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Wolters KluwerTax & Accounting
Investor Seminar
9 December 2014
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This presentation contains forward-looking statements. These statements may be identifiedby words such as "expect", "should", "could", "shall", and similar expressions. Wolters Kluwer
cautions that such forward-looking statements are qualified by certain risks and
uncertainties, that could cause actual results and events to differ materially from what is
contemplated by the forward-looking statements. Factors which could cause actual results to
differ from these forward-looking statements may include, without limitation, general
economic conditions, conditions in the markets in which Wolters Kluwer is engaged, behavior
of customers, suppliers and competitors, technological developments, the implementationand execution of new ICT systems or outsourcing, legal, tax, and regulatory rules affecting
Wolters Kluwer's businesses, as well as risks related to mergers, acquisitions and divestments.
In addition, financial risks, such as currency movements, interest rate fluctuations, liquidity
and credit risks could influence future results. The foregoing list of factors should not be
construed as exhaustive. Wolters Kluwer disclaims any intention or obligation to publicly
update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise.
Unless otherwise stated, growth rates are cited are in constant currencies.
Forward-looking Statements
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Todaysspeakers
Nancy McKinstry
CEO, Wolters Kluwer
Karen AbramsonCEO, Wolters Kluwer Tax & Accounting
Teresa MackintoshPresident & CEO, Wolters Kluwer Tax &
Accounting, CCH US
Jason MarxPresident, Wolters Kluwer Tax & Accounting
Small Firm Services US & Brazil
Henri van EngelenManaging Director, Wolters Kluwer Tax &
Accounting Europe
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Agenda
Nancy McKinstryCEO Wolters Kluwer
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
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Four global divisionsTax & Accounting: 27% of revenues and 32% of adjusted operating profit
5
Wolters KluwerFY 2013 Adjusted Operating Profit
765 million
Note: Operating profit split is before corporate costs
Wolters KluwerFY 2013 Revenues
3,565 million
Financial &Compliance
11%
Legal &Regulatory
40%
Tax &Accounting
27%
Financial &Compliance
8%
Legal &Regulatory
39%
Tax &Accounting
32%
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Wolters Kluwer strategyAccelerating profitable growth
Expandour leading,high growth
positions
Deliversolutions and
insights
Driveefficiencies
Continue to drive efficiencies throughoperational excellence initiatives
Invest in solutions that enable ourcustomers to make critical decisions andincrease their productivity
Focus investment on high growth segmentswith leading positions
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2008 2009 2010 2011 2012 2013 2014
Tax & Accounting acquisitionsBolt-on acquisitions supporting transformation
Tax & Accounting Investor Seminar, 9 December 2014
Acquired
Acclipse (NZ)EDS (ES)
BSI (US)
Acquired
Twinfield (NL)
Speedtax (US)
BusinessFitness (NZ)
CGT Reporter(AU)
TopPower (BE)
Acquired
Prosoft (BR)Best PracticeSolutions (AU)
Acquired
Addison (GER)MYOB (UK)
IntelliTax (US)
Divested
Complete Tax
(US)
Transferred
certain US and European
publishing assets to Legal &Regulatory as of January 2013and January 2014
AcquiredE&Y CRSSoftware (AU)
AcquiredDingxinChuangzhi (CN)
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Transforming into softwareDigital and services reach 88%, including software 61%
Wolters Kluwer Tax & AccountingRevenue by Media Format
Note: 2009 figures are pro forma (Tax & Accounting division formed in 2010).
SoftwareCAGR +6% in
ConstantCurrencies
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Tax & Accounting performanceRevenue and margin resilient throughout financial crisis and
transformation
Tax & AccountingAdjusted Operating Profit Margin
Tax & AccountingOrganic Revenue Growth
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Note: 2009 figures are pro forma (Tax & Accounting division formed in 2010).
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Health
Tax & Accounting
Legal & Regulatory
Financial & ComplianceFinance, Risk &Compliance and Audit1)
+4%
Clinical Solutions
Tax & Accounting Software
Corporate Legal Services
% OrganicGrowth
1) Includes the Finance, Risk & Compliance and Audit units within the F&CS division. Wolters Kluwer organic growth 9M 2014: +1%
+7%
Leading, high growth units within divisions:(47% of total revenues)
Tax software is key to our growth agendaLeading high growth positions continue to perform well
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Wolters Kluwer Revenue 9M 2014
Divisions:
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Wolters KluwerGlobal leader in Tax & Accounting
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VIDEO
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Agenda
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
Tax & Accounting Investor Seminar, 9 December 2014
Karen AbramsonCEO, Wolters Kluwer Tax &
Accounting
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A global businessLeading positions across the globe
United States Canada
Germany Italy SpainUnited Kingdom SwedenNorwayDenmark BelgiumNetherlands
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AustraliaNew Zealand JapanHong Kong Singapore
Malaysia India China Brazil
Wolters Kluwer Tax & Accounting
Revenue by Geographic Market9M 2014
Europe33%
AsiaPac& ROW
11%
NorthAmerica
56%
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World leaderLeading global player in professional tax & accounting software
Source: Wolters Kluwer estimates, based on OC&C, company data and other sources. Includes professional and corporate tax & accounting software and publishing inthe US, Canada and Asia Pacific, and professional and corporate tax & accounting software in Brazil and 9 European countries. Excludes all SME and Consumersegments, and excludes Publishing in Europe
Global Addressable MarketTax & Accounting 2013
6 billion
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Wolters Kluwer Tax & Accounting
#1 in North American professional tax &accounting software
#1 pan-European professional tax &accounting software player
Tax & Accounting Market Growth
Global Professional Software: 4-6%
Global Corporate Software: 8-10%
Global Publishing: 0-2%
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Competitive landscapeWell-positioned in professional software
Segment Region Wolters
Kluwer
Thomson
Reuters
Sage
Intuit
Others
Professionalall segments
NorthAmerica
South
America
Europe
Asia Pacific
Corporate
NorthAmerica
SouthAmerica
Europe
Asia Pacific
SME
Consumer
Vertex, CorpTax,Avalara
Xero, DATEV, MYOB,ADP, Exact, Lexware
Niche players, e.g.Drake
DATEV, Sistemi, Zucchetti,Visma, Exact
MYOB, APS, Handisoft,Xero
H&R Block, TaxACT,Jackson Hewitt
Tax & Accounting Software
Local players
Unit4, Oracle, SAP, IBM
Low High
Market Presence andBreadth of Offer
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Our missionHelping our customers grow, manage, and protect their businesses and
their clients businesses
Research Advise
file tax returns facilitate planning manage firmfind answers
Research Comply Advise Manage
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Our key strengthsLeading in technology, expertise, and customer support
TechnologyInnovation
Comprehensiveand GlobalCapabilities
Strong Sales& CustomerSupport
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Trusted
DomainExpertise
CPA Practice Advisor: 2013 Technology Innovation Award Byte TI:2014 Award for the Best ERP of the Year 2014 CODiE Award: Best Enterprise Mobile Application (CCH Mobile) First to market with fully integrated cloud solution for US CPAs
2013 K2 Quality Award winner Tax Software Trusted to process and file 30% of US professional tax returns
First mover with IRS-approved e-Signature solution Over 1,000 content experts worldwide
Comprehensive coverage: 1,700 sales & support staff worldwide SFS named a Top 25 Mid-Size Call Center in 2014 by BenchmarkPortal Training provided to over 100,000 customers annually
Global software development centers of excellence in Dallas, TX (US),Barcelona (Spain), and Pune (India)
40 offices in 20 countries Global platform: Intelliconnect Cross-border products: Intelliconnect and iFirm
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Key product brandsOur brands are trusted leaders in their target markets
CCH iKnow
CCH IntelliConnect
Research Comply Advise Manage
CCH Mobile CCH iFirm
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CCH Small Firm
CCH TaxPrepCCH Bold
CCH
CCH Axcess
CCH ProSystemfx
Addison/Steuertipps, Twinfield
a3, Ipsoa, Osra, Prosoft
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Our customersCustomers of all sizes rely on us
Tax & Accounting Investor Seminar, 9 December 2014
All of The Big
4210K The Fortune
500All of the Big 4 AccountingFirms use Wolters KluwerAll of the top
US and UKAccounting Firms
Firms210,000 firms worldwide relyon Wolters Kluwer solutions.
87% of
The Worlds Governing
Tax Authorities
Longstanding partnerships with
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Revenue performanceSteady organic growth in software outweighs declines elsewhere
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Note: Revenue types based on pre-2014 product classification. 2009 figures are pro forma.
Wolters Kluwer Tax & AccountingOrganic Growth by Revenue Type
Wolters Kluwer Tax & AccountingOrganic Growth Software
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Highly recurring88% of revenues from subscriptions and other recurring revenue streams
Wolters Kluwer Tax & AccountingFY 2013 Revenues by Type (965 Million)
Digital and servicessubscriptions (69%) Software subscriptions
Software maintenance Online research and learningsubscriptions
E-book subscriptions
Other recurring (13%)
Recurring license fees Continuing education Certification programs E-filing fees Bank product fees E-signature fees
Note: 2013 figures based on 2014 product classification.
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Other non-recurring (6%) Software license fees Training Professional services Events; seminars
Print subscriptions (6%) Loose-leaf publications Journals
Print books (6%) Print books (incl. standing
order)
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Increasing regulatory activity
Productivity pressure and price sensitivity
Sheer quantity of information is overwhelming
Globalization and growth of professionals in emerging markets
Profession in transition with retirement and new entrants
Global market trendsTransformation is everywhere in Tax & Accounting
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Tax & Accounting strategyInvesting in cloud-based, collaborative solutions and expanding
geographically while optimizing cost base
Expanding in cloud-based tax and accounting solutions Investing in collaborative solutions Driving growth in faster-growing geographies, including
Brazil and China
Launching innovative productivity tools CCH eSign, QuickAnswers, Intelliconnect Browser Search
CCH iKnow, CCH Mobile
Customizing global platforms for local requirements Leveraging global scale Building development centers of excellence Optimizing editorial processes and outsourced print
operations
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Modular product suitesWe offer an integrated ecosystem in each geography
Accounting
PayrollTax
Prosoft
Document
Portal
Tax
Workstream
Practice
CCH Axcess
Open Integration
App Platform
TAXOffice MgmtPayroll
Dashboard Doc Mgmt.
WorkflowAudit Rule Set
BIG DATA CRM
Twinfield
TwinApp
Store
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SummaryGlobal leader investing to expand
Global leader in Tax & Accounting
Highly recurring revenue
Strong market penetration inprofessional markets
Global leader in innovation
Investing in software growthwhile driving operatingefficiencies
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CloudSoftware
Collaboration
GlobalExpansion
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Agenda
Teresa MackintoshPresident & CEO, Wolters KluwerTax & Accounting, CCH US
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
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Moving to the Cloud: United StatesDelivering productivity gains to our customers
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Collaboration
GlobalExpansion
Tax & Accounting United States
#1 in US professional software
Serving all of the top 100 USaccounting firms and 150,000 USprofessionals
Positive organic growth andexcellent margins
Investing in cloud-based solutions
CloudSoftware
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Our customers status quoTechnology boundaries hamper efficiency
Current State
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FirmAdmin
IT
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Market dynamicsProfessional firms goals and issues
Increased Focus on Client Services
Talent Management and Succession Planning
Technology Integration
Digital Mobility Opportunities
Source: Wolters Kluwer 2014 Accounting Firm Preparedness Survey
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Benefits of moving to the cloudKey reasons firm leaders want to move to the cloud
Source: AICPA Digital CPA Survey
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Business continuity and quickerdisaster recovery
The ability for our firm to work
virtually and/or expand ourgeographic reach
Productivity improvements that canlead to more billable hours
Dont have to worry about softwareupdates, troubleshooting and
maintenance
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CCH Axcess differentiationThe first integrated cloud solution for tax and accounting professionals
Efficiently sharecommon data andservices across
modules as well aswith mobile and 3rdparties
Advanced integration data and servicesalways available at thepoint of need
Anytime, anywhereaccess allows firms to
deliver higher levels ofservice to their clients
Modular to allow firms
to adopt features andfunctions at their pace
Scalable for firms ofany size
End-to-end integratedworkflow tailored toneed
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Source: AICPA Digital CPA Survey
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CCH AxcessArchitected and deployed for flexibility, extensibility and scalability
CCH Axcess Modules 3rdParty Applications (OIP)
CCH Axcess
PracticeCCH Axcess
Workstream
CCH Axcess Tax
CCH AxcessDocument / Portal
CCH Scan/AutoFlow
CCH eSign
Future modules
Web ServicesIntegration
Common Database
General Ledger/ERPMicrosoft ExcelMicrosoft WordMicrosoft OutlookCRMPayroll
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Modular product suiteFlexible and integrates easily
Portal
TaxPractice
Document
Workstream
O P E N I N T E G R A T I O N P L A T F O R M
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Delivering productivity gainsUnified device and application experience enabling best in class client
services
CCH AxcessCurrent State
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FirmAdmin
IT
Tax & Accounting Investor Seminar, 9 December 2014
Portal
Tax
Practice
Document
Workstream
O P E N I N T E G R A T I O N P L A T F O R M
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Long term business benefitsCloud solutions yield long-term customer relationship and growth
opportunities
Source: OC&C Professional Market Survey (April 2014); OC&C Analysis (May 2014)
New Customer Acquisition through Cloud Adoption
Additional module enablement providing more efficientand effective customer processes
Longer Retention of Committed Customers
Future Product Introduction
Front Office Evolution
Maximizing Customer Productivity & Technology Investment
Establishing the foundation for growth andhigher customer lifetime value
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Results to datePlatform performance and scaling to rising demand
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4.95Out of 5Customers rated the CCH Axcessimplementation team 4.95 out of 5
28% of new salesare CCH Axcess
Most Recent Tax Season Performance
Tax returns migratedto CCH Axcess
CCH Axcess Tax return processingtripled from last years debut
The number of projects managed inCCH Axcess Workstream quadrupledfrom the previous season
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From industry experts and our customersUsers report significant productivity gains
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BenefitsMutual benefits to Wolters Kluwer and its customers and partners
Benefits to Wolters Kluwer Benefits to Customers
Competitively distinct platform todrive customer acquisition
Increased customer share of
wallet as platform enablesancillary product adoption
Increased retention (stickiness)
as number of modules increasesand the suite acts as foundationfor accounting firms production of
client work
Faster product development dueto open integration platform
First and only of its kind - coreunified database makes workflowmore efficient
Additional efficiencyimprovements are easy to createwith expansion on unifiedplatform
Provides ecosystem of additionalmodules for enhanced
functionality and unification including mobile apps
Offers best in class availability
and security of data
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Agenda
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
Tax & Accounting Investor Seminar, 9 December 2014
Henri van EngelenMD, Wolters Kluwer Tax &Accounting Europe
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Collaborative solutions: EuropeEnabling our customers to collaborate with their clients
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CloudSoftware
Collaboration
GlobalExpansion
Tax & Accounting Europe
European leader in professional tax
advisor segment Positive organic growth and good
margins
Serving over 55,000 tax advisors in9 European countries
Investing in collaborative solutions
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We will offer
connected,collaborative,smart &
easy-to-usebusiness solutions
...that createan ecosystemwith banks,
governmentalinstitutions & 3rdparty software
providers
to automateend-
to-end processes &to simplify tasks sothat our customers
& theirs can operatemost efficiently.
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Supporting the European tax advisorHelping our customers deliver value to their clients
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Market trendsPressure on existing business models of tax advisors, transforming their
business
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Younger generations demand ease of useand always on connectivity
Increasingly complex and fragmentedregulatory environment
Technology integration and mobility
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Maintainand conservativelygrow the business
Transaction-based services Hourly fees
Work is office-based
On-premise solutions
Process oriented
Personal relationships andphysical customer contacts
Tax advisors are evolvingChanging behavior brings challenges but also opportunities for our
customers
Commercial focus
The Traditionalist
Business models
Technology & tools
Client Interaction
Grow the business
Introduce sales & marketing
Predefined serviceofferings High value consultancy
Work is cloud-based & mobile
End-to-end processes in theextended enterprise
Online collaboration tools toenrich personal relationships
The Adventurer
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Benefits of collaborationMore efficient processes and interaction for the tax advisor and his clients
Cloud CollaborationTraditional On-Premise
Tax AdvisorSME client
Manual transactions Duplication of effort Frequent exports and
imports of backups Not simultaneous
BanksPartners
Government
Automated transactions Single data entry Central data storage,
security & back-up Real time
CRM
BI
Tax
Reports
Tax AdvisorSME client
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Workload sharingEnabling tax advisors to adjust to their clients needs and capabilities
Cashaccounting
Size
,needsandcapabilities
o
fTax
Advisors
client
Large
Medium
Small
Micro
Selfemployed
Workload Sharing Between Tax Advisor and SME
Book-keeping
FinancialStatements &Returns
Consulting
WorkloadSales &PurchaseInvoices
Performedby SME
Performedby Tax Advisor
Legend:
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Payments
AdvisorClient
Advisor portals Deloitte ctrl BDO Direct Van Oers Comfort
Example 2: Twinfield online accountingSmart accounting software from Twinfield with which entrepreneurs and
accountants can seamlessly collaborate
Real time information Better and faster insight Links to 200 complementary software
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PartnersGovernment
Banks
Easy entry of invoices Automatic processing of invoices Reconciliation of bank statements Automatic timeline
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What our customers are sayingAnytime, anywhere access
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Results so farGrowing numbers are using our collaboration tools
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Increase inonline software
revenue at Twinfield
50%Addison online softwarerevenues tripled from
2011 to 2014from 2011 to 2014
90,000 SME clients
are collaborating with over4,500 tax advisorsusing theAddison Collaboration Portal
In Germany
3X
Italian Portal
revenuesdoubled
from 2011 to 2014
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BenefitsMutual benefits to Wolters Kluwer and its customers and partners
Benefits to Wolters Kluwer Benefits to Customers
Own the core financialtransaction process between taxadvisor & SME supporting
increased retention Input stream for our tax
compliance solutions
Gateway to offer SME-solutionscreating new revenueopportunities
Internationally scalable, enablingus to leverage our investment
Simultaneous access to real timedata, driving productivityimprovements and client
satisfaction Able to balance workload
between tax advisor & SME
Seamless integration intoecosystem with banks,governments and partners
delivers all-round efficiencies
Offer best in class reachability,
availability & security of data
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Agenda
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
Tax & Accounting Investor Seminar, 9 December 2014
Jason MarxPresident, Small Firm Services,US & Brazil
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Global expansion: BrazilLeveraging our domain expertise in faster growing geographies
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CloudSoftware
Collaboration
Global
Expansion
Tax & Accounting Brazil
Leading player in Brazilianprofessional segment
Strong organic growth and goodmargins
Most comprehensive SPED solutionin the market
Supporting continued productdevelopment
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Brazilian environmentLatinAmericas largest economy is a market in transition
Growing at 10% plusannually asregulations rapidlyevolve(Source: Serie Estudos)
Compliance changesimpact the Tax,Accounting andPayroll markets
Economists projectGDP to expand 1.2%in 2015(Source: Bloomberg)
Brazil: the worlds seventh largest economy
New and complex tax regulations are growthdrivers for the Tax and Accounting industry
Overall Tax and Accounting market forsoftware currently estimated at US $1 billion
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Regulatory environmentMandatory compliance requirements are growth drivers
CUSTOMERCHALLENGES
Filing Tax Returns~2,600 hours annually
Mandatory E-filingElectronic data
requirements
Audit ExposureImprove data
inconsistencies & avoid
penalties
GROWTHOPPORTUNITIES
Leverage SPED compliancereforms
Expand start-to-finish taxand accountingcapabilities
Develop extensible
solutions to address smalland medium sizedbusinesses tax complianceneeds
REGULATORYENVIRONMENT
2008: Public DigitalBookkeeping System(SPED) established
2011: Mandatoryrequirements forelectronic filing
2013: Additional 4 millioncompanies are impactedby Payroll compliance
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SPED initiativeTax and accounting regulation spurs market opportunities
AccountingStandardized
electronic formatthat substitutestraditional paper
bookkeeping
E-InvoiceStandardized
electronic formatthat substitutestraditional paper
bookkeeping
PayrolleSocial regulationunifies employeeand payroll data
and reporting
SPEDPublic Digital Bookkeeping System
Tax
Centralizedpermanentelectronic
certificationsystem and tax
calculation registry
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Note: SPED = Sistema Pblico de Escriturao Digital (Public Digital Bookkeeping System )
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Strategic acquisition of ProsoftLeveraging global compliance focus and local expertise
Acquired in May 2013 for 85 million Including deferred consideration
Annualized 2013 revenues of 28 million
Organic revenue growth >10%
Adjusted operating margin above groupaverage
Leading tax and accounting softwareprovider in Brazil
Established 1985
Over 250 employees
Strong local management team
Serving over 150,000 users
Cloud-based and on-premise software
Software license and maintenance model
Well established, leadingprovider of tax compliancesolutions in Brazil
Customer-centric,integrated compliancesolutions supporting SPED
Established distributionchannels
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Established coverageStrong national distribution network and established customer base
Clients range from small tomedium based accountingfirms and small mediumenterprise
Customers represented inall 27 state jurisdictions andthousands of municipalities
Established national salesand distribution model
Headquarters & Office Locations
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Customer-centric, integrated compliance solutionsCreating value by aligning compliance solutions to SPED requirements
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AccountingPayrollTax
Office
Electronic Point
GED
DiagnosticsNFe Manager Tax Analyzer Tax Audit
CND
OFFICE2 CRM
CNPJ
GFC Small
Prosoft
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SPED compliance in actionA use case
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Our customersRely on us for collaborative solutions
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Over 44,000 companies had their taxcertificates verified by Prosoft software
States26Our compliance products serve 26 states, plus federal,and over 5500 municipalities
Municipalities5,500FederalPeople trained this year
30,000
44KCompanies
10,000150,000
110,000
firms
users
questions and answers
in our online TaxGuidance Center
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Competitive landscapeProsoft has broadest product breadth and strongest distribution network
Aggressive investment inproduct solutions toaddress SPED
Product expansionoutpacing the competition
Distribution coverage -only national platform tocover all 26-state andfederal jurisdictions
Wolters
Kluwer
(Prosoft)
Alterdata
Contmatic
Thomson
Reuters
(Dominio)
Sage
(Folhamatic)
Mastermaq
Tax
Accounting
Payroll
SPED
ElectronicInvoice
Analyzer
Auditor
Distribution
Source: Crowe Horwath and Wolters Kluwer estimate
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Low High
Market Presence andBreadth of Offer
Brazil: Tax & Accounting Software
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Leveraging Wolters Kluwers expertiseProven global practices to support Prosoft
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Compliance expertise Go-to-Market Sales channel
management
Products and delivery Technology andarchitecture Process andBest Practices
Common developmenttools
Agile development
processes Mobile applications
Contextual designmethodologies
Customer NPS
Market research andsegmentation methods
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What our customers are sayingManaging increasing regulation and complexity
VIDEO
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BenefitsMutual benefits to Wolters Kluwer and its customers and partners
Benefits to Wolters Kluwer Benefits to Customers
Compliance opportunity in small-mid market is strong; Prosoft iswell positioned to grow
Regulatory solutions addressbreadth of SPED compliancerequirements in Brazil
Leverage global expertise andlocal implementation to serve
customers
Integrated tax, accounting andpayroll solutions built to meetcompliance requirements of SPED
Ecosystem of additionalcompliance modules for increasedfunctionality
Complete sales office coverageacross all 27 jurisdictions (26
state plus federal)
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Agenda
Introduction
Wolters Kluwer Tax & Accounting
Collaborative Solutions: Europe
Moving to the Cloud: US
Summary and Q&A
Break
Globalization: Brazil
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SummaryWolters Kluwer Tax & Accounting
Global leader in Tax & Accounting
Strategic focus on professional markets
Highly recurring revenue and best-in-class margins
Strong track record of innovation
Investing in software
Driving operating efficiencies
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Q&A
Investor Seminar
9 December 2014
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Thank you
Investor Seminar
9 December 2014