RSM Transparency Report 2020

MARCH 2021

FROM REACT TO REIMAGINE

2020 RSM Transparency Report

THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING

We exist to empower our clients to move forward with confidence

Contents 4

A message from RSM’s Global CEO

6

A year of react, resilience, reactivate and reimagine

10

A message from RSM’s Global Leader, Quality & Risk

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The RSM network

14

RSM’s global structure

15

RSM’s people and culture

17

Governance, leadership and management

22

Ethics and independence

25

Quality related policies and requirements

26

Activities to assess and monitor quality

28

RSM Centres of Excellence and Leadership Groups

30

Global and regional revenues

31

RSM representation

REIMAGINATION

A message from RSM’s Global CEO 2020 was a challenging year for middle market business leaders, whom we serve, and indeed the accounting profession as a whole. Yet, amidst the uncertainty and disruption presented by the pandemic, as an organisation, we have seized the opportunity to reflect and reimagine how we collaborate, embrace new emerging technologies, stay connected and shape the future of RSM. The continued success and growth of RSM reflects the agility and resilience we have shown in the face of adversity, adapting our digital infrastructure in line with rapid change, being purposeful in every decision and prioritising the wellbeing of RSM colleagues and the business security of RSM’s clients.

Throughout the RSM network, providing the highest quality services and supporting middle market business leaders in their response to the pandemic, the reorganisation of their business operations and the digitalisation of their infrastructure, are key priorities. We are committed to helping clients overcome the challenges they face and harness the opportunities that present themselves amidst great change.

By forming deep, long-lasting relationships and providing relevant ideas and insight, we empower clients to move forward with confidence by delivering on RSM’s brand promise, The Power of being Understood. While businesses around the world are being challenged to transform, we continue to provide innovative, high-quality services and solutions to help those organisations reimagine their future.

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FROM REACT TO REIMAGINE

“The strength of RSM derives from the people that work within the network, and in fully utilising their different strengths, insights, and ideas.”

Jean M Stephens, Global CEO, RSM

As a global network of independently owned and operated Firms, RSM’s core purpose is to bring our team of 48,000 professionals closer together and to support the provision of seamless cross-border services by RSM Member Firms to their clients. While global policies and procedures are fundamental to us working cohesively, true collaboration only comes when the collective shares the same values and vision for the future.

RSM Member Firms are united under the same brand and high-quality standards; this is what they sign up to when joining the network. However, the right cultural fit and the sharing of the same beliefs are just as important as the commitment of Member Firms to meet these global expectations. RSM’s core beliefs of Understanding, Collaboration, and Ideas and Insight are central to The Power of Being Understood and are underpinned by shared global values of Respect, Integrity, Teamwork, Excellence and Stewardship.

The strength of RSM derives from the people that work within the network, and in fully utilising their different strengths, insights, and ideas. In 2020, we appointed Candice Eaton Gaul as RSM’s Global Diversity and Inclusion (D&I) Leader, to propel our D&I strategy forward and to explore the wealth of opportunities that come from valuing human relevance in an increasingly digital world. With RSM’s growth and development forging ahead, we also recognised that the internal infrastructure needs to be aligned so that we can continue to develop and fully realise the global vision of RSM. To help drive this forward, we appointed Bob Dohrer as Chief Operating Officer in October 2020.

2020 RSM TRANSPARENCY REPORT

Audit, one of RSM’s core service offerings, has been a key focus for RSM’s ongoing transformation with 2020 seeing the further development of RSM Orb, a global audit solution that scales according to the requirements of individual clients. RSM Orb comprises the methodology, software and tools that are adaptable to local legal requirements and compliant with the International Standards on Auditing.

There are many people within RSM who contribute their time and expertise to RSM’s various leadership groups and committees that help to steer and guide the provision of services and the way the RSM network operates. Special thanks go to all of these professionals for their dedication and commitment to the ongoing development and sustainability of RSM in these extraordinary times.

Jean M Stephens

Global Chief Executive Officer

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A year of react, resilience, reactivate and reimagine In business, the opportunity to pause, recalibrate and reimagine does not come often.

Yet the global pandemic has opened the door to extraordinary change.

Faced with unprecedented challenges and major disruption at the start of the pandemic, it became an immediate priority to ensure that RSM could continue to operate cohesively and deliver the same level of exceptional client service. In order to achieve this, the Global Executive Office worked closely with Member Firms to support them through a period of adjustment, both to their day-to-day operating activities and to their financial position.

RSM focused on finding new ways to provide support and help our colleagues and clients through this prolonged period of uncertainty.

We moved quickly to identify, develop, and communicate a four-stage response for both internal management and client service, to navigate the different phases of the crisis: 1. R eact - The initial steps to secure business operations and the safety of colleagues and clients during the crisis.

2. Resilience - Ensuring business continuity and supporting clients through the worst of the crisis.

3. Reactivate - Returning to the workplace and reactivating processes and supply chains as we come through the crisis.

4. Reimagine - Utilising key learnings from the crisis to innovate, reshape RSM and increase RSM’s relevance to clients and the people of RSM in the ‘next normal’.

02

REACT

01 2020

RESILIENCE

04

REACTIVATE

REIMAGINE

03 2021 and beyond As we adopted these four stages, we continued to look forward and consider how we might use our own experiences to reimagine RSM and ensure we remain relevant for clients of RSM Member Firms, the talent within RSM and for local communities throughout the crisis.

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FROM REACT TO REIMAGINE

CREATING A DIGITAL-FIRST NETWORK A key priority throughout 2020 was supporting RSM’s people, Member Firms’ clients and the communities around them. Therefore, digital transformation played a key role in ensuring we had strong communication channels and seamless business continuity. Meanwhile, a new, dedicated global learning management system was rolled out, enabling the rapid transition from face-to-face learning and development to online knowledge sharing. This enabled new ways of working, encouraged the sharing of the latest industry insights, leadership skills, IT training and best practice.

In addition, audit services were further enhanced through the launch of an innovative online collaboration tool to augment client experience, enable efficiencies in audit, compliance, and advisory services, as well as offering integrated data analytics capabilities.

Most importantly, these initiatives also facilitated collaboration across the network - between individual colleagues, teams, Member Firms, and regions.

EMPOWERING THE PEOPLE WITHIN RSM Times of crisis highlight the significance of effective collaboration for long-term success. These events illustrate the need for organisations to come together to overcome rapidly changing, complex obstacles with long-term effects. Harnessing diverse opinions and sharing experiences enables us to identify solutions by observing issues from different angles and ultimately generating new solutions.

An important catalyst for creative problem solving and innovation is diversity of thought and RSM enjoys many benefits from being a multi-cultural organisation across more than 120 countries.

Therefore, Diversity and Inclusion (D&I) play a critical role in how we engage with all key stakeholders across the network and beyond. A key step forward in RSM’s D&I journey was the appointment of Candice Eaton Gaul, as Global Diversity and Inclusion Leader in October 2020, further demonstrating RSM’s commitment to D&I. Caring for the people who form part of the RSM network is fundamental and a key characteristic of the culture of RSM. As the pandemic swept across the globe, Member Firms proactively took intentional steps to ensure the physical and mental well-being of staff was assured. These included: y Virtual counselling, resilience training, raising awareness about mental health and well-being y Employee Assistance Programmes and access to virtual doctors and healthcare y C reative ways to maintain ‘water cooler moments’, virtual lunches and social activities such as baking, learning new languages and craft-making y Increased number of team building activities y New ways of celebrating achievements y Care packages to show appreciation y E nsuring people had the right virtual working environment – desks, chairs, and technology, as well as other ergonomic considerations

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2020 also saw us accelerate our efforts to celebrate the rich and diverse opinions within RSM through a programme of events and online learning. y I nsight led events – Globally, RSM International’s programme of events was moved online using a variety of new platforms to deliver conferences, workshops, and training: Regional conferences for Africa, Asia Pacific, Europe, Latin America, and MENA The RSM Global Tax conference was delivered as a series of events over 5 weeks y Insight led programmes for clients and colleagues: Global Coronavirus Resource Centre Leading Through Change CEO Matters y G lobal LMS – 2020 saw the launch of a global learning management system to support the empowerment and development of the people within RSM globally, with rich content covering service lines, business development, brand and marketing, leadership, IT and compliance, external software and quality and risk y L ive virtual training events – Included Risk Advisory, Financial Due Diligence, Tax, and International Financial Reporting Standards (IFRS) y ‘ A Festival of Reimagination’ – In this new, virtual world we transformed one of RSM International’s most important events of the year, the RSM World Conference, into a virtual festival of insight, creating a positive experience in the face of adversity. Open to all 48,000 people across the RSM world, The Festival of Reimagination encouraged collaboration on a whole new scale. The event demonstrated RSM’s determination, in the face of a rapidly evolving working world, to maximise the opportunities that change presents and harness the benefits of digital technology and enhanced communication channels

REIMAGINING OUR FUTURE Throughout the pandemic, RSM has remained dedicated to continuously reimagining the network’s operational world to create a better one for clients. 2020 saw the introduction of: y R SM Leaders – Reimagining Our Future - A year-long initiative launched in September 2020 involving more than 80 Senior Leaders from over 30 RSM Member Firms to strategically research, analyse, ideate and propose forward thinking and innovative solutions to anticipate, plan and respond to the future needs of the clients of RSM’s Member Firms and the people of RSM y I nnovation Group – The Innovation Group was introduced to drive innovation and develop an international community of innovators and curious minds, which shares knowledge and insight and fosters a culture of innovation y T he Forward Sprint – With the ambition to leverage the creative and innovative capabilities of the youngest members in the RSM family, Europe created The Forward Sprint initiative.

‘Forward Thinkers’, from 20 countries participated in a series of virtual events in September 2020. These “Innovation Sprints” included applying creative thinking to explore new innovative ideas for future development and culminated with the teams presenting their ideas to a jury

“Amidst the uncertainty and many challenges presented by the pandemic, we have seized the opportunity to reflect, and reimagine how we collaborate, harness the right technology, stay connected and intentionally shape our future. These are the themes that we continue to focus on as we think about the changing world around us and our 2030 strategic roadmap for RSM.” Jean M Stephens, Global CEO, RSM 8

FROM REACT TO REIMAGINE

Thinking ahead and responding rapidly

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A message from RSM’s Global Leader, Quality & Risk The economic disruption of the pandemic has given rise to many critical accounting and auditing judgements including going concern, complex valuations and accounting estimates, and impairment evaluations, as well as other industry-specific issues such as estimating credit losses for financial institutions.

In this environment, we re-emphasised the RSM commitment to quality. Quality is the bedrock of our network and a common foundation across all RSM Member Firms. We focus on ensuring RSM Members have the common methods and processes needed to continuously enhance the quality of the services they deliver. This has been particularly important as many RSM colleagues were working in a remote environment for the majority of 2020.

RSM Orb, RSM’s Optimal Risk-Based audit solution, which is translated into several languages, supports Members in delivering a consistently high standard of auditing. RSM Orb is critical in delivering The Power of Being Understood through using common methods and processes. Member Firms use the same core audit methodology, software and tools which can be adapted for local regulatory requirements.

In 2020, RSM Orb was updated for the adoption of the important new requirements in ISA 540 Auditing Accounting Estimates and Related Disclosures. As part of the update, we also took the opportunity to include several improvements based on feedback from users to further enhance quality.

Ethics and independence are fundamental to RSM’s ability to be trusted business advisers. We have increased our investment in this critical area by recruiting a Global Ethics and Independence Leader and the Board has recently approved investment in a significant system upgrade.

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FROM REACT TO REIMAGINE

“The global network is committed to the provision of the highest quality audit services around the world and has robust policies and procedures to achieve this.”

Marion Hannon, Global Leader, Quality & Risk, RSM

The pandemic provided a particular challenge for RSM’s global inspections process which is normally carried out using in person meetings and file reviews. In 2020 we set up arrangements for inspections to be carried out remotely and all inspections were successfully completed.

In 2020 we brought together existing globally available technical training into a Quality Curriculum which is accessed through the global intranet, and forms part of RSM’s new on-demand global learning management system. We now have a single point of reference for Member Firms to access the wide variety of training that is available globally.

In adapting to the challenge of enabling Members to continue serving clients, to the highest standard, during the pandemic, we established a globally available, secure, file-sharing portal, which complements similar portals already in use in some Member Firms. These arrangements have enabled RSM Member Firms to exchange documents and data with their clients and to continue to deliver engagements.

becoming increasingly complex, having data analytics solutions that are suitable for use across the full range of middle market clients will be key in providing a dynamic and responsive audit of the future.

The audit profession has responded to the very practical challenges that it faced during 2020 by reimagining some of the standard ways in which it was previously doing business.

There will be further challenges ahead as we emerge from the pandemic and implement the ISQMs, but I am confident that RSM is equipped to face them and to continue to perform high quality work for clients.

Marion Hannon

Global Leader, Quality & Risk

We welcome the publication of the International Standards on Quality Management (ISQMs) in December 2020 and believe that the ISQMs are the basis for continuing the profession’s journey of improvement in audit quality. Even before the final ISQMs were published, we started planning for their implementation including raising awareness throughout RSM through webinars in addition to RSM’s regular communications.

We are evaluating and piloting a number of potential global data analytics solutions, some of which are already being used by individual Member Firms. With the business environment

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A world leader in providing audit, tax and consulting services to the global middle market

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FROM REACT TO REIMAGINE

The RSM network RSM is the brand name used by Members of the RSM international network of independent professional services firms.

Member Firms of RSM are all separate legal entities practising in their own right. The network is not itself a separate legal entity in any jurisdiction and membership of the network does not make any Firm responsible for the services of other Firms.

RSM International is a private company limited by guarantee. It is the network umbrella company and does not provide services to clients.

120+

countries

820

offices

48,000 people

As at December 2020

Member Firms are driven by a common vision of providing high quality professional services both in their domestic market and in serving the international professional service needs of their client base.

The RSM network connects Member Firms through common methods and processes, including commonly agreed and applied quality standards. These connections facilitate RSM Member Firm partners and staff to provide consistently high standards of service and advice to referred clients – everywhere in the world.

During 2020, new Member Firms were admitted in Chile, Denmark, Kazakhstan, Paraguay and Zambia, and the RSM Member in Japan that provides consulting services resigned as a Member of RSM and rejoined the network as a Correspondent Firm.

As of December 2020, RSM is the sixth largest network of independent accounting and advisory firms, comprising Members and Correspondents in more than 120 countries with 820 offices, 48,000 total staff, and combined revenues in excess of US$6.3 billion of which approximately US$2.4 billion was derived from audit services.

MEMBERSHIP OF THE FORUM OF FIRMS RSM International is a member of the Forum of Firms, an association of international networks of accounting firms that perform transnational audits. RSM is active in and fully supports the objective of the Forum of Firms, which is to promote consistent and high - quality standards of financial reporting and auditing practices worldwide and to support convergence of national audit standards with the International Standards on Auditing. Marion Hannon currently represents RSM as a member of the Forum of Firms’ Transnational Auditors Committee.

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RSM’s global structure RSM’s global structure, as depicted in this diagram, is aimed at executing RSM’s strategy and facilitating Member Firms to develop business together.

To enable the communication and coordination of actions and to share information and best practices to better acquire, retain and serve clients, RSM is organised into six regions - Africa, Asia Pacific, Europe, Latin America and the Caribbean, Middle East and North Africa, and North America.

This regional structure facilitates cross border collaboration and includes Regional Councils and Regional Leaders, who are supported by Regional Coordinators. The delivery of services within and across RSM’s regions is enhanced by Leadership Groups, Service Groups, Centres of Excellence and Sector Groups.

Committees

Board of Directors

Leadership Groups

Service Groups and CoEs

Member Firms and our people

Sector Groups

Regional Councils

Regional Leaders and teams

Board SubCommittees

TASEC/GQC

CEO, COO and GEO Key

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Communication lines

Reporting lines

FROM REACT TO REIMAGINE

RSM’s people and culture An important part of delivering quality is building a culture that promotes inclusion and supports the values of RSM. RSM sets expectations for Member Firms to ensure that there are consistently high standards of performance and capability throughout RSM. These expectations describe how we conduct ourselves in professional dealings and how Member Firms connect with each other and with their clients. This is not a set of rules, but rather a set of benchmarks to align all Members of the RSM international network behind a common vision to achieve RSM’s global strategic objectives. Member Firms agree to specific requirements in their membership agreement with regard to expected Member behaviours, but we also encourage Firms to maintain their own personality while still serving the needs of the network at the highest level.

At RSM we establish close and enduring relationships between Member Firms and their clients, while maintaining objectivity and independence, when required, in all services provided. We aim to have an in-depth understanding of the business landscape and the middle market’s vision for the future. Engagement teams at RSM Member Firms are led by senior personnel who identify the RSM professional with the best skills to be the point of contact for the client and the rest of the network, making the client relationship of personal significance, in order to build trust and understanding. Client service and the client relationship are critical for their growth and the growth of RSM. Through utilising global and regional engagement leaders, we can enable Member Firms to serve their clients across a range of geographic locations and through a rich variety of services.

Through global and regional conferences, training programmes, global projects, RSM’s global learning management system and RSM’s Centre of Excellence structures, we encourage people from across the world to collaborate and develop close relationships to facilitate seamless service to clients across borders.

RSM operates a contributed hours concept. This means RSM Member Firms, depending on their size, are expected to provide a certain number of hours every year, for initiatives that have a benefit beyond their geographic region. Hours can be contributed towards activities such as training, due diligence and inspection programmes, producing articles or content for publication, or for Centres of Excellence. Asking Member Firms to contribute their time to the network means Member Firms are committed to the success of RSM and the success of each other, while at the same time raising the profile of individual employees who contribute to these areas.

The development of the people within RSM is a key strategic focus and has been a catalyst for several new activities within the network. Launching RSM’s global learning management system in Q3 2020 has allowed employees of Member Firms to have access to the same training courses around the world, from technical content to content focused on management and leadership. Encouraging curiosity is part of RSM’s culture and is essential to continuous professional development which is so critical to being a first-choice, trusted adviser.

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Diversity and inclusion play a critical role in facilitating high levels of employee satisfaction as a result of belonging, connectedness, critical thinking and personal growth. Diversity and inclusion benefit individual employees and enhance the employee experience, but they also have a broader benefit to families and communities, while simultaneously advancing business initiatives and client service through higher levels of engagement, increased productivity, and the forging of stronger relationships.

The recent appointment of a Global Diversity & Inclusion Leader who works with Member Firms to reap the business benefits of a diverse and inclusive workforce is another way that we demonstrate that RSM has a culture that puts its people first.

At RSM we understand that, in putting RSM’s people first, we create an environment that is positive, encouraging, and inclusive - centred around continuous professional and personal development where talent is identified, developed and valued. The more engaged and motivated RSM’s people are, the more satisfaction they derive from their careers with RSM which in turn enables them to perform as first choice advisers in supporting clients to succeed.

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RESPECT

INTEGRITY

TEAMWORK

EXCELLENCE

STEWARDSHIP

treat others as we would like to be treated

do the right thing

work together effectively

be the best in everything we do

better our network and Members, and develop our people

We display respect in each interaction with:

We stay true to our beliefs in:

We cultivate genuine collaboration:

We achieve distinction through:

We make RSM a better place by:

Clients Employees Partners

Decisions Negotiations Communications

In work groups Across Member Firms Across functions Amongst leaders

Our standards Our operations The work we deliver

Developing our people Building our brand Supporting our communities

FROM REACT TO REIMAGINE

Governance, leadership and management RSM International Limited Board of Directors (the Board) The RSM International Board of Directors is the governing body of RSM International Limited. Its objectives and responsibilities include: y Creating, approving, and overseeing implementation of the international strategy for the network y O versight of matters relating to the membership of RSM, including admitting new Members and termination of membership y Oversight of the ethical and effective leadership of the network y Approving RSM International’s budget, operational plan and Member Firm fees y S afeguarding the Company’s assets and satisfying itself that the Company has adequate systems and control processes in place y S trategic risk management of RSM International and oversight of risk management policies and best practices y Overseeing a process to ensure adherence to quality standards by Member Firms y Assessing and determining the CEO’s remuneration As of the date of this report the Directors of RSM International are: Brian Eaton, South Africa, Chair Joe Adams, US Jason Chen, China Guillermo Erhard, Mexico Tom Ferreira, US Cherif Hammouda, Egypt Simon Hart, UK James Komninos, Australia Jorge Perez, Argentina Jean-Michel Picaud, France Wong Poh Weng, Hong Kong Angela Simatupang, Indonesia Stefan Walter, Austria The Directors are appointed for a period of three years, after which they become eligible for re-election for a further three-year term. There is provision for the appointment of an additional three directors by the Board who may serve for a period up to three years and who would also be eligible for reappointment. The Chair is also elected for a three-year term and may be re-elected for up to two further three-year terms. Neither the Chair nor the Directors are renumerated.

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To assist in discharging its responsibilities, the Board has established sub-committees:

Committees

Purpose

Governance

Assist the Board in the discharge of its responsibilities relating to: Oversight of RSM membership matters Assessment of the processes, practices and the results relating to the Company’s governance Oversight of relevant existing governance documents

Nominations Audit

Oversight of the administration of the Board appointment process.

Assist the Board in the discharge of its responsibilities relating to: The safeguarding of the Company’s assets The operation of adequate systems and control processes The preparation of accurate financial reporting information and statements in compliance with all applicable legal and regulatory requirements and accounting standards

Remuneration

Assess and recommend to the Board the remuneration of the CEO and other senior management.

Risk

Provide additional analysis to the Board regarding the strategic risk management of RSM International and to determine that risk management best practices and policies are established The Board’s Risk Committee collaborates with the Operational Risk Committee comprised of the CEO, Global Leader Quality & Risk and other Global Executive Office staff.

TASEC/GQC

Detailed consideration of network quality matters to equip Member Firms to deliver uniform high-quality professional services and to achieve full alignment with RSM network policies and procedures.

Further details of the role of this committee are set out below.

To ensure quality matters receive the time and attention necessary to drive uniform highquality professional services, the Board established the Transnational Assurance Services Executive Committee (TASEC). On 1 April 2021, TASEC will be succeeded by the Global Quality Committee (GQC) with a clarified remit to monitor quality across all service lines.

TASEC/GQC ‘s responsibilities include: y P romulgation and monitoring of compliance with all standards issued by the International Auditing and Assurance Standards Board and the International Ethics Standards Board for Accountants y E stablishing policies and guidelines for both the RSM Member Firm inspection programme and the RSM global inspection programme y M onitoring the management of quality assurance activities conducted by the RSM Global Executive Office

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FROM REACT TO REIMAGINE

y Review of due diligence reports for the admission of new Member Firms y A pproval of global and Member Firm inspection reports, and action plans to address deficiencies identified from the global inspection programme y O versight of the development, promulgation and monitoring of compliance with the requirements of: RSM Orb RSM Quality Assurance and Risk Containment Policies RSM Ethics and Independence Policies RSM Anti-Bribery and Corruption Policies P olicies and Procedures for the Global Inspection Programme and Member Firm Inspection Programme RSM Assurance Services Training and Continued Professional Development Policies A range of sanctions is available where it is determined that a Member Firm is not complying with its membership obligations including strategy, branding, quality standards, risk management and ethics and independence policies and processes. The proposed sanctions are presented by the Global Executive Office to TASEC/GQC for review and a recommendation is then made to the Chief Executive Officer for approval. Where a Member Firm appeals against an approved sanction, the appeal is considered by the Board or a sub-committee of the Board.

Under the Articles of Association, the Board has the ultimate authority with regard to the sanction of termination of membership.

According to its terms of reference TASEC/GQC, whose members are appointed by the Board, consists of five to nine members of suitably qualified and experienced partners or equivalent from Member Firms. The composition of TASEC/GQC is designed to ensure representation from across the RSM regions. The chair of TASEC/GQC is selected by the Board from members of the Committee and serves for a term of three years and can be renominated at the end of the three-year term. Current members of TASEC/GQC are from Member Firms in Australia, France, Hong Kong, Mexico, UK and US. The Chair is from the Member Firm in South Africa.

CHIEF EXECUTIVE OFFICER (CEO) The Chief Executive Officer (CEO) is appointed by and accountable to the RSM International Board.

The CEO has overall responsibility for leading on the execution of the network’s strategy, and to develop and grow RSM for its Members. On an annual basis the CEO prepares and presents to the Board for approval an annual operational plan which outlines the key global activities to deliver against the strategy. The CEO works closely with the Board, regions, Member Firms, leadership teams and external advisers to deliver on the responsibilities of the role to execute on the operational plan and long-term strategy.

The CEO also leads the RSM Global Executive Office, based in London.

CHIEF OPERATING OFFICER (COO) The COO works closely with the CEO to help drive RSM’s strategic plan and central activities with responsibility for managing several of the Global Executive Office functions including regional and operational support, the leadership groups and Centres of Excellence, Member relations, legal, brand and digital, IT and marketing communications.

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RSM GLOBAL EXECUTIVE OFFICE (GEO) The GEO is a global team, reporting ultimately to the CEO, primarily based in London.

Its responsibilities include: y Execution of the global strategy y Financial health of RSM International y O peration of the Global Member Firm Inspection Programme including compliance with network ethics and independence policies y Development and maintenance of RSM Orb and oversight of Member Firm implementation y Brand development and corporate messaging y International client needs and business development y International referral protocols y Geographic coverage y Global training initiatives, including RSM’s global learning management system y RSM’s global intranet and capabilities database y Support to Centres of Excellence, leadership groups and Regional Councils The GEO reflects the diverse nature of the RSM network and employs staff from many different countries and backgrounds. Staff are encouraged to develop their existing skills and to acquire new ones through participation in continuing professional education, which includes mandatory training, as well as by taking on new responsibilities. In addition to receiving continuous feedback, staff have an annual personal development review so that they can reflect on their achievements for the past year and set their objectives for the coming year.

During the period of working remotely, additional support has been provided to safeguard the wellbeing and mental health of staff in these challenging times.

Within the GEO the CEO is supported by a senior leadership team comprising the; Chief Operating Officer Chief Financial Officer Global Chief Innovation Officer Global Leader, Business Development & Marketing Global Leader, Quality & Risk Remuneration of the senior leadership team is set by the CEO after consultation with the Board Remuneration Committee. The CEO sets the remuneration of all other GEO staff.

The RSM Global Leader, Quality & Risk has oversight for the quality of assurance and other services provided by Member Firms. These responsibilities specifically include: Meeting membership obligations of the Forum of Firms RSM quality assurance policies, procedures, and inspections RSM Orb Global ethics and independence

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FROM REACT TO REIMAGINE

Benefit from the ideas and insights of our most senior experts

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Ethics and independence ETHICS AND INDEPENDENCE POLICIES RSM maintains ethics and independence policies which all Member Firms are required to adopt.

These policies help ensure that Member Firms, partners, and professional employees comply with the independence and ethical requirements of the following: y I nternational Ethics Standards Board for Accountants (IESBA) International Code of Ethics for Professional Accountants (including International Independence Standards) y Local professional organisations y Local security exchange regulators y Other relevant regulatory authorities y RSM International policies, guidance, and requirements Every Member Firm has a Head of Ethics and Independence, a partner (or equivalent position) who has responsibility to augment these policies, as necessary, with the specific requirements of their Member Firm to reflect additional local ethical codes or regulatory requirements that establish higher standards than those reflected in the minimum RSM ethics and independence policies. Any amendments made to the basic RSM policies to include additional local requirements must be submitted to the GEO for review and must be approved by the Global Ethics and Independence Leader. Partners or professional employees who have a question regarding the RSM ethics and independence policies are required to consult promptly with their Member Firm’s Head of Ethics and Independence. If the Member Firm’s Head of Ethics and Independence has a question regarding these policies, they consult with the GEO. Partners and professional employees are required annually to complete an independence compliance questionnaire confirming that they: y Have read the RSM ethics and independence policies y Have read his or her Member Firm’s ethics and independence policies y Understand the applicability to his or her activities y Are, and have been for the past year, in compliance with those policies Any qualifications to such confirmation are fully explained in writing and corrective actions are taken by a Member Firm.

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FROM REACT TO REIMAGINE

INDEPENDENCE, RELATIONSHIP, AND CONFLICT OF INTEREST TRACKING RSM maintains an online independence, relationship and conflict of interest tracking tool called the Global Relationship Tracker (GRT). Member Firms are required to use GRT to list assurance or non-assurance clients in the following categories: y Public interest entities, including listed entities y Private equity groups or funds y Private entities with ownership or affiliates located in another jurisdiction or country Additionally, all clients that are affiliates of groups meeting the above criteria are required to be included on the GRT. The GEO, under the direction of the Global Ethics and Independence Leader, is responsible for overseeing the timely maintenance of the GRT by Member Firms and for overseeing the adequate functioning of the relevant policies and processes.

Member Firm partners and professional employees are required to consult the GRT and take such other precautions that are considered necessary in the circumstances to ensure compliance with the RSM Ethics and Independence policies with respect to financial, business, family, or employment interests.

Member Firm partners and professional employees are also responsible for consulting the GRT and taking such other precautions that are considered necessary in the circumstances to ensure compliance with respect to identifying potential conflicts of interest in the services Member Firms provide to clients or prospective clients, particularly international groups.

Annually, Member Firms are required to perform procedures sufficient to assess the completeness and accuracy of their client information required to be included on the GRT and report accordingly to the GEO. When a Member Firm partner or professional employee identifies a potential impairment of independence or conflict of interest with respect to a client or prospective client of another Member Firm through GRT searches and other conflict of interest checks, the Head of Ethics and Independence of the Member Firm is required to be informed. The Head of Ethics and Independence communicates the relevant details of the client (or prospective client) and engagement to the Head of Ethics and Independence of the other Member Firm(s). The relevant Heads of Ethics and Independence then assess the facts and circumstances relating to the potential impairment of independence or conflict of interest and apply the appropriate safeguards, which may include withdrawal from an engagement or opportunity.

If Member Firms are unable to agree appropriate safeguards, the CEO and the Chair of the Board are requested to consider the potential impairment of independence or conflict of interest. The Member Firms provide the GEO with the necessary information regarding the relevant facts and circumstances, which will be used to assess the potential impairment of independence or conflict of interest. The CEO and the Chair of the Board will then, after considering the request and information provided, make a recommendation as to the resolution of the potential impairment of independence or conflict of interest.

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Anticipating challenges, identifying opportunities

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FROM REACT TO REIMAGINE

Quality related policies and requirements CLIENT ACCEPTANCE/CONTINUANCE Providing high-quality assurance services requires that RSM Member Firms accept only clients who share RSM’s core values and beliefs. Member Firms are required to only enter into relationships with clients who fit key RSM acceptance criteria and who are prepared to pay a fair fee for high value work.

These client acceptance criteria include: y T he client acts with integrity and adheres to compliance with all local laws and regulations, including anti-money laundering requirements y T he Member Firm complies with RSM ethics and independence policies and is not entering into any client relationship or engagement which would be prohibited under those policies y The Member Firm understands the client’s needs and service requirements y T he Member Firm has the necessary capabilities available, including sufficient resources and expertise, to perform the work required by the client and to render the necessary reports and other deliverables within the reporting time frames During the client acceptance process, the prospective engagement partner, or lead assignment partner, also assesses the level of risk attached to the engagement and determines whether special staffing, supervision and review requirements apply. A second partner is assigned to concur with a conclusion to accept any engagement or a client relationship that meets certain risk profiles.

RSM ORB Quality is the absolute cornerstone for RSM and, in order to support Member Firms in performing high quality audits, the GEO has developed RSM Orb, RSM’s risk-based audit solution. It is comprised of four elements: y Proprietary Global Audit Methodology y Global Audit Manual y RSM template housed in licensed software y Guidance In accordance with RSM’s strategy to achieve common methods and processes across the network, RSM Orb is required to be used by all Member Firms for all audits. To assist local implementation, RSM Orb is translated into Spanish, French, German, Russian and Chinese.

RSM Orb includes requirements for engagement quality control reviews and mandatory consultations with a Member Firm’s Head of Audit, Head of Ethics and Independence (or their designees) or another suitably qualified partner, as appropriate. RSM Orb complies with the requirements of the following: y I nternational Standard on Quality Control issued by the International Auditing and Assurance Standards Board (IAASB) y International Standards on Auditing issued by the IAASB y International Auditing Practice Statements issued by the IAASB y RSM Quality Assurance and Risk Containment Policies Member Firms can tailor RSM Orb to include additional requirements arising from local laws and regulations in each jurisdiction.

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Activities to assess and monitor quality GLOBAL INSPECTION AND RSM MEMBER FIRM MONITORING PROGRAMMES Each individual RSM Member Firm is required to establish a monitoring process designed to provide it with reasonable assurance that the policies and procedures relating to the system of quality control over its assurance and other professional services practices are relevant, adequate, operating effectively, are aligned with RSM expectations and all requirements established by the International Federation of Accountants (IFAC) standard-setting boards including: y I nternational Standard on Quality Control (ISQC) 1, Quality Control for Firms that Perform Audits and Reviews of Historical Financial Statements, and Other Assurance and Related Services Engagements y International Standard on Auditing (ISA) 220, Quality Control for an Audit of Financial Statements y I ESBA International Code of Ethics for Professional Accountants (including International Independence Standards) Further objectives of an RSM Member Firm’s inspection programme are to provide an evaluation of: y The extent of the Firm’s alignment with RSM policies and procedures y T he Firm’s adherence to local/national professional standards and applicable local/national legal and regulatory requirements y W hether the Firm’s quality control system has been appropriately designed and implemented, so that reports that are issued by the Firm or engagement partners are appropriate in the circumstances y A reas where further actions are needed by either the Firm or RSM in order to take corrective actions or make improvements to the Firm’s quality control system A distinct benefit of the inspection process is that it provides the opportunity to identify areas for improvement in engagement management and the client service production and delivery system. Under RSM’s global inspection programme, an inspection team comprised of partners and staff from other Member Firms periodically oversees and/or participates in all Member Firm inspection programmes on a cycle not exceeding three years. Such inspections are referred to as globally coordinated inspections.

RSM globally coordinated inspections are conducted by independent qualified partners and senior personnel of other Member Firms under the direction of Global Executive Office personnel and the Global Leader, Quality & Risk. The RSM global inspection programme is also designed to meet the membership obligations of the Forum of Firms, of which RSM is a member network. The RSM International Board has the authority to impose sanctions on a Member Firm to ensure compliance with professional requirements and RSM methodologies, policies and procedures.

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OTHER QUALITY ACTIVITIES Member Firm admissions RSM seeks to admit new Member Firms that share the RSM vision, purpose, strategy, and values. Each prospective new Member Firm is subjected to a due diligence review, the outcome of which forms the basis for deciding whether to admit the firm as a Member Firm of RSM. The due diligence review includes an assessment of: y T he quality and technical capability of the Firm and whether audit and non-audit services are conducted in compliance with applicable professional standards y T he commitment of the Firm to a culture of high quality and ethical standards, through compliance with the requirements of ISQC1 y Whether the Firm is aligned with the RSM Strategy y Whether the Firm can meet the commitments and expectations for being a Member Firm The due diligence reviews are conducted by qualified independent partners and senior personnel from current RSM Member Firms under the direction of GEO personnel and the Global Leader, Quality & Risk. The outcome of the due diligence review is considered by TASEC. The CEO then makes a membership recommendation to the RSM International Board of Directors, which ultimately decides on admission of the Firm to RSM. Special Reviews A special review of a Member Firm is undertaken on instruction of the CEO when significant matters arise in relation to quality or other Member Firm matters. The reviews are conducted by appropriately independent partners and senior personnel from other RSM Member Firms under the direction of GEO personnel and the Global Leader, Quality & Risk. The Board has the authority to impose specific requirements, sanctions or to terminate the Firm’s membership.

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RSM Centres of Excellence and Leadership Groups RSM CENTRES OF EXCELLENCE (COE), SERVICE LINE GROUPS AND SECTOR GROUPS CoEs, service line and sector groups serve to enhance Member Firm core competencies in services delivered and play a critical role in RSM’s international business development efforts.

The groups are resourced by professionals from various Member Firms who aim to establish common practices, facilitate seamless regional delivery and align RSM’s resources.

CoEs are particularly focused on building and developing capabilities and as such improving the quality of services internationally.

Global Audit and Consulting CoEs were established in February 2021. The purpose of service line groups is to promote consistent services, share best practices and to explore ways in which RSM’s collective expertise can be used.

Sector groups seek to ensure engagement teams across Member Firms understand the implications of sector issues that impact clients and apply deep expertise whether it be through delivering audit, tax or consulting services.

RSM CoEs Global Audit Global Consulting Global IFRS Global International Tax Global Risk Advisory RSM service line groups Global Financial Due Diligence Leadership Team Global Legal Group Global Risk Consulting Committee Global Tax Leadership Group RSM Sector Groups Automotive Leadership Team Financial Services Leadership Team Real Estate Leadership Team Other relevant activities The Global Digital Advisory Committee (GDAC) acts in an advisory capacity to the Global Executive Office, providing impetus to digital activities and aligning strategic technology initiatives with network and Member Firm needs. GDAC also plays in key role in the deploying new technologies to enhance the quality of services delivered.

A Global Strategy Taskforce was established in 2020 to provide input to proposed revisions to the strategy of the network.

A Global Innovation Group has been established to collaborate on innovations to enhance service quality and introduce new products and services. This group also provides an internal marketplace to exchange innovations.

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Thinking about your business is a big part of ours

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Global and regional revenues Global combined revenues for year ending December 2020 classified according to the International Accounting Bulletin World Survey categories.

By region

($m) 2020

($m) 2019

Variance ($m)

Variance (%)

35.2

37.0

-1.8

-4.9

749.8

625.1

124.7

19.9

1,041.9

998.6

43.3

4.3

Latin America

111.0

126.2

-15.2

-12.0

Middle East

47.0

44.1

2.9

6.6

North America

4,283.6

3,908.4

375.2

9.6

Total

6,268.5

5,739.4

529.1

9.2

($m) 2020

($m) 2019

Variance ($m)

Variance (%)

Audit and accounting

2,821.7

2,561.8

259.9

10.1

Tax

1,913.2

1,820.3

92.9

5.1

Consulting

1,435.9

1,245.9

190.0

15.3

97.7

111.4

-13.7

-12.3

6,268.5

5,739.4

529.1

9.2

Africa Asia Pacific Europe

By service line

Other Total

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RSM representation RSM has Member and Correspondent Firms in the following jurisdictions, reflecting RSM’s regional structure.

AFRICA Angola Botswana Eswatini

Ethiopia Ghana Kenya

Malawi Mauritius Mozambique

South Africa Tanzania Uganda

Zambia Zimbabwe

China Hong Kong, SAR China India Indonesia

Japan Korea (Republic of) Malaysia Myanmar

New Zealand Pakistan Philippines Singapore

Sri Lanka Taiwan Thailand Vietnam

Croatia Cyprus Czech Republic Denmark Finland France Georgia Germany Gibraltar Greece

Hungary Ireland (Republic of) Isle of Man Israel Italy Kazakhstan Kosovo Kyrgyzstan La Reunion Luxembourg

Malta Mayotte Netherlands North Macedonia Norway Poland Portugal Romania Russia Serbia

Slovakia Spain Sweden Switzerland Tajikistan Ukraine United Kingdom

Ecuador El Salvador Guatemala Honduras

Mexico Nicaragua Panama Paraguay

Peru Puerto Rico Uruguay Venezuela

Lebanon Mauritania Morocco Oman Palestine

Qatar Saudi Arabia Senegal Tunisia United Arab Emirates

ASIA PACIFIC Afghanistan Australia Bangladesh Cambodia

EUROPE Albania Andorra Austria Azerbaijan Belarus Belgium Bosnia & Herzegovina Bulgaria Channel Islands

LATIN AMERICA & THE CARIBBEAN Argentina Bolivia Brazil Cayman Islands

Chile Colombia Costa Rica Dominican Republic

MIDDLE EAST & NORTH AFRICA Bahrain Benin Chad Egypt Gabon

Guinea Iraq Ivory Coast Jordan Kuwait

NORTH AMERICA Canada United States of America RSM representation as at March 2021

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RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm each of which practices in its own right. The RSM network is not itself a separate legal entity of any description in any jurisdiction. The RSM network is administered by RSM International Limited, a company registered in England and Wales (company number 4040598) whose registered office is at 50 Cannon Street, London EC4N 6JJ. The brand and trademark RSM and other intellectual property rights used by members of the network are owned by RSM International Association, an association governed by article 60 et seq of the Civil Code of Switzerland whose seat is in Zug. © RSM International Association, 2021