Insights

As we have seen, Thailand plans to spend money attracting new businesses and tourists, all while lowering personal income taxes. Given such an array of new expenses, the treasury arm of the Thai government would ordinarily come under pressure to balance the budget. Indeed, we have already seen the Ministry of Finance struggling to locate new sources of revenue. Thailand’s Revenue Department has considered plans for imposing taxes on capital gains, casting the tax net wide enough to include on-line operators. Banks will be required to report account holders with high-volume cash transactions in an effort to seal off tax evasion. Plans are in place to increase the tax base – with a target of adding 200,000 new taxpayers per annum.

As the world’s economic engine slows, countries are moving to stimulate their economies by increasing government spending and cutting taxes to inject cash into the domestic economy. Such actions are intended to boost the economy, and prevent it from stalling.

As businesses strive to maximise growth and performance, they must always keep an eye on the changing environment around them. These changes typically occur among their customers or competitors, but regulatory policy can also have a big impact on business operations. The Thai government has recently enacted a number of policies, provisions and regulations to respond to new developments around the business world. These include the Personal Data Protection Act, new merger amendments to the Trade Competitions Act of 2017, and the Cybersecurity Act – all requiring potentially significant action among businesses operating in country.

For any industry reshaped by rapid technological growth, new business models must be accompanied by the development of complementary skillsets among its employees. The world of auditing is no different; as ever more advanced service capabilities raise client expectations, there is an increasing recognition among accountants that – as the saying goes – “what got you here won’t get you there”. Indeed, auditors in the financial services industry have traditionally prioritised skills such as accounting, risk management, IT and data analytics when looking to land their desired job. Training in these areas will remain essential for some time to come; however, an oft-overlooked set of “soft skills” is becoming ever more relevant in today’s age of digital transformation. These abilities emphasise the human side of business interaction, where interpersonal communication leads to understanding in a way that technology alone cannot yet replicate. With technology now playing a massive role in the finance industry along with other business sectors, auditors now have greater technical abilities at their fingertips than ever before. In such an environment, where computers can outperform even the best and most experienced auditors at fundamental tasks, the traditional role of the auditor can now expand into new areas. It is therefore worth exploring the challenges and opportunities of this new ecosystem, with an eye toward the particular skills that auditors can develop in order to differentiate themselves from their fellow auditors – as well as their silicon-based assistants.

Now that the political climate in Thailand has stabilised, the government is looking to speed up its Free Trade Agreement (FTA) negotiations with key trading partners. Plans include resuming negotiations with the EU and UK post Brexit, as well as talks to join major multilateral FTAs. To be successful in these negotiations, Thailand needs to keep in mind the consequences that non-tariff barriers will have on improving trade as a whole.

Ever since the Industrial Revolution, manufacturing has been at the forefront of innovation. New technologies that improve efficiency and productivity have always been enthusiastically implemented, leading to great benefits for both producer and consumer. Today, an important new dimension is at play, as manufacturers find themselves in the midst of the digital revolution. Those who embrace the forces of disruption will prosper, while those who resist the inevitable will fall by the wayside. Digital transformation is the only way to ensure lasting success, and manufacturers need to take every step necessary to ensure it is done correctly. Manufacturers that do not commit to digital transformation will not be able to keep up with competitors who can offer data-based services to their customers. If they do not offer the latest services, buyers will find someone else who does.

This is the first article for Experience and Insights, a series of interviews and articles where I discuss best business practices and insights – particularly in matters of finance – with successful thought leaders based in Bangkok. Watewiboon Pumipue is the Founder and CEO of Talad Invoice, Thailand’s first on-line invoice factoring platform. Watewiboon is also a member of the Thai Fintech Association and has worked closely with various government and public agencies such as the Bank of Thailand, the Securities Exchange Commission, the Ministry of Digital Economy and Society on the latest developments in rules and regulations on the emerging fintech industry in Thailand. I recently met with Watewiboon to discuss his business as well as some of the challenges new Fintech companies face in Thailand.

Hendrik van den Berg is the Founder and Managing Director at Neos IT Services. Having founded the company in 2005, Hendrik and his diverse team have transformed Neos into a thriving business. I recently met with Hendrik to have a detailed discussion of business transformation and what it entails. The most fascinating insights from the interview revolved around the role of technology and cultural change in the transformation process.

Years after its inception, Blockchain remains a central focus of the tech world, thanks to its potential to revolutionise business activity in every sector. Yet when it comes to the actual integration and implementation of Blockchain technology into mainstream use and business value chains, people may be getting ahead of themselves. Public interest in Blockchain has largely been limited to the hype surrounding cryptocurrencies – and in some ways, the Bitcoin phenomenon itself is a useful metaphor for Blockchain as a whole. In both cases, while the potential for genuine disruption is great, the current level of excitement nevertheless seems premature, as a number of complex obstacles still need to be overcome.

Advances in data analytics are allowing today’s auditors to gain greater insights into their clients’ organisational structure and provide them with higher levels of assurance at similar or even lower costs than ever before.

True business transformation requires change to an organisation’s culture, processes and strategies in the face of shifting norms, digital disruption and evolving consumer needs. If done effectively, the benefits can be both immediate and long-lasting. However, transformation for its own sake is not a sustainable recipe for success. Before they begin the change process, companies must set clear goals to determine where they want to go and what enablers they will need to get them there. A clear plan for benefits realisation is critical to successful transformation.

For many manufacturers, cash flow is the limiting factor that determines how many new business opportunities they are able to pursue, and how ambitious their strategy can be as they plan for the future. The demands of Industry 4.0 require data-driven management both inside and outside the factory, requiring continuous capital investment to keep pace with a fast-moving business environment. Pricing pressures add to the challenge, reducing margins even as customer demands increase ever more quickly. Even the most forward-thinking manufacturers will have trouble staying ahead of the curve if they cannot access enough internal cash flow to keep the wheels of innovation turning.

On 28 February, the National Legislative Assembly approved the Personal Data Protection Act (“PDPA”). The Act is aimed at regulating the lawful collection, use, or disclosure of personal data that can directly or indirectly identify a natural person – but does not apply to the data of a deceased person. This Act also provides a framework how to process the personal data. The PDPA, which in many ways resembles a similar initiative in Europe (the General Data Protection Regulation, known as GDPR), requires a data controller (a natural person or a legal person), who has the authority to decide to collect, use, or disclose the personal data, to follow guidelines in an effort to protect each data owner.

This article provides some insight into why audit firms sometimes compromise audit quality, while also giving examples of how this happens, and relaying the implications of inconsistent audit quality for the profession as a whole.

I recently met with Richard to discuss how British businesses can establish themselves and prosper in Thailand. The two most salient points he made were about the imperative of understanding the complexities of the Thai market, along with the need to foster strategic local partnerships.

From the outside, multi-generation family businesses often appear to be models of stability. Yet underneath the durable exterior structure, many such companies must deal with highly complex family politics and emotional components that affect how they operate and how they are led. Lack of cohesion and strategy during crucial processes – like business transformation and succession – causes the vast majority of family businesses to fail before they reach the third generation.