A MERGED CHINESE FIRM operating as a member of both RSM International and Crowe Horwath International would be a “transitional” arrangement, according to one of the network’s chiefs.
Jean Stephens, chief executive of RSM International, told Accountancy Age that the two networks were discussing with their respective boards about giving the go-ahead on the arrangement.
Earlier today the networks revealed that the two Chinese firms were to merge. To be known as Ruihua China CPAs, the new firm wishes to remain with their respective networks RSM International and Crowe Horwath International.
Stephens said: “The situation will evolve over a period of time, we’d expect there to be just one network. We don’t expect this will be a final solution.”
RSM’s board decision on the issue was likely to be made in the short-term, in what Stephens described as a “unique situation”. Both of the Chinese firms’ leaders are very active within their networks, and the two had made their focus on bringing the practices together.
When asked whether RSM would consider looking at other firms to partner with, Stephens said that the network was focused on supporting its Chinese member firm. Discussions between RSM and Crowe have focused purely on the Chinese situation, she added.
UPDATED 15.00 07/06/13:
Crowe Horwath International chief executive Kevin McGrath said that the combined firm would “likely make a choice” on one network or another – but this would not be an immediate decision. “For the moment, we’re supporting the new firm,” said McGrath.
The merged firm, as a bigger entity, gave Crowe Horwath International a “bigger input” into Chinese matters.
While the network’s board had yet to meet to discuss the merged firm, he believed Crowe Horwath would support the transaction. “No issues have been fully evaluted, but we’re comfortable and confident.
“It’s early on in its development, but our working relationship with RSM is good enough to manage it.”
On the Chinese firms’ request to maintain relationships with two networks, he added: “They made a decision to not make a decision.”
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