TaxAssist Accountants Information Package for Canada

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Canadian Franchise Information Package 2014 This document provides summary information only about the history and operations of TaxAssist in the United Kingdom and the opportunities available for the establishment and operation of a TaxAssist Franchised Business in Canada. No representation, warranty, condition or guarantee is made with respect to the success of the franchise program in any jurisdiction, which will be dependent upon a number of factors including the business ability and skills of the prospective franchisee. The prospective franchisee is encouraged to conduct an independent investigation of the franchise opportunity described herein.

Please note that this is an information document only. A Franchise Disclosure Document will be provided in accordance with applicable law to prospective franchisees by a TaxAssist Master Franchisee.

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Executive Summary The purpose of the Executive Summary is to give a condensed overview of the TaxAssist Accountants franchise concept. TAXASSIST DIRECT LTD EXPERIENCE TaxAssist Direct Ltd (TAD) is the Franchisor for the TaxAssist Accountants network. With no accounting practice of its own or other business concerns, the sole function of TAD is that of a training, marketing and support company servicing a network of franchised accounting practices. Established in the U.K. in 1995, TAD has developed a strong brand and a robust business model. Each Franchisee provides a comprehensive range of accounting and taxation services to small businesses (self-employed, sole proprietors, partnerships and Limited companies) and personal income tax payers. As of October 2014, the U.K. network consists of over 195 franchisee areas. TAD was founded to service small businesses, self-employed, sole practitioners, and incorporated companies with an annual revenue of up to £2million as this is a lucrative and growing sector that is usually under-serviced by the traditional accounting practices. TAD has gone through a period of change and has revolutionized accounting practices in the U.K. by creating a retail experience with customer-friendly storefront premises which strip away the mystery and intimidation, something from which traditional practices can suffer. TAD currently has over 80% of their U.K. network operating from retail locations which, coupled with industry leading marketing strategies and the one-stop-shop services provided in house along with additional service partners, gives TAD a powerful edge over the competition. In February 2009, the Master Franchise Licence for the Republic of Ireland was awarded and as at September 2014, there are 22 franchisees operating in Ireland. With the grant of the Master Franchise Licence in Ireland, the International expansion of TaxAssist Accountants began. In January 2014, the Master Franchise Licence for the Greater Toronto Area in Ontario was granted and with this event, the International expansion of TaxAssist Accountants continues into Canada.

TAD enjoys full membership status with the British Franchise Association (bfa) and the Canadian Franchise Association (CFA) and is proud to support and adhere to the Code of Ethics of both the bfa and the CFA. TAD was ranked first place in the 2010 bfa / HSBC Franchisor of the Year Awards beating eight finalists to the Gold Award which included McDonalds and Domino’s Pizza. This is following on from winning the Silver Award in 2008 and 2009, which is unprecedented. In 2013 TAD participated in The Best Franchise Awards based on an independent franchisee benchmark survey and was awarded first place in the ‘Best Training and Support’ category having been awarded ‘Best Large Franchisor’ and ‘Best Training and Support’ in 2012. This was on the back of being awarded first place for ‘Best Training and Support’ in 2011. Fellow finalists in 2012 and 2013 included McDonalds and ActionCOACH. In 2014 for the second year running TaxAssist Accountants were awarded 5 star franchisee satisfaction by Smith & Henderson based on feedback from the network’s UK franchisees.

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In addition to the franchise industry awards TAD has also won various marketing and Accounting awards. In 2013 the Association of International Accountants awarded TAD the prestigious award of “Accounting firm of the Year” beating global groups and industry giants and in 2014 was ranked 25th in the Accounting Age Top 50 U.K. Accounting Practices, up 9 places from when they first appeared in the 2010 report. Please see Appendix “A” for further information on TAD awards.

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TaxAssist Direct Ltd has an experienced Executive Directorate of Three:

Chief Executive - Karl Sandall FCIB, QFP

Karl spent 26 years at a senior level with HSBC before joining TaxAssist Accountants on January 1, 2000 as Operations Director – taking on the role of Chief Executive in 2002. A Fellow of the Chartered Institute of Bankers, a member of the Financial Industry Group and of the Committee of the IFS School of Finance for the East of England, Karl oversees the running of the company and the whole network on a day to day basis and ensures the company continues to expand. Karl has been awarded the British Franchise Association Qualified Franchise Professional (QFP) qualification in recognition of his expertise in ethical business format franchising.

Business Development Director – Sarah Robertson MSc, Dip M, Chartered Marketer, MCIM FIDM

Sarah has over 20 years’ experience in the marketing and advertising industry, working with a broad range of national and regional brands such as the British Red Cross, Norwich Union, Oracle, Del Monte, the Imperial Cancer Research Fund and Swinton Insurance along with her own successful business. She is a Fellow of the Chartered Institute of Marketing and a Fellow of the Institute of Direct Marketing. Sarah joined the TaxAssist Accountants’ Board on September 1, 2004. Sarah is responsible for marketing strategy, brand development, storefronts, practice management

and business development strategies for Franchisees. Sarah was named the 2007 and 2010 Marketing Person of the Year by the 2020 Innovation Group and runner up in 2009.

Network Operations & Finance Director - Phil Sullivan BSc (Hons), ACIB

During a 26 year career with HSBC Bank plc Phil achieved Executive Management status and undertook roles covering a wide range of disciplines. Prior to leaving HSBC Phil was Area Director for Leicestershire, a role with responsibility for all aspects of the bank's branch banking and commercial business in the county and corporate banking activities in East Midlands. Phil established his own business in 2006 providing corporate and commercial advisory services to selected

business clients. After working with TaxAssist Direct Ltd for 18 months on a consultancy basis, Phil joined the Board as a full-time Executive Director with effect from October 1 2008. His responsibilities include overall technical competency and compliance of the Network and Support Centre, internal financial control, operational integrity and training.

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Non-Executive Director – John Chambers

John has specialised in franchising for over 20 years. He thinks of himself as a business man first and a solicitor second. His "no nonsense, practical, commercial approach" is appreciated by clients as much as is his unrivalled knowledge of the franchising sector.

He read law at University College London and worked in the City of London for Mitsui, a Japanese trading company, and in the Middle East for Turner & Newall Plc. John then worked in sales and contract management roles in the oil industry, first in the UK and then abroad before deciding that he could provide more commercially focused and practical advice than he was receiving from lawyers. He re-trained as a solicitor and worked for two leading international law firms prior to setting up Chambers & Co in 1998. After establishing himself as one of the UK’s leading franchise lawyers and acting for 20% of the franchisors in the UK, Ashton KCJ acquired the practice in early 2012.

John is a former member of the now disbanded British Franchise Association Legal Committee, and regularly speaks on franchising law both at home and abroad.

John joined the board in August 2014.

A representative will also be appointed to represent the franchisees interests.

TaxAssist in the Greater Toronto Area

Master Franchisee – Rina Mancini, B.A.S., MBA

Prior to becoming the Master Franchisee for TaxAssist in the GTA, Rina Mancini held strategic leadership roles with Manulife Bank of Canada, Equifax Canada, Sears Bank and Rogers Communications. An experienced business executive, leader and strategist, Rina has extensive depth and breadth of experience within the Financial Services, Telecommunications and Information Solutions industries. Her experience spans Consumer Credit Risk Management, Accounts Receivable

Management, Call Centre Management, Operations, Customer Service, Finance, Change Management and Process Improvement. With Rina’s acquisition of the Master Franchisee licence for the Greater Toronto Area, she looks forward to introducing and growing the TaxAssist brand to Canada and to establishing a network of franchisees within the GTA.

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TaxAssist Accountants Mission Statement To deliver an unrivalled Accounting and Tax service to small business operators. By establishing and reinforcing the TaxAssist Accountants core values we aim to become the leading business service of its kind, representing a visible and recognizable brand known for the cornerstones of value-for-money and service. Through its network TaxAssist Accountants is to become the first point of contact for professional business services to the small business sector.

The TaxAssist Accountants Market The accounting market is dominated by four accounting firms: PriceWaterhouseCoopers, Deloitte & Touche, KPMG and Ernst & Young – all of which are global organizations. Beyond the ‘big four’ there are many mid-tier and smaller firms. The small business market has been neglected by the traditional accounting practices. This gives us a unique opportunity through our national branded network to provide services to a largely untapped market.

The TaxAssist Accountants Concept Every small business needs to have an annual financial statement prepared in one form or another, for taxation and other purposes. Very few business people have the knowledge or inclination to prepare their own financial statements, even though it is not as complicated as many people think, and hence the ever-increasing demand for accounting services. People who need to complete their own income tax forms will usually need some help and will turn to a professional for assistance. With initial and ongoing training and support, you can provide that help and build your own business and financial independence. The small business owner who is seeking to establish and grow his business will also need a wide range of services from different places. For example, a visit to the Bank to borrow some money, to a Factoring Provider for help with cash flow, to Web Design and IT Consultants… and the list goes on. We have brought access to all of these services under one roof for our clients, by creating and continuing to develop a range of Additional Services. Our concept is accounting – but how different are we from all the other accounting practices? TaxAssist identified back in 1995 that small businesses were often not being looked after very well and we consider that it is still the same today. The proprietors of these businesses were not always proactively supported in looking for ways to reduce their tax liabilities and in helping them develop their businesses. We do not offer audits; however, franchisees are still required to hold a recognized Canadian accounting designation. This not only protects the integrity and professionalism of the network, but also satisfies the bylaws of the various accounting regulating bodies in Canada.

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The Canadian Market According to Statistics Canada and as of 2012, there are:

� 1.08 million small businesses in Canada that had employees

� 98% of businesses in Canada have 1 to 99 employees

� The net increase in the number of small businesses was almost 22,000 over the 2008 – 2009 period

� Small businesses employed over 7.7 million individuals in Canada, or 69.7% of the total private labour force.

� Small businesses created over 100,000 jobs on average between 2002 and 2012, accounting for almost 78% of all private jobs created on average.

As in the U.K., the target market for TaxAssist Accountants in Canada is significant with no recognized national brand specifically servicing this small business sector.

Frequently Asked Questions

How do you justify your franchise fees and why should I join TaxAssist Accountants rather than one of the other accounting franchises?

Formed in 1995 in the U.K., TaxAssist Accountants have developed a business model that has been hugely successful in their domestic market and have proved that the model can be successfully replicated in another country. We have seen the potential in bringing this model to Canada as we know that there will be a strong demand for the business concept that franchisees will offer.

Internationally, we have a highly visible presence with over 240 offices, including over 185 retail locations and growing. The retail locations are supplemented by many branded cars, national advertising, internet presence and marketing collateral. We constantly look to be at the forefront in terms of brand awareness, technical training and support for business growth.

Unlike some of our competitors, we do not have our own accounting practice to support. This means we can concentrate focus on our franchisees and their growth.

The three U.K. Executive Directors have a breadth of business experience which they bring to the franchise. Karl Sandall had 26 years working for a major clearing bank and is an ex bank manager. Sarah Robertson is a Chartered Marketer who previously operated her own Marketing and PR Company, and Phil Sullivan spent 26 years with HSBC achieving Executive Management status before leaving in 2006 to establish his own business providing corporate and commercial advisory services.

In Canada, our Master Franchisee for the Greater Toronto Area territory in Ontario does not own an existing accounting practice herself and therefore, as she builds the new GTA network will become focused on supporting franchisees. Rina Mancini has built a career over the last 25 years in senior strategic leadership roles in financial services, credit risk, accounts receivable management and various facets of operations.

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What sort of person does TaxAssist Accountants look for?

Along with a recognized Canadian accounting designation, one of the other main attributes we look for is the determination to develop a successful business General business acumen and people skills are essential as the franchisee will be responsible for developing relationships with existing and prospective clients, as well as looking after staff needs.

How much working capital will I need?

In addition to your own living expenses you will need to allow for a marketing budget, office expenses, any staff and sundry costs, which may vary across regions.

Do you train me? Who pays for my training?

Full and professional initial and ongoing training is provided to all franchisees. Accounting and tax training is provided by in-house staff or specialist training partners. The initial training course which lasts for six weeks is included in the franchise package fee.

We also provide further update days, operations manuals, and a support site which offers our franchisees access to technical releases, frequently asked questions, on-line tutorials, advice and the ability to personalize your own website.

Is the business seasonal?

In Canada client financial statements are made up to financial year-end dates that can be at any time of the year. Although typically busier during the traditional Canadian tax season (January to April) we have strategies to ensure that cashflow is even throughout the year.

What fees do I charge?

We give you guidance on the level of fees that you should charge your clients, but the final decision on the exact amount is up to you.

What exclusive rights do you get?

You will be allocated an exclusive marketing territory defined by postal code boundaries. No other TaxAssist Accountant can market directly in your area or vice versa. When you and other franchisees carry out local advertising in publications covering more than one franchise area then the normal procedure is to share costs and divide out responses according to the geographical areas covered by you. However, should you receive a genuine recommendation or request from a potential client outside your exclusive marketing territory then you can act for that person.

I am a qualified accountant. Do I still need to go on all of the training and pay the full franchise fee?

We understand that you would naturally wish to avoid any unnecessary duplication and expenditure but because we have correctly identified a niche in the market, our training is specifically tailored to address that niche and nothing else. Past experience has shown that even fully qualified accountants will benefit from full participation in our training course.

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What if it is too expensive to move into a retail location in my area? Is it absolutely necessary for me to make this move? You will have up until the end of the second year of the franchise agreement term to move into a retail location. We have franchisees who have managed to find good retail premises when at first glance there appeared to be nothing remotely suitable. It is location, location, location translated as visibility, accessibility and affordability. This will help you to achieve the growth that we both seek.

Does this contract permit me to sell my business?

Yes, the client base is a considerable asset built up and owned by you. There are various deferred fees to consider which are laid out in our franchise agreement, which you would factor into your selling price.

For how long is the franchise granted and is there a fee payable on renewal?

The initial term of the Franchise Agreement is 5 years. Assuming you have operated the franchise as set out in the Franchise Agreement including meeting your minimum targets, the agreement is renewable by you every 5 years for an administration fee. In most cases we anticipate franchisees will renew the agreement to continue the franchise every 5 years until they dispose of it at some future date.

What if I already have clients before becoming a TaxAssist Accountant?

We have recruited accountants who already have a block of clients of their own, acquired during the period before they joined us. We have been asked to consider whether some relief can be given against charging our normal rates of Management Service Fees. Our policy for this scenario is subject to certain minimums, we may allow the fees introduced or acquired to be kept in a separate pool and for two years only we will not charge Management Service Fees on these fees. After two years these fees will be amalgamated with other fees acquired during the TaxAssist Accountants Franchise term to form one pool and full Management Service Fees will be payable on the total pool of fees.

Can I talk to some of your existing franchisees?

We would need your background information, resume, and Application Form to assess your suitability before giving names and contact details out. We will give you access to the complete international network of franchisees, after you have attended a Discovery Day, and we would encourage you to speak to as many existing franchisees as you possibly can as part of your research.

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PROPERTY AND WORKING CAPITAL The Franchise Agreement states that you will operate from retail premises within 24 months of joining TaxAssist Accountants. You may wish to start operating from such premises from day one, and we have strategic relationships with certain suppliers that can facilitate this.

RETAIL PREMISES REFURBISHMENT

We have Preferred Suppliers for renovating your new storefront location, and they have been fully briefed on our minimum requirements in terms of fittings and office equipment. The cost of a refurbishment is dependent on the size and condition of the premises.

WORKING CAPITAL

If you are joining us without an established client base, you will not have an initial regular income. TaxAssist does not provide any financing for the purchase of a franchise licence or the refurbishing of storefront premises. We are happy to refer you to Bank personnel who specialize in financing franchised businesses. Initially operating from a rented office is less capital-intensive and it also gives you an opportunity to develop your business before moving to a storefront operation. The quality and location of commercial offices is very important. Under these operating conditions working capital requirements will still be governed by local market trends, and you will still need to budget for rent, marketing and other costs until your revenue stream is established.

10 Reasons Why You Should Join TaxAssist Accountants 1. Our Brand Name:

We are the leading franchised accounting organization in the U.K. looking after small businesses, with over 15 years’ experience of operating a substantial national network of branded offices that is well recognized and respected. Having launched our first Master Franchise in Ireland in 2009 we are very well prepared to expand and promote this model into the Canadian marketplace.

2. Our Training:

We are confident that we are providing the best initial and ongoing training for you and your staff. As well as providing a comprehensive initial six week training course, we also offer ongoing update days as well as individual training if needed. Continuing Professional Development: We offer the use of innovative online learning aids and face-to-face courses. This solution enables existing and newly qualified accountants to meet the CPD requirements set by their qualifying institutions, as well as ensuring our entire network meets these same standards.

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3. Support:

We are focused and committed to supporting the Franchise network and have no other corporately-owned TaxAssist offices to take our focus away from the importance of assisting the network. In the GTA territory, Rina Mancini has over 25 years’ experience in strategic leadership, financial services, and operations management. After leaving the corporate arena, Rina became self-employed through her own consulting company. In turn, Rina receives support from the U.K. Head Office of TaxAssist Accountants. In the U.K. the three Executive Directors have a breadth of business experience which they bring to the franchise. Karl Sandall had 26 years working for a major clearing bank and an ex bank manager, Sarah Robertson is a Chartered Marketer who previously operated her own Marketing and PR company. Phil Sullivan spent 26 years with HSBC achieving Executive Management status before leaving in 2006 to establish his own business providing corporate and commercial advisory services

Specialist Services

There will be times when your clients will need assistance with a query in a specialist area such as foreign taxes, inheritance tax – or maybe a complex capital gains tax issue - which would be more time consuming for you to deal with and outside of services covered by the normal engagement letter. It may not be efficient for the help line to deal with these types of queries and therefore for enquiries of a specialist nature we reserve the right to charge a fee for this professional advice, using an internal or external specialist as appropriate, which you will then pass on to your client. You will of course be entitled to charge your clients a premium for this. After all, it is your knowledge and contacts that will have sourced this advice.

Remember the philosophy of TaxAssist Accountants has and always will be to provide a service to small businesses only – i.e. keep it simple.

4. Storefront Concept:

We have a highly visible presence internationally with over 200 storefronts and growing. We constantly look to be at the forefront in terms of brand awareness, technical training and support for business growth. The storefront will allow you to build up a team of staff who you can delegate to, allowing you the free time to work on and develop your business.

5. An Exclusive Territory:

You gain the rights to operate and receive leads in an exclusive postal code territory. Once established, there is the possibility of taking on an area and a half or two franchise territories.

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6. Marketing Support

Comprehensive marketing support is provided, both in the initial start-up phase and ongoing. This support includes: - Lead generation through online advertising - Websites, both national and local - Advertisements - Promotional Literature - Networking - PR - Email newsletters - Digital leaflets - Client factsheets - Branded technical releases - Social media - Marketing Toolkit

7. Access to Specialist Advice/In-field Back-up:

We work closely with all franchisees on maximizing their profit and working towards their own exit strategies. We see this as an invaluable contribution to our franchisees’ business life.

8. Resale Value:

The business model makes financial sense, with the potential for taking a good salary while creating a real asset for your long term future.

9. Additional Service Providers:

So that your business can be the ‘one stop shop’ for small businesses, we have a range of branded partners including: Asset Finance, Independent Financial Services, Debt Recovery, Company Formations, and Employment Advice, amongst other services. Many of these suppliers might agree to pay a commission to you, which can form a part of your revenue. These services are not only available to you, but for your clients to offer their clients as well.

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10. Office and Storefront Premises

When you join TaxAssist Accountants, you will be making a commitment to operate your franchise from storefront premises within 24 months of joining.

What do we mean by a ‘storefront’? When we created the first TaxAssist storefront premise, our main intentions were to create a modern, welcoming, branded office located in highly visible and highly trafficked areas, with the aim of departing from the look and characteristics of traditional accounting practices. From the pictures below we think you will agree that we have fulfilled our objectives.

A Word about “The Canadian Franchise Association”: TaxAssist Accountants are Full Members of the Canadian Franchise Association and we fully endorse the CFA's Code of Ethics and operate in accordance with them.

About the Canadian Franchise Association

“With over 600 corporate members nation-wide, including many of Canada's best-known brands, the Canadian Franchise Association is the national voice of franchising in Canada and works with all levels of government to develop industry-made solutions. CFA promotes excellence in franchising and educates Canadians about franchising, specific franchise opportunities and proper due diligence through its many events, programs, publications and websites.** **from the Canadian Franchise Association website at www.cfa.ca.

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Canadian Franchise Statistics **from FranchiseLink 2014

� Canada has the second largest franchise industry in the world (the U.S. has the largest).

� The Franchise industry in Canada represents over $100 billion in sales annually and continues to grow.

� Approximately 1 out of 5 consumer dollars are spent on goods and services at a franchise.

� Approximately 76,000 individual franchise operations do business in Canada under 900 different brand names.

� Franchising employs over 1 million people in Canada; or 1 out of every 14 working Canadians is employed by a Franchise.

� Ontario leads the rest of the country in franchising with 56 per cent of franchises headquartered in Ontario, mostly in the Greater Toronto Area, and 65 per cent of franchise outlets operating in Ontario.

� Franchising is the preferred Canadian small business expansion model.

� All Canadian banks have established national franchise departments.

What Next? An often used cliché in franchising states that “you are in business for yourself but not by yourself”. Like many such clichés it rings true. The prospect of becoming self-employed can seem a daunting one. Many people that join us have strong technical skills but need support in areas such as client acquisition, marketing and business development. With a franchise you will be expected to put in the same level of effort, time and enthusiasm you would if going it alone, however you will be doing so with the added benefits of proven training, systems and support provided by the franchisor. You will also enjoy the benefits of being part of a well-established network of accountants who have a community spirit of sharing and supporting one another. If you would like to take your interest further, you can telephone us at 905-267-8542 or 1-866-431-5763 or e-mail your questions to recruitment@taxassist.ca Following on from our initial conversations the next step would be to invite you to attend the one of our scheduled ‘Discovery Day’ to discuss every aspect of our Franchise without obligation of any kind. You are welcome to (and we would encourage you to) bring a partner or colleague to this ‘Discovery Day’, if you wish. The Discovery Day is not a hard sell and there is no obligation to join us after the day. The days are a two-way process to establish if we can work together. We welcome questions on any issue connected with our Franchise as we want you to be completely satisfied with our concept - so you can feel confident and fully committed to our business relationship.

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Our network of Franchisees is expanding - Join us now and share in our success.

Feel free to contact us for any further information you require:

Rina Mancini

Master Franchisee TaxAssist Accountants GTA

77 City Centre Drive, Suite 501 East Tower Mississauga, Ontario L5B 1M5

rina.mancini@taxassist.ca 905-267-8542 or 1-866-431-5763

CANADIAN FRANCHISE ASSOCIATION

We are members of the Canadian Franchise Association.

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Exhibit A

TaxAssist Direct Limited U.K. Achievements

2014

Smith & Henderson Awarded 5* Franchisee

Satisfaction Recognition Award

2014

Most Innovative Tax Team of the Year

‘Winner’

2013

Best U.K. Accounting Firm Supporting Apprentices

2013

Smith & Henderson Best Franchise Award

‘Best Training & Support’

2013

Smith & Henderson Best Franchise Award

‘Best Overall Franchise’

2013

Smith & Henderson Awarded the 5* Franchisee

Satisfaction Recognition Award

2013

British Franchise Association, Franchisee of the Year Award

Finalist

2013

Association of International Accountants

‘Winner’

2013

Unbiased.co.uk Media Adviser Awards ‘Professional Adviser

of the Year’ Awarded to Jo Nockels,

Communications & Training Manager

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2012

Smith & Henderson Best Franchise Award ‘Best Large Franchisor’

2012

Smith & Henderson Best Franchise Award

‘Best Training & Support’

2012 British Franchise Association, Franchisor of the Year Award:

Selected Finalist

2011

Eastern Daily Press Business Development

Award Winner

2011

Best Franchise Award Best

Training & Support

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