While technology has its benefits, it is important to remember that we sometimes need to take our time to do our best. I feel about 102 years old writing this article, as I fear I will be seen to bemoan the advances of technology and run the risk of coming across as a technophobe. Luckily for me, neither is true. Having qualified at a time when a laptop was a COMPAQ computer that you needed to be a weightlifter to bring on audit with you, I fully welcome the benefits that technology has brought us. However, I do acknowledge that, with all the advancements we have witnessed in the past 20 years, and with every screed of benefit it brings us as professional accountants, it also brings risks which we must acknowledge in our profession and, particularly, our education and training. There are many facets of benefits and threats, and people much more qualified than me have done SWOT analyses of the influence technology has on our profession. However, for me, the biggest risk technology brings us is the pace at which we  are forced to lead our professional lives.  Yes, it is a double-edged sword. This pace ensures we can shorten the life-cycle of our deliverable, be it a report, a trial balance or a lecture. I have to ask, though: when does this demand for speed become a threat to the very cornerstone of our profession? A threat to our ethics As a profession, we know that ethics is the foundation for everything we do and we must as, professional accountants, comply with the following fundamental principles:  (a) Integrity; (b) Objectivity; (c) Professional competence and due care; (d) Confidentiality; and (e) Professional behaviour. Are the above principles delivered as a practice/process or a value set or a mixture of both? Does it matter? How does technology influence or impact this? To me, three of them definitely are value sets – integrity, objectivity and professional behaviour. And it is these values that can be put under pressure in the fast-paced, digital world in which we work. We must be mindful that these values are maintained and upheld in all aspects of our work, especially when we are challenged to deliver output or answers instantaneously.  Time to slow down As an employer in practice, I can see the pressures that are put on all levels of our organisation, from trainee through to partner. This is often by virtue of a question or request in an email that simply “must” be answered immediately. We have all become so used to living in a fast-paced world where instantaneous information (Google), photos, videos (Instagram) and commentary (Twitter) are the norm, especially for a younger generation where they have never witnessed anything different. I urge other Chartered Accountants to teach our students and younger accountants to know when they must take time to consider, think, confer with others (face-to-face) and reflect. We need to be able to show them that speed is not the fundamental requirement but the consideration of their ethical obligations is, which may mean they should slow down. They need to understand that consultation with peers can be crucial to success.   Sinead Donovan is a Partner in Financial Accounting and Advisory Services at Grant Thornton.

With recent equity weakness, investors have to ask themselves if supporting long equities is still a safe bet. Marathon Man is one of my favourite movies. It fits into the genre of 1970s paranoia movies such as The Conversation, Chinatown and Three Days of the Condor. Those movies represented a cultural reaction to America’s unsettling status at home (Watergate) and abroad (Vietnam). The film’s central scene pits Laurence Olivier (as an elderly ex-Nazi war criminal) against Dustin Hoffman, (playing a student whose CIA brother has been hunting Olivier). Olivier kidnaps Hoffman and straps him into a chair to torture him with a dentist’s drill. Olivier asks “is it safe” for him to retrieve money from his illicit bank account. Poor Hoffman doesn’t know what Olivier is talking about.  Today, in early 2019, equity investors are confronted by the same question: is it safe? Over the course of 2018, US equities dropped by 7%. Irish equities dropped by a startling 22%, which was met by indifference from the Irish media and political classes. This dramatic fall in Irish equity values has passed by with little public commentary.  These are the same classes who populated the room on the night of 29 (to 30) September 2008 when the Irish government decided to guarantee the liabilities of Irish banks. That decision was based on the proposition that our banks were merely suffering a funding crisis rather than a solvency crisis (resulting from the market value of banks’ loans falling far below their book value). A cursory glance at the share price chart of the main Irish banks back then would have revealed that they had already lost three quarters of their peak value prior to Lehman Brothers becoming insolvent. Conclusion: markets often know more than supposed experts.  Is it safe? All we can do is examine the possible reasons for recent market weakness and consider the balance of market forces likely to prevail in 2019. There are several factors that may explain recent equity weakness: High equity valuations – on several long-term measures, such as the cyclically adjusted price earnings ratio, equities look richly valued. However, two caveats must be noted. First, while valuation levels offer a good indicator of prospective returns over three years and longer, they are poor indicators of likely returns over shorter periods. Second, equities look reasonably valued based on some valuation metrics, such as prospective price earnings. Tighter monetary conditions – across the globe, central banks are tightening monetary policy whether through withdrawal of quantitative easing or outright interest rate increases. The danger is that central banks will overdo it and tip the global economy into recession. Recent comments from Fed chairman, Jerome Powell, suggest the Fed is alive to this risk. Recession danger – we are already very long into the current global recovery cycle. Several reliable American indicators (the unemployment rate and the yield curve) suggest the next US recession may happen by 2020/2021. But it may come even sooner. Just two months ago, JPMorgan reported a 60% chance of a recession within two years, and stated in early January that “US equity, bond and commodity markets appear to be pricing in on average close to 60% chance of a US recession over the coming year.”  Brexit – as the clock ticks down to 29 March, the prospect of a hard, no-deal Brexit is growing. That scenario could tip an already weak European economy into recession. This factor may be weighing especially (and probably mistakenly) on Irish equities. Is it safe? No, it’s not. But I remain optimistic about the prospects for equities in 2019 for two reasons. One, this is not at all what a stock market top looks like: investors are frightened rather than euphoric. Two, the US economy continues to perform strongly. I sense the next US recession is still some years away. That’s why I’m still long equities.     Cormac Lucey is an economic commentator and lecturer at Chartered Accountants Ireland.

Tadhg Young, State Street’s Global Services Country Manager, reflects on his career, the crisis and his positivity for the future.   When State Street Global Services country manager, Tadhg Young, looks out from the company’s office on Dublin’s Sir John Rogerson’s Quay, he can see the Central Bank headquarters across the river, a growing number of new apartments and commercial developments, and the original IFSC up-river. “We have a growing community here and it’s great to be part of that,” he says. Young has been part of that community for more than two decades, having worked in both Dresdner Bank and Allianz Global Services before joining State Street in 2007. He began his career with PwC in the 1980s and moved into industry to gain wider experience. “I had specialised early and young in tax,” he recalls. “I was just 21 or 22 years of age and I felt that it was too early. I wanted to see what else was out there. I probably took the first job that came up and that was in W&R Jacob, the biscuit manufacturer. I was never going to stay there for long, but I enjoyed it. I left to join Dresdner after just over a year.” After several years with Dresdner and Allianz, he joined IBT Ireland as Head of Trustee, Custody and Middle Office Servicing. That company was acquired by State Street in 2007. “Any person who gets acquired with a company has to go through a period when the new organisation gets to know them,” he notes. “I had the fortunate experience of moving from being a client to a competitor to an employee of State Street within 24 months. We knew each other quite well already so it made the transition quite easy when I joined.” The financial crisis That aspect of the change might have been easy, but the onset of the global financial crisis was about to change everything. “It was a bit different for us here,” he points out. “While almost everyone was preoccupied with the domestic situation, we were preoccupied with the international situation. You learned more than you ever thought you were going to learn. Everything that was tried and trusted had to be questioned – liquidity risk, counter-party risk, everything. All these things we had relied on had to be questioned from the ground up. State Street had a group of risk management experts to manage our way through that, in Ireland and globally. “By 2010, the worst was behind us and we started growing in Ireland again,” he adds. “They were a very intense few years, having to deal with the challenges of the acquisition and the crisis. In hindsight, they were great learning opportunities.” Winning trust Young’s modesty becomes apparent when he is asked to describe his career journey in State Street. “Since 2010, we won a number of significant mandates here in Ireland. I was put in charge of on-boarding one of them, then I got another. I got more and more challenging work to do. I ran a group, then a bigger group, then became COO, then became country manager. It was a question of showing what you are capable of and winning the trust of management and staff.” That matter-of-fact recollection belies the scale of projects he undertook, which included on-boarding the largest exchange traded fund (ETF) platform in Europe at the time. “That was a hugely significant transaction for State Street in Ireland,” he says. “ETFs have different characteristics to other funds. They are traded on the stock market, so the level of precision required for valuations and so on is very high. I got to understand State Street from end-to-end and got exposure to senior management and investment managers.” He quickly shifts the focus back to State Street. “In Ireland, we offer depositary, transfer agency and fund administration services,” he explains. This sees the company hold trillions of dollars worth of assets for clients across the world and value them every day.  “That’s why we have about 2,000 people in Ireland,” he continues. “We do business across every kind of investment product including ETFs, tax transparent funds, hedge funds, alternative funds and so on. Ireland has built an industry here over the past 25 years, which allows investors across the world to invest in products that are domiciled and administered in Ireland but managed globally.” State Street has a 38% share of the global investment funds market here in Ireland. “We service some of the world’s largest and most successful fund managers,” he says. “It’s been very intense and rewarding work. It’s a great way to develop your skills in areas like project management. You also develop inter-personal and technical skills.” But it isn’t all about business. “We have a social purpose as well. A large proportion of our business is servicing people’s retirement savings. That’s very important.” Positive outlook Looking ahead, Tadhg believes State Street is set to continue to grow on the base of the solid platform it has built. “At present, investment funds regulated by the CBI (Central Bank of Ireland) total $2.8 trillion and State Street services over $1.1 trillion of that. I am really convinced that we have the best workforce in the sector in Europe and globally. The team here services complex investment funds as well as anyone on the planet.” He is also positive about Ireland. “It’s fantastic to see how Ireland responded to the crisis,” he says. “I have three children and it’s great to see them grow up in a country with so much to offer compared to the mid-1980s. IBEC has done some fantastic work on projections around housing, education and so on. Social capital is what’s going to drive Ireland and help the country to continue to grow in a reasonable way.” Tadhg is also quite open in his admiration for the Central Bank and the work it is doing. “It goes back to what this business is about – managing other people’s money. That requires regulation. You have to give credit to the Central Bank for developing the sector in the first place. For example, Ireland hosts 54% of the assets held in exchange traded funds across Europe. Internationally, the Central Bank has taken thought leadership positions in many forums and it is widely respected for that. It hasn’t been a passive supervisor. It is very active in the space and is committed to being a forward-thinking regulator. Of course, there will be times when we think regulation might be too constraining but ultimately, these things find equilibrium.” The role of the Central Bank will become even more significant in the wake of Brexit, he believes. “It will be the only English language regulator in Europe. It’s very important to recognise that. The roles that individuals from the CBI have filled in ESMA (European Securities and Markets Authority) and other bodies will also be very important.” On tax, he points out that the 12.5% rate is of secondary importance to the funds industry. “Tax certainty is key,” he contends. “State Street is in Ireland because international investment managers decided to domicile funds here. They didn’t come here for the 12.5% rate; they came here for the ability to passport funds to the EU and globally. We came here to service clients. The investment funds themselves are tax neutral and operate in a tax environment that is clear, transparent and compliant with OECD practice and EU law.” Inclusion and diversity Inclusion and diversity are topics close to Tadhg’s heart and he describes the organisation’s commitment to them as “one of the most attractive parts of working for State Street.” Under the wider banner of global inclusion, State Street offers programmes such as flexible work, which allows five possible options: flexible place (remote working), flex time, compressed schedules, reduced schedules or job-sharing; a global mentoring programme; a wide variety of employee networks and affinity groups; sponsorships of external events and organisations focused on diversity and inclusion; a formal work/life programme to help balance professional life and personal responsibilities; a recognition programme for employees who display best-practice inclusion behaviour; inclusion-focused leadership initiatives, with a 30-member global working group; performance goals focused on inclusion-related behaviour; a Global Employee Engagement Survey; and a ‘Voices of Inclusion’ programme and other opportunities to share feedback. “We don’t want to blow our own trumpet,” he adds. “Lots of companies are doing things. But it’s not about ticking a box. This is something we want to do, not something we think we must do. You have to work really hard at it. It’s a very complex topic. You have to be sensitive about it. If you are well-intentioned and work at it, you will get a better outcome.” Future leaders When asked for his thoughts on leadership, Young’s self-deprecating nature is in evidence once again. “I am not the most self-reflective of people,” he says. “For anyone who wants to be a leader, if you plan things out, you have a better chance of success. You need to grasp opportunities and take an element of risk. Don’t go for perfection; 80% is probably as good as 100% in terms of the information you need to make a decision. Make the decision based on facts, but trust your instincts as well. You also have to explain why you are making decisions; if you have good people, they will come with you. You also have to be self-aware and know what you can’t do.” And he has no concerns about the next generation of leaders in State Street. “I was at a management update with 50 of our vice-presidents recently and I saw five or six people in the room with the ability to do my job in five or six years’ time.” Tadhg Young is Global Services Country Manager at State Street.

Davos is over for another 12 months. Out of the debates, interviews and discussions came seven areas that boards will now need to consider when planning for their future. Global Risks Worsening economic and political confrontations between major powers are anticipated this year, and over a ten-year period, extreme weather and climate-change policy failures are seen as the gravest threats. The Fourth Industrial Revolution  The Fourth Industrial Revolution is introducing technologies at a speed and scale unparalleled in history. Regulation and cooperation between countries will be imperative to harnessing the value of what is seen as the 'new oil' -- data. We are still in the foothills of this new industrial revolution and have to find a way that uses data to our advantage while, at the same time, staying compliant with GDPR. Climate change and ecological challenges Climate change is real but is not as high on politicians agendas as it should be. United States President Donald Trump, who did not attend the World Economic Forum, has never been a fan of addressing climate change as it would impact his coal mining support-base in the US. Angela Merkel said Germany would need coal for “a certain time”, which disappointed many environmentalists. Broadcaster David Attenborough, however, was in Davos to promote the need to address climate change, and climate activist Greta Thunberg used the forum’s spotlight to promote climate activism. Ecological challenges including, but not limited to, climate change are threatening socio-economic development. Human basic needs such as food, water, health and shelter are all affected by climate. The changes in climate may threaten these needs with increased temperatures, rising sea levels, changes in precipitation, and more frequent or intense extreme weather events. The gender gap The gender gap is not closing fast enough. According to The Global Gender Gap Report 2018, the world still has a long way to go when it comes to political and economic leadership. Across the 149 countries assessed, there are just 17 that currently have women as heads of state while, on average, just 18% of ministers and 24% of parliamentarians globally are women. Similarly, women hold just 34% of managerial positions across the countries where data is available. Full parity of this indicator is already a reality in five countries (Bahamas, Colombia, Jamaica, Lao PDR and the Philippines), and in another 19 countries, there are at least 40% of women in managerial positions. Geopolitical risk  Geopolitical risk has increased as a result of Brexit and the possibility of no deal being made between the EU and the UK, the USA–China trade war and general unease about the global economy. The impact of globalism and nationalism in many countries has and will continue to cause political instability. There are also concerns that the tech bubble will burst as many impending IPOs, like Uber, are overpriced. Greater focus on diversity and inclusion Seven top businesses backed the new Partnership for Global LGBTI Equality and will be an important inclusion in the agendas of businesses and boards around the world. Global data governance Japan’s prime minister, Shinzō Abe, pledged action on global data governance, which is a start to what will be a global conversation as data analytics and the consumption of data grows. Prime Minister Abe told the Davos audience that personal and security data must be placed under strong privacy protection while, at the same time, allowing a free flow of medical, industrial, traffic and other data be to analysed and utilised. David W Duffy is the founder and CEO of The Governance Company and author of A Practical Guide for Company Directors, published by Chartered Accountants Ireland

Whatever form it takes, Brexit requires you to be ready from day one. With time running out before the UK leaves the European Union, businesses and firms need to prepare for every eventuality to protect themselves against all of the potential disruptions that might follow. Answer the questions below and ask yourself: is my business ready for Brexit? Customers and contracts Have you engaged with all your key clients to understand their particular needs in the first few months after Brexit? Have you considered which of your contractual obligations may be impacted by Brexit? Unless tariffs can be mitigated, price inflation poses a significant risk to the cost of services. Have you fully identified and understood this potential threat along with options to mitigate? Have you transferred all impacted Brexit customer contracts to an appropriately regulated entity, either in the UK or the EU-27? Cash flow and currency Have you considered the impact of a weakened Sterling on your transactions to and from the UK? Have you determined what impact price inflation and tariff changes will have on your cost base, and your ability to mitigate, absorb or pass them on? Have you identified the impact of import VAT on your cashflow? It should be noted that both UK and Irish governments have announced proposals to allow VAT on imports to be delayed until the next VAT return filing date rather than imposing VAT upfront on imports.  People Have you carried out an impact assessment to determine the possible effect of Brexit on your employees and your business model? Have you mapped where your employees have come from, where they are now and where they may be travelling to as they perform their roles? Have you reviewed your social security arrangements and whether they may need to be reviewed once the UK leaves the EU? Have you considered the possible impact of foreign exchange rate fluctuations on your globally mobile employees? Have you relocated or recruited all necessary staff to perform the required control functions in your regulated entity, and do they meet the relevant competency standards? Contingency planning and regulation Have you secured all of the necessary regulatory approvals to continue to provide financial services to your customers across the EU and the UK? Where you plan to continue to access the UK market and UK clients, have you registered with the UK FCA to avail of their Temporary Permissions Regime? These are examples of the types of questions where your answer should be 'yes' to be confident you and your company are prepared for Brexit. You should also have considered any changes to your organisational structure, tax arrangements and IT infrastructure that may be required. David McGee is a Brexit Leader at PwC Ireland. This article was updated on 11 February to reflect to reflect Minister Paschal Donohoe’ proposal to introduce a legislative change to introduce a system of postponed accounting.

Successful leaders demonstrate integrity, vision, commitment, confidence and self-awareness, says Teresa Campbell. What is it that makes the best leaders stand out? Do the best leaders have some kind of innate ability that others lack, or can anyone develop leadership skills through training and personal development? Arguably, the answer to both questions is ‘yes’. Certainly, in our work with businesses across the island of Ireland, we come across some ‘born leaders’. Typically, these are energetic, charismatic individuals with a strong vision and commitment to their business. They have great communication skills that help them to inspire, motivate and challenge their teams. However, we also find many successful leaders who have developed leadership skills through experience, coaching, and personal development. Set out below are five traits which, in our experience, set both types of successful leader apart. Integrity: Warren Buffett, the investor and billionaire CEO of Berkshire Hathaway, famously said, “In looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And, if they don’t have the first, the other two will kill you.” Business is built on relationships and relationships are built on trust. Without integrity, there is no trust. Successful leaders set the tone from the top and act as an example for their teams to follow. Vision: Successful leaders have a clear vision of where their business is going and, more importantly, they have the ability to communicate their vision to their team. Padraig McManus, Chairman, Mincon Group Plc emphasised this in PKF FPM's 2018 Annual Leadership Talk when he said, “If you can get those around you to buy into your strategy and what you are trying to achieve, you are on the road to becoming a leader.” Commitment: Successful leaders are committed and passionate about their business, realising that by instilling passion among their team, they fuel momentum and inspire their team to strive and accomplish exceptional results.  Confidence: Leadership involves influencing others, therefore self-belief is very important. However, confidence needs to be partnered with clarity and good communication skills, and tempered with empathy in order to secure buy-in from others. Self-awareness: This quality, perhaps more important than any other, is vital for successful leaders as it gives them the ability to recognise their own strengths and weaknesses, a requirement for both personal development and knowing what and when to delegate.  Even the most successful leaders will eventually reach the end of their tenure and it would be remiss to end without the stressing the importance of planning for leadership transition. Passing on what you know and coaching tomorrow's leaders keeps your business sustainable.  This year’s PKF-FPM Annual Leadership talk takes place on 14 February 2019. For further information, contact PFK FPM's Belfast Office 02890243131. Teresa Campbell is a Director is PKF FPM.