Crowe Horwath International Statistics - 2014 J. Kevin McGrath Audit | Tax | Advisory www.crowehorwath.net Capabilities Presentation to <Prospect Company Name> Objectives of meeting Introduce you to <Member Firm Name> Understand global issues facing your company Discuss a global relationship that exactly meets your needs Agenda Overview of <Prospect Name> How we are helping multinational clients succeed Overview of <Member Firm Name> Determine if there is value in having further discussions Audit | Tax | Advisory The world’s leader in scroll compressor technology and manufacturing. Insert Prospect Logo or Webpage (Example) © 2014 Crowe Horwath International 2 Understanding the Needs of Multinational Clients Want to build a sustainable organization and long term shareholder value Convergence of international accounting standards Identifying and managing enterprise risk on a global basis Compliance with complex international and local jurisdiction tax laws Shifting needs and priorities of capital sources Solution: The right international network that meets their needs Audit | Tax | Advisory © 2014 Crowe Horwath International 3 Overview of <Member Firm Name>: Firm Profile <Member Firm Legal Name> Market position: One of the <top 10> accounting and advisory services firms in <Country> and a leading independent member of Crowe Horwath International Audit leader: One of only <eight> firms in <Country> subject to an annual review by the <Regulator> Tax leader: Recognized as one of the fastest growing tax practices in <Country> Recognized as industry thought leaders in the < sector 1, sector 2, sector 3, sector 4, sector 5, and sector 6> A national reputation for delivering impeccable customer service Recognized as “the employer of choice” in <Locations> Areas of specialization Audit Tax Financial Advisory Optional Service 1 Audit | Tax | Advisory © 2014 Crowe Horwath International 4 Crowe Horwath International Statistics (as of December 2013) US$ 3,168.2m Total Revenue 118 Countries 684 Offices 3,352 Partners 21,363 Professional Staff 4,699 Admin Staff 29,414 Partners & Staff 9th largest international network of independent accounting and advisory services firms - International Accounting Bulletin (IAB) December 2013 Audit | Tax | Advisory © 2014 Crowe Horwath International 5 Crowe Horwath International: Global Profile A top 10 international network of accounting and advisory services firms Audit | Tax | Advisory www.crowehorwath.net Overview of Crowe Horwath International 9th largest international network of independent accounting and advisory services firms* US$ 3,168.2m Total Revenue 3% Growth 118 Countries 684 Offices 3,352 Partners 21,363 Professional Staff 4,699 Admin Staff 29,414 Partners & Staff * IAB Survey: World Leading accounting networks 2013: fee data Audit | Tax | Advisory As of December 31, 2013 Crowe Horwath International J. Kevin McGrath, CEO “Crowe Horwath has welded a truly international network of business experts drawn from the leaders of their professional communities. All share a commitment to delivering technical excellence and the highest standards of client service.” © 2014 Crowe Horwath International 7 J. Kevin McGrath - Chief Executive Officer Previously COO of Crowe Chizek and Co. from 2007 to 2012 Joined Crowe in 1976 and became a partner in 1986 Partner in Charge of Crowe’s firm-wide banking practice As COO, he was responsible for both practice management and Crowe’s go to market strategy Oversaw Crowe’s new product development, marketing, communications and industry specialties Member of the American Institute of Certified Public Accountants (AICPA) and the Indiana CPA Society Member of the AICPA’s National Banking Committee Audit | Tax | Advisory © 2014 Crowe Horwath International 8 Organizational Chart Audit | Tax | Advisory © 2014 Crowe Horwath International 9 Kamel Abouchacra – Chief Operating Officer Partner of Horwath Abouchacra & Co., overseeing client services functions for audit and tax advisory from 1999 to 2007 A founding partner of AD&A (a corporate restructuring firm) leading the firm’s M&A and financial advisory practice from 2005 to 2007 A member of Crowe Horwath International’s operations committee from 2002 to 2007, responsible for the Middle East and North Africa Associate Accounting and Assurance Director of Crowe Horwath International from 2007 to 2010 after which he was appointed as COO As a member of the Management Committee of Crowe Horwath International, he is responsible for overseeing the Audit & International Tax functions, managing the financial reporting function and running the operations of headquarters Member of the American Institute of Certified Public Accountants (AICPA) and the New York State Society Audit | Tax | Advisory © 2014 Crowe Horwath International 10 Global Ranking 2013 (in 000 US Dollars) Rank 2013 Network Name IAB Survey: World Leading accounting networks 2013: fee data Audit | Tax | Advisory Revenue Growth (US$m) Rate (%) NETWORKS 1 Deloitte 2 PwC 3 Ernst & Young 4 KPMG 5 BDO 6 Grant Thornton International 7 RSM International 8 Baker Tilly International 9 Crowe Horwath International 10 Nexia International 11 Moore Stephens International 12 PKF International 32,400.0 32,088.0 25,892.0 23,420.0 6,453.1 4,519.0 3,714.1 3,404.2 3,168.2 2,918.0 2,682.1 2,523.0 © 2014 Crowe Horwath International 4% 2% 6% 2% 7% 8% -7% 3% 3% 3% 17% -6% 11 Growth: Annual Fee Volume (in Millions of US Dollars) 3,250 3,000 Annual Fee Volume 2,750 2,500 2,250 2,000 1,750 1,500 1,250 1,000 Audit | Tax | Advisory Year © 2014 Crowe Horwath International 12 Crowe Horwath International Fee Revenue: IAB Categorization The chart shows a breakdown of Crowe Horwath’s FY13 revenue as reported in the International Accounting Bulletin (IAB), World Survey for 2013 Accounting & Audit Corporate Finance Management Consulting Risk Consulting/Other Tax Services Tax Services 24% Corporate Finance 1% Risk Consulting/Other 13% Management Consulting 12% Accounting & Auditing 50% Audit | Tax | Advisory © 2014 Crowe Horwath International 13 Distinction: Integrated Global Network* vs. Association Recent IFAC Ethics Code and the EU 8th Directive requires clear distinction between a “network” and an “association.” An “association” merely acts as a referral source between member firms; Crowe Horwath International “network” member firms: * Serve international clients as one, global organization * Constantly build human capacity Member Firms * * Work closely together to achieve the global organization’s vision Audit | Tax | Advisory * Proactively help each other Crowe Horwath International Network * Commit to living the core values and assure impeccable quality © 2014 Crowe Horwath International 14 The Crowe Horwath Brand Distinction Our brand principles* reflect what makes us distinct; our global reputation. * Relationships * Integrated Global Network * Impeccable Service Member Firms * Technical Expertise Audit | Tax | Advisory * Crowe Horwath International Network * Consistent Quality © 2014 Crowe Horwath International 15 Crowe Horwath International: Global Profile Crowe Horwath International Statistics* Member Firms & Business Associates 191 Countries 118 Offices 684 Partners 3,352 Partners & Staff Revenue 29,414 US$ 3,168.2M * As of December 2013 Crowe Horwath International 9th largest global network of independent audit and advisory services firms in the world - International Accounting Bulletin (IAB) Contact: J. Kevin McGrath, kevin.mcgrath@crowehorwath.net www.crowehorwath.net Audit | Tax | Advisory © 2014 Crowe Horwath International 16 Eduardo Pestarino - Regional Executive - The Americas Managing partner of Horwath Argentina and Horwath Consulting from 1999-2007, Buenos Aires, Argentina In 2004, Eduardo succeeded Ely Graciá as regional director of Horwath’s Latin America and Caribbean region (HORLAC) In his college years he joined Seoane Canepa, which later became the first member firm of Horwath & Horwath International Associates in 1960 Served in numerous international capacities, including participating in the international accounting and audit committee, conducting inspections worldwide and assuming responsibility for assurance services, compliance and quality control for the Latin America region Audit | Tax | Advisory © 2014 Crowe Horwath International 17 Crowe Horwath International: Regional Profile - Americas Regional Statistics – Americas* Member Firms & Business Associates 39 Countries 21 Partners Partners & Staff 1,501 10,456 * As of December 2013 Crowe Horwath International - Americas Representation in all major countries in North, Central and South America Contact: Eduardo Pestarino, eduardo.pestarino@crowehorwath.net www.crowehorwath.net Audit | Tax | Advisory © 2014 Crowe Horwath International 18 Mok Yuen Lok - Regional Executive - Asia/Pacific Trained at Ernst & Young, Kuala Lumpur Co-founder of Horwath Malaysia in 1990 – ranked #5 in the country Member of Young Presidents’ Organization (YPO) – currently Regional Education Chair winning the Global “Best of the Best” Education Award in 2007 Member of Entrepreneurs Organization (EO) – conferred International Member of the Year in 2001 Audit Committee Chairman of two publicly listed companies Founder and Director of a WIMAX company that was sold to a large Malaysian conglomerate Council Member of Hospis Malaysia, a private hospice offering free palliative care to patients with life limiting conditions Audit | Tax | Advisory © 2014 Crowe Horwath International 19 Crowe Horwath International: Regional Profile – Asia/Pacific Regional Statistics – Asia/Pacific* Member Firms & Business Associates 35 Countries 26 Partners 667 Partners & Staff 10,849 * As of December 2013 Crowe Horwath International – Asia/Pacific Representation in all major Asia/Pacific countries Contact: Mok Yuen Lok, yuenlok.mok@crowehorwath.net www.crowehorwath.net Audit | Tax | Advisory © 2014 Crowe Horwath International 20 Bernard Deloménie - Regional Executive - Europe, Mid-East & Africa Has over 35 years experience in the accounting profession, having spent his entire career with PwC and its predecessor firm, Coopers & Lybrand Part of the global management team of PwC with specific responsibilities for Africa and the Middle East Prior to moving to London in 1999, he was based in Budapest, Hungary where he was responsible for the corporate finance activities of PwC in central and eastern Europe, including Russia and the Commonwealth of Independent States Spent the previous 13 years in Africa building the Frenchspeaking African network of Coopers & Lybrand With a chartered accounting designation and an MBA from École Supérieure de Commerce de Marseille, he also attended training on the management of professional services firms at Harvard University School of Business Administration and e-business training at the Darden School of Business at the University of Virginia Audit | Tax | Advisory © 2014 Crowe Horwath International 21 Crowe Horwath International: Regional Profile - EMEA Regional Statistics – EMEA* Member Firms & Business Associates 117 Countries 71 Partners 1184 Partners & Staff 8,109 * As of December 2013 Crowe Horwath International – EMEA Representation in all major countries in Europe, the Middle East and Africa Contact: Bernard Delomenie, bernard.delomenie@crowehorwath.net www.crowehorwath.net Audit | Tax | Advisory © 2014 Crowe Horwath International 22 The Crowe Horwath “Pinnacle” Symbol Pinnacle: The highest level or degree attainable Symbolizes our commitment to our brand principles: Relationships Integrated Global Network Impeccable Service Technical Expertise Consistent Quality Audit | Tax | Advisory © 2014 Crowe Horwath International 23 Crowe Horwath. Multinational Team. Single Point of Contact. Multinational clients want consistency in cross-border engagements Crowe Horwath International provides a single point-of-contact project leader Local professionals who perform consistent processes in their home countries Support by global and regional specialists with required knowledge Audit | Tax | Advisory © 2014 Crowe Horwath International 24 Our Global Specialty Practices Local expertise in the global markets A strong international network with impeccable quality and standards Audit Tax Securities Exchange Reporting Benefit Plan Audit Services Audits, Reviews and Compilations Agreed-upon Procedures Forecasts and Projections Transfer Pricing Value Added Tax Wealth Management Real Estate Expat Taxes Corporate Tax Compliance International Tax Restructuring Advisory Transaction Support Deal Structuring Foreign GAAP Conversions Tax Consulting Merger Integration Services Risk Enterprise Risk Regulatory Risk Technology Risk Fraud Risk Operational Risk Financial Risk Acquisition Strategy Due Diligence IT Compatibility Reviews Advice on Negotiation Strategies Audit | Tax | Advisory © 2014 Crowe Horwath International 25 Global Audit Specialty Practice Profile Your global alternative for audit services. Audit | Tax | Advisory © 2014 Crowe Horwath International 26 Global Audit Specialty Practice Profile Accounting & Auditing Global Committee Companies that successfully address audit issues Improve the quality of their financial reporting Stand to gain global credibility with leading sources of capital Audit Services Audits, Reviews and Compilations Agreed-upon Procedures Forecasts and Projections Securities Exchange Reporting Benefit Plan Audit Services David Chitty, A&A Director; Chairman Download Global Audit Brochure at www.crowehorwath.net/audit Audit | Tax | Advisory © 2014 Crowe Horwath International 27 David Chitty - International Accounting & Audit Director Audit | Tax | Advisory Partner, Crowe Clark Whitehill LLP, responsible for audit services to public companies, international businesses, and large private companies, 2007-2012 National Technical & Training Partner of a UK "Top 20" accounting firm, responsible for leading the firm's audit technical, training and compliance activities, 1997-2006 Member of the Board of Directors of a leading association of international accounting firms, 2001-2006, and Chairman of the association's International Assurance Services Committee, 2000-2006 Member of the Crowe Horwath International Accounting and Audit Committee, 2007-, Chairman of the Committee, 2008-2011 Appointed International Accounting & Audit Director of Crowe Horwath International in 2010, responsible for the development and implementation of international audit support and methodology, international training and quality control, and supporting the business development activities of member firms Member of the Council of the Institute of Chartered Accountants in England & Wales (ICAEW), 2001-, and Member of the ICAEW's Audit Committee, 2010President of the Croydon & District Society of Chartered Accountants, 19992002, and 2012-2013 UK member of the Small & Medium Practices Committee of the International Federation of Accountants (IFAC), 2006-2012 © 2014 Crowe Horwath International 28 Global Audit Value Proposition Reputation Methodologies and quality assurance programs Streamlined audit processes result in timely financial reporting and disclosure Insight Reputation Understanding of complex financial transactions Audit of the effectiveness of internal controls Advice on the convergence of national accounting practices to IFRS Service Flexible, well-designed, and risk-based processes Technologies that respond to client needs Prompt identification and communication of issues Timely delivery of results Audit | Tax | Advisory Added Value Insight Service © 2014 Crowe Horwath International 29 Crowe Horwath Global Audit Process Our process enables efficiency and collaboration – delivering a quality audit. An established audit methodology Consistent with the International Standards on Auditing (ISAs) Issued by the International Audit & Assurance Standards Board (IAASB) IAASB functions as an independent standard setting body under the auspices of the International Federation of Accountants (IFAC). Common audit process and tools Crowe Horwath applies our audit methodology through a common technology platform Allows for the sharing and transfer of information between members Audit | Tax | Advisory © 2014 Crowe Horwath International 30 Ensuring Global Audit Quality Our member firms maintain policies and procedures consistent with international professional standards which promotes continuous improvement in audit quality. Compliant with international audit quality policies and procedures Member Firms * Subject to external regulation and periodic monitoring of the quality of work performed Audit | Tax | Advisory Crowe Horwath International Network Performs a rigorous periodic review of members' compliance with global quality standards © 2014 Crowe Horwath International 31 Member of IFAC and Forum of Firms IFAC (International Federation of Accountants) and the Forum of Firms promote consistent and high quality standards of financial reporting and auditing practices worldwide. IFAC The worldwide organization for the accountancy profession 157 member organizations and associations Representing 2.5 million accountants in 122 countries Forum of Firms One of seventeen full members The Forum and IFAC work together in: Standard setting Dialogue with regulatory community Promoting convergence to international standards Strengthening the profession around the world Audit | Tax | Advisory © 2014 Crowe Horwath International 32 International Tax Specialty Practice Profile Your global alternative for tax services. Audit | Tax | Advisory © 2014 Crowe Horwath International 33 International Tax Specialty Practice Profile International Tax Planning & Structuring Committee Successful companies consider tax implications before they make business decisions. International tax compliance and structuring is a crucial element in every global strategy. Tax Services Transfer Pricing Value Added Tax Wealth Management Real Estate Expat Taxes Corporate Tax Compliance International Tax Restructuring Download Global Tax Brochure www.crowehorwath.net/tax Audit | Tax | Advisory John Stewart International Tax Director at © 2014 Crowe Horwath International 34 International Tax Value Proposition Our international service teams are committed to delivering value to multinational clients doing business across borders through: A highly-integrated, global tax practice operating under common high-quality standards; across borders; anywhere in the world One contact person to lead the global process Impeccable service delivery Frequent access to senior tax executives Competitive price A long-term relationship with professionals around the world committed to client success Audit | Tax | Advisory © 2014 Crowe Horwath International 35 International Tax Process Crowe Horwath International member firms have a proven three-step tax process to help their clients make more tax-savvy decisions throughout the year: To the tax issues you face The right multinational team The exact solution Understand your global needs Drawing on the knowledge & skills of nearly 20,000 tax professionals worldwide To meet your current tax needs and your future expansion Audit | Tax | Advisory © 2014 Crowe Horwath International 36 International Tax Quality Review and Training Procedures Crowe Horwath International has an international tax quality review and training program led by our International Tax Director. Quality policies and procedures Crowe Horwath member firms maintain policies and procedures for achieving and monitoring quality that are fully consistent with international and local professional standards. Global training program Crowe Horwath International has a global tax program that provides members with constant updates on the practical implications of professional developments. Audit | Tax | Advisory © 2014 Crowe Horwath International 37 Global Corporate Advisory Specialty Practice Profile Your global alternative for mergers & acquisitions, due diligence and valuations. Audit | Tax | Advisory © 2014 Crowe Horwath International 38 Global Corporate Advisory Specialty Practice Global Corporate Advisors Committee Global Corporate Advisors is a coordinated group of legally independent member firms with specialized competencies in cross-border advisory, transaction support, and integration consulting services. Advisory Services Transaction Support Deal Structuring Foreign GAAP Conversions Tax Consulting Merger Integration Services Acquisition Strategy Due Diligence IT Compatibility Reviews Advice on Negotiation Strategies Peter Varley, Chairman Download Global Advisory Brochure at www.crowehorwath.net/advisory Audit | Tax | Advisory © 2014 Crowe Horwath International 39 Global Corporate Advisory Value Proposition As one of the largest professional services organizations in the world, we have member firms with local expertise nearly everywhere you may be considering a transaction. We can support your deal with great connections in the banking, legal, and technical communities, as well within local and national governments. Connectivity A single point of contact Local country diligence More senior executive involvement High profile account treatment Lower cost structure than the Big Four Equal sharing Partnership approach Audit | Tax | Advisory © 2014 Crowe Horwath International 40 Global Corporate Advisory Process Consistency in cross-border engagements A single point-of-contact project leader Local professionals who perform consistent processes in their home countries Support by global and regional specialists with required knowledge Common process and tools Agreed engagement letter templates Standard reporting styles Efficient conflict clearance procedures Common quality control requirements Internal peer reviews Continual training programs Audit | Tax | Advisory © 2014 Crowe Horwath International 41 Global Risk Consulting Specialty Practice Profile Your global alternative for risk consulting services. Audit | Tax | Advisory © 2014 Crowe Horwath International 42 Global Risk Consulting Committee Global Risk Consulting Specialty Practice Deep subject-matter expertise to keep clients advised of emerging trends, industry benchmarks, and best practices. Risk Management Internal Audit Fraud and Ethics Security and Privacy Regulatory Compliance Risk Services Enterprise Risk Regulatory Risk Technology Risk Fraud Risk Operational Risk Financial Risk Download Global Risk Brochure at www.crowehorwath.net/risk Audit | Tax | Advisory Mike Varney Chairman © 2014 Crowe Horwath International 43 Global Risk Consulting Value Proposition Improve Corporate Governance Help clients improve the processes and procedures they have in place to protect the interests of its diverse stakeholders. Experienced risk professionals Global practice model guides member firms to hire full-time experienced risk, internal audit, anti-fraud, compliance, security and privacy professionals. Experienced thought leaders who practice Extensive knowledge including Fortune 500 or Big Four partner experience Our delivery model is based on our practice leaders working on client engagements to develop and design the best solutions. Develop global service delivery standards and tools Audit | Tax | Advisory © 2014 Crowe Horwath International 44 Enterprise Risk Management (ERM) Consulting Process Crowe Horwath’s Governance Framework™ links seven essential and interrelated components of corporate governance. We consult with clients and conduct governance audits to identify areas for improvement. Our practical ERM approach helps clients identify and prioritize significant risks facing their enterprise and design processes to manage the risk including an ongoing internal audit monitoring program. 1. 2. 3. 4. 5. Organize the effort; Establish a framework; Conduct risk assessments; Inventory risk responses; and Implement risk response monitoring. Audit | Tax | Advisory © 2014 Crowe Horwath International 45 Remaining Slides are Misc. Optional Slides for future use Audit | Tax | Advisory © 2014 Crowe Horwath International 46 Would you find value in further conversations? Are you currently dealing a national or international issue where we may be of assistance? * Local expertise where you do business <Member Firm Name> Audit | Tax | Advisory * Strong international network with impeccable quality and standards * Crowe Horwath International Network © 2014 Crowe Horwath International 47 Management Committee Andrew Pianca Chairman London, United Kingdom Eduardo Pestarino Regional Executive – Americas Buenos Aires, Argentina J. Kevin McGrath Chief Executive Officer New York, United States Kamel Abouchacra Chief Operating Officer New York, United States Bernard Deloménie Regional Executive – EMEA London, United Kingdom David Chitty International Accounting & Audit Director London, United Kingdom Mok Yuen Lok Regional Executive – Asia/Pacific Kuala Lumpur, Malaysia John Stewart International Tax Director New York, United Sates Audit | Tax | Advisory © 2014 Crowe Horwath International 48 International Committee Chairs Accounting & Audit Thomas Schaffer Vienna, Austria Global Risk Consulting Toronto, Canada Mike Varney International Tax Claudia Ortiz Buenos Aires, Argentina Hotel, Tourism & Leisure Robert Hecker Singapore Global Corporate Advisors Peter Varley London, United Kingdom Audit | Tax | Advisory © 2014 Crowe Horwath International 49 Members of the Board of Directors Andrew Pianca, Chairman London, United Kingdom J. Kevin McGrath, CEO New York, United States Charles Allen Oak Brook, United States Juan Carlos Lara-Povedano San Jose, Costa Rica Mok Wai Ling Kuala Lumpur, Malaysia Klaus Bauer-Mitterlehner Vienna, Austria Yang Jiantao Beijing, China Mark Watson Johannesburg, South Africa Vijay P. Thacker Mumbai, India David Mellor London, United Kingdom Audit | Tax | Advisory © 2014 Crowe Horwath International 50 The History of Horwath 1907 Brothers Edmund & Ernest Horwath emigrate from Hungary 1915 Founding of Horwath & Horwath Developing valuable expertise in the hospitality sector – the ‘hotel accountant’ 1960 Horwath & Horwath International associates launched 1990 Laventhol & Horwath closes 1991 Crowe Chizek joins Horwath International 2009 Horwath International became Crowe Horwath International as part of global branding Audit | Tax | Advisory © 2014 Crowe Horwath International 51 Core Purpose Audit | Tax | Advisory © 2014 Crowe Horwath International 52 Core Values These are the high-level values by which Crowe Horwath and its member firms desire to live, in working among each other and the international business community If CHI and its member firms care, share and invest in each other, in their people and in their international clients, Crowe Horwath International will grow and build the value of its international business network Audit | Tax | Advisory © 2014 Crowe Horwath International 53 Core Membership Philosophy NATIONAL & INTERNATIONAL BUSINESS MARKETS & CLIENTS WIN3 CROWE HORWATH INTERNATIONAL Audit | Tax | Advisory MEMBER FIRM © 2014 Crowe Horwath International 54 2010 – 2013 Strategic Plan Theme “Right Firms – Right Places – Right Level” New plan represents a new approach to: Working with member firms Bring value to the member firms Unique alternative to “Global 6” Getting to the next level – “Level 4” Audit | Tax | Advisory © 2014 Crowe Horwath International 55 Vision Statement “To be the premier global network of independent, highly integrated audit, tax and advisory service firms serving middle-to-upper market national and multi-national businesses in a focused group of industry and service sectors. To maintain and be recognized as having a global reputation for delivering impeccable quality service focused on meeting our member firms’ client needs, utilizing common and consistent branding and delivery standards worldwide.” Audit | Tax | Advisory © 2014 Crowe Horwath International 56