Member firms in Australia and India comment on SME loans, tax reforms, and regulatory changes in the July edition of the IAB
The July edition of the International Accounting Bulletin (IAB) has been published in which member firms MGI Joyce Dickson in Australia, and Tambakad & Goil in India, share their thoughts on industry-related matters.
SME loans and tax reforms
Lorin Joyce, partner at MGI Joyce|Dickson, spoke to the IAB about the Loan Guarantee Scheme that supports SMEs by guaranteeing 50% of new loans issued - it was originally only meant to run until September 2020 but was extended due to the impact of Covid until June 2021. Lorin comments:
“Some clients accessed lending under the scheme but it was not an ideal solution for struggling SMEs. Overall, it was felt that the relatively onerous lending requirements to access the scheme – and the limited funding amount available – forced businesses to look into other funding options.”
With regards to tax issues, he went on to say that the single biggest challenge facing tax reform in Australia relates to providing advice - in respect of retirement - to clients, specifically in relation to their Self Managed Superannuation Funds (SMSFs).
“When the accountants’ exemption was removed in 2016 it placed accountants in an impractical situation where, as trusted advisers, they were expected by their clients to be able to provide advice relating to SMSFs but could not unless they held an AFSL. The costs and regulation around these licences and authorisations have both increased rather than improved. This has led to many advisers ceasing to be licensed to provide the advice, which means access and cost of this advice to clients has increased.”Lorin Joyce, Partner at MGI Joyce|Dickson
Lorin concludes that clients are still confused as to why their accountant can give them tax and strategic advice on all business and investment structures but not provide advice regarding their SMSF, reiterating the point that the professional bodies need to address the issue and figure out a solution.
India grapples with constant regulatory changes
India is continuing to struggle with regulatory changes that are designed to increase transparency and make it easier to do business in the country. Perhaps the most notable are: the Simplification of Companies (Amendment) Act, aimed at making it easier to do business by decriminalising non-compliances of minor, technical, or procedural violations; and several major changes brought in by the Ministry of Corporate Affairs (MCA) in March 2021, with implications for audit and the use of digital currencies.
“The profession has become more challenging due to the constant changes made through notifications and circulars by various statutory bodies on an almost daily basis and compliance requirements continue to become more difficult.”Deepak Goil, partner at Tambakad & Goil
Deepak shared an example of this by discussing a recently enacted tax provision (Section 206AB) which requires higher withholding taxes on payments to vendors/service providers where they have not filed their tax returns within stipulated timelines for the previous two years, concluding that;
“The position of the ICAI on member firms being associated with international networks remains a matter of concern and recently released guidelines on this have done little to clear the air.”
Our member firms in Australia, India, Japan, New Zealand and Singapore are ranking highly against the other top accounting associations!
The latest accounting network and association rankings have been published. We’re delighted to share that in Australia, our member firms are ranking an impressive 3rd for both fee income and staff data. This 3rd position is also held by our member firm in New Zealand. In India, our member firms hold the 9th position for fee income and are ranking 12th in terms of their staff data. It’s also good news in Japan where our member firms are 5th and 6th respectively for fee income and staff data. The 3rd position for fee data is held by our firms in Singapore, who hold the 9th position for staff data.
MGI Worldwide CPAAI would like to congratulate our member firms who are responsible for helping achieve these fantastic results.
MGI Worldwide with CPAAI is a top 20 ranked global accounting network and association with almost 10,000 independent auditors, accountants and tax experts in some 460 locations in over 100 countries around the world.