EFTA00597590.pdf

Aff Family office design and setup Our approach to designing and delivering family office services is rooted in a review of eight key areas that, if addressed effectively, determine long-term success. The major advantage of this approach is the way we scrutinize subject areas with a holistic view to operational, regulatory, tax, strategic and family-related aspects. This enables us to uncover hidden opportunities and risks, which might have been missed if we were to examine each area individually. Why set up a family office? 1) Your family and business are growing, and your business staff are distracted by supporting family needs. 2) You have a liquidity event, such as selling the business. There are many reasons why setting up a family office might make sense. Below are the advantages and concerns most frequently identified: Advantages Concerns • Maintain family cohesion • Cost of family office setup and operations • Maximize privacy and control over assets • Complexity of market, legal and tax infrastructures • Manage family risks • Difficulties in identifying and managing • Support family entities and investments staff • Service family houses and other • Obtaining expert advice across a wide holdings range of topics Types of family offices: A family office can take many forms. As family wealth increases and business needs get more complex, the family office may evolve from a simple founder's office into a complex, full-service company. And the office could revert over time. Founders office: Embedded: A Compliance or tax Investment management Full service office: For the Often an assistant or shareholder services office: A CPA-led office: In addition to most complex scenarios, a few staff members group, handling the office that oversees accounting services, this may be a private family who pay bills, make family's personal investments manages private equity trust company providing a travel plans and financial affairs as and takes care of investments, hedge funds variety of services: family handle the financial well as corporate record-keeping, and more; may seek to education, tax, investment, needs of the founder duties insurance and tax manage money for outside governance and accounting, returns families as well usually across multiple generations EFTA00597590 Our approach EY has examined global family offices to understand what makes them successful in the long-term. Our professionals take a holistic view of the family, strategic, operational, regulatory and tax aspects in order to help the family move toward their long term legacy. Evaluate/assess Design/innovate Execute/implement Scope and purpose • Vision and O r Business plan • Legal structure P OP Source and build • Job descriptions Prepare and test • Implement 10 1 Launch • Begin family office expectations • Identify in-source vs. • Technology platforms governance operations (phased) • Define who is part of out-source services and support • Test systems and Develop the family • Operational • Vendor contracts processes communication and • Identify the family's and technology • Consider disaster review processes • Facilities key values requirements risks (cyber, theft, • Ongoing monitoring • Processes and work controls, etc.) and review • Define family office • Identify people, flows services technology and • Policy and procedure • Participate in facilities • Detailed governance manuals networking • Describe the family framework office's purpose and • Governance for family • Final review of opportunities long-term goals and the office processes • Periodic risk reviews • Family office budget • Review/refine from outside advisor • Funding and cost financial models • Ongoing strategic allocation planning Scoping study approach Identify and present "Develop" instead of Present assessment strategic and tactical "Build" and business case framework options Business and operating model alignment Operating model assessment Program management Interested? Robert (Bobby) A. Stover, Jr., Partner Jon Carroll, Executive Director EY Americas Family Office Leader Private Client Services I Family Office Advisory Please contact EY's Private Client Services I Family Office Advisory Ernst & Young. LLP Family Office Advisory Ernst & Young, LLP 1+1 561 955 8240 Services for assistance I *1 214 969 8321 Paul McKibbin, Executive Director with strategic planning Jeffrey H. Brodsky, Partner Private Client Services I Family Office Advisory Private Client Services Ernst & Young, LLP for your family. Ernst & Young, LLP 1+1 215 448 5420 1+1 312 879 3871 EY refers to the global organization. and may refer to one Ernst & Young LLP is a client-serving member firm of or min, of the member firms of Ernst & Young Global Ernst & Young Global Limited operating in the US. Limited. each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by 6)2016 Ernst & Young LLP. All Rights Reserved. guarantee, does not provide services to clients. For more SCORE no. YY3758 information about our organization, please visit MI BSC No. 1606-1971228 PAW ED None WISISSISI EFTA00597591