Shipping accountant and business consultant Moore Stephens says that, despite recent publicity to the contrary, Russia is now a better place to do business than it has ever been for small and medium-size enterprises, including shipowners.
Writing in the latest issue of The Bottom Line, the newsletter of the Moore Stephens shipping industry group, Gavin Stoddart, managing director of Moore Stephens Russia, says, "The door to international finance and international markets is open, with traffic flowing in both directions. The only passport to success is sound and visible financial structures".
Acknowledging that there is still a Russian risk premium on investment capital, Stoddart says that all the indicators are nevertheless pointing to this reducing or disappearing as Russian business practice meets international standards. He adds that the three key things which Russian companies need in order to access global finance and markets are: (1) Good accounting systems, and accounts prepared in accordance with internationally accepted standards, going back at least three years, and ready for future audit. (2) A compelling business plan. (3) Some form of security.
Stoddart says, "For shipowning companies, the security issue is relatively straightforward because they can create, as they have been doing for years, offshore companies to own vessels and flag them in global registries. For almost all banks, there are still questions over the Russian flag and registry as a suitable place to register a
ship mortgage." Adding that, for non-shipowning companies, the solution may be to work with Russia's increasingly powerful banks, or to take advantage of soft loan options backed by some form of export guarantee scheme, Stoddart concludes, "Open your books, and order your thoughts. Russia is booming."
Moore Stephens London, founded in 1907, is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting networks, with 440 offices of member firms in 90 countries. Moore Stephens London is noted for a number of industry specialisations and, in particular, is widely acknowledged as a leading shipping and insurance adviser.