COO: Business Restructuring
BDO
One of the criticisms of the business rescue profession is that creditors and financiers (banks and other credit houses) believe that only a few business rescue professionals are suitably qualified to carry out business rescue plans (2022 Deloitte Restructuring Survey).
Turnaround Talk touched base with Buhle Hanise, recently appointed Chief Operating Officer of Business Restructuring at BDO. We spoke about the concerns regarding the profession and the characteristics that will drive the growth of the profession going forward.
Your appointment at BDO comes when business rescue and restructuring are under increased scrutiny from the public. Do you feel that there is value in the profession?
The professionals in the BDO Business Restructuring Team have a collective of 100 years of experience in restructuring. The most senior practitioner has 40 years of experience as a lawyer and restructuring professional. Over the years, the team has not avoided controversial and complex cases despite occasional criticism being levelled against processes where the complainants are, by far and large, laymen with no practical professional experience.
The success rate of the BDO team has been remarkable, and the vast number of completed business rescue cases is a testament to that and demonstrates that there is tremendous value in the profession when approached by a professional.
Where can this value be found?
Since the provisions of the Companies Act came into law in May 2011, two members of the BDO Team, which I have just joined, hold the top and number five positions out of the Top 10 BRPs (according to the CIPC) with the most projects in South Africa respectively.
Between the two of them, they held 216 appointments in the last 12 years, meaning they have made a substantial difference. In addition, they have completed 185 cases between the two of them, with a possible 13 cases nearing completion (by the end of March 2023).
BDO completed business rescue assignments in multiple sectors such as inter alia, construction, mining, retail, and property. The collective value of the group that I joined extends over all these sectors, and together with my experience, we have a team that can make a professional difference.
South Africa is increasingly criticized as a nation of liquidators rather than a nation where business rescue is successful. Do you feel this assessment is fair or unfair? Please discuss.
That sentiment may exist; however, with the global BDO brand behind us and my team’s vast experience, we can change that perception.
With early intervention and the creation of the correct mindset, we can assist struggling businesses.
Some criticism of the business rescue profession is driven by comments from advisory firms who make statements regarding the success rate of the profession and the suitability of the qualifications of some individuals. Are these comments fair?
The success rate of the profession in the public domain and the BDO team’s success rates are poles apart; whilst it might be fair in terms of the success rate of the profession is not fair in relation to BDO.
Our team consist of duly admitted attorneys and CAs; we are a suitably qualified team of professionals.
How do we address these statements?
We should address this by taking the truth and the reality of the present situation to the market and which is one of my intended goals.
Image By: BDO
Many professionals feel that there is a need for regulatory reformation whereby a lot of work is done to improve the regulatory framework that governs the industry. Do you agree with these sentiments? Please discuss.
We agree with that but wish to add that our professionals are at the forefront of the professional bodies; to date, Hans Klopper, Dawie van der Merwe, Anneke Barnard, Hillary Plaatjies and Chris Rey have served on the National Board of SARIPA over the last 15 years. Dawie was instrumental; procuring SARIPA’s accreditation as a professional body has been the driving force behind the agreed professional code of conduct and disciplinary rules to mention but a few.
What are the areas that can be developed?
We are working on creating awareness by identifying a Financial Health Check service offering that will assist businesses with identifying early warning signs and getting professional help sooner.
Please discuss your goals with BDO.
I am very passionate about educating young professionals about the industry and the auditing and accounting industries.
In my work, I find that young trainees doing their articles with us often do not understand what we do in the business restructuring department. I would love to allow these trainees to rotate with us, so they can look beyond accounting and auditing as career options and fall in love with Business Restructuring.
In the industry, education about business restructuring is quite limited and often elicits a sense of fear. Our department offers several services, including independent business reviews, turnaround, rescue, restructuring and liquidation. Working with us does not necessarily mean you might have to close your doors; our first approach is always to try and save the business because we understand the hard work that goes into building it.
I can build the BDO Business Restructuring unit up enough (during the next five to ten years) to the point where we are competing with the Big 4 and collaborating with them. We have the skills and resources to become one of the most sought-after Business Rescue departments in South Africa, and it is my goal to see this happen.
