The new MGI Clive Bennett What were going to talk about How the - - PowerPoint PPT Presentation

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The new MGI Clive Bennett What were going to talk about How the - - PowerPoint PPT Presentation

Aug 01, 2023 356 likes •925 views

The new MGI Clive Bennett What were going to talk about How the network was created the debate The Chicago AGM decisions How MGI Worldwide will be organized Join MGI Worldwide or stay in the alliance? MGI quality review

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Clive Bennett

The new MGI

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What we’re going to talk about

  • How the network was created – the debate
  • The Chicago AGM decisions
  • How MGI Worldwide will be organized
  • Join MGI Worldwide or stay in the alliance?
  • MGI quality review process
  • Using the brands
  • MGI Worldwide means better business
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How the network was created

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The debate

LatAm, Montevideo, May 2013 Is MGI already a network?

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The debate

Europe, Brussels, June 2013 What are the legal and liability risks?

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The debate

Sydney 2013 (AGM) Must we be hybrid?

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The debate

Miami 2014 What would a hybrid MGI look like?

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The debate

Berlin 2014 How will the network operate?

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The Chicago AGM, October 2014

Members decide

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Chicago The IC’s Plan

Agreed by 100 votes to 19

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The hybrid structure

No quality reviews Non-MGI brand

the alliance

the network

All members quality reviewed New MGI network brand Many MGI branded firms Brand investment

Chicago

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Network management

Chicago

International Committee Technical Committee External Adviser Technical Manager

Decisions Technical supervision and opinions Technical advice Support & administration

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USD ¡ First ¡year ¡ From ¡2017 ¡ From ¡main ¡budget ¡ ¡ ¡ ¡ ¡ ¡ ¡External ¡adviser ¡ 96 ¡000 ¡ 48 ¡000 ¡ ¡ ¡ ¡ ¡ ¡ ¡Technical ¡Manager ¡ 0 ¡ 100 ¡000 ¡ ¡ ¡ ¡ ¡ ¡ ¡Other ¡costs ¡ 72 ¡000 ¡ 47 ¡000 ¡ TOTAL ¡from ¡main ¡budget ¡ 168 ¡000 ¡ 195 ¡000 ¡ From ¡annual ¡network ¡fee ¡(=$800 ¡p.a.) ¡ ¡ ¡ ¡ ¡ ¡ ¡Onsite ¡reviews ¡ 0 ¡ 104 ¡000 ¡ TOTAL ¡from ¡network ¡fee ¡ 0 ¡ 104 ¡000 ¡

TOTAL ¡COSTS ¡ 168 ¡000 ¡ 299 ¡000 ¡

Costs

Chicago

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How will be organized?

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Key changes since the AGM

  • Network Liaison Committee (NLC) created
  • Reduce spending from main budget.

– SWAT-UK replaces external adviser (Brian Smith). – No Technical Manager.

  • Longer period for first sign-up phase.
  • Completely separate network and alliance

brands

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Network governance

International Committee Technical Committee SWAT-UK

Decisions Technical supervision and opinions Technical support, process and administration

CEO

Management Members’ views

NLC

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Network Liaison Committee (NLC)

  • One member from each Area

– not the IC Member.

  • Communicates members’ views to centre

– IC, TC, CEO.

  • Communicates main network decisions to

members.

  • Three of its members selected by IC to

form Technical Committee (TC).

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Network Liaison Committee

Africa Juané Schreuder Asia Deepak Goil Australasia David Fong Europe Michael Grüne Latin America Luis Uncal MENA Mohamed Boumesmar North America Sharon Gregor UK & Ireland Roger Isaacs

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Africa Juané Schreuder Asia Deepak Goil Australasia David Fong Europe Michael Grüne Latin America Luis Uncal MENA Mohamed Boumesmar North America Sharon Gregor UK & Ireland Roger Isaacs

Technical Committee

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What does the TC do?

  • 1. Advises the International Committee

– Network regulations – Procedures and processes – The operation of the network – Relevant technical issues – Disciplinary matters regarding member firms – Quality of member firms

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  • 2. Analyses and decides:

– How well members have implemented quality controls – Reviewers for on site review – On site review programme – Member review scores – Improvement plans, where needed

What does the TC do?

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  • One of the UK’s largest suppliers of

accountancy/audit training and compliance reviews.

  • Replace roles of Brian Smith +

Technical Manager.

  • Will manage:

– Self assessment questionnaires – Audit independence system – On site reviews – First analysis of reviews

What is SWAT-UK?

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USD ¡ First ¡year ¡ From ¡2017 ¡ From ¡main ¡budget ¡ ¡ ¡ ¡ ¡ ¡ ¡External ¡adviser ¡ 27 ¡000 ¡ 0 ¡ ¡ ¡ ¡ ¡ ¡ ¡SWAT-­‑UK ¡ 59 ¡000 ¡ 70 ¡000 ¡ ¡ ¡ ¡ ¡ ¡ ¡Technical ¡Manager/support ¡ 0 ¡ 20 ¡000 ¡ ¡ ¡ ¡ ¡ ¡ ¡Other ¡costs ¡ 70 ¡000 ¡ 40 ¡000 ¡ TOTAL ¡from ¡main ¡budget ¡ 156 ¡000 ¡ 130 ¡000 ¡ From ¡annual ¡network ¡fee ¡(=$800 ¡p.a.) ¡ ¡ ¡ ¡ ¡ ¡ ¡Onsite ¡reviews ¡ 0 ¡ 104 ¡000 ¡ TOTAL ¡from ¡network ¡fee ¡ 0 ¡ 104 ¡000 ¡

TOTAL ¡COSTS ¡ 156 ¡000 ¡ 234 ¡000 ¡

Revised budget

  • 7%
  • 33%

From ¡

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  • 1. The Network

Branding

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  • 2. The Alliance

Branding

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How to join

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Taking the decision

Does ¡our ¡ firm ¡want ¡ to ¡join ¡the ¡ network? ¡ Do ¡we ¡use ¡ the ¡MGI ¡ prefix? ¡

No Yes No Change ¡firm ¡name ¡

Replace ¡all ¡references ¡ to ¡MGI ¡with ¡ ¡

Yes

Complete ¡sign-­‑up ¡ process ¡ Enhance ¡use ¡of ¡MGI ¡ brand ¡in ¡marke[ng ¡ Prepare ¡for ¡quality ¡ review ¡(2 ¡years) ¡

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Documents to complete

Deadline: 15 September

Business ¡informa[on ¡form ¡ Sign ¡and ¡return ¡network ¡agreement ¡ Ques[onnaire ¡about ¡quality ¡systems ¡ Audit ¡independence ¡register ¡

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Network costs

  • One-off joining fee $500

– After 15 September 2015 = $1000

  • Annual fee $800 – pays for review visits

– Only from 1 July 2017

  • These costs in addition to usual

international and area fees.

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Read the Network Regulations

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Self assessment quality questionnaire

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Audit independence register

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Membership agreement

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The quality review process

ANNUALLY ¡ Self-­‑assessment ¡ques[onnaires ¡ EVERY ¡THREE ¡YEARS ¡ Receive ¡MGI ¡peer ¡review ¡visit ¡ Review visits start in 2017 Two years to develop quality assurance systems

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The quality review process

Objective

Firms must meet MGI quality standards

– ISQC-1 (IFAC international quality standards for audit and non-audit). – Non-technical quality – response time, transparency, language capability, website, communication.

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Self assessment questionnaire 1

Fact finding

Business information form + questions about your audit practice

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Part 1 General quality controls Part 2 Audit quality controls Based on ISQC-1

Self assessment questionnaire 2

Your firm’s quality systems

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Check how audit quality controls are applied to specific audit files.

Self assessment questionnaire 3

Quality of specific files

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Update register of cross border clients.

Self assessment questionnaire 4

Audit independence register

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  • Members must complete all

questionnaires fully and on time.

  • IC will apply penalties to late

submissions.

Discipline

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  • TC will analyze self-assessment

questionnaires submitted.

  • Firms will be advised where they need

to improve.

  • Firms that do not show serious

investment in quality will not be allowed to stay in the Network after June 2017.

Quality review

Phase 1: 2015-17

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  • One on-site review every three years,

planned by TC.

  • Reviewers compare self-monitoring

questionnaire responses with reality.

  • Non-technical quality included.
  • Reviewers chosen from members by

Technical Committee.

  • Review report analyzed by TC.

Quality review

Phase 2: from July 2017

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Level 1

Very good or excellent quality. Some minor deficiencies may need remediation.

Level 2

Adequate quality. Reasonable quality assurance systems are in place but some significant deficiencies require remediation.

Level 3

Poor quality. Quality assurance systems are substantially deficient and require significant effort and investment of resources to remedy.

Quality review

Classification by TC

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Level 1

None needed.

Level 2

Improvement plan agreed. TC may require follow-up review visit.

Level 3

Improvement plan agreed. TC shall require follow-up review visit. If improvements not made, firm may be dismissed from Network.

Quality review

Remediation

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Using the brands

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Existing firms brands stay as they are For now! *

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When you talk about membership of MGI you use

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If you do not join the network

  • You must use
  • You CANNOT use the name of MGI in any

name, logo or marketing.

  • If your company uses MGI, you must change

the company name.

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Market share Reputation Profit

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  • Proven quality at an international

standard.

  • Forum of Firms quality guarantee

(from 2017/18).

  • Local MGI brand = global MGI brand.

Enhanced reputation

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Powerful brand

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Higher margins

  • Compete on quality against the big

firms

  • More and bigger international clients
  • Global contracts

– World Bank – European Commission development – United Nations – Global charities

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More market share

  • MGI moves higher in the rankings

– Worldwide – Regional

  • More business exchange

– Worldwide – Within MENA

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Strengthening the brand needs member investment

  • Quality systems and review
  • Consistent brand marketing
  • Sharing expertise and knowledge
  • International business

development

  • Strong Area coordination
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Thank you Any questions?