Distinguished guests, Past Presidents, fellow Council members, Committee members, Ladies and Gentlemen, Good Evening.

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1 Spring dinner speech Philip Tsai President, Hong Kong Institute of CPAs 24 February 2011 Thank you, Winnie. Distinguished guests, Past Presidents, fellow Council members, Committee members, Ladies and Gentlemen, Good Evening. On behalf of the Institute I'd like to welcome everyone to this evening s Spring Dinner, and a belated Gong Xi Fa Cai to you all. I hope that everyone had a pleasant and relaxing Chinese New Year holidays and that you are all ready for a hopping Year of the Rabbit. Last year, the Year of the Tiger, was a year full of accomplishments and achievements for the Institute. This year, we will keep up the momentum and continue with an ambitious agenda. This agenda consists of three primary audiences: our members, small- and medium-size practitioners, and mainland students. During the coming year, I would like to see the profession make progress in three areas: boosting member engagement with the Institute, improving our understanding of the challenges faced by small- and medium- sized practitioners, and increasing the availability of QP in the Mainland. It often surprises me when I meet members who are unaware of the many resources available through the Institute. When I tell them what they have at their disposal, it is their turn to be surprised. The Institute has state-of-the-art facilities at Wu Chung House including a fully stocked library ideal for research and study, conference rooms with cutting edge technology perfect for seminars and workshops; a wide range of continuing professional development courses to help members keep abreast of the latest standards and skill-sets; and a slew of networking, sports, and recreational activities such as a dragon boat team, bridge club and dance classes, not to mention our 500 strong team which participated in the 10k, Half Marathon and Full Marathon at the Standard Chartered Bank Marathon last Sunday. As 25% of our members are under the age of 35, we have started a 25:35 group under the leadership of the youngest member of the Council, Gary Poon. We hope the new generation of the profession can have their own events and develop together as the future leaders of the profession and pillars of our society. We need to serve our SMP members because they make up a significant portion of the Institute's membership and play a huge role in Hong Kong's small- and medium-size enterprises. As SMEs are the lifeblood of Hong Kong, it would be no exaggeration to say that our SMP members are important to the commercial and economic success of Hong Kong. Winnie and I attended the first meeting of the 1

2 SMP Leadership Panel last week and I plan on increasing the quantity and volume of discussion with them and making sure that their voice is louder and clearer in the accounting profession dialogue. Keeping this segment of our membership at the forefront of business is an important priority for the Institute. Our members in business are greatly important to the profession not only because they make up a majority of the Institute s membership, but because they are also the business leaders of Hong Kong. Winnie and I had a recent meeting with two very senior members in business and we have listened to their suggestion to provide a platform for our members who are senior CFOs and even CEOs. We discussed how the Institute can contribute resources in shaping our policy for this platform and creating an arena in which our experienced members in business can serve as mentors to our young, budding PAIBs. QP is becoming more prominent in the Mainland, with China's burgeoning need for accountants with knowledge of, and experience in, international standards. Our geographical and linguistic proximity give us a reason to step in to support the Mainland as it fulfills its goals to develop the profession, and I plan on building an even stronger relationship with our mainland counterparts. They need world-class accountants and we know how to train and develop them. This is a simple and symbiotic relationship that has and should continue to be mutually beneficial and long-lasting. Building on the success and reputation of the QP in the Mainland is definitely at the top of our to-do list. At the beginning of this new decade, I am encouraged and excited to say that we are beyond where we thought we could be. Even though we are geographically a small market, we are punching well above our weight and are widely recognized as one of the leading professional accounting bodies in the world. I would like to take this festive opportunity to thank our members both in practices and businesses who have devoted their time and energy to the works of the committees for their dedication to the Institute and their commitment to the profession. Committee members are vital in the translation and implementation of the Council s vision. Without your support, the profession could not be as vibrant and as influential as it is now. The Institute could not be in its place among all the outstanding accounting bodies in the world if it were not for your contribution of time and expertise over the years. So once again, I d like to extend to you my deepest gratitude. Finally, may the Year of the Rabbit bring you all Health and Happiness, and bring to Hong Kong Prosperity and Fortune. Before I let you get back to your drink and conversation, we are honored to have our Permanent Secretary for the Financial Services and Treasury Bureau, Ms. Au King Chi, who has kindly agreed to say a few words for us. King Chi please 2

3 Spring dinner speech Winnie Cheung Chief Executive, Hong Kong Institute of CPAs 24 February 2011 Distinguished guests, ladies and gentlemen. Welcome to the Hong Kong Institute of Certified Public Accountants spring dinner. I know today is an auspicious day, and there are many events and functions taking place at the same time, especially spring dinners, so thank you all for choosing to celebrate the Year of the Rabbit with us. May the year of the rabbit bring you leaping success and bounding good fortune. 恭祝大家兔年東成西就 如意吉祥 萬事勝意 身體健康! We are delighted to have with us tonight - Permanent Secretary for Financial Services & the Treasury, Ms. Au King Chi, - Under Secretary, Ms. Julia Leung and - Deputy Secretaries, Mr. John Leung and Mr. Patrick Ho from the FSTB, - the Chairman of Securities & Futures Commission, Mr. Eddy Fong - Chief Executive Officer of Financial Reporting Council and a past president, Dr. P.M. Kam, And our many friends from the SAR government: - Director of Audit, Mr. Benjamin Tang, - Commissioner of Inland Revenue, Mr. Y.Y. Chu, - Director of Accounting Services, Mrs. Lesley Wong, - Official Receiver, Mr. Eammon O'Connell, - Registrar of Companies, Ms. Ada Chung, - Commissioner for Narcotics, Ms. Sally Wong. A warm welcome to you all. We also welcome Paul Chan, our Legislative Council representative and an Institute past president, who is here with us tonight. 同時, 我也代表香港會計師公會歡迎中央政府中聯辦路和平部長, 陳紹彬副部長及其他代表, 還有外交部駐港特派員公署的陳海平副主任, 還有全國人大代表雷添良先生和全國政協委員李家祥先生兩位前會長, 感謝你們的光臨 We also have our council members, past presidents, senior management team, many of our 400 volunteer members from our boards and committees and panels, and important stakeholders, including leaders in politics, business, academia and fellow professional bodies. A warm welcome to you all. 1

4 We are able to keep the Institute at the forefront of the world's professional bodies thanks to your support and the many and varied contributions of all of you. Thanks for volunteering your time and efforts to our work. The value you bring to the Institute and the commitment you show to the profession is invaluable. As all of you here know, Hong Kong now leads the world in terms of capital raised from IPOs and has done so for two years running. Our economy has recovered from the financial crisis and our GDP exceeded the peak before the crisis it grew by 6.8 percent in Against that background, the Hong Kong Institute of CPAs is urgently working to keep the skills of our members in the premier leagues in order to keep up with the break-neck growth of China's economy. Our main mission is to produce top accountants with expertise in international finance and the language and communication skills to lead and serve Hong Kong's capital and financial markets, as the main fundraising centre for China. Our collaboration with the MoF, the CICPA and CSRC on financial reporting and auditing standards and capital market issues is very close indeed and we expect this to continue. To help us hone our skills, we've re-vamped our qualification programme for our students, we're doing more to take that programme to mainland students, and we're working on gaining closer recognition with the MoF & Chinese Institute of CPAs so that our members have more opportunities in the vast mainland market. We have also just launched our first specialist qualification and designation in insolvency and we will introduce additional ones to match Hong Kong's increasing market sophistication. As China gained a place as the world second largest economy, the Institute worked with our counterparts on the mainland to converge Chinese accounting standards with Hong Kong. This enormous undertaking is why H-share companies can now choose to use just one set of books instead of two, according to a new stock exchange listing rule. We expect this to be a challenge for our members, who may see greater competition and reduced volume in audit work, but a good opportunity in the long run as more mainland businesses raise funds in Hong Kong and increased demand for Hong Kong's professional services. As Hong Kong leads the world in convergence with IFRS, our ties with the international accounting standard setters are closer than ever and we are now a core member of the Asian Oceania Standards Setter Group. This group strengthens Asia's voice in international standard setting circles so that as more Asian jurisdictions adopt international financial reporting standards, concerns are addressed and met something that hasn't always happened. With opportunities, there are also risks and challenges too. The recent inflationary pressure and running property prices are concerns to everyone, especially our younger members. 2

5 At the same time as in both recession and the recovery, our profession has been stressed by long working hours, especially for younger members working in public practice. This has had the unfortunate consequence of making the profession less attractive to bright young people, right at the time we need more professionals in our ranks. Pressure on audit fees and auditors' liabilities are also significant issue of concern. We are working hard to develop measures to address these issues. There are other challenges too. One of which is keeping our regulatory regime in line with international benchmarks while at the same time ensuring our auditors are not overregulated, and that our SME/SMPs are not over burdened as they are in some jurisdictions. To make sure our regime is vigorous, we've established committees and working groups to look into any reforms that might be necessary; we are willing to make ways to change to keep our premier position as a listing destination. I hope the brief overview I've just given you on the Institute's current agenda will help you in your committee work. In the near future, the Institute will be seeking your advice and collaboration as we ride on our steep opportunities and mitigate our challenges and risks. The Institute is thriving on all fronts and we re going to show you a video now that showcases the Institute's many activities and engagements of our members and the volunteers in them. After the video, we ll hear from our president, Philip Tsai who will talk about the initiatives and plans he has in mind for his presidency. And then, we d like to invite Permanent Secretary, Au King Chi, to say a few words to us. Let us enjoy tonight and have fun together. What better way to start off a new year than with food, drink, conversation, song and laughter in the company of friends and colleagues? Happy New Year and thank you! 3