated adoption many organisations. found that over half (53%) of larger
of new technology and prioritisation organisations plan to reduce the size of
of more secure supply chains. their office space after the pandemic.
The world is in the midst of perhaps the The result of this shift away from
biggest shake-up to business practice DIGITAL TOOLS FOR REMOTE SUCCESS large, centralised offices is potentially
since the invention of the internet. transformative. UHY firms around the
For companies considering a move
UHY’s global network of member world have already seen clients reduce
to hybrid working, new digital tools
firms is part of this change, working office space in preparation for a post-
that promote virtual communication
with businesses on the ground. pandemic world. In addition, the flight
and collaboration are vital. This could
REMOTE WORKING HERE TO STAY mean videoconferencing and file from city centres could see an increased
sharing software, teamwork tools, and requirement for co-working spaces in the
According to some estimates, three
cloud-based unified communications suburbs and small towns where many
or four times as many people could
systems that let employees make of us live. Remote workers may replace
be working at home after the
professional calls from anywhere. the social aspect of office life by renting
pandemic than before it began.
communal desk space closer to home.
“You don’t necessarily need to spend
But making remote work as productive
a ton of money; there are many cost- The appeal of smaller offices away
and collaborative as its office-based
effective solutions out there,” says Adil. from city centre locations is one Roman
counterpart can be a challenge. Adil
The worry, he adds, is “the digital highway Seredynski, managing partner at Polish
Buhariwalla, partner at UHY James
suddenly widening, exposing businesses member firm UHY ECA Group, knows
Chartered Accountants, UHY’s member
to a huge magnitude of potential threat well. Lockdown has shown that it is
firm in UAE, says the supervision of
traffic, be it unintentional or malicious.” possible to work efficiently remotely, and
remote workers requires physical
has opened up the possibility of working
distance but ‘virtual closeness’. There Eran Amir, partner at UHY Shtainmetz- from smaller offices and premises away
is a fine balance to be maintained. Aminoach & Co CPAs, Israel, says the from the expensive centres of major cities.
use of digital tools that give businesses
“Remote supervision of work is untrodden
the ability to switch quickly to home “Our own firm has set up an audit
ground for many organisations, and
working has become a key measure subsidiary in a small town near Warsaw,”
threats arise from either too much
of business resilience, and that remote Roman says. “It’s much cheaper and
or too little of it,” Adil adds.
working will make cybersecurity it’s a university town, so there isn’t a
even more of a challenge. problem finding talented people. It’s
one possible model for the future.”18 UHY GLOBAL May 2021 PERSPECTIVES
COLLATERAL DAMAGE Donna adds that management of determination to make up for lost time.
Both the increase in remote work multinational entities (MNEs) are now Entrepreneurial opportunities will be
and the flight from city centres have focused on developing greater supply unlocked and the widespread shift to
consequences beyond office space and chain resilience for the months and years digital platforms also offers possibilities
location. UHY’s professional advisors ahead. “That might involve finding local for tech-focused firms and niche retail.
predict that businesses relying on the suppliers, redefining supplier relationships
and using technology to change the cost Roberto says that entrepreneurs are already
daily commute – food vendors near
structure where applicable,” she says. sensing this shift. “Some entrepreneurs
train stations, for example – may suffer,
see opportunities to get into new
or they may decide to relocate in
Adil agrees, but adds that sourcing new markets now, and venture capitalists
tandem with the workers they serve.
suppliers can prove tricky for many firms. are making money available. Risk takers
Hospitality businesses that rely on “Businesses have to forge partnerships and adapters will be the winners.”
corporate bookings may also lose out with new often, untried and untested
suppliers. This poses threats in terms of Agile businesses with flexible workforces,
in the ‘new normal’. In some cases,
reliability, quality, costs, and production a ‘digital-first’ philosophy and low costs
marketing efforts will need to target
and distribution delays,” he says. will be in the best position to exploit this
remote working teams who will still come
wave of consumer spending. Eran believes
together regularly for team building days,
professional advisors can help businesses
social contact and creative workshops.
remodel themselves for the post-Covid
Roberto Macho, managing partner at landscape. Could workforces be leaner and
UHY Macho & Asociados, Argentina, Lean and agile more agile, perhaps by merging roles or the
believes that some businesses, especially greater use of contractors and freelancers,
in badly hit sectors like tourism and
businesses that he asks? Businesses may require short-term
hospitality, will have mothballed large quickly adapt credit to increase stock during a period of
parts of their operations during Covid, limited income, and UHY member firms
and that reshaping them for the post-
to new business are on hand to help clients find the very
lockdown world might require “a pivot realities will thrive. best sources of credit for their needs.
through organic innovation and inorganic
Roman also believes that a professional
growth. Some may be forced to abandon
services network like UHY can help
the market in the longer term,” he says.
entrepreneurs grasp opportunities.
OPPORTUNITIES AS BUSINESS RESUMES “Through an ‘ask the expert’ platform,
RETHINKING THE SUPPLY CHAIN
There is no doubt that the post-pandemic supported by the Polish Chamber of
UHY experts agree that changes to supply era will be a challenging time for many Commerce, UHY ECA Group shared
chain management may be one of the businesses. But UHY advisors also predict information in the areas of labour
lasting hangovers of Covid. “Supply chain a period ripe with opportunity. Lean law, civil and commercial law, digital
disruption has clearly materialised with and agile businesses that quickly adapt transformation, finance, company
Covid-19,” says Donna Frye, director to new business realities will thrive. liquidity and debt, bankruptcy,
of transfer pricing, UHY Advisors Inc., restructuring and taxes,” he says.
Michigan, US. “Supply chain reorganisation Some economists are even predicting
has been constant for many (during Covid) a 21st century version of the ‘roaring With good advice and an agile mindset,
and accounting firms like UHY have been twenties’, a consumer-led spending many companies will do well but for
helping our clients manage the change.” spree driven by a post-pandemic others, the post-pandemic world will
present challenges, as measures adopted
during Covid become permanent.
UHY member can help businesses
navigate a new reality of hybrid work,
accelerated digital transformation and
a fresh focus on secure supply. n
For more information about UHY’s
capabilities, email the UHY executive
office, info@uhy.com, or visit
www.uhy.com
iStock.com/PekicCLIENT STORY UHY GLOBAL May 2021 19
GAME ON
UHY’S POLISH MEMBER FIRM IS HELPING
A HISTORIC FOOTBALL CLUB WEATHER
THE COVID STORM AND FIND SUCCESS
Shutterstock.com/Marcin Kadziolka
Founded in 1906, MKS Cracovia is the performance on the pitch would never “We quickly agreed on the method
oldest football team and active sports be undermined by financial issues off it. of cooperation with UHY ECA Group
club in Poland. Its volatile history includes and the first audits went smoothly,”
triumphs in the Polish top division (the For Comarch, UHY ECA Group’s reputation says Konrad. “All deadlines were met
Ekstraklasa) at one end of the spectrum, for excellent service was well established. despite the occurrence of force majeure
relegation and near bankruptcy at the “We already had positive opinions and during the audit period in the form of
other. Today, after years in lower leagues credentials around UHY ECA Group the pandemic. We are satisfied with
the club is re-established in Poland’s and UHY is a well-known brand,” says the quality and timeliness of UHY ECA
top flight, and last year competed in Konrad Taranski, CFO and vice president Group’s services as well as with a fully
the Europa League for the first time of the management board of Comarch professional approach to cooperation.”
in decades. In 2020 Cracovia won the S.A. “We could draw on the experience
Polish super cup for the first time. Off of earlier cooperation between UHY UHY ECA Group is now tasked with
the pitch Cracovia’s fortunes are also ECA Group and other entities related completing the next Cracovia audit, which
on the rise – it is now a subsidiary of to Comarch, so we were happy to trust may be more complex still. The Polish
Comarch S.A., the club’s Cracow-based the firm with the Cracovia account.” Ekstraklasa was one of the first leagues
sponsor and global software business to suspend matches due to the pandemic
For UHY ECA Group, Cracovia is a in March 2020. The league resumed in
listed on the Warsaw Stock Exchange.
labour of love. “Cracovia is more than May, with games played without fans
Football club finances are a complicated a football club, it is part of our football until the end of the competition in July.
business, with income generated through history,” says Dominik Biel, partner at So far, 2020/21 season matches have
gate receipts, media earnings, sponsorship, UHY ECA. “It is the oldest Polish club, been played behind closed doors.
club shop sales, hospitality franchises and and the beloved club of Pope John Paul
player transfers. Income can rise and fall II. Being an auditor of Cracovia is both As well as shortfalls in ticket revenue,
on an almost weekly basis. A poor run a private and professional passion.” the audit will take account of other
of form dampens matchday receipts and financial pressures caused by Covid,
Associate partner Patryk Steidten with reductions in hospitality and
shop sales, and success has the opposite
agrees. “Football is my greatest hobby, media income. Cracovia will weather
effect. Outgoings are equally unstable.
so the analysis of the business was the storm thanks to the support of
Player wages usually make up the lion’s
one of my favourite projects.” Comarch, but for UHY ECA it will be a
share, and transfers can dramatically
alter the short term financial picture. football club audit unlike any other.
CLINICAL FINISH
Happily, the firm has the complete
STRONG PARTNERS The trust between UHY ECA Group and
confidence of the club and its parent
Comarch was reinforced by the smooth
Comarch first acquired shares in Cracovia’s company to perform to the highest
handling of the first audit. UHY ECA
holding company in 2003, and now holds standards. Konrad says the cooperation
Group was contracted in 2019, and
66.11% of Cracovia share capital. In 2019 between Comarch and UHY ECA
completed the audit during the first wave
the club turned to Polish UHY member Group, and the quality of the work
of Covid in 2020. Comarch was impressed
firm UHY ECA Group to audit its financial so far has put the firm in a strong
by the firm’s commitment despite the
statements and licensee documentation, position to be considered for further
challenges presented by lockdown.
and to help ensure that the club’s contracts as the group expands. nYou can also read
