Tough meeting

Went to as meeting with a Chinese client today with a Chinese partner and Senior Manager.

Client speaks little or no English so the meeting is conducted in Mandarin. However, important points are translated for me by my colleagues and the partner frequently suspends discussion to ask my point of view and then translates back to client. We debrief after the meeting is Starbucks and it appears meeting went well, client was glad for my input and partner thanks me for coming. He also asks if I could run some basic international tax training for new recruits when it is suitable for me - I am happy to do so, as this certainly would not be a request in Hong Kong.

Just before take-off back to HK, an email lands in the Blackberry - it is the minutes of our meeting earlier in the day. 

My faith in the firm is restored but on Monday, it is back again in Hong Kong.

Beijing

After all the crap of yesterday, I am in Beijing for a meeting. 

This is so refreshing and more what I'm used to: intelligent and approachable partners working for the common good of the firm and all who work there, down to the newest and lowest ranking recruit.

Above all I have found in every visit to Beijing (and Shanghai) a strong culture of Professional Courtesy - respect for other views, collegiality and stewardship. 

Had to laugh - saw the Colonel scurrying into MacDonalds for lunch today - he obviously hasn't settled in well into China and still needs things that remind him of home.

Non -Disclosure is Good - The Aftermath

Hauled into the Managing Partner's office to day for a stern telling off!

It would appear that my request for a dictaphone and telling another partner that we should not advise a client that non-disclosure is acceptable is a source of great concern to the local partners.

I brush the dictaphone issue off by saying that I have bought my own and as far as I'm concerned the matter is dispensed with.

The issue about non-disclosure is non-negotiable: it is contrary to the law, contrary to ethics of the firm and can open the firm to legal sanction.

It appears that partner in question has gone around to all the other partners and complained that I was disrespectful in questioning her judgement. The local partners frequently join together in a sign of unity, but when it involves Gweilo's, they are the ultimate Band of Brothers/Sisters.

Notwithstanding a vehement defence on my part, the prosecution case is simple:

• it is not for an outsider (Gweilo!) to question the technical or ethical judgement of local partners.
• she has been here longer than me, therefore I listen and accept her judgement - end of story
• this is Hong Kong.

Suitable reprimanded, I depart thinking WTF is this place about. 

I decide to put in a call to the Colonel, the area leader, who tells me he doesn't want to get involved in internal problems even though it has serious QRM ramifications. He suggests we flag such matters for the next discussion on QRM. What a cop-out!

I'm on the point of calling an old friend who is global head of QRM but decide to drop it as I reckon if the matter progresses it will be suggested by the locals that either I have lied or it was in fact me who made the non-disclosure suggestion. Cover-up and shifting the blame are artforms here.

Just fainted

Currently working on a fairly straight-forward Transfer Pricing project in Australasia and have has had a series of conference calls with offices involved in the project.

I have been working with a pretty bright and enthusiastic Manager who appears to relish his new found freedom of having work delegated to him where he can use a bit of initiative.

So we're in my office, speaker phone ready to start the call in 5 minutes and I inform him that I would like him to lead the call today. He is bemused. He begins to protest that he is scared, has never led a call before, doesn't have enough knowledge etc etc.

I reassure that I have faith in him and that he is more knowledgeable than he gives himself credit for and that I will support him on the call if anything goes haywire.

All set to go,  make the call greet everybody and it's over to Bright Manager - who promptly faints.

Anyway, he came round eventually, I took the call and all was in order. Poor bloke is terribly shaken but after discussing it with him. he is secure in the knowledge that, in my eyes at least, he hasn't lost face.

What I find amazing is that no responsibility is given those below partner so no wonder said fellow passed out. What do these poor souls do when they make partner - suddenly they have responsibility but have no idea how to deal with it. Sadly, the result is all too predictable.

No lunch for the Gweilo

My diary for today included a Partner & Director lunch. I think this was remotely added to my PC calender about a month ago. 

I asked my secretary to please find out the venue and confirm the time. 

She came back about 10 minutes later to inform me that my presence was not required as the lunch was only for Chinese Partners and Directors.

Take that Gweilo!

Hospital Pass

Attended a meeting with a client in HK today, at the request of local partner who had asked me to accompany him. Apparently we have put some "hard yards" with the client and they had not given us any meaningful work. Could I help to ease the problem?

Pitched up at clients office in Central to find that partner had excused himself to participate in an urgent conference call (a likely story!).

I dutifully had my head ripped off by the tax director who told me what a useless firm we were: unresponsive, not proactive, technically deficient, no access given to foreign offices etc etc.

Now I can see why the partner on the job did a runner.

No doubt I will be blamed for wrecking a profitable relationship - yet another day in the life of the Gweilo Running Dog.

Dictaphone blues

I put in a request the other day for a dictaphone. Now call me old fashioned, but I can only type with 4 fingers and not particularly quickly. I share a secretary with another partner but have found over the past 6 months that it is impossible to turn around any typing in less than 3 days. Not that the, very amenable, secretary is incompetent; she is seemingly burdened in attending to personal matters of the other partner, who on time served is far more important than me. 

The first response I got from the MP was that why can I not type opinions and letters myself? The obvious answer to that is that clients pay for professional time, not for our limited typing skills.

I did a quick straw poll among some of the Senior Managers and it would appear that they all type their own documents, and are indeed expected to do so. No wonder our recovery rates are so low.

A few went so far as to tell me that they do not charge time for typing but have to work longer hours to meet the target of 8 chargeable hours a day. No wonder the poor buggers are in the office until midnight!

Having luckily got away with my response to the MP, I was then told that none of the other partners have a dictaphone. Somewhat cheekily I responded that if they have a lot of typing, they should perhaps consider this as an option as it increases operational efficiency. This was not appreciated! 

I was asked why I had to be different. The answer was again to say that it will increase efficiency (and profit) and that this is fairly common in other practices around the world.

I was given the standard answer: This is Hong Kong.

Yes, this may be Hong Kong but in a practice that is predominantly Compliance in its nature Partners don't necessarily have to produce opinions and other fairly lengthy documents. Also, the working practice is very much Work Harder Not Smarter.

Having given up on arguing this, I have bought a dictaphone and transcriber for HK$15K and paid for my secretary to go on a course to learn to use.

Don't ask questions

Had coffee today with a gweilo from another Big 4 firms and found him feeling sorry for himself. 

He had just attended a staff meeting where they were told they had to take unpaid leave as a consequence of the economic downturn. Their managing partner had told the assembled mass they they had to show their worth to the firm and increase their efforts in generating new business.

Stupid fellow thought it would be useful to illicit some ideas from the managing partner to encourage the junior staff to improve their business development skills and asked the MP what he had  been doing to generate new work. 

He was disappointed to me met with a really dirty look, not only from the MP but from all the local partners.

He has still has to learn that the work ethic here is: Do as I say, not as I do.

Non-disclosure is good!

When I started off in the tax profession some years ago one of the first lessons I was taught was that NON-DISCLOSURE is one the most deadly sins imaginable.  Dishonesty personified!

Imagine my horror upon finding that one of the local partners here believes it is acceptable to cover up the firm's mistake.

Simple scenario: Local partner asks me to help out on a basic regional recharge plan for a US company that is regionally HQd in HK. 

• HK operation supplies services to member firms throughout Asia and no income of its own.
  
• These services are not recharged to Asian companies.
• Massive accumulated tax losses in HK entity since 1998.
• So, recharge expenses in order to run down tax losses accumulated in HK.

Having done my bit on the Asian recharge, I was asked to have a look at document Local Partner had drawn up on HK tax consequences. It struck me that if there if the expenditure in Hong Kong had been incurred to generate income in other Asian countries, it should not have been claimed as a tax deduction in HK which led to the huge tax loss accumulated. We of course did the tax returns where the expenditure was improperly claimed

Having raised this with said partner and suggesting that the taxpayer should volunteer to have the deductions reversed and the tax loss adjusted. I was astonished to be given a fresh draft of the document today that effectively said that the "IRD may reverse the expenditure claimed but is unlikely do so if it does not know. We advise that it is not necessary to inform the IRD of the actual situation as this may result in the loss of the tax loss." 

Immediately called genius partner to say that this was not appropriate advice only to be told document had already been sent to client, and that the firm can not be seen to have got the initial advice wrong.

God Help us!!!!!!!! 

In other country that would be instant dismissal - but then, as the local partners frequently tell me,  This is Hong Kong!

How to become a partner - Part 2

So how does one become a partner here in Hong Kong:

A. If Gweilo?

A.1  be appointed before you arrive in Hong Kong - this only applies to those who are already with the firm.

A.2 if above doesn't apply, don't even bother thinking about it - you have no chance. Unwritten rule: Gweilo will not be partner - just running dog.

B. If local

You have a chance, provide you follow some simple guidelines:

• Work harder NOT smarter - being smart is not appreciated.
• Stay in office until at least after midnight. Still only charge 8 hours. Never leave before partner - This shows you are dedicated to creating wealth for the partners and that you are committed to the glorious cause.
• Do not come into work on time, ever - this will indicate that you didn't stay late the previous night and these show no commitment to partners wealth gathering.
• Do not show initiative - this is not appreciated and may cause partner to lose face.
• Wear your access card around your neck with the firms name emblazoned on the necklace - partners like free advertising as it doesn't diminish their earnings.
• Do not do post-graduate tax courses, and if you foolishly do, do not pass - you cannot be seen to be better qualified than the partners (face issue!)
• Ensure you criticise all gweilos (partners included) to the local partners - this will show that you know how to sing from the same hymn sheet. 
• If you screw up, find any junior to blame (even if they were not involved) and then shout and scream at them in front of the whole office - this is compulsory partner training.
• Be rude to subordinates (and particularly secretaries) - another compulsory partner characteristic.
• You must not mentor, train or coach subordinates - they are potential threats and this is self defeating. 
• Demand respect - earning respect is for weak and decadent gweilos.
• Make sure you tell partners, particularly the one in whose whose backside your head is usually buried just how brilliant they are and how you wish you could be like them one day - they just love adulation and adoring minions
• Do not be too technically advanced you just need to follow perceived revenue practice - again a face issue with the local partners.
• Use communication difficulties as an excuse with clients when you cock-up - as a partner you are never wrong, clients are!
• Don't mix with the gweilos, not openly at least - they may corrupt you and tell you things you should not know.
• Never ask the partners questions at staff meetings, even when asked - partner has already told you everything you need to know.
• Do not be innovative or think "outside the box" - mediocrity is good.
• Do not delegate work, rather abdicate it - delegation and coaching is for gweilos
• Never discuss general matters with clients over lunch - just sell tax returns and revenue query responses.
• Learn about the HK Stock Exchange and find good tips - partners will love you as most of them day trade every day until lunchtime.
• Never admit that you don't know - this is a sign of weakness
• Never ever give an opinion - revenue knows best and it removes the possibility that you may be wrong.
• Most importantly, be prepared to spend years achieving your goal of making partner (unless your daddy is a BIG client) - loyalty is more valued than capability.

Bad lunch

Had lunch today with the Tax Director of a major bank. One of the local partners insisted on accompanying me "to show the local face of the firm". Bloody disaster!

Uninvited partner kept pushing TD to let the firm do their domestic tax returns - notwithstanding the fact that they have 4 tax managers doing the job for them already. He wasn't impressed by partners insistence that local firm has such good contacts with the local revenue authorities that favourable assessment is a formality. So little social skills and she left early for "conference call". TD says he would love to have lunch again provided I don't bring irritating partner again. 

It's my birthday - buy me lunch!

So today is one of the partner's birthday, the one that gets up everybody's nose. Official invite to join her for lunch, sounds too good to be true. It is!

Everybody attending is expected to contribute the cost, based on seniority. So, I don't like the restaurant or its food, I'm going to be the only gweilo there (again) and I have to contribute to her free lunch and subsidise the junior staff. Stuff it - Lan Kwai Fong beckons.

Seems I'm the only one not to go, apart from some local partners who hate her and are either on sick leave or an "urgent conference call".

Blackberry grief

A recent arrival on short-term assignment asked me today whether he could have a Blackberry. This reminded me of the difficulties I had encountered when I arrived in Hong Kong.....

I am no fan of the Blackberry, but when you have to deal with colleagues and clients as far west as Vancouver you rather need one instead of firing up the laptop before going to bed every night or when staying in an out-of-town hotel. So I asked my secretary to arrange one for me. "This is not possible" she told me, shocked that I had even asked for one. When pushed, she handed me a requisition form and asked me to complete it and she would pass it onto the Managing Partner for consideration.  Duly completed, off went the form for what I expected to be instant approval. 

A few days later my secretary returned with a request to supply reasons why I should have a Blackberry. Jeez, I thought this would be obvious, but nevertheless complied. About a week later I got a note from the MP saying my request had been rejected as Blackberries were only for the use of partners. So I fired off an email to her, politely pointing out that as a Director I needed one just as much as I suspected partners needed one, and to an extent, probably needed one more than them given my responsibilities.

Still no joy! It eventually took a client spitting the dummy and my email response to him that I could have acted more promptly had I had a Blackberry (an email I copied to the MP) that resulted in a brand new Blackberry (identical to the one I was given by the EU firm in 2005) arriving on my desk. I soon discovered that the Hong Kong office practised Blackberry apartheid - local partners get the new models and others deemed worthy of having one get shitty old models that the telecom company have obviously paid the firm to take out of their warehouse.

Business Plan Blues

The entire tax executive is called into a meeting this morning to discuss how we are going save money (and ensure that there is no diminution in partners earnings, off course). So many poor buggers are going to have to take additional unpaid leave, we are talking of an additional 40 days at the moment and perhaps a 5% reduction in partner earnings from last year. 

Needless to say, the cheeky Gweilo was at it again. "What is our business strategy over this tough period?", I asked . Daggers.

What you need to recognise is that no local Chinese below the level of partner (this applies to some of the junior partners as well) would ever dream of asking such a question. The reason is primarily face but also knowing your place. "Face" because in my experience of Hong Kong, the partners have absolutely no idea of strategy (apart from lowering the charges of completing mundane tax returns for local businesses) so they have no answer, or at least coherent answer. 

Then there is knowing your place: the locals so are so petrified of seniority they never utter a peep in these meetings apart from nodding vigorously whenever somebody senior to them says anything. 

I eventually leave the meeting none the wiser apart from the fact that the only plan is screw to the junior staff while those in control have no clue how to improve business.